Boeing Raises Annual Profit Guidance -- Update

By Ezequiel Minaya Features Dow Jones Newswires

Boeing Co. posted profit well above expectations in the second quarter and lifted its forecast for the year, although sales fell.

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Shares, which have climbed nearly 58% over the past 12 months, were up 3% in premarket trading at $219.30

Boeing, the world's leading plane maker by deliveries, has been on a roll and last raised its forecast in April. The company has now beaten expectations in the last four quarters, after taking a rare loss a year ago amid special charges.

In all for the second quarter, Boeing earned $1.76 billion, or $2.89 a share, up from last year's loss of $234 million, or 37 cents a share.

Excluding nonrecurring items, the company earned an adjusted profit of $2.55 a share, topping the average analyst estimate for $2.30 a share, according to Thomson Reuters. Revenue fell 8.1% to $22.74 billion on lower commercial aircraft deliveries. Analysts were looking for $23.02 billion in sales.

Boeing's backlog grew to $482 billion, including $27 billion of net orders during the most recent period.

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The company now expects adjusted earnings of $9.80 to $10 a share compared with previous guidance for $9.20 to $9.40 a share. Revenue is still expected between $90.5 billion to $92.5 billion, including between 760 to 765 commercial deliveries.

The aerospace giant shed more than 6,000 staff during the first half of the year, some 4% of its workforce. Executives have said the cost-cutting drive was crucial to remain competitive with Airbus SE. Boeing's European rival has in recent years claimed more than half of the market for single-aisle workhorse jets, clawing a lead in what for two decades had been an evenly balanced duopoly.

Write to Ezequiel Minaya at ezequiel.minaya@wsj.com

Boeing Co. Wednesday raised its full-year profit guidance and outlined plans to pay some of its big pension liabilities ahead of schedule.

The additional $3.5 billion pension payment highlights the aerospace company's confidence in boosting cash generated by sales of its commercial jetliners as Boeing prepares to boost output of the best-selling 737 and absorb a downturn in demand for larger aircraft.

Boeing shares were up more than 3% in pre-open trade, lifting its market value above $130 billion.

The pension payment would cover expected funding needs over the next four years and eliminates another risk for Boeing, while providing a tax benefit that lifts its cash flow.

Boeing shares have soared 36% this year as investors expressed more confidence about the demand for jets and the company's ability to convert its $500 billion order book into cash and profits. It now expects to buy back some $10 billion in stock this year.

The move came as Boeing reported forecast-beating second quarter profit, and the company raised its margin guidance as a mix of job cuts and efficiency measures boost productivity.

In all for the quarter, Boeing earned $1.76 billion, or $2.89 a share, up from last year's loss of $234 million, or 37 cents a share. Excluding nonrecurring items, the company earned an adjusted profit of $2.55 a share, topping the average analyst estimate for $2.30 a share, according to Thomson Reuters. Revenue fell 8.1% to $22.7 billion, reflecting a dip in commercial and military jet deliveries.

The company retained its full-year guidance for delivering 760 to 765 jetliners. Its backlog rose to $482 billion, including $27 billion of net orders during the latest quarter.

Boeing now expects adjusted earnings of $9.80 to $10 a share compared with previous guidance for $9.20 to $9.40 a share. Revenue guidance was unchanged at $90.5 billion to $92.5 billion.

Write to Doug Cameron at doug.cameron@wsj.com and Ezequiel Minaya at ezequiel.minaya@wsj.com

(END) Dow Jones Newswires

July 26, 2017 08:45 ET (12:45 GMT)