Boeing has lowered its revenue forecast for 2003, but expects growth to return in 2004 as its defence business moves into high gear. The company is projecting revenues of $49 billion this year, down from $54 billion last year and $1 billion below previous estimates, growing to $52-54 billion in 2004.
The aerospace giant now expects to deliver 280 commercial aircraft this year, down from 381 in 2002 and at the low end of estimates a year ago, and forecasts between 275 and 300 deliveries in 2004. Chairman Phil Condit says 2003 deliveries "are virtually sold", while 2004 deliveries "are 80% sold at the lower end" of the forecast.
Condit expects the commercial aircraft order intake this year to be similar to 2002's gross total of 251, with a pick-up in orders expected for 2004, leading to a recovery in deliveries beginning in 2005.
Operating earnings at Boeing Commercial Airplanes were higher last year than in 2001, despite revenues falling 19% to $28.4 billion. Revenues are expected to drop again this year, to $22 billion, and stay there for 2004.
Revenues at the company's Integrated Defense Systems sector, up over 9% to $25 billion last year, will overtake commercial aircraft sales for the first time this year. Sales are forecast to reach $26-27 billion in 2003, with a further 10% growth expected in 2004, mainly on integrated battlespace, missile defence and aerospace support contracts.
Condit says Boeing showed "good overall operating performance" last year. Net earnings were down 18% at just over $2.3 billion, but free cashflow was up 25% at almost $3.4 billion. Cashflow is forecast at $2-2.5 billion this year and over $2.5 billion in 2004.
Source: Flight International