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Boeing’s quarterly profit more than doubles

Boeing Co. on Wednesday said its fourth-quarter earnings more than doubled as the huge aerospace company's resurgent commercial airplane division posted strong gains.
/ Source: The Associated Press

Boeing Co. said Wednesday its fourth-quarter earnings more than doubled as the huge aerospace company’s resurgent commercial airplane division posted strong gains.

The company also raised its profit outlook for 2006, citing better operating performance.

Boeing’s fourth-quarter net income rose to $460 million, or 58 cents per share, up from $186 million, or 23 cents per share a year earlier. Analysts were expecting 44 cents a share, based on the consensus estimate by Thomson Financial.

The year-ago profit was depressed by heavy charges for ending production of its 717 jet and writing off its loss of a controversial Pentagon contract.

Chicago-based Boeing said fourth-quarter revenue grew 7 percent to $14.2 billion, up from $13.3 billion a year earlier but below Wall Street estimates of $14.8 billion.

Boeing’s Seattle-based commercial airplane division had operating earnings of $330 million, up from a $149 million loss in fourth quarter 2004.

Boeing Chairman and CEO Jim McNerney said in a statement that Boeing will focus on several new growth and productivity initiatives to further boost performance.

“Our results and improved outlook reflect a strong commitment to growth, expanding margins and improving how we do business every day,” McNerney said.

For the full year, Boeing’s net profits grew 37 percent to $2.6 billion, capping a year in which it closed the gap on Airbus for the world’s top spot in commercial aviation despite a four-week strike at its production facilities. Boeing’s earnings amounted to $3.20 a share in 2005 versus $1.87 billion, or $2.30 a share, a year ago.

The strike shaved off $2.3 billion in annual revenue, which still grew 4.3 percent from a year earlier to $54.8 billion.

Boeing said the commercial airplane outlook is “very strong” and reiterated its expectation to deliver 395 planes in 2006.

“It was obviously an excellent quarter,” said analyst Mark Davis at FTN Midwest Research. “They’re starting to see real leverage in commercial airplanes, both in terms of orders and manufacturing initiatives that are helping margins.”

Toulouse, France-based Airbus SAS said earlier this month it unexpectedly beat Boeing’s tally for jet orders last year. But Boeing surpassed Airbus in value terms after winning 70 percent of global orders for larger, pricier planes like the 787.

Revenue from Boeing’s defense unit grew 7 percent to $8.1 billion. The company said its C-17 transport plane led an 18 percent increase in sales of aircraft and weapon systems, which totaled $3.1 billion.

Operating profits from defense rose 37 percent to $924 million.

Boeing increased its 2006 earnings per share forecast to between $3.25 and $3.45, up from $3.10 to $3.30, citing better operating performance and a lower-than-expected tax charge in the first quarter.

The company cut its 2006 revenue outlook from $62 billion to $60 billion because of an accounting change. It also issued a 2007 profit forecast of $4.10 to $4.30 per share, in line with analysts’ estimates of $4.15.