787-9

Boeing has reported an 11% increase in second quarter results, reaching $24.5bn with an 18% gain in its commercial aircraft business.

For the quarter ending 30 June, the company’s net earnings dropped 33% to $1.11bn, compared with $1.65bn last year.

The earnings were primarily affected by an after-tax charge associated with the KC-46 military tanker contract.

Boeing president and CEO Dennis Muilenburg said: "Record commercial aircraft deliveries to customers worldwide drove solid revenue growth, and the strength of our overall portfolio and diligent focus produced significant operating cashflow during the quarter.

"Strong operating performance across our commercial and defence production programmes partially offset the tanker charge and enabled us to maintain our commitments to return cash to our shareholders and invest in innovation and our people."

During the quarter, the company logged $18bn worth of orders and reduced its backlog value to $489bn, compared with $495bn at the beginning of the quarter.

Boeing Commercial Airplanes unit recorded $16.9bn revenues on higher delivery volume and mix, while earnings from operations decreased to $1.2bn from $1.5bn.

"There’s more work to do here but we remain focused on risk reduction while improving long-term productivity and cashflow going forward."

The division delivered 197 aircraft and logged 171 net orders during the quarter. It has a backlog of around 5,700 aircraft valued at $431bn.

The company incurred additional costs of $790m on its 787 programme, to produce 34 model 787 airliners during the quarter.

Boeing CFO Greg Smith was quoted by Financial Times as saying that the costs are expected to remain the same in the current quarter, and could decrease in the fourth quarter due to recent introduction of the 787-9 variant.

Smith said: "There’s more work to do here but we remain focused on risk reduction while improving long-term productivity and cashflow going forward."

The company has adjusted its core earnings per share guidance for the fiscal 2015 to between $7.7 and $7.9 per share, compared with the previous estimate of between $8.2 and $8.4 per share. Its annual revenue forecast remained unchanged at between $94.5bn and $96.5bn.

Image: A Boeing 787-9 Dreamliner. Photo: courtesy of Boeing.