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News Releases/Statements
Boeing Reports Second-Quarter Results and Raises 2014 EPS Guidance
Revenue of $22 billion reflects higher commercial deliveries
Core EPS (non-GAAP)* increased 45 percent to $2.42; GAAP EPS of $2.24
Solid operating cash flow of $1.8 billion; strong liquidity of $11.3 billion in cash & marketable securities
Backlog remains strong at $440 billion with over 5,200 commercial airplane orders
Repurchased 11.4 million shares for $1.5 billion
2014 core EPS guidance increased $0.75 to between $7.90 and $8.10

CHICAGO, July 23, 2014 /PRNewswire/ -- 

Table 1. Summary Financial Results

Second Quarter



First Half



(Dollars in Millions, except per share data)


2014

2013


Change


2014

2013


Change












Revenues


$22,045


$21,815


1%


$42,510


$40,708


4%














Non-GAAP*













Core Operating Earnings


$1,991


$2,028


(2)%


$4,086


$3,895


5%

Core Operating Margin


9.0%


9.3%


(0.3) Pts


9.6%


9.6%


0.0 Pts

Core Earnings Per Share


$2.42


$1.67


45%


$4.16


$3.40


22%

Operating Cash Flow Before Pension Contributions


$1,809


$3,480


(48)%


$2,921


$4,004


(27)%

GAAP













Earnings From Operations


$1,787


$1,716


4%


$3,329


$3,244


3%

Operating Margin


8.1%


7.9%


0.2 Pts


7.8%


8.0%


(0.2) Pts

Net Earnings


$1,653


$1,088


52%


$2,618


$2,194


19%

Earnings Per Share


$2.24


$1.41


59%


$3.50


$2.85


23%

Operating Cash Flow


$1,809


$3,467


(48)%


$2,921


$3,991


(27)%

* Non-GAAP measures (core operating earnings, core operating margin and core earnings per share) exclude certain components of pension and post retirement benefit expense that management believes are not reflective of underlying business performance. Complete definitions of Boeing's non-GAAP measures are on page 7, "Non-GAAP Measures Disclosures."

The Boeing Company [NYSE: BA] reported second-quarter core earnings per share (non-GAAP) of $2.42, reflecting strong performance and favorable tax items (Table 1). Second-quarter 2014 results included a $272 million after-tax charge ($0.37 per share) on the KC-46A Tanker program reflecting the cost of additional engineering and systems installation work required to complete the Engineering and Manufacturing Development contract. Favorable tax items include the previously announced tax benefit of $116 million for the 2007-2008 tax settlement, as well as an additional tax benefit of $408 million in the second quarter.

Core earnings per share guidance for 2014 increased to between $7.90 and $8.10, from $7.15 to $7.35, reflecting the $408 million tax benefits, strong operating performance and the KC-46A Tanker charge. GAAP earnings per share guidance for 2014 increased to between $6.85 and $7.05.

"Strong operating performance across our production programs and services businesses drove revenue and earnings-per-share growth and healthy operating cash flow, which supported $1.5 billion in additional share repurchases in the quarter," said Boeing Chairman and Chief Executive Officer Jim McNerney. "We delivered our first 787-9 and our 8,000th 737, successfully completed a key missile defense intercept test, and delivered our 100th EA-18G Growler to the U.S. Navy."

"While challenges resolving engineering and systems installation issues on our tanker test aircraft are resulting in higher spending to maintain schedule, the issues are well understood and we remain on path to begin flight testing fully provisioned tankers the first part of next year," McNerney said.

"With 783 new commercial airplane orders to date this year and significant contracts in the quarter for military aircraft and satellites, our backlog remains large and diverse. Overall, our strong first-half financial performance, sustained focus on growth and productivity, and positive market outlook support our increased earnings guidance for the year," he said.

Table 2. Cash Flow


Second Quarter


First Half

(Millions)


2014


2013


2014


2013

Operating Cash Flow Before Pension Contributions*


$1,809


$3,480


$2,921


$4,004

Pension Contributions




($13)




($13)

Operating Cash Flow


$1,809


$3,467


$2,921


$3,991

Less Additions to Property, Plant & Equipment


($449)


($455)


($946)


($976)

Free Cash Flow*


$1,360


$3,012


$1,975


$3,015

Operating cash flow in the quarter was $1.8 billion, reflecting commercial airplane production rates, strong operating performance and timing of receipts and expenditures (Table 2). During the quarter, the company repurchased 11.4 million shares for $1.5 billion, leaving $6.8 billion remaining under the current repurchase authorization expected to be completed over approximately the next two years. The company also paid $0.5 billion in dividends in the quarter, reflecting an approximately 50 percent increase in dividends per share compared to the same period of the prior year.

