THE COST of restructuring caught up with Boeing in the second quarter, sending the group to its first quarterly loss in decades. Merger costs have also left Lockheed Martin with a deficit for the quarter.
Boeing ended the three months to June with a net loss of $231 million, after putting aside $600 million to cover the group's early-retirement programme, which has been taken up by 9,500 staff.
Without the charge, the group would have shown a 14% increase in profits, to $254 million. The improvement largely stems from a $141 million cut in the research and development expenditure, although, much of this benefit was offset by sluggish markets.
Boeing believes that the market is beginning to pick up, however, and a slight increase in revenues over the quarter was a welcome reverse to recent downward trends.
Lockheed Martin showed a loss of $53 million for its second quarter after taking a $326 million charge to pay for its merger. The underlying results, showed a 19% profits improvement, however.
Chairman Dan Tellep points out that the benefits from the merger, and the consolidation plan announced in June, would yield annual savings of $1.8 billion.
Source: Flight International
