Boeing (BA) Misses Q1 EPS by 9c; Lowering Production Rates, Sees Ability to Accesses Liquidity to Fund Operations

Boeing (NYSE: BA) reported Q1 EPS of ($1.70), $0.09 worse than the analyst estimate of ($1.61). Revenue for the quarter came in at $16.91 billion versus the consensus estimate of $17.31 billion. Boeing is taking several actions that include reducing commercial airplane production rates. In addition, the company believes it will be able to obtain sufficient liquidity to fund its operations.

"The COVID-19 pandemic is affecting every aspect of our business, including airline customer demand, production continuity and supply chain stability," said Boeing President and CEO David Calhoun. "Our primary focus is the health and safety of our people and communities while we take tough but necessary action to navigate this unprecedented health crisis and adapt for a changed marketplace."

As the pandemic continues to reduce airline passenger traffic, Boeing sees significant impact on the demand for new commercial airplanes and services, with airlines delaying purchases for new jets, slowing delivery schedules and deferring elective maintenance. To align the business for the new market reality, Boeing is taking several actions that include reducing commercial airplane production rates. The company also announced a leadership and organizational restructuring to streamline roles and responsibilities, and plans to reduce overall staffing levels with a voluntary layoff program and additional workforce actions as necessary.

Boeing has also taken action to manage near-term liquidity, as it has drawn on a term loan facility; reduced operating costs and discretionary spending; extended the existing pause on share repurchases and suspended dividends until further notice; reduced or deferred research and development and capital expenditures; and eliminated CEO and Chairman pay for the year. Access to additional liquidity will be critical for Boeing and the aerospace manufacturing sector to bridge to recovery, and the company is actively exploring all of the available options. Boeing believes it will be able to obtain sufficient liquidity to fund its operations.

"While COVID-19 is adding unprecedented pressure to our business, we remain confident in our long term future," said Calhoun. "We continue to support our defense customers in their critical national security missions. We are progressing toward the safe return to service of the 737 MAX, and we are driving safety, quality and operational excellence into all that we do every day. Air travel has always been resilient, our portfolio of products and technology is well positioned, and we are confident we will emerge from the crisis and thrive again as a leader of our industry."

For earnings history and earnings-related data on Boeing (BA) click here.

You May Also Be Interested In

• Nanometrics (NANO) Issues Business Update, Reports FY23 Results
• Boeing (BA) Statement on U.S. Air Force Collaborative Combat Aircraft Announcement
• WM (WM) Tops Q1 EPS by 25c