Table 3. Cash, Marketable Securities and Debt Balances


Quarter-End

(Billions)


Q2 14


Q1 14

Cash


$7.5


$6.9

Marketable Securities1


$3.8


$5.3

Total


$11.3


$12.2

Debt Balances:





The Boeing Company, net of intercompany loans to BCC


$6.4


$6.3

Boeing Capital, including intercompany loans


$2.5


$2.6

Total Consolidated Debt


$8.9


$8.9

1 Marketable securities consists primarily of time deposits due within one year classified as "short-term investments."

 

Cash and investments in marketable securities totaled $11.3 billion at quarter-end (Table 3), down from $12.2 billion at the beginning of the quarter, primarily due to the share repurchases. Debt was $8.9 billion, unchanged from the beginning of the quarter.

Total company backlog of $440 billion was unchanged from the beginning of the quarter, and included net orders for the quarter of $23 billion.

Segment Results
Commercial Airplanes

Table 4. Commercial Airplanes


 

Second Quarter




 

First Half



(Dollars in Millions)


2014


2013


Change


2014


2013


Change














Commercial Airplanes Deliveries


181


169


7%


342


306


12%














Revenues


$14,304


$13,624


5%


$27,041


$24,314


11%

Earnings from Operations


$1,550


$1,453


7%


$3,052


$2,672


14 %

Operating Margin


10.8%


10.7%


0.1 Pts


11.3%


11.0%


0.3Pts

 

Commercial Airplanes second-quarter revenue increased 5 percent to $14.3 billion on higher deliveries. Second-quarter operating margin was 10.8 percent, reflecting the delivery volume and strong performance offset by the $238 million pre-tax charge on the KC-46A Tanker program (Table 4). During the quarter, Commercial Airplanes delivered the first 787-9 Dreamliner and the 787 program received 330-minute ETOPS certification. In July, Emirates Airline and Qatar Airways finalized orders totaling 200 777X airplanes and Monarch Airlines announced a commitment to purchase 30 737 MAX airplanes.

Commercial Airplanes booked 264 net orders during the quarter. Backlog remains strong with over 5,200 airplanes valued at a record $377 billion.

Defense, Space & Security



























Table 5. Defense, Space & Security


Second Quarter




First Half



(Dollars in Millions)


2014


2013


Change


2014


2013


Change

Revenues1













Boeing Military Aircraft


$3,523


$3,641


(3)%


$6,981


$7,621


(8)%

Network & Space Systems


$1,920


$2,049


(6)%


$3,796


$4,009


(5)%

Global Services & Support


$2,304


$2,496


(8)%


$4,603


$4,666


(1)%

Total BDS Revenues


$7,747


$8,186


(5)%


$15,380


$16,296


(6)%

Earnings from Operations1













Boeing Military Aircraft


$165


$386


(57)%


$497


$813


(39)%

Network & Space Systems


$150


$137


9%


$318


$293


9%

Global Services & Support


$267


$253


6%


$545


$502


9%

Total BDS Earnings from Operations


$582


$776


(25)%


$1,360


$1,608


(15)%

Operating Margin


7.5%


9.5%


(2.0)Pts


8.8%


9.9%


(1.1)Pts

1 During the first quarter of 2014, certain programs were realigned between Boeing Military Aircraft and Global Services & Support.

Defense, Space & Security's second-quarter revenue was $7.7 billion. Operating margin was 7.5 percent, reflecting the $187 million pre-tax charge recorded at BMA on the KC-46A Tanker program partially offset by strong operating performance (Table 5).

Boeing Military Aircraft (BMA) second-quarter revenue was $3.5 billion, reflecting fewer C-17 and P-8 deliveries partially offset by higher F-15 deliveries. Operating margin of 4.7 percent was impacted by the charge on the KC-46A Tanker program. During the quarter, BMA was awarded a contract for 44 E/A-18 and F/A-18 aircraft from the U.S. Navy.

