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Boeing's (BA) FY12 Guidance Weighs as Q4 Results Beat

January 25, 2012 8:32 AM EST
Shares of The Boeing Company (NYSE: BA) are down more than a percent following the company's fourth-quarter earnings report.

Revenue rose 18 percent from $16.55 billion in the fourth quarter of 2010 to $19.55 billion. The Street’s consensus called for $19.37 billion in total revenue.

The cost of products for the company rose 10.5 percent to $46.64 billion, while the cost of service revenue fell 4 percent to $9.1 billion. The total cost of expenses rose 7.8 percent to $55.87 billion.

Operating margin rose from 6.7 percent in last year's fourth quarter to 8.2 percent.

Net income rose from $1.2 billion, or $1.56 per share, in the year-ago quarter to $1.4 billion, or $1.84 per share. The result topped the Street’s forecast of $1.01 per share.

Operating cash flow was $2.93 billion, an increase from 1.12 billion last year.

Total company backlog at year-end was a record $356 billion, up from $332 billion at the beginning of the quarter.

"Strong fourth-quarter operating performance, record revenue and backlog, and expanded earnings and cash flow capped a year of substantial progress for Boeing in 2011," said Jim McNerney, Boeing chairman, president, and chief executive officer. "Major accomplishments of our team during the year included certifying and delivering the first 787s and 747-8s, winning the U.S. Air Force Tanker program, launching the 737 MAX, and securing both an important U.S. missile defense contract and a key agreement for F-15s to Saudi Arabia."

"We enter 2012 with renewed momentum, and proven business and product strategies. With a record backlog and intense focus on productivity, we are well positioned to deliver growth and increased competitiveness, even as we face constrained U.S. defense spending and pension headwinds. Our priorities for the year are to continue with disciplined increases in production rates for our commercial airplane customers, and to build on our strong position in defense, space and security with aggressive pursuit of growth in core, adjacent and international markets," he said.

Earnings guidance for 2012 has been established at between $4.05 and $4.25 per share, below the Street’s consensus of $4.96 per share. Revenue guidance for 2012 is between $78 and $80 billion, inline with the Street’s forecast of $78.55 billion. Operating cash flow is expected to be greater than $5.0 billion in 2012, including $1.5 billion of discretionary pension contributions.

Commercial Airplanes' 2012 deliveries are expected to be between 585 and 600 airplanes. This includes an expected 70 to 85 787 and 747-8 deliveries, of which approximately half are 787 aircraft. Commercial Airplanes' 2012 revenue is expected to be between $47.5 and $49.5 billion with operating margins between 8.5 and 9 percent.


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