Boeing Reports
First-Quarter Results and Raises EPS Guidance
CHICAGO, April 26, 2017
--
- GAAP EPS of $2.34 and core EPS
(non-GAAP)* of $2.01 on solid
execution
- Revenue of $21.0 billion
reflecting 210 commercial and defense aircraft deliveries and
services
- Strong operating cash flow of $2.1
billion; repurchased 14.9 million shares for $2.5 billion
- Backlog grew to $480 billion,
including $27 billion of net orders
during the quarter
- Cash and marketable securities of $9.2 billion provide strong liquidity
- Revenue, margin, and operating cash guidance reaffirmed; EPS
guidance increased by $0.10 on tax
benefit
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Table 1. Summary Financial Results |
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First Quarter |
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(Dollars in Millions, except per share
data) |
|
2017 |
2016 |
Change |
|
|
|
|
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|
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Revenues |
|
|
$20,976 |
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$22,632 |
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(7)% |
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GAAP |
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|
|
|
Earnings From Operations |
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$2,024 |
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|
$1,788 |
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13% |
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Operating Margin |
|
9.6% |
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7.9% |
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1.7 Pts |
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Net Earnings |
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$1,451 |
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$1,219 |
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19% |
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Earnings Per Share |
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$2.34 |
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$1.83 |
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28% |
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Operating Cash Flow |
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$2,094 |
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$1,275 |
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64% |
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Non-GAAP* |
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Core Operating Earnings |
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$1,709 |
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$1,694 |
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1% |
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Core Operating Margin |
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8.1% |
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7.5% |
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0.6 Pts |
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Core Earnings Per Share |
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$2.01 |
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$1.74 |
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16% |
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* Non-GAAP measures. Complete
definitions of Boeing's non-GAAP measures are on page 6, "Non-GAAP
Measures Disclosures." |
The Boeing Company [NYSE: BA] reported higher first-quarter
earnings and operating cash flow compared to the previous year,
driven by solid execution on production programs and services
(Table 1). First-quarter GAAP earnings per share increased to
$2.34 and core earnings per share
(non-GAAP)* increased to $2.01.
Revenue decreased to $21.0 billion,
reflecting the timing of commercial and defense aircraft
deliveries.
For the full year, GAAP earnings per share guidance increased to
between $10.35 and $10.55 from
$10.25 and $10.45 and core earnings
per share (non-GAAP)* guidance increased to between $9.20 and $9.40 from $9.10
and $9.30, primarily driven by a lower-than-expected tax
rate.
"With a sharp focus on performance and productivity, our team
delivered another quarter of solid financial results, including
year-over-year earnings growth and strong operating cash flow,"
said Boeing Chairman, President and Chief Executive Officer
Dennis Muilenburg. "In turn, we
continued to position Boeing for growth with investments in new
products and services, innovation, and our people, while again
demonstrating our commitment to return significant cash to our
shareholders."
"We also achieved major milestones, including the certification
of the new 737 MAX 8 and first flight of the 787-10 Dreamliner, and
we captured a $3.4 billion contract
award for 268 Apache helicopters."
"We remain on track to achieve our full-year revenue, earnings
and cash flow targets as our teams deliver on our large and diverse
order backlog. As we do so, we're focused on accelerating
productivity, quality and safety improvements, strengthening
execution on development programs, and capturing new business
opportunities."
Table 2. Cash Flow |
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First Quarter |
(Millions) |
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2017 |
2016 |
Operating Cash Flow |
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$2,094 |
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$1,275 |
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Less Additions to Property, Plant &
Equipment |
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($466) |
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($748) |
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Free Cash Flow* |
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$1,628 |
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$527 |
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* Non-GAAP measures. Complete
definitions of Boeing's non-GAAP measures are on page 6, "Non-GAAP
Measures Disclosures." |
Operating cash flow in the quarter of $2.1 billion was driven by solid operating
performance and timing of receipts and expenditures (Table 2).
