Boeing Boosts Outlook for Deliveries and Cash Flow--Update

By FeaturesDow Jones Newswires

Boeing Co. forecast a higher profit margin and a big rise in cash generated from record jetliner deliveries.

The world's largest aerospace company on Wednesday said higher jetliner sales will push operating cash up to $15 billion this year from $13.3 billion. Boeing and rival Airbus SE have backlogs stretching ahead for six or seven years, and investors are increasingly focused on deliveries and cash flow rather than new plane deals.

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The company handily beat forecasts for those metrics on Wednesday, forecasting that sales will climb to between $96 billion and $98 billion this year while deliveries of commercial jetliners rise to between 810 and 815. Boeing delivered 763 jetliners in 2017 and secured net orders for 912 planes, as surging airline traffic continues to fuel a multiyear boom for the airline and aerospace industries.

Boeing has helped drive the benchmark Dow Jones Industrial Index with an index-leading rise of 14.5% so far this year, even after falling in each of the past three sessions. The shares closed Tuesday at $337.71.

Boeing plans to boost production of the 737 and the 787 again and this year is expected to decide whether to press ahead with developing a new midsize plane that would come into service around 2025. Boeing's backlog rose to $488 billion at the end of the year, including 5,800 commercial jets. One challenge remains to boost its defense backlog.

The company is also exploring a deal with Brazil's Embraer SA that would broaden its range to include smaller jetliners and give the Chicago-based company access to thousands of engineers.

Per-share earnings in 2018 are forecast at between $15.90 and $16.10; with core profits excluding certain items such as pension costs at $13.80 to $14.00. Profit in the fourth quarter rose $3.13 billion from $1.6 billion a year earlier. Adjusted for one-off items and excluding pension costs, earnings climbed to $4.80 from $2.47. Sales rose 9% to $25.4 billion.

Write to Doug Cameron at doug.cameron@wsj.com

(END) Dow Jones Newswires

January 31, 2018 09:18 ET (14:18 GMT)

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