Network & Space Systems (N&SS) second-quarter revenue was $1.9 billion, reflecting lower commercial satellites volume, and operating margin increased to 7.8 percent. During the quarter, N&SS completed a successful Missile Defense System intercept in flight test.

Global Services & Support (GS&S) second-quarter revenue was $2.3 billion, reflecting lower volume in maintenance, modifications and upgrades. Operating margin increased to 11.6 percent reflecting strong performance. During the quarter, GS&S was awarded a 5 year contract to provide support for Australia's Airborne Early Warning & Control (AEW&C) aircraft.

Backlog at Defense, Space & Security was $63 billion, of which 36 percent represents orders with international customers.

Additional Financial Information



















Table 6. Additional Financial Information


 

Second Quarter


 

First Half

(Dollars in Millions)


2014


2013


2014


2013

Revenues









Boeing Capital


$90


$104


$172


$209

Other segment


$22


$27


$42


$54

Unallocated items and eliminations


($118)


($126)


($125)


($165)

Earnings from Operations









Boeing Capital


$33


$19


$77


$63

Other segment income/(expense)


($48)


($43)


($110)


($101)

Unallocated items and eliminations excluding unallocated pension/postretirement expense


($126)


($177)


($293)


($347)

Unallocated pension/postretirement expense


($204)


($312)


($757)


($651)

Other income, net


$11


$13


$20


$22

Interest and debt expense


($81)


($96)


($173)


($195)

Effective tax rate


3.7%


33.4%


17.6%


28.6%

At quarter-end, Boeing Capital's net portfolio balance was $3.4 billion down from $3.5 billion at the beginning of the quarter.

Unallocated items and eliminations totaled $126 million at quarter end, down from $177 million in the same period of the prior year, primarily due to lower deferred compensation expense. Total pension expense for the second quarter was $693 million, down from $753 million in the same period of the prior year. The company's effective income tax rate was 3.7 percent at quarter end, down from 33.4 percent in the same period of the prior year. The second quarter 2014 effective income tax rate included a $265 million benefit for a tax basis adjustment, $143 million benefit for a 2009-2010 tax settlement and the previously announced benefit of $116 million for the 2007-2008 tax settlement.

Outlook

The company's 2014 financial guidance (Table 7) reflects continued strong performance in both businesses.




Table 7. Financial Outlook


(Dollars in Billions, except per share data)

2014



The Boeing Company


Revenue

$87.5 - 90.5

Core Earnings Per Share*

$7.90 - 8.10

GAAP Earnings Per Share

$6.85 - 7.05

Operating Cash Flow Before Pension Contributions*

~ $7

Operating Cash Flow 1

~ $6.25



Commercial Airplanes


Deliveries 2

715 - 725

Revenue

$57.5 - 59.5

Operating Margin

> 10%



Defense, Space & Security (revised for business realignment)


Revenue


Boeing Military Aircraft

~ $14.2

Network & Space Systems

~ $7.7

Global Services & Support

~ $8.6



Total BDS Revenue

$30 - 31



Operating Margin


Boeing Military Aircraft

~ 9.0%

Network & Space Systems

~ 8.5%

Global Services & Support

~ 11.0%



Total BDS Operating Margin

~ 9.5%



Boeing Capital


Portfolio Size

Lower

Revenue

~ $0.3

Pre-Tax Earnings

~ $0.05



Research & Development

~ $3.2

Capital Expenditures

~ $2.5

Pension Expense 3

~ $3.2

Effective Tax Rate 4

~ 23%

1 After discretionary cash pension contributions of $0.75 billion and assuming new aircraft financings under $0.5 billion

2 Assumes approximately 110 787 deliveries

3 Approximately $1.3 billion is expected to be recorded in unallocated items and eliminations

4 Assumes the extension of the research and development tax credit

* Non-GAAP measures. Complete definitions of Boeing's non-GAAP measures are on page 7, "Non-GAAP Measures Disclosures."

Boeing's core earnings per share guidance for 2014 increased to between $7.90 and $8.10, from $7.15 to $7.35, reflecting the $408 million tax benefits, strong operating performance and the KC-46A Tanker charge. GAAP earnings per share guidance for 2014 increased to between $6.85 and $7.05.

Commercial Airplanes operating margin guidance increased to greater than 10 percent on strong operating performance.

