updated 4/23/2008 3:09:50 PM ET 2008-04-23T19:09:50

Boeing Co., the world’s second biggest commercial airplane manufacturer, reported a better-than-expected 38 percent jump in its first-quarter earnings, as it improved efficiency and recorded more orders for its aircraft.

The results, announced Wednesday by the Chicago-based aerospace and defense company, sent Boeing shares up sharply to a two-month high.

The aerospace company said it earned $1.2 billion, or $1.62 per share, for the quarter ending March 31. That compares with $877 million, or $1.13 per share, a year earlier. Revenue rose 4 percent to $16 billion from $15.37 billion a year ago.

“As our numbers from the quarter attest, we are off to a strong start in what we believe will be another year of improving financial performance for this company,” said Boeing Chairman and Chief Executive Jim McNerney.

On average, analysts surveyed by Thomson Financial expected Boeing to earn $1.35 per share on $16.5 billion in revenue, just above the company’s reported revenue performance.

“Boeing reported excellent first-quarter results Wednesday that support our view that, despite credit market turmoil and a slowing domestic economy, the current upswing in commercial airplane deliveries should continue through at least the end of the decade,” Morningstar analyst Brian Nelson told investors in a research note.

Citigroup analyst George Shapiro told investors that the results would likely be the company’s best of the year.

The company’s commercial airplane segment saw its operating profit grow 39 percent to $983 million in the January-through-March quarter. Revenue grew 8 percent to $8.2 billion.

Meanwhile, operating profits for Boeing’s defense unit rose 10 percent to $860 million while revenue slipped 2 percent to $7.6 billion.

Boeing said its total backlog reached a new record of $346 billion.

The company also reaffirmed its 2008 guidance, saying it expects to earn between $5.70 and $5.85 this year while delivering between 475 and 480 airplanes.

Next year, the company predicted it will earn between a better-than-expected $6.80 and $7.00 per share and said it and is on track to deliver between 500 and 505 planes, including 25 of its thrice-delayed 787 jetliners.

The fuel-efficient plane has been beset with delays the company attributed to outside contractors and won’t be delivered to customers until late 2009.

“We are methodically working through our challenges, including the startup of the 787,” McNerney said. “... With many of the early challenges on the 787 behind us, we can see our way to getting electrical power on the airplane by the end of June, then flying later this year, and beginning deliveries of this game-changing new airplane next year.”

Boeing’s bigger rival in commercial aircraft is Europe’s Airbus, which announced this week that it was raising prices because of the devalued U.S. dollar and high cost of metals.

Boeing executives said the company was well-positioned to weather the souring economy, thanks to its diverse portfolio of customers, especially in the Middle East and Asia. And executives predicted domestic airlines would invest in new, fuel-efficient planes to help them cope with rising fuel costs, rather than delay purchases.

“I think the new oil reality is a tough one for them to deal with,” McNerney said.

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