10-QPeriod: Q1 FY2012

BOEING CO Quarterly Report for Q1 Ended Mar 31, 2012

Filed April 25, 2012For Securities:BABA-PA

Summary

Boeing Co. reported a significant increase in revenues and net earnings for the first quarter of 2012 compared to the prior year. Total revenues surged by 30% to $19.38 billion, primarily driven by a strong performance in the Commercial Airplanes segment, which saw a 54% revenue increase. This growth in commercial sales, coupled with a reduction in research and development expenses for key programs like the 747-8 and 787, significantly boosted operating earnings, leading to a 57% rise in net earnings to $923 million. The company's financial position remains robust, though cash and cash equivalents saw a decrease due to significant investment activities. Backlog also increased, indicating strong future demand for Boeing's products and services. Despite ongoing legal proceedings and market risks, including potential impacts from the U.S. Export-Import Bank's charter expiration, Boeing appears to be navigating a positive operational period with substantial revenue growth and improved profitability.

Financial Highlights

51 data points
Beta

Revenue

$19.38B

17.1% Gross Margin

Net Income

$923.00M

4.8% Net Margin

EPS (Diluted)

$1.22

Total Assets

$80.20B

Cash & Equivalents

$6.72B

Free Cash Flow

$413.00M

Financial Statements
Beta
Revenue$19.38B
Cost of Revenue$16.07B
Gross Profit$3.31B
R&D Expenses$835.00M
Operating Income$1.56B
Net Income$923.00M
EPS (Basic)$1.23
EPS (Diluted)$1.22
Shares Outstanding (Basic)752.50M
Shares Outstanding (Diluted)757.30M

Key Highlights

  • 1Total revenues increased by 30% year-over-year to $19.38 billion, driven by strong performance in Commercial Airplanes.
  • 2Net earnings from continuing operations more than doubled to $924 million, resulting in diluted EPS of $1.22, up from $0.78 in the prior year.
  • 3The Commercial Airplanes segment revenue grew by 54% to $10.94 billion, reflecting higher new airplane deliveries and a favorable mix.
  • 4Defense, Space & Security (BDS) revenues increased by 8% to $8.23 billion, supported by growth in Boeing Military Aircraft and Global Services & Support.
  • 5Operating earnings increased by 57% to $1.57 billion, with improved operating margins to 8.1% from 6.7%.
  • 6Contractual backlog grew to $358.6 billion, indicating strong future demand for Boeing's products.
  • 7Cash and cash equivalents decreased by $3.33 billion to $6.72 billion, primarily due to substantial investments.

Frequently Asked Questions

The primary driver of Boeing's revenue growth was a significant increase in its Commercial Airplanes segment, which saw revenues rise by 54% due to higher new airplane deliveries and a favorable product mix. This segment's strong performance, coupled with growth in Defense, Space & Security, led to an overall 30% increase in total revenues.

Boeing's profitability improved significantly. Net earnings from continuing operations more than doubled to $924 million, and diluted earnings per share increased to $1.22 from $0.78 in the same period last year. This improvement was mainly due to higher revenues and reduced research and development expenses on key programs.

Boeing's contractual backlog increased to $358.6 billion. This substantial backlog indicates strong future demand for its aircraft and services, providing a degree of revenue visibility for the company.

Yes, the filing highlights several risks. These include potential impacts from the expiration or funding limitations of the U.S. Export-Import Bank's charter, which affects financing for international customers. Additionally, Boeing faces ongoing legal proceedings, including the complex A-12 litigation, and risks associated with new development programs like the 787 and 747-8, which could lead to cost overruns or production challenges. Market risks related to customer financing and economic conditions are also present.