Boeing profit up despite downturn in aviation
Boeing Co. swung to a fourth-quarter profit compared with the previous year’s loss, when a machinists strike halted production lines.
The world’s second-largest commercial-plane manufacturer posted earnings of $1.27 billion, or $1.75 a share. In the fourth quarter of 2008 Boeing lost $86 million, or 12 cents a share.
Revenue rose to $17.9 billion from $12.7 billion a year earlier.
Profits came despite Boeing facing an economic downturn that shrank orders for airplanes for the full year. Amid the depressed economic environment, airlines were stung by a slump in air travel and cut orders for new planes. Boeing’s defense unit also felt the crunch as the Pentagon pulled back on spending.
“Air traffic was horrible last year and aircraft orders were anemic. Still, Boeing beat expectations," said Alex P. Hamilton, an analyst at Jesup & Lamont in New York. “Overall, it was a solid report.”
Boeing shares jumped $4.22 to $61.93.
In the current fiscal year, the Chicago-based company is hoping for a boost from the 787 Dreamliner, which has been delayed more than two years, and the 747-8 jet, a larger variant of its popular 747 jumbo jet.
Both programs have incurred several developmental setbacks, which have cost Boeing billions of dollars. The planes are scheduled for delivery at the end of this year.
Jim McNerney, Boeing’s chairman and chief executive, said he anticipated “head count reductions” in the face of a tough business environment.
“The global recession has clearly affected our airline customers,” McNerney said. “It will take some time for economic indicators to rebound significantly.”
Boeing projected it would earn $3.70 to $4 a share in 2010. Analysts were expecting the company to earn $4.26 a share.
Boeing is one of the largest private employers in Southern California with a factory that produces the C-17 cargo plane in Long Beach and a satellite operation in El Segundo.
-- W.J. Hennigan
Photo: Boeing CEO Jim McNerney. Credit: Michael Reynolds / EPA