Defense, Space & Security operating margin guidance is unchanged at approximately 9.5 percent. Boeing Military Aircraft operating margin guidance is lowered to approximately 9 percent. Global Services & Support operating margin guidance increased to approximately 11 percent reflecting strong performance.

Boeing's effective tax rate is now expected to be approximately 23 percent in 2014, down from approximately 29 percent, to reflect the additional tax benefits recorded in the second quarter and continues to assume the extension of the research and development tax credit.

Non-GAAP Measures Disclosures
We supplement the reporting of our financial information determined under U.S. generally accepted accounting principles (GAAP) with certain non-GAAP financial information. The non-GAAP financial information presented excludes certain significant items that may not be indicative of, or are unrelated to, results from our ongoing business operations. We believe that these non-GAAP measures provide investors with additional insight into the company's ongoing business performance. These non-GAAP measures should not be considered in isolation or as a substitute for the related GAAP measures, and other companies may define such measures differently. We encourage investors to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. The following definitions are provided:


Core Operating Earnings, Core Operating Margin and Core Earnings Per Share
Core operating earnings is defined as GAAP earnings from operations excluding unallocated pension and post-retirement expense. Core operating margin is defined as core operating earnings expressed as a percentage of revenue. Core earnings per share is defined as GAAP diluted earnings per share excluding the net earnings per share impact of unallocated pension and post-retirement expense. Unallocated pension and post-retirement expense represents the portion of pension and other post-retirement costs that are not recognized by business segments for segment reporting purposes. Management uses core operating earnings, core operating margin and core earnings per share for purposes of evaluating and forecasting underlying business performance. Management believes these core earnings measures provide investors additional insights into operational performance as they exclude unallocated pension and post-retirement costs, which primarily represent costs driven by market factors and costs not allocable to government contracts. A reconciliation between the GAAP and non-GAAP measures is provided on page 14.

Operating Cash Flow Before Pension Contributions
Operating cash flow before pension contributions is defined as GAAP operating cash flow less pension contributions. Management believes operating cash flow before pension contributions provides additional insights into underlying business performance. Management uses operating cash flow before pension contributions as a measure to assess both business performance and overall liquidity. Table 2 provides a reconciliation between GAAP operating cash flow and operating cash flow before pension contributions.

Free Cash Flow
Free cash flow is defined as GAAP operating cash flow less capital expenditures for property, plant and equipment additions. Management believes free cash flow provides investors with an important perspective on the cash available for shareholders, debt repayment, and acquisitions after making the capital investments required to support ongoing business operations and long term value creation. Free cash flow does not represent the residual cash flow available for discretionary expenditures as it excludes certain mandatory expenditures such as repayment of maturing debt. Management uses free cash flow as a measure to assess both business performance and overall liquidity. Table 2 provides a reconciliation between GAAP operating cash flow and free cash flow.

Caution Concerning Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "may," "should," "expects," "intends," "projects," "plans," "believes," "estimates," "targets," "anticipates," and similar expressions are used to identify these forward-looking statements. Examples of forward-looking statements include statements relating to our future financial condition and operating results, as well as any other statement that does not directly relate to any historical or current fact. Forward-looking statements are based on our current expectations and assumptions, which may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties, and changes in circumstances that are difficult to predict. Many factors could cause actual results to differ materially and adversely from these forward-looking statements. Among these factors are risks related to: (1) general conditions in the economy and our industry, including those due to regulatory changes; (2) our reliance on our commercial airline customers; (3) the overall health of our aircraft production system, planned production rate increases across multiple commercial airline programs, our commercial development and derivative aircraft programs, and our aircraft being subject to stringent performance and reliability standards; (4) changing budget and appropriation levels and acquisition priorities of the U.S. government; (5) our dependence on U.S. government contracts; (6) our reliance on fixed-price contracts; (7) our reliance on cost-type contracts; (8) uncertainties concerning contracts that include in-orbit incentive payments; (9) our dependence on our subcontractors and suppliers, as well as the availability of raw materials, (10) changes in accounting estimates; (11) changes in the competitive landscape in our markets; (12) our non-U.S. operations, including sales to non-U.S. customers; (13) potential adverse developments in new or pending litigation and/or government investigations; (14) customer and aircraft concentration in Boeing Capital's customer financing portfolio; (15) changes in our ability to obtain debt on commercially reasonable terms and at competitive rates in order to fund our operations and contractual commitments; (16) realizing the anticipated benefits of mergers, acquisitions, joint ventures/strategic alliances or divestitures; (17) the adequacy of our insurance coverage to cover significant risk exposures; (18) potential business disruptions, including those related to physical security threats, information technology or cyber-attacks or natural disasters; (19) work stoppages or other labor disruptions; (20) significant changes in discount rates and actual investment return on pension assets; (21) potential environmental liabilities; and (22) threats to the security of our or our customers' information.

Additional information concerning these and other factors can be found in our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Any forward-looking statement speaks only as of the date on which it is made, and we assume no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.

 

Contact:




Investor Relations:


Troy Lahr or Matt Welch (312) 544-2140

Communications:


Chaz Bickers (312) 544-2002

 

 

The Boeing Company and Subsidiaries
Consolidated Statements of Operations
(Unaudited)











 

Six months ended
June 30


 

Three months ended
June 30

(Dollars in millions, except per share data)

2014


2013


2014


2013

Sales of products

$37,542


$35,556


$19,527


$19,238

Sales of services

4,968


5,152


2,518


2,577

Total revenues

42,510


40,708


22,045


21,815









Cost of products

(31,932)


(30,165)


(16,674)


(16,437)

Cost of services

(3,999)


(4,004)


(1,979)


(1,995)

Boeing Capital interest expense

(35)


(37)


(17)


(18)

Total costs and expenses

(35,966)


(34,206)


(18,670)


(18,450)


6,544


6,502


3,375


3,365

Income from operating investments, net

120


88


61


43

General and administrative expense

(1,795)


(1,900)


(918)


(929)

Research and development expense, net

(1,542)


(1,468)


(733)


(763)

Gain on dispositions, net

2


22


2



Earnings from operations

3,329


3,244


1,787


1,716

Other income, net

20


22


11


13

Interest and debt expense

(173)


(195)


(81)


(96)

Earnings before income taxes

3,176


3,071


1,717


1,633

Income tax expense

(558)


(878)


(64)


(546)

Net earnings from continuing operations

2,618


2,193


1,653


1,087

Net gain on disposal of discontinued operations, net of taxes of $0, $0, $0 and $0



1




1

Net earnings

$2,618


$2,194


$1,653


$1,088

Basic earnings per share from continuing operations

$3.55


$2.88


$2.26


$1.43

Net gain on disposal of discontinued operations, net of taxes








Basic earnings per share

$3.55


$2.88


$2.26


$1.43

Diluted earnings per share from continuing operations

$3.50


$2.85


$2.24


$1.41

Net gain on disposal of discontinued operations, net of taxes








Diluted earnings per share

$3.50


$2.85


$2.24


$1.41

Cash dividends paid per share

$1.46


$0.97


$0.73


$0.485

Weighted average diluted shares (millions)

747.4


770.1


740.1


771.8

 

 

 

The Boeing Company and Subsidiaries
Consolidated Statements of Financial Position
(Unaudited)








(Dollars in millions, except per share data)


June 30
2014


December 31
2013

Assets





Cash and cash equivalents


$7,533


$9,088

Short-term and other investments


3,797


6,170

Accounts receivable, net


7,694


6,546

Current portion of customer financing, net


237


344

Deferred income taxes


15


14

Inventories, net of advances and progress billings


46,251


42,912

Total current assets


65,527


65,074

Customer financing, net


3,180


3,627

Property, plant and equipment, net of accumulated depreciation of $15,424 and $15,070


10,449


10,224

Goodwill


5,139


5,043

Acquired intangible assets, net


3,004


3,052

Deferred income taxes


2,664


2,939

Investments


1,196


1,204

Other assets, net of accumulated amortization of $420 and $448


1,578


1,500

Total assets


$92,737


$92,663

Liabilities and equity





Accounts payable


$11,060


$9,498

Accrued liabilities


13,222


14,131

Advances and billings in excess of related costs


21,244


20,027

Deferred income taxes and income taxes payable


6,222


6,267

Short-term debt and current portion of long-term debt


1,591


1,563

Total current liabilities


53,339


51,486

Accrued retiree health care


6,506


6,528

Accrued pension plan liability, net


9,812


10,474

Non-current income taxes payable


740


156

Other long-term liabilities


864


950

Long-term debt


7,292


8,072

Shareholders' equity:





Common stock, par value $5.00 – 1,200,000,000 shares authorized; 1,012,261,159 shares issued


5,061


5,061

Additional paid-in capital


4,524


4,415

Treasury stock, at cost – 290,904,517 and 264,882,461 shares


(21,381)


(17,671)

Retained earnings


34,516


32,964

Accumulated other comprehensive loss


(8,659)


(9,894)

Total shareholders' equity


14,061


14,875

Noncontrolling interests


123


122

Total equity


14,184


14,997

Total liabilities and equity


$92,737


$92,663

 

 

 





The Boeing Company and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)


Six months ended
June 30





(Dollars in millions)

2014


2013

Cash flows – operating activities:




Net earnings

$2,618


$2,194

Adjustments to reconcile net earnings to net cash provided by operating activities:




Non-cash items –




Share-based plans expense

101


107

Depreciation and amortization

900


865

Investment/asset impairment charges, net

36


26

Customer financing valuation benefit

(26)


(5)

Gain on disposal of discontinued operations



(1)

Gain on dispositions, net

(2)


(22)

Other charges and credits, net

87


31

Excess tax benefits from share-based payment arrangements

(97)


(47)

Changes in assets and liabilities –




Accounts receivable

(1,286)


(550)

Inventories, net of advances and progress billings

(3,402)


(2,614)

Accounts payable

1,783


848

Accrued liabilities

(913)


(682)

Advances and billings in excess of related costs

1,217


1,472

Income taxes receivable, payable and deferred

394


608

Other long-term liabilities

(88)


(60)

Pension and other postretirement plans

1,118


1,638

Customer financing, net

466


188

Other

15


(5)

Net cash provided by operating activities

2,921


3,991

Cash flows – investing activities:




Property, plant and equipment additions

(946)


(976)

Property, plant and equipment reductions

17


44

Acquisitions, net of cash acquired

(163)


(26)

Contributions to investments

(5,657)


(7,045)

Proceeds from investments

8,030


4,632

Net cash provided/(used) by investing activities

1,281


(3,371)

Cash flows – financing activities:




New borrowings

85


531

Debt repayments

(854)


(1,361)

Payments to noncontrolling interests

(12)



Repayments of distribution rights and other asset financing

(184)


(139)

Stock options exercised, other

261


484

Excess tax benefits from share-based payment arrangements

97


47

Employee taxes on certain share-based payment arrangements

(88)


(57)

Common shares repurchased

(3,998)


(1,000)

Dividends paid

(1,071)


(735)

Net cash used by financing activities

(5,764)


(2,230)

Effect of exchange rate changes on cash and cash equivalents

7


(37)

Net decrease in cash and cash equivalents

(1,555)


(1,647)

Cash and cash equivalents at beginning of year

9,088


10,341

Cash and cash equivalents at end of period

$7,533


$8,694

 

 

 





The Boeing Company and Subsidiaries
Summary of Business Segment Data
(Unaudited)

















Six months ended June 30


Three months ended June 30

(Dollars in millions)

2014


2013


2014


2013

Revenues:







Commercial Airplanes

$27,041


$24,314


$14,304


$13,624

Defense, Space & Security:







Boeing Military Aircraft

6,981


7,621


3,523


3,641

Network & Space Systems

3,796


4,009


1,920


2,049

Global Services & Support

4,603


4,666


2,304


2,496

Total Defense, Space & Security

15,380


16,296


7,747


8,186

Boeing Capital

172


209


90


104

Other segment

42


54


22


27

Unallocated items and eliminations

(125)


(165)


(118)


(126)

Total revenues

$42,510


$40,708


$22,045


$21,815

Earnings from operations:







Commercial Airplanes

$3,052


$2,672


$1,550


$1,453

Defense, Space & Security:







Boeing Military Aircraft

497


813


165


386

Network & Space Systems

318


293


150


137

Global Services & Support

545


502


267


253

Total Defense, Space & Security

1,360


1,608


582


776

Boeing Capital

77


63


33


19

Other segment

(110)


(101)


(48)


(43)

Unallocated items and eliminations

(1,050)


(998)


(330)


(489)

Earnings from operations

3,329


3,244


1,787


1,716

Other income, net

20


22


11


13

Interest and debt expense

(173)


(195)


(81)


(96)

Earnings before income taxes

3,176


3,071


1,717


1,633

Income tax expense

(558)


(878)


(64)


(546)

Net earnings from continuing operations

2,618


2,193


1,653


1,087

Net gain on disposal of discontinued operations, net of taxes of $0, $0, $0 and $0


1




1

Net earnings

$2,618


$2,194


$1,653


$1,088








Research and development expense, net:







Commercial Airplanes

$970


$865


$441


$446

Defense, Space & Security

577


579


297


307

Other

(5)


24


(5)


10

Total research and development expense, net

$1,542


$1,468


$733


$763








Unallocated items and eliminations:







Share-based plans

($44)


($53)


($20)


($22)

Deferred compensation

(19)


(102)


(26)


(46)

Amortization of previously capitalized interest

(36)


(34)


(18)


(17)

Eliminations and other

(194)


(158)


(62)


(92)

Sub-total (included in core operating earnings)

(293)


(347)


(126)


(177)

Pension

(804)


(689)


(228)


(331)

Postretirement

47


38


24


19

Total unallocated items and eliminations

($1,050)


($998)


($330)


($489)

 

 


The Boeing Company and Subsidiaries
Operating and Financial Data
(Unaudited)
















Deliveries


Six months ended June 30


Three months ended June 30

Commercial Airplanes


2014


2013


2014


2013


737


239


218


124


116


747


6


12


2


6


767


1


12


1


8


777


48


47


24


23


787


48


17

(1)

30


16

(1)

Total


342


306


181


169


Note: Deliveries under operating lease are identified by parentheses.















Defense, Space & Security










Boeing Military Aircraft










F/A-18 Models


23


24


12


12


F-15E Eagle


8


3


4




C-17 Globemaster III


5


6


2


3


CH-47 Chinook


32


17


15


8


AH-64 Apache


19


20


9


5


P-8 Models


2


5


2


3












Global Services & Support










AEW&C


2





1














Network & Space Systems










Commercial and Civil Satellites


2


1


2


























Contractual backlog (Dollars in billions)


June 30
2014


March 31
2014


December 31
2013


Commercial Airplanes



$376.3



$374.0



$373.0


Defense, Space & Security:





Boeing Military Aircraft


23.8


23.2


23.6


Network & Space Systems


9.6


9.4


9.8


Global Services & Support


16.3


16.1


16.2


Total Defense, Space & Security


49.7


48.7


49.6


Total contractual backlog



$426.0



$422.7



$422.6


Unobligated backlog



$14.3



$17.1



$18.3


Total backlog



$440.3



$439.8



$440.9


Workforce


169,300


169,000


168,400






















 

 

The Boeing Company and Subsidiaries

Reconciliation of Non-GAAP Measures

Core Operating Earnings, Core Operating Margin and Core Earnings Per Share

(Unaudited)

The tables provided below reconcile the non-GAAP financial measures core operating earnings, core operating margin and core earnings per share with the most directly comparable GAAP financial measures, earnings from operations, operating margin and diluted earnings per share. See page 7 of this release for additional information on the use of these non-GAAP financial measures.

 























Second Quarter


First Half


Guidance


2014


2013


2014


2013


2014

Revenues

$22,045


$21,815


$42,510


$40,708













GAAP Earnings From Operations

$1,787


$1,716


$3,329


$3,244



GAAP Operating Margin

8.1%


7.9%


7.8%


8.0%













Unallocated Pension/Postretirement Expense

$204


$312


$757


$651


~ $1,200

Core Operating Earnings (non-GAAP)

$1,991


$2,028


$4,086


$3,895



Core Operating Margin (non-GAAP)

9.0%


9.3%


9.6%


9.6%













Increase/(Decrease) in GAAP Earnings From Operations

4%




3%















GAAP Diluted Earnings Per Share

$2.24


$1.41


$3.50


$2.85


$6.85 - $7.05

Unallocated Pension/Postretirement Expense1

$0.18


$0.26


$0.66


$0.55


$1.05

Core Earnings Per Share (non-GAAP)

$2.42


$1.67


$4.16


$3.40


$7.90 - $8.10











Weighted Average Diluted Shares (millions)

740.1


771.8


747.4


770.1


~ 740

Increase in GAAP Earnings Per Share

59%




23%





Increase in Core Earnings Per Share

45%




22%





 

1 Earnings per share impact is presented net of the federal statutory tax rate of 35.0 percent.

 

SOURCE Boeing

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