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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Boeing Co. | LSE:BOE | London | Ordinary Share | COM STK USD5 (CDI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 220.00 | 210.00 | 230.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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TIDMBOE
Boeing Reports Second-Quarter Results
CHICAGO, July 27, 2016 --
* Revenue increased to $24.8 billion on strong commercial deliveries and
services growth
* Loss of $0.37 per share (GAAP) and core (non-GAAP)* loss of $0.44 per share
reflect $3.23 per share impact related to previously announced 787 R&D
reclassification and 747 & Tanker charges
* Strong operating cash flow of $3.2 billion; repurchased 15 million shares
for $2.0 billion
* Backlog remains robust at $472 billion with nearly 5,700 commercial
airplane orders
* Cash and marketable securities of $9.3 billion provide strong liquidity
* Reaffirmed cash & revenue guidance; EPS reflects reclassification, charges,
solid performance & tax
Table 1. Summary Second Quarter First Half
Financial
Results
(Dollars in 2016 2015 Change 2016 2015 Change
Millions, except
per share data)
Revenues $24,755 $24,543 1% $47,387 $46,692 1%
GAAP
Earnings/(Loss) ($419) $1,683 (125)% $1,369 $3,702 (63)%
From Operations
Operating Margin (1.7)% 6.9% (8.6) Pts 2.9% 7.9% (5.0) Pts
Net Earnings/ ($234) $1,110 (121)% $985 $2,446 (60)%
(Loss)
Earnings/(Loss) ($0.37) $1.59 (123)% $1.51 $3.46 (56)%
Per Share
Operating Cash $3,234 $3,297 (2)% $4,465 $3,385 32%
Flow
Non-GAAP*
Core Operating ($488) $1,713 (128)% $1,206 $3,845 (69)%
Earnings/(Loss)
Core Operating (2.0)% 7.0% (9.0) Pts 2.5% 8.2% (5.7) Pts
Margin
Core Earnings/ ($0.44) $1.62 (127)% $1.35 $3.59 (62)%
(Loss) Per Share
* Non-GAAP measures. Complete definitions of Boeing's non-GAAP measures are on
page 7, "Non-GAAP Measures Disclosures."
The Boeing Company [NYSE: BA] reported second-quarter revenue of $24.8 billion
on strong commercial deliveries and services growth (Table 1). GAAP loss per
share of $0.37 and core loss per share (non-GAAP)* of $0.44 reflect the
previously announced 787 cost reclassification ($1.33 per share) and charges on
the 747 program ($1.28 per share) and the KC-46 Tanker program ($0.62 per
share), partially offset by solid execution and higher volume.
"The underlying operating performance of the company remains solid with our
commercial and defense teams again delivering strong revenues and operating
cash flow. Actions taken during the quarter that impacted our earnings were the
right, proactive steps to reduce risk and strengthen our position for the
future," said Chairman, President and Chief Executive Officer Dennis
Muilenburg. "Our strong cash generation also supported our ongoing commitment
to invest in product innovation and in our people, and return substantial cash
to shareholders through stock repurchases and dividends."
"As we look forward to the second half of the year, we anticipate continued
strong operating performance across our production and services programs on
generally healthy demand for our broad portfolio of market-leading offerings.
Our commercial airplane development programs remain on track and we have
successfully completed the flight testing required for customer approval of key
KC-46 production milestones."
"Overall our teams remain intensely focused on improving productivity and
quality, building out our large and diverse backlog, investing in future
growth, and delivering increasing value to all of our stakeholders."
GAAP earnings per share guidance for 2016 has been adjusted to between $6.40
and $6.60 from $8.45 and $8.65 and core earnings per share (non-GAAP)* guidance
has been adjusted to between $6.10 and $6.30 from $8.15 and $8.35 to reflect
the impact of the 787 R&D reclassification and the 747 and Tanker charges,
solid performance and tax benefits.
Table 2. Cash Flow Second Quarter First Half
(Millions) 2016 2015 2016 2015
Operating Cash Flow $3,234 $3,297 $4,465 $3,385
Less Additions to Property, Plant & ($671) ($692) ($1,419) ($1,266)
Equipment
Free Cash Flow* $2,563 $2,605 $3,046 $2,119
* Non-GAAP measures. Complete definitions of Boeing's non-GAAP measures are on
page 7, "Non-GAAP Measures Disclosures."
