Boeing quarterly profit surges 78%


NEW YORK: Boeing Co posted on Wednesday a 78% jump in quarterly earnings that beat Wall Street forecasts as stronger demand for its military networking and weapons systems helped offset a fall in commercial aircraft revenue. 

The company raised its full-year forecast and bumped up its commercial aircraft delivery forecast for next year. 

Boeing also said it still expected 200 firm orders for its newest jetliner, the 7E7, even as higher oil prices had dampened airline profits. 

Boeing employees work on the first 737 Airborne Early Warning and Control airplane in Seattle.

“Boeing’s quarter was solid overall, with the excellent performance in defence and a strong earnings per share number,” said Banc of America Securities analyst Nick Fothergill. 

Still, he noted, the company did not raise its 2005 profit forecast which could “hint at headwinds” including pension expenses or possible commercial aircraft deferrals. 

Earnings for the Chicago-based maker of commercial and military jets rose to US$456mil from US$256mil a year earlier. 

Sales rose 8% to US$13.15bil, topping forecasts for US$12.42bil. 

“We believe the release is neutral for the stock,” JP Morgan Securities analyst Joe Nadol said in a note to clients. “EPS upside was due to the tax benefit.” 

The company generated US$2.3bil in cash flow, before making a US$1.6bil contribution to pension plans. 

Revenue for Integrated Defense Systems, Boeing’s defence unit which makes the C-17 transport plane and fighter jets including the F-15 Eagle and F/A-18E/F Super Hornet, jumped 13% to US$8.3bil, while the group’s operating margins rose to 9.9% from 7.7%. 

But revenues at the Commercial Airplanes unit fell 8% to US$4.6bil as deliveries rose but included more smaller planes. – Reuters 

 

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