During the quarter, the company repurchased 14.9 million shares for
$2.5 billion, leaving $11.5 billion remaining under the current
repurchase authorization which is expected to be completed over
approximately the next two years. The company also paid
$868 million in dividends in the
quarter, reflecting a 30 percent increase in dividends per share
compared to the same period of the prior year.
Table 3. Cash, Marketable Securities and Debt
Balances |
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Quarter-End |
(Billions) |
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Q1
17 |
Q4
16 |
Cash |
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$8.2 |
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$8.8 |
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Marketable Securities1 |
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$1.0 |
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$1.2 |
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Total |
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$9.2 |
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$10.0 |
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Debt Balances: |
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The Boeing Company, net of intercompany loans to
BCC |
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$7.7 |
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$7.1 |
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Boeing Capital, including intercompany loans |
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$3.1 |
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$2.9 |
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Total Consolidated Debt |
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$10.8 |
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$10.0 |
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1 Marketable securities
consists primarily of time deposits due within one year classified
as "short-term investments." |
Cash and investments in marketable securities totaled
$9.2 billion, down from $10.0 billion at the beginning of the quarter
(Table 3). Debt was $10.8 billion, up
from the beginning of the quarter, primarily due to the issuance of
new debt.
Total company backlog at quarter-end was $480 billion, up from $473
billion at the beginning of the quarter, and included net
orders for the quarter of $27
billion.
Segment Results
Commercial Airplanes
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Table 4. Commercial Airplanes |
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First Quarter |
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(Dollars in Millions) |
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2017 |
2016 |
Change |
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Commercial Airplanes Deliveries |
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169 |
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176 |
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(4)% |
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Revenues |
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$14,305 |
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$14,399 |
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(1)% |
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Earnings from Operations |
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$1,215 |
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$1,033 |
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18% |
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Operating Margin |
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8.5% |
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7.2% |
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1.3 Pts |
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Commercial Airplanes first-quarter revenue was $14.3 billion on services growth, offset by lower
planned 737 deliveries, as we prepare for 737 MAX entry into
service in May (Table 4). First-quarter operating margin increased
to 8.5 percent, reflecting improved performance on production and
services programs, cost growth on the initial production of KC-46
Tanker aircraft, and less favorable delivery mix.
During the quarter, Boeing successfully completed first flight
of the 787-10 Dreamliner. The 737 program rolled out the first 737
MAX 9 and received FAA certification for the 737 MAX 8. Demand
continues to be strong for the 737 MAX with more than 3,700 orders
since launch.
Commercial Airplanes booked 198 net orders during the quarter.
Backlog remains robust with more than 5,700 airplanes valued at
$417 billion.
Defense, Space & Security
Table 5. Defense, Space & Security |
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First Quarter |
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(Dollars in Millions) |
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2017 |
2016 |
Change |
Revenues |
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Boeing Military Aircraft |
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$2,636 |
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$3,659 |
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(28)% |
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Network & Space Systems |
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$1,564 |
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$1,735 |
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(10)% |
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Global Services & Support |
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$2,332 |
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$2,562 |
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(9)% |
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Total BDS Revenues |
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$6,532 |
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$7,956 |
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(18)% |
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Earnings from Operations |
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Boeing Military Aircraft |
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$321 |
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$334 |
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(4)% |
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Network & Space Systems |
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$98 |
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$148 |
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(34)% |
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Global Services & Support |
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$318 |
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$340 |
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(6)% |
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Total BDS Earnings from Operations |
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$737 |
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$822 |
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(10)% |
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Operating Margin |
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11.3% |
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10.3% |
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1.0 Pts |
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Defense, Space & Security first-quarter revenue was
$6.5 billion (Table 5). First-quarter
operating margin increased to 11.3 percent, reflecting improved
performance at BMA.
Boeing Military Aircraft (BMA) first-quarter revenue was
$2.6 billion, reflecting lower
planned deliveries, and operating margin increased to 12.2 percent
on improved performance. During the quarter, BMA was awarded a
contract for 268 AH-64E Apache helicopters from the U.S. Army, a
contract for 17 P-8A Poseidon aircraft from the U.S. Navy, Royal
Australian Air Force, and the U.K. Royal Air Force, and a contract
from the U.S. Air Force for an additional 15 KC-46 Tanker
aircraft.
Network & Space Systems (N&SS) first-quarter revenue was
$1.6 billion, reflecting lower volume
on Commercial Crew. Operating margin was 6.3 percent driven by
lower satellite services volume and investments in development
efforts. During the quarter, N&SS announced an order for a 702
satellite with a dual payload from SKY Perfect JSAT and
Kacific.
Global Services & Support (GS&S) first-quarter revenue
was $2.3 billion, reflecting timing
of contracts. Operating margin increased to 13.6 percent largely
reflecting improved performance. During the quarter, GS&S
was awarded a contract from the Republic of Korea Air Force to
continue long-term sustainment of F-15 aircraft over the next five
years.
Backlog at Defense, Space & Security was $63 billion, of which 34 percent represents
orders from international customers.
Additional Financial Information
Table 6. Additional Financial
Information |
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First Quarter |
(Dollars in Millions) |
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2017 |
2016 |
Revenues |
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Boeing Capital |
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$92 |
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$64 |
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Unallocated items, eliminations and other |
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$47 |
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$213 |
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Earnings from Operations |
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Boeing Capital |
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$39 |
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$5 |
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Unallocated pension/postretirement |
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$315 |
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$94 |
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Other unallocated items and eliminations |
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($282) |
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($166) |
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Other (loss)/income, net |
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$22 |
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$26 |
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Interest and debt expense |
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($87) |
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($73) |
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Effective tax rate |
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25.9% |
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30.0% |
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At quarter-end, Boeing Capital's net portfolio balance was
$4.0 billion. Total pension expense
for the first quarter was $334
million, down from $629
million in the same period of the prior year. Unallocated
items, eliminations and other revenue decreased primarily due to
the elimination of intercompany revenue for one aircraft delivered
under operating lease. The effective tax rate for the first quarter
decreased from the same period in the prior year due to
higher-than-expected tax benefits related to share-based
compensation in the first quarter of 2017.
Outlook
The company's 2017 updated financial and delivery guidance
(Table 7) reflects continued solid performance across the company
and the impact of the lower-than-expected tax rate.
Table 7. 2017 Financial Outlook |
Current |
|
Prior |
(Dollars in Billions, except per share
data) |
Guidance |
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Guidance |
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The Boeing Company |
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Revenue |
$90.5 - 92.5 |
|
$90.5 - 92.5 |
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|
GAAP Earnings Per Share |
$10.35 -
10.55 |
|
$10.25 - 10.45 |
Core Earnings Per Share* |
$9.20 -
9.40 |
|
$9.10 - 9.30 |
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Operating Cash Flow |
~$10.75 |
|
~$10.75 |
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Commercial Airplanes |
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Deliveries |
760 - 765 |
|
760 - 765 |
Revenue |
$62.5 - 63.5 |
|
$62.5 - 63.5 |
Operating Margin |
9.5% - 10.0 |
|
9.5% - 10.0 |
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Defense, Space & Security |
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Revenue |
|
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Boeing Military Aircraft |
~$11.5 |
|
~$11.5 |
Network & Space Systems |
~$7.0 |
|
~$7.0 |
Global Services & Support |
~$10.0 |
|
~$10.0 |
|
|
|
|
Total BDS Revenue |
$28.0 - 29.0 |
|
$28.0 - 29.0 |
|
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|
Operating Margin |
|
|
|
Boeing Military Aircraft |
~12.0% |
|
~12.0% |
Network & Space Systems |
~9.0% |
|
~9.0% |
Global Services & Support |
>12.5% |
|
>12.5% |
|
|
|
|
Total BDS Operating Margin |
~11.5% |
|
~11.5% |
|
|
|
|
Boeing Capital |
|
|
|
Portfolio Size |
Stable |
|
Stable |
Revenue |
~$0.3 |
|
~$0.3 |
Pre-Tax Earnings |
~$0.05 |
|
~$0.05 |
|
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|
Research & Development |
~ $3.6 |
|
~ $3.6 |
Capital Expenditures |
~ $2.3 |
|
~ $2.3 |
Pension Expense 1 |
~ $0.7 |
|
~ $0.7 |
Effective Tax Rate |
~ 31.0% |
|
~ 32.0% |
|
|
1 Approximately
