Connect with us

Hi, what are you looking for?


Boeing disappoints with loss

WASHINGTON, Oct 22 – Boeing announced a disappointing quarter Wednesday, posting a loss of 1.56 billion dollars on hefty charges to modify its 787 Dreamliner and the new version of its 747 jumbo jet.

Although the charges had been previously announced, the loss amounting to 2.23 dollars per share for the third quarter was steeper than anticipated by analysts.

Revