Boeing Co. said pension charges pushed down net profit in the
first quarter, but improvements in its core operations beat
analysts' expectations as output for jetliners continued to
rise.
The aerospace giant's first-quarter earnings fell 13% to $965
million, or $1.28 a share, from $1.11 billion, or $1.44 a share, a
year earlier.
However, the Chicago-based company's core earnings, which
exclude pension and other retirement benefits, rose 12% during the
quarter to roughly $2.1 billion, or $1.76 per share, up from $1.87
billion and $1.73 during the same period a year prior.
Revenue increased 8.3% to $20.47 billion on higher output of its
787 Dreamliner and single-aisle 737. The company handed over 161
jets from January through March and Boeing anticipates beating its
2013 record of 648 jetliner deliveries with between 715 and 725
planned for 2014.
Analysts polled by Thomson Reuters expected core profit of $1.56
a share and $20.2 billion in revenue.
Boeing also raised its per-share earnings guidance to between
$7.15 and $7.35, from $7 to $7.20, to reflect a tax settlement.
Boeing has been aggressively driving down its internal and
supplier costs in a coordinated cost-cutting initiative that grew
its core operating margin to 10.2%, up from 9.9% a year
earlier.
In the latest quarter, revenue at its commercial division rose
19%, while operating earnings increased 23%.
In contrast to its commercial jetliner division, quarterly
revenue at its defense unit ticked down 5.9% to $7.6 billion from
$8.1 billion a year ago on fewer deliveries.
The latest period included previously disclosed charges of $334
million related to Boeing's plans to move most of its unionized and
nonunion workers to 401(k) retirement-savings plans from
traditional pension plans starting in 2016.
A growing number of U.S. companies have swapped traditional
pensions for 401(k) plans, effectively shifting the risk of market
volatility to workers and reducing long-term costs.
Write to Jon Ostrower at jon.ostrower@wsj.com
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