Operating cash flow in the quarter was $3.2 billion, largely reflecting
commercial airplane production rates and solid operating performance (Table 2).
During the quarter, the company repurchased 15.3 million shares for $2.0
billion, leaving $8.5 billion remaining under the current repurchase
authorization which is expected to be completed over approximately the next two
years. The company also paid $691 million in dividends in the quarter,
reflecting an approximately 20 percent increase in dividends per share compared
to the same period of the prior year.
Table 3. Cash, Marketable Securities and Debt Balances Quarter-End
(Billions) Q2 16 Q1 16
Cash $8.6 $7.9
Marketable Securities1 $0.7 $0.5
Total $9.3 $8.4
Debt Balances:
The Boeing Company, net of intercompany loans to BCC $8.7 $7.6
Boeing Capital, including intercompany loans $2.3 $2.4
Total Consolidated Debt $11.0 $10.0
1 Marketable securities consists primarily of time deposits due within one year
classified as "short-term investments."
Cash and investments in marketable securities totaled $9.3 billion, up from
$8.4 billion at the beginning of the quarter. Debt was $11.0 billion, up from
the beginning of the quarter, primarily due to the issuance of new debt (Table
3).
Total company backlog at quarter-end was $472 billion, down from $480 billion
at the beginning of the quarter, and included net orders for the quarter of $17
billion.
Segment Results
Commercial Airplanes
Table 4. Second Quarter First Half
Commercial
Airplanes
(Dollars in 2016 2015 Change 2016 2015 Change
Millions)
Commercial 199 197 1% 375 381 (2)%
Airplanes
Deliveries
Revenues $17,456 $16,877 3% $31,855 $32,258 (1)%
Earnings/(Loss) ($973) $1,206 (181)% $60 $2,823 (98)%
from Operations
Operating Margin (5.6)% 7.1% (12.7) Pts 0.2% 8.8% (8.6) Pts
Commercial Airplanes second-quarter revenue increased 3 percent to $17.5
billion on higher volume and mix (Table 4). Second-quarter operating margin was
negative 5.6 percent, reflecting previously announced R&D reclassification of
$1,235 million on the 787 program, a pre-tax charge of $1,188 million on the
747 program, and a pre-tax charge of $354 million on the KC-46 Tanker program.
The results also reflect higher planned R&D and solid execution. Second-quarter
operating margin excluding the reclassification and charges (non-GAAP)* was
10.3%.
During the quarter, the 787 program reached a 12 per month delivery rate and
the company opened the new 777X Composite Wing Center in Everett. The 737
program rolled out the first two 737 MAX production airplanes and has captured
over 3,200 orders for the 737 MAX since launch, including an order for 100 737
MAX 200 airplanes from Vietjet during the quarter. The 737 MAX development
program is progressing smoothly and entry into service is being accelerated.
Commercial Airplanes booked 152 net orders during the quarter. Backlog remains
strong with nearly 5,700 airplanes valued at $417 billion.
Defense, Space & Security
Table 5. Defense, Space Second Quarter First Half
& Security
(Dollars in Millions) 2016 2015 Change 2016 2015 Change
Revenues1
Boeing Military $2,979 $3,474 (14)% $6,638 $6,200 7%
Aircraft
Network & Space Systems $1,810 $1,938 (7)% $3,545 $3,670 (3)%
Global Services & $2,385 $2,132 12% $4,947 $4,383 13%
Support
Total BDS Revenues $7,174 $7,544 (5)% $15,130 $14,253 6%
Earnings from
Operations1
Boeing Military $175 $121 45% $509 $380 34%
Aircraft
Network & Space Systems $153 $151 1% $301 $318 (5)%
Global Services & $265 $274 (3)% $605 $591 2%
Support
Total BDS Earnings from $593 $546 9% $1,415 $1,289 10%
Operations
Operating Margin 8.3% 7.2% 1.1 Pts 9.4% 9.0% 0.4 Pts
1 During the first quarter of 2016, certain programs were realigned between
Boeing Military Aircraft and Global Services & Support.
Defense, Space & Security's second-quarter revenue was $7.2 billion.
Second-quarter operating margin was 8.3 percent, reflecting the previously
announced $219 million pre-tax charge recorded at Boeing Military Aircraft on
the KC-46 Tanker program (Table 5).