($0.9) billion is expected to be recorded in unallocated items and
eliminations |
* Non-GAAP measures. Complete
definitions of Boeing's non-GAAP measures are on page 6, "Non-GAAP
Measures Disclosures." |
Non-GAAP Measures Disclosures
We supplement the reporting of our financial information
determined under U.S. generally accepted accounting principles
(GAAP) with certain non-GAAP financial information. The non-GAAP
financial information presented excludes certain significant items
that may not be indicative of, or are unrelated to, results from
our ongoing business operations. We believe that these non-GAAP
measures provide investors with additional insight into the
company's ongoing business performance. These non-GAAP measures
should not be considered in isolation or as a substitute for the
related GAAP measures, and other companies may define such measures
differently. We encourage investors to review our financial
statements and publicly-filed reports in their entirety and not to
rely on any single financial measure. The following definitions are
provided:
Core Operating Earnings, Core Operating Margin and Core Earnings
Per Share
Core operating earnings is defined as GAAP earnings from
operations excluding unallocated pension and post-retirement
expense. Core operating margin is defined as core operating
earnings expressed as a percentage of revenue. Core earnings per
share is defined as GAAP diluted earnings per share
excluding the net earnings per share impact of unallocated
pension and post-retirement expense. Unallocated pension and
post-retirement expense represents the portion of pension and
other post-retirement costs that are not recognized by business
segments for segment reporting purposes. Pension costs, comprising
service and prior service costs computed in accordance with
Generally Accepted Accounting Principles in the United States of America (GAAP) are
allocated to Commercial Airplanes. Pension costs allocated to BDS
segments are computed in accordance with U.S. Government Cost
Accounting Standards (CAS), which employ different actuarial
assumptions and accounting conventions than GAAP. CAS costs are
allocable to government contracts. Other postretirement benefit
costs are allocated to all business segments based on CAS, which is
generally based on benefits paid. Management uses core operating
earnings, core operating margin and core earnings per share for
purposes of evaluating and forecasting underlying business
performance. Management believes these core earnings measures
provide investors additional insights into operational performance
as they exclude unallocated pension and post-retirement costs,
which primarily represent costs driven by market factors and costs
not allocable to government contracts. A reconciliation between the
GAAP and non-GAAP measures is provided on page 13.
Free Cash Flow
Free cash flow is defined as GAAP operating cash flow
without capital expenditures for property, plant and equipment
additions. Management believes free cash flow provides
investors with an important perspective on the cash available for
shareholders, debt repayment, and acquisitions after making the
capital investments required to support ongoing business operations
and long term value creation. Free cash flow does not represent the
residual cash flow available for discretionary expenditures as it
excludes certain mandatory expenditures such as repayment of
maturing debt. Management uses free cash flow as a measure to
assess both business performance and overall liquidity. Table 2
provides a reconciliation between GAAP operating cash flow and free
cash flow.
Caution Concerning
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. Words such as "may," "should," "expects," "intends,"
"projects," "plans," "believes," "estimates," "targets,"
"anticipates," and similar expressions generally identify these
forward-looking statements. Examples of forward-looking statements
include statements relating to our future financial condition and
operating results, as well as any other statement that does not
directly relate to any historical or current fact. Forward-looking
statements are based on expectations and assumptions that we
believe to be reasonable when made, but that may not prove to be
accurate. These statements are not guarantees and are subject to
risks, uncertainties, and changes in circumstances that are
difficult to predict. Many factors could cause actual results to
differ materially and adversely from these forward-looking
statements. Among these factors are risks related to: (1) general
conditions in the economy and our industry, including those due to
regulatory changes; (2) our reliance on our commercial airline
customers; (3) the overall health of our aircraft production
system, planned production rate increases across multiple
commercial airline programs, our commercial development and
derivative aircraft programs, and our aircraft being subject to
stringent performance and reliability standards; (4) changing
budget and appropriation levels and acquisition priorities of the
U.S. government; (5) our dependence on U.S. government contracts;
(6) our reliance on fixed-price contracts; (7) our reliance on
cost-type contracts; (8) uncertainties concerning contracts that
include in-orbit incentive payments; (9) our dependence on our
subcontractors and suppliers, as well as the availability of raw
materials, (10) changes in accounting estimates; (11) changes in
the competitive landscape in our markets; (12) our non-U.S.
