A push to improve productivity paid off for Boeing in the first quarter as operating profits rose 30% compared with the same period a year ago on only a 6% improvement in revenues.
As operating profits jumped to $2.88 billion in first quarter, Boeing’s net earnings showed even greater improvement, rising 57% to $2.48 billion.
The results helped Boeing inch closer to a targeted operating margin in the mid-teens by the end of next year. The critical ratio of operating sales to costs improved by 2.3 percentage points to 12.3% compared with the first quarter of last year.
As a result, Boeing provided more optimistic guidance for the full year. The company now predicts a full-year operating margin of about 11.5%, or half a percentage point higher than predicted at the end of January. The company’s guidance for operating cash flow also improved from $15 billion to a range up to $15.5 billion for the full year.
“Our team’s strong first-quarter performance, combined with the positive market outlook across our businesses and our confidence in executing on our production and development programmes, gives us a solid foundation to raise our guidance for the year,” says Boeing chief executive Dennis Muilenburg.
A year ago, Boeing Commercial Airplanes reported sluggish performance, as a backlog of undelivered 737s dipped ahead of the entry into service of the 737 Max 8. By contrast, the company’s performance in the first quarter of this year showed significant improvement. Commercial aircraft deliveries improved by 9% to 184, as operating earnings leaped by 73% to $1.59 billion on a 5% growth in revenues to $13.7 billion.
Source: Cirium Dashboard