Boeing Military Aircraft (BMA) second-quarter revenue was $3.0 billion,
reflecting lower planned C-17 and Chinook deliveries. Operating margin was 5.9
percent, reflecting the KC-46 Tanker charge. During the quarter, BMA was
awarded contracts for 24 Apache and 12 Chinook helicopters.
Network& Space Systems (N&SS) second-quarter revenue was $1.8 billion.
Operating margin increased to 8.5 percent, reflecting performance and timing on
United Launch Alliance launches.
Global Services & Support (GS&S) second-quarter revenue increased to $2.4
billion, reflecting higher volume in Aircraft Modernization & Sustainment.
Operating margin was 11.1 percent largely reflecting contract mix.
Backlog at Defense, Space & Security was $55 billion, of which 37 percent
represents orders from international customers.
Additional Financial Information
Table 6. Additional Financial Second Quarter
Information First Half
(Dollars in Millions) 2016 2015 2016 2015
Revenues
Boeing Capital $84 $115 $148 $201
Unallocated items, eliminations and $41 $7 $254 ($20)
other
Earnings from Operations
Boeing Capital $18 $11 $23 $31
Unallocated pension/postretirement $69 ($30) $163 ($143)
Other unallocated items and ($126) ($50) ($292) ($298)
eliminations
Other income, net $13 $15 $39 $3
Interest and debt expense ($73) ($75) ($146) ($136)
Effective tax rate 51.1% 31.6% 21.9% 31.5%
At quarter-end, Boeing Capital's net portfolio balance was $3 billion, down
from the beginning of the quarter. Total pension expense for the second quarter
was $463 million, down from $523 million in the same period of the prior year.
Other unallocated items and eliminations decreased from the same period in the
prior year primarily due to higher deferred compensation expense and
elimination of intercompany profit. The effective tax rate for the second
quarter was increased from the same period in the prior year primarily due to
lower pre-tax income. During the quarter, the company adopted a new accounting
standard for share-based compensation payments which resulted in a $54 million
tax benefit ($0.08 per share).
Outlook
The company's 2016 updated financial and delivery guidance (Table 7) reflects
the impact of the 787 R&D reclassification and the 747 and Tanker charges,
solid performance and tax benefits.
Table 7. 2016 Financial Outlook Current Prior
(Dollars in Billions, except per share data) Guidance Guidance
The Boeing Company
Revenue $93.0 - 95.0 $93.0 - 95.0
GAAP Earnings Per Share $6.40 - 6.60 $8.45 - 8.65
Core Earnings Per Share* $6.10 - 6.30 $8.15 - 8.35
Operating Cash Flow $10.0 $10.0
Commercial Airplanes
Deliveries 740 - 745 740 - 745
Revenue $64.0 - 65.0 $64.0 - 65.0
Operating Margin 4.5% - 5.0 9.0%
Defense, Space & Security
Revenue
Boeing Military Aircraft $12.3 $12.3
Network & Space Systems $7.3 $7.3
Global Services & Support $9.4 $9.4
Total BDS Revenue $28.5 - 29.5 $28.5 - 29.5
Operating Margin
Boeing Military Aircraft 9.5% 10.0%
Network & Space Systems 9.0% 9.0%
Global Services & Support 12.0% 11.5%
Total BDS Operating Margin >10.0% >10.0%
Boeing Capital
Portfolio Size Stable Stable
Revenue $0.3 $0.3
Pre-Tax Earnings $0.05 $0.05
Research & Development $4.8 $3.6
Capital Expenditures $2.8 $2.8
Pension Expense 1 $2.1 $2.1
Effective Tax Rate 23.0% 30.0%
1 Approximately ($0.1) 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 7, "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/(Loss), Core Operating Margin and Core Earnings/(Loss)
Per Share
Core operating earnings/(loss) is defined as GAAP earnings/(loss) from
operations excluding unallocated pension and post-retirement expense. Core
operating margin is defined as core operating earnings/(loss) expressed as a
percentage of revenue. Core earnings/(loss) per share is defined as GAAP
diluted earnings/(loss) 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 14.
Commercial Airplanes Operating Margin Excluding the Reclassification and
Charges
Commercial Airplanes GAAP operating margin for the three months ended June 30,
2016 includes research and development expense of $1,235 million related to the
reclassification of costs associated with two 787 flight test aircraft from
program inventory, a reach-forward loss on the 747 program of $1,188 million,
and a reach-forward loss recorded at Commercial Airplanes on the KC-46 Tanker
program of $354 million. Management uses Commercial Airplanes operating margin
excluding the reclassification and charges for the purpose of evaluating
underlying business performance for the three months ended June 30, 2016.