operations, including sales to non-U.S. customers; (13) potential
adverse developments in new or pending litigation and/or government
investigations; (14) customer and aircraft concentration in Boeing
Capital's customer financing portfolio; (15) changes in our ability
to obtain debt on commercially reasonable terms and at competitive
rates in order to fund our operations and contractual commitments;
(16) realizing the anticipated benefits of mergers, acquisitions,
joint ventures/strategic alliances or divestitures; (17) the
adequacy of our insurance coverage to cover significant risk
exposures; (18) potential business disruptions, including those
related to physical security threats, information technology or
cyber-attacks, epidemics, sanctions or natural disasters; (19) work
stoppages or other labor disruptions; (20) significant changes in
discount rates and actual investment return on pension assets; (21)
potential environmental liabilities; and (22) threats to the
security of our or our customers' information.
Additional information concerning these and other factors can be
found in our filings with the Securities and Exchange Commission,
including our most recent Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K. Any
forward-looking statement speaks only as of the date on which it is
made, and we assume no obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events, or otherwise, except as required by law.
Contact: |
Investor Relations: |
|
Troy Lahr or Ben Hackman (312) 544-2140 |
Communications: |
|
Bernard Choi (312) 544-2002 |
The Boeing Company
and Subsidiaries |
Consolidated
Statements of Operations |
(Unaudited) |
|
|
|
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|
Three months ended
March 31 |
(Dollars in millions, except per share
data) |
2017 |
|
2016 |
Sales of products |
|
$18,512 |
|
|
$19,885 |
Sales of services |
2,464 |
|
2,747 |
Total revenues |
20,976 |
|
22,632 |
|
|
|
Cost of products |
(15,363) |
|
(16,945) |
Cost of services |
(1,888) |
|
(2,136) |
Boeing Capital interest expense |
(13) |
|
(16) |
Total costs and expenses |
(17,264) |
|
(19,097) |
|
3,712 |
|
3,535 |
Income from operating investments, net |
81 |
|
54 |
General and administrative expense |
(933) |
|
(888) |
Research and development expense, net |
(838) |
|
(917) |
Gain on dispositions, net |
2 |
|
4 |
Earnings from operations |
2,024 |
|
1,788 |
Other income, net |
22 |
|
26 |
Interest and debt expense |
(87) |
|
(73) |
Earnings before income taxes |
1,959 |
|
1,741 |
Income tax expense |
(508) |
|
(522) |
Net earnings |
|
$1,451 |
|
|
$1,219 |
|
|
|
Basic earnings per share |
|
$2.36 |
|
|
$1.85 |
|
|
|
Diluted earnings per share |
|
$2.34 |
|
|
$1.83 |
|
|
|
Cash dividends paid per share |
|
$1.42 |
|
|
$1.09 |
|
|
|
Weighted average diluted shares
(millions) |
621.2 |
|
665.8 |
The Boeing Company
and Subsidiaries |
Consolidated
Statements of Financial Position |
(Unaudited) |
|
|
|
|
|
|
|
(Dollars in millions, except per share
data) |
March 31
2017 |
|
December 31
2016 |
Assets |
|
|
Cash and cash equivalents |
|
$8,190 |
|
|
$8,801 |
Short-term and other investments |
