Boeing Reports First-Quarter Earnings

-- First-quarter net income was $0.6 billion with earnings per share of $0.86 which includes the previously announced $0.38 per share reduction from revised twin-aisle commercial airplane production rates and lower price escalation forecasts

-- Revenue rose 3 percent to $16.5 billion on higher commercial airplane deliveries and higher volume in defense

-- Operating cash flow was $0.2 billion

-- Backlog at $339 billion - nearly five times current annual revenues

-- 2009 earnings outlook reduced to reflect changes in commercial market; outlook for Integrated Defense Systems is reaffirmed on solid execution

CHICAGO, April 22 /PRNewswire-FirstCall/ -- The Boeing Company's (NYSE: BA) first-quarter 2009 earnings per share decreased 47 percent to $0.86 driven by the previously announced $0.38 per share impact from pending twin-aisle production rate changes and lower delivery price escalation forecasts in commercial airplanes (Table 1). The majority of this earnings impact was recorded as an increase in the reach-forward loss position of the 747 program.

    Table 1.  Summary Financial Results
                                          First Quarter
                                          -------------
    (Millions, except per share data)      2009     2008     Change
    ---------------------------------      ----     ----     ------

    Revenues                            $16,502  $15,990        3%
    Earnings From Operations             $1,025   $1,799      (43%)
    Operating Margin                        6.2%    11.3%    (5.1)Pts
    Reported Net Income                    $610   $1,211      (50%)
    Reported Earnings per Share           $0.86    $1.62      (47%)
    Operating Cash Flow                    $193   $1,933      N.A.

Excluding the effects of a weakened commercial airplane market, solid execution on programs across Integrated Defense Systems and Commercial Airplanes underpinned the quarter's results. Results were also impacted by a less favorable delivery mix in defense and higher expense for research and development.

"The expanded global economic downturn is presenting unprecedented challenges in our commercial airplane markets," said Boeing Chairman, President, and Chief Executive Officer Jim McNerney. "We believe we are better positioned than most companies to withstand the ongoing pressures of this economy, and we are not hesitating to take necessary actions to preserve our financial strength and maintain our ability to invest and grow for the long term. Performance across the overwhelming majority of our programs remains solid, and we are making progress toward our milestones on the 787 and other important programs."

Boeing's quarterly revenue rose 3 percent to $16.5 billion while its operating cash flow was $0.2 billion reflecting continued investment in development programs and lower advances from commercial airplane orders. Free cash flow* was ($0.2) billion (Table 2).

Boeing lowered its 2009 earnings per share guidance to between $4.70 and $5.00 primarily due to the lower price escalation forecasts.

Total company backlog at quarter-end was $339 billion, down 4 percent in the quarter, driven by run-off of backlog through revenues, the lower price escalation forecast, and previously announced 787 cancellations, partially offset by new orders in IDS for C-17 and integrated logistics.

    Table 2.  Cash Flow
                                                     First Quarter
                                                     -------------
    (Millions)                                        2009    2008
    ----------                                        ----    ----

    Operating Cash Flow (1)                           $193  $1,933
       Less Additions to Property, Plant & Equipment ($442)  ($409)
                                                     -----   -----
    Free Cash Flow*                                  ($249) $1,524
    ----------------                                 -----  ------
    (1) Operating cash flow for the first quarter of 2008 includes a
        $506 million contribution to pension plans.
    *   Non-GAAP measure.  A complete definition and reconciliation
        of Boeing's use of non-GAAP measures, identified by an
        asterisk (*), is found on page 8, "Non-GAAP Measure
        Disclosure."

Cash and investments in marketable securities totaled $4.7 billion at quarter-end, up during the first quarter as a result of new debt issuance (Table 3). The company spent $50 million to acquire 1.2 million of its shares in the quarter.

    Table 3.  Cash, Marketable Securities and Debt Balances
                                                                   Quarter-
                                                                                                                                End
                                                                                                                          --------
        (Billions)                                                                                              1Q09  4Q08
        ----------                                                                                              ----  ----
        Cash                                                                                                          $4.2  $3.3
        Marketable  Securities(1)                                                                  $0.5  $0.3
                                                                                                                          ----  ----
              Total                                                                                                  $4.7  $3.6

        Debt  Balances:
        The  Boeing  Company                                                                              $5.7  $3.9
        Boeing  Capital  Corporation                                                              $3.6  $3.6
                                                                                                                          ----  ----
              Total  Consolidated  Debt                                                              $9.3  $7.5
        --------------------------                                                              ----  ----
        (1)  Marketable  securities  consists  primarily  of  investment-grade
                instruments  classified  as  "short-term  investments"  and
                "investments."
 


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