Management believes that this measure also helps investors assess overall
trends in our operational performance and provide additional context for year
over year financial results. A reconciliation between the GAAP and non-GAAP
measures is provided on page 14.
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 are used to 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 our current expectations
and assumptions, which 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)
Six months ended Three months ended
June 30 June 30
(Dollars in millions, except per 2016 2015 2016 2015
share data)
Sales of products $42,069 $41,408 $22,184 $21,923
Sales of services 5,318 5,284 2,571 2,620
Total revenues 47,387 46,692 24,755 24,543
Cost of products (37,210) (35,627) (20,265) (19,247)
Cost of services (4,180) (4,186) (2,044) (2,086)
Boeing Capital interest expense (32) (33) (16) (17)
Total costs and expenses (41,422) (39,846) (22,325) (21,350)
5,965 6,846 2,430 3,193
Income from operating investments, 151 129 97 50
net
General and administrative expense (1,694) (1,705) (806) (760)
Research and development expense, (3,044) (1,569) (2,127) (800)
net
(Loss)/gain on dispositions, net (9) 1 (13)
Earnings/(loss) from operations 1,369 3,702 (419) 1,683
Other income, net 39 3 13 15
Interest and debt expense (146) (136) (73) (75)
Earnings/(loss) before income taxes 1,262 3,569 (479) 1,623
Income tax (expense)/benefit (277) (1,123) 245 (513)
Net earnings/(loss) $985 $2,446 ($234) $1,110
Basic earnings/(loss) per share $1.52 $3.50 ($0.37) $1.61
Diluted earnings/(loss) per share $1.51 $3.46 ($0.37) $1.59
Cash dividends paid per share $2.18 $1.82 $1.09 $0.91
Weighted average diluted shares 654.9 706.6 636.3 * 698.9
(millions) *
* As a result of incurring a net loss for the three months ended June 30, 2016,
* potential common shares of 6.7 million were excluded from diluted earnings
per share.
The Boeing Company and Subsidiaries
Consolidated Statements of Financial Position
(Unaudited)
(Dollars in millions, except per share data) June 30 December 31
2016 2015
Assets
Cash and cash equivalents $8,605 $11,302
Short-term and other investments 660 750
Accounts receivable, net 9,809 8,713
Current portion of customer financing, net 251 212
Inventories, net of advances and progress billings 44,182 47,257
Total current assets 63,507 68,234
Customer financing, net 2,909 3,358
Property, plant and equipment, net of accumulated 12,533 12,076
depreciation of $16,641 and $16,286
Goodwill 5,128 5,126
Acquired intangible assets, net 2,544 2,657
Deferred income taxes 267 265
Investments 1,312 1,284
Other assets, net of accumulated amortization of $451 1,409 1,408
and $451
Total assets $89,609 $94,408
Liabilities and equity
Accounts payable $11,748 $10,800
Accrued liabilities 13,534 14,014
Advances and billings in excess of related costs 23,409 24,364
Short-term debt and current portion of long-term debt 1,168 1,234
Total current liabilities 49,859 50,412
Deferred income taxes 2,422 2,392
Accrued retiree health care 6,586 6,616
Accrued pension plan liability, net 18,200 17,783
Other long-term liabilities 2,048 2,078
Long-term debt 9,847 8,730
Shareholders' equity:
Common stock, par value $5.00 - 1,200,000,000 shares 5,061 5,061
authorized; 1,012,261,159 shares issued
Additional paid-in capital 4,778 4,834
Treasury stock, at cost - 386,402,793 and 345,637,354 (34,821) (29,568)
shares
Retained earnings 38,362 38,756
Accumulated other comprehensive loss (12,795) (12,748)
Total shareholders' equity 585 6,335
Noncontrolling interests 62 62
Total equity 647 6,397
Total liabilities and equity $89,609 $94,408
The Boeing Company and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
Six months ended
June 30
(Dollars in millions) 2016 2015
Cash flows - operating activities:
Net earnings/(loss) $985 $2,446
Adjustments to reconcile net earnings to net cash provided
by operating activities:
Non-cash items -
Share-based plans expense 97 94
Depreciation and amortization 890 912
Investment/asset impairment charges, net 50 74
Customer financing valuation benefit (4) (5)
Gain/(loss) on dispositions, net 9 (1)
Other charges and credits, net 141 140
Excess tax benefits from share-based payment arrangements (124)
Changes in assets and liabilities -
Accounts receivable (503) (313)
Inventories, net of advances and progress billings 3,004 (2,395)
Accounts payable 1,221 888
Accrued liabilities (269) (177)
Advances and billings in excess of related costs (954) 195
Income taxes receivable, payable and deferred (494) 482
Other long-term liabilities (103) (17)
Pension and other postretirement plans 181 1,244
Customer financing, net 275 19
Other (61) (77)
Net cash provided by operating activities 4,465 3,385
Cash flows - investing activities:
Property, plant and equipment additions (1,419) (1,266)
Property, plant and equipment reductions 13 20
Acquisitions, net of cash acquired (23)
Contributions to investments (657) (1,205)
Proceeds from investments 705 2,040
Other 8 22
Net cash used by investing activities (1,350) (412)
Cash flows - financing activities:
New borrowings 1,323 761
Debt repayments (267) (846)
Stock options exercised 147 276
Excess tax benefits from share-based payment arrangements 124
Employee taxes on certain share-based payment arrangements (79) (90)
Common shares repurchased (5,501) (4,501)
Dividends paid (1,408) (1,264)
Other (24)
Net cash used by financing activities (5,809) (5,540)
Effect of exchange rate changes on cash and cash equivalents (3) (9)
Net decrease in cash and cash equivalents (2,697) (2,576)
Cash and cash equivalents at beginning of year 11,302 11,733
Cash and cash equivalents at end of period $8,605 $9,157
The Boeing Company and Subsidiaries
Summary of Business Segment Data
(Unaudited)
Six months ended Three months ended
June 30 June 30
(Dollars in millions) 2016 2015 2016 2015
Revenues:
Commercial Airplanes $31,855 $32,258 $17,456 $16,877
Defense, Space & Security:
Boeing Military Aircraft 6,638 6,200 2,979 3,474
Network & Space Systems 3,545 3,670 1,810 1,938
Global Services & Support 4,947 4,383 2,385 2,132
Total Defense, Space & Security 15,130 14,253 7,174 7,544
Boeing Capital 148 201 84 115
Unallocated items, eliminations and 254 (20) 41 7
other
Total revenues $47,387 $46,692 $24,755 $24,543
Earnings/(loss) from operations:
Commercial Airplanes $60 $2,823 ($973) $1,206
Defense, Space & Security:
Boeing Military Aircraft 509 380 175 121
Network & Space Systems 301 318 153 151
Global Services & Support 605 591 265 274
Total Defense, Space & Security 1,415 1,289 593 546
Boeing Capital 23 31 18 11
Segment operating profit/(loss) 1,498 4,143 (362) 1,763
Unallocated items, eliminations and (129) (441) (57) (80)
other
Earnings/(loss) from operations 1,369 3,702 (419) 1,683
Other income, net 39 3 13 15
Interest and debt expense (146) (136) (73) (75)
Earnings/(loss) before income taxes 1,262 3,569 (479) 1,623
Income tax (expense)/benefit (277) (1,123) 245 (513)
Net earnings/(loss) $985 $2,446 ($234) $1,110
Research and development expense, net:
Commercial Airplanes $2,548 $1,097 $1,877 $554
Defense, Space & Security 521 474 263 250
Other (25) (2) (13) (4)
Total research and development $3,044 $1,569 $2,127 $800
expense, net
Unallocated items, eliminations and
other:
Share-based plans ($41) ($37) ($18) ($16)
Deferred compensation (5) (48) (21) 10
Amortization of previously capitalized (48) (49) (18) (20)
interest
Eliminations and other unallocated (198) (164) (69) (24)
items
Sub-total (included in core operating (292) (298) (126) (50)
earnings)
Pension 79 (209) 34 (57)
Postretirement 84 66 35 27
Total unallocated items, eliminations ($129) ($441) ($57) ($80)
and other
The Boeing Company and Subsidiaries
Operating and Financial Data
(Unaudited)
Deliveries Six months ended Three months ended
June 30 June 30
Commercial Airplanes 2016 2015 2016 2015
737 248 249 127 128
747 3 9 2 5
767 5 9 4 4
777 51 50 28 26
787 68 64 38 34
Total 375 381 199 197
Note: Deliveries under operating lease are identified by parentheses.