1,015 |
|
1,228 |
Accounts receivable, net |
9,335 |
|
8,832 |
Current portion of customer financing, net |
580 |
|
428 |
Inventories, net of advances and progress
billings |
43,247 |
|
43,199 |
Total current assets |
62,367 |
|
62,488 |
Customer financing, net |
3,527 |
|
3,773 |
Property, plant and equipment, net of accumulated
depreciation of $17,156 and $16,883 |
12,842 |
|
12,807 |
Goodwill |
5,342 |
|
5,324 |
Acquired intangible assets, net |
2,496 |
|
2,540 |
Deferred income taxes |
336 |
|
332 |
Investments |
1,319 |
|
1,317 |
Other assets, net of accumulated amortization of
$527 and $497 |
1,444 |
|
1,416 |
Total assets |
|
$89,673 |
|
|
$89,997 |
Liabilities and equity |
|
|
Accounts payable |
|
$11,964 |
|
|
$11,190 |
Accrued liabilities |
13,332 |
|
14,691 |
Advances and billings in excess of related
costs |
24,118 |
|
23,869 |
Short-term debt and current portion of long-term
debt |
367 |
|
384 |
Total current liabilities |
49,781 |
|
50,134 |
Deferred income taxes |
1,339 |
|
1,338 |
Accrued retiree health care |
5,885 |
|
5,916 |
Accrued pension plan liability, net |
19,796 |
|
19,943 |
Other long-term liabilities |
2,285 |
|
2,221 |
Long-term debt |
10,432 |
|
9,568 |
Shareholders' equity: |
|
|
Common stock, par value $5.00 ā
1,200,000,000 shares authorized;
1,012,261,159 shares issued |
5,061 |
|
5,061 |
Additional paid-in capital |
4,604 |
|
4,762 |
Treasury stock, at cost - 406,468,802 and
395,109,568 shares |
(38,320) |
|
(36,097) |
Retained earnings |
42,165 |
|
40,714 |
Accumulated other comprehensive loss |
(13,415) |
|
(13,623) |
Total shareholders' equity |
95 |
|
817 |
Noncontrolling interests |
60 |
|
60 |
Total equity |
155 |
|
877 |
Total liabilities and equity |
|
$89,673 |
|
|
$89,997 |
The Boeing Company
and Subsidiaries |
Consolidated
Statements of Cash Flows |
(Unaudited) |
|
|
|
|
|
|
|
|
Three months ended
March 31 |
(Dollars in millions) |
2017 |
|
2016 |
Cash flows ā operating
activities: |
|
|
Net earnings |
|
$1,451 |
|
|
$1,219 |
Adjustments to reconcile net earnings to net cash
provided by operating activities: |
|
|
Non-cash items ā |
|
|
Share-based plans expense |
50 |
|
51 |
Depreciation and amortization |
471 |
|
443 |
Investment/asset impairment charges, net |
23 |
|
33 |
Customer financing valuation benefit |
7 |
|
(2) |
Gain on dispositions, net |
(2) |
|
(4) |
Other charges and credits, net |
52 |
|
84 |
Changes in assets and liabilities ā |
|
|
Accounts receivable |
(769) |
|
(1,002) |
Inventories, net of advances and progress
billings |
(31) |
|
(56) |
Accounts payable |
616 |
|
960 |
Accrued liabilities |
(613) |
|
(467) |
Advances and billings in excess of related
costs |
249 |
|
(435) |
Income taxes receivable, payable and deferred |
495 |
|
273 |
Other long-term liabilities |
(72) |
|
(116) |
Pension and other postretirement plans |
10 |
|
79 |
Customer financing, net |
232 |
|
276 |
Other |
(75) |
|
(61) |
Net cash provided by operating
activities |
2,094 |
|
1,275 |
Cash flows ā investing activities: |
|
|
Property, plant and equipment additions |
(466) |
|
(748) |
Property, plant and equipment reductions |
9 |
|
11 |
Contributions to investments |
(605) |
|
(204) |
Proceeds from investments |
803 |
|
493 |
Other |
(3) |
|
10 |
Net cash used by investing
activities |
(262) |
|
(438) |
Cash flows ā financing activities: |
|
|
New borrowings |
872 |
|
115 |
|
Debt repayments |
(34) |
|
(128) |
|
Stock options exercised |
174 |
|
42 |
|
Employee taxes on certain share-based payment
arrangements |
(107) |
|
(76) |
|
Common shares repurchased |
(2,500) |
|
(3,501) |
|
Dividends paid |
(868) |
|
(717) |
|
Net cash used by financing
activities |
(2,463) |
|
(4,265) |
|
Effect of exchange rate changes on cash and cash
equivalents |
20 |
|
12 |
|
Net decrease in cash and cash
equivalents |
(611) |
|
(3,416) |
|
Cash and cash equivalents at beginning of
year |
8,801 |
|
11,302 |
|
Cash and cash equivalents at end of
period |
|
$8,190 |
|
|
$7,886 |
|
The Boeing Company
and Subsidiaries |
Summary of Business
Segment Data |
(Unaudited) |
|
|
|
|
|
|
|
|
Three months ended
March 31 |
(Dollars in millions) |
2017 |
|
2016 |
Revenues: |
|
|
Commercial Airplanes |
|
$14,305 |
|
|
$14,399 |
Defense, Space & Security: |
|
|
Boeing Military Aircraft |
2,636 |
|
3,659 |
Network & Space Systems |
1,564 |
|
1,735 |
Global Services & Support |
2,332 |
|
2,562 |
Total Defense, Space & Security |
6,532 |
|
7,956 |
Boeing Capital |
92 |
|
64 |
Unallocated items, eliminations and other |
47 |
|
213 |
Total revenues |
|
$20,976 |
|
|
$22,632 |
Earnings from operations: |
|
|
Commercial Airplanes |
|
$1,215 |
|
|
$1,033 |
Defense, Space & Security: |
|
|
Boeing Military Aircraft |
321 |
|
334 |
Network & Space Systems |
98 |
|
148 |
Global Services & Support |
318 |
|
340 |
Total Defense, Space & Security |
737 |
|
822 |
Boeing Capital |
39 |
|
5 |
Segment operating profit |
1,991 |
|
1,860 |
Unallocated items, eliminations and other |
33 |
|
(72) |
Earnings from operations |
2,024 |
|
1,788 |
Other income, net |
22 |
|
26 |
Interest and debt expense |
(87) |
|
(73) |
Earnings before income taxes |
1,959 |
|
1,741 |
Income tax expense |
(508) |
|
(522) |
Net earnings |
|
$1,451 |
|
|
$1,219 |
|
|
|
Research and development expense, net: |
|
|
Commercial Airplanes |
|
$636 |
|
|
$671 |
Defense, Space & Security |
213 |
|
258 |
Other |
(11) |
|
(12) |
Total research and development expense,
net |
|
$838 |
|
|
$917 |
|
|
|
Unallocated items, eliminations and
other |
|
|
Share-based plans |
|
($21) |
|
|
($23) |
Deferred compensation |
(50) |
|
16 |
Amortization of previously capitalized
interest |
(31) |
|
(30) |
Eliminations and other unallocated items |
(180) |
|
(129) |
Sub-total (included in core operating
earnings) |
(282) |
|
(166) |
Pension |
255 |
|
45 |
Postretirement |
60 |
|
49 |
Total unallocated items, eliminations and
other |
|
$33 |
|
|
($72) |
The Boeing Company
and Subsidiaries |
Operating and
Financial Data |
(Unaudited) |
|
Deliveries |
|
Three months
ended
March 31 |
Commercial Airplanes |
|
2017 |
|
|
2016 |
737 |
|
113 |
|
|
121 |
747 |
|
1 |
(1) |
|
1 |
767 |
|
2 |
|
|
1 |
777 |
|
21 |
|
|
23 |
787 |
|
32 |
|
|
30 |
Total |
|
169 |
|
|
176 |
Note: Deliveries under operating
lease are identified by parentheses. |
|
|
|
|
|
|
Defense, Space & Security |
|
|
|
|
|
Boeing Military Aircraft |
|
|
|
|
|
AH-64 Apache (New) |
|
3 |
|
|
7 |
AH-64 Apache (Remanufactured) |
|
13 |
|
|
11 |
C-17 Globemaster III |
|
|
|
|
3 |
CH-47 Chinook (New) |
|
3 |
|
|
3 |
CH-47 Chinook (Renewed) |
|
9 |
|
|
9 |
F-15 Models |
|
3 |
|
|
4 |
F/A-18 Models |
|
6 |
|
|
8 |
P-8 Models |
|
4 |
|
|
4 |
|
|
|
|
|
|
Network & Space Systems |
|
|
|
|
|
Commercial and Civil Satellites |
|
1 |
|
|
1 |
Military Satellites |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contractual backlog (Dollars in
billions) |
|
March 31
2017 |
|
|
December 31
2016 |
Commercial Airplanes |
|
$415.1 |
|
|
$416.2 |
Defense, Space & Security: |
|
|
|
|
|
Boeing Military Aircraft |
|
23.4 |
|
|
21.4 |
Network & Space Systems |
|
6.0 |
|
|
5.1 |
Global Services & Support |
|
17.0 |
|
|
15.6 |
Total Defense, Space & Security |
|
46.4 |
|
|
42.1 |
Total contractual backlog |
|
$461.5 |
|
|
$458.3 |
Unobligated backlog |
|
$18.0 |
|
|
$15.2 |
Total backlog |
|
$479.5 |
|
|
$473.5 |
Workforce |
|
147,000 |
|
|
150,500 |
The Boeing Company and
Subsidiaries
Reconciliation of Non-GAAP Measures
(Unaudited)
The tables provided below reconcile the non-GAAP financial
measures core operating earnings, core operating margin, and core
earnings per share with the most directly comparable GAAP financial
measures, earnings from operations, operating margin, and diluted
earnings per share. See page 6 of this release for additional
information on the use of these non-GAAP financial measures.
(Dollars in millions, except per share
data) |
First Quarter |
Guidance |
|
|
|
2017 |
2016 |
2017 |
|
|
Revenues |
|
$20,976 |
|
|
$22,632 |
|
|
|
|
|
|
|
|
|
|
GAAP Earnings From Operations |
|
$2,024 |
|
|
$1,788 |
|
|
|
|
Increase/(Decrease) in GAAP Earnings From
Operations |
13% |
|
|
|
|
|
|
GAAP Operating Margin |
9.6% |
|
7.9% |
|
|
|
|
|
|
|
|
|
|
Unallocated Pension Income |
|
($255) |
|
|
($45) |
|
|
|
|
Unallocated Other Postretirement Benefit
Income |
|
($60) |
|
|
($49) |
|
|
|
|
Unallocated Pension and Other Postretirement
Benefit Income |
|
($315) |
|
|
($94) |
|
~($1,075) |
|
|
Core Operating Earnings (non-GAAP) |
|
$1,709 |
|
|
$1,694 |
|
|
|
|
Increase/(Decrease) in Core Operating Earnings
(non-GAAP) |
1% |
|
|
|
|
|
|
Core Operating Margin (non-GAAP) |
8.1% |
|
7.5% |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Diluted Earnings Per Share |
|
$2.34 |
|
|
$1.83 |
|
$10.35 -
$10.55 |
|
|
Unallocated Pension Income |
|
($0.41) |
|
|
($0.07) |
|
|
|
|
Unallocated Postretirement Benefit
Income |
|
($0.10) |
|
|
($0.07) |
|
($1.15) |
|
|
Provision for deferred income taxes on
adjustments (1) |
|
$0.18 |
|
|
$0.05 |
|
|
|
|
Core Earnings Per Share (non-GAAP) |
|
$2.01 |
|
|
$1.74 |
|
$9.20 -
$9.40 |
|
|
|
|
|
|
|
|
Weighted Average Diluted Shares
(millions) |
621.2 |
|
665.8 |
|
605 -
610 |
|
|
Increase/(Decrease) in GAAP Earnings Per
Share |
28% |
|
|
|
|
|
Increase/(Decrease) in Core Earnings Per Share
(non-GAAP) |
16% |
|
|
|
|
|
|
|
|
|
|
|
(1) The income tax impact
is calculated using the tax rate in effect for the non-GAAP
adjustments. |