Defense, Space & Security
Boeing Military Aircraft
AH-64 Apache (New) 15 12 8 6
AH-64 Apache (Remanufactured) 18 23 7 13
C-17 Globemaster III 4 3 1 2
CH-47 Chinook (New) 10 21 7 15
CH-47 Chinook (Renewed) 16 5 7 1
F-15 Models 7 5 3 4
F/A-18 Models 14 20 6 9
P-8 Models 9 6 5 4
Global Services & Support
AEW&C
C-40A 1
Network & Space Systems
Commercial and Civil Satellites 1 1 1
Military Satellites 1 1 1 1
Contractual backlog (Dollars in billions) June 30 December 31
2016 2015
Commercial Airplanes $416.6 $431.4
Defense, Space & Security:
Boeing Military Aircraft 22.6 19.9
Network & Space Systems 6.9 7.4
Global Services & Support 16.9 17.9
Total Defense, Space & Security 46.4 45.2
Total contractual backlog $463.0 $476.6
Unobligated backlog $9.2 $12.7
Total backlog $472.2 $489.3
Workforce 158,100 161,400
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, core earnings per share, and
Commercial Airplanes operating margin excluding the reclassification and
charges with the most directly comparable GAAP financial measures, earnings
from operations, operating margin, diluted earnings per share and Commercial
Airplanes operating margin. See page 7 of this release for additional
information on the use of these non-GAAP financial measures.
(Dollars in Second Quarter First Half Guidance
millions, except per
share data)
2016 2015 2016 2015 2016
Revenues $24,755 $24,543 $47,387 $46,692
GAAP Earnings/(Loss) ($419) $1,683 $1,369 $3,702
From Operations
Increase/(Decrease) (125%) (63%)
in GAAP Earnings
From Operations
GAAP Operating (1.7%) 6.9% 2.9% 7.9%
Margin
Unallocated Pension ($34) $57 ($79) $209
(Income)/Expense
Unallocated Other ($35) ($27) ($84) ($66)
Postretirement
Benefit Income
Unallocated Pension ($69) $30 ($163) $143 ($300)
and Other
Postretirement
Benefit (Income)/
Expense
Core Operating ($488) $1,713 $1,206 $3,845
Earnings/(Loss)
(non-GAAP)
Increase/(Decrease) (128%) (69%)
in Core Operating
Earnings (non-GAAP)
Core Operating (2.0%) 7.0% 2.5% 8.2%
Margin (non-GAAP)
GAAP Diluted ($0.37) $1.59 $1.51 $3.46 $6.40 - $6.60
Earnings/(Loss) Per
Share
Unallocated Pension ($0.05) $0.09 ($0.12) $0.29
(Income)/Expense
Unallocated ($0.06) ($0.04) ($0.13) ($0.09) ($0.30)
Postretirement
Benefit (Income)/
Expense
Provision for $0.04 ($0.02) $0.09 ($0.07)
deferred income
taxes on adjustments
(1)
Core Earnings/(Loss) ($0.44) $1.62 $1.35 $3.59 $6.10 - $6.30
Per Share (non-GAAP)
Weighted Average 636.3 * 698.9 654.9 706.6 645 - 650
Diluted Shares *
(millions)
Increase/(Decrease) (123%) (56%)
in GAAP Earnings Per
Share
Increase/(Decrease) (127%) (62%)
in Core Earnings Per
Share (non-GAAP)
Commercial Airplanes $17,456
Revenues
GAAP Commercial ($973)
Airplanes Earnings/
(Loss) from
Operations
GAAP Commercial (5.6%)
Airplanes Operating
margin
Cost $1,235
reclassification of
two 787 flight test
aircraft
Reach-forward loss $1,188
on 747 program
Reach-forward loss $354
at Commercial
Airplanes on KC-46
Tanker program
Commercial Airlines $1,804
Earnings from
Operations excluding
the reclassification
and charges
(non-GAAP)
Commercial Airplanes 10.3%
operating margin
excluding the
reclassification and
charges (non-GAAP)
(1) The income tax impact is calculated using the tax rate in effect for the
non-GAAP adjustments.
** As a result of incurring a net loss for the three months ended June 30,
2016, potential common shares of 6.7 million were excluded from diluted
earnings per share.
SOURCE: Boeing
END
(END) Dow Jones Newswires
July 27, 2016 07:30 ET (11:30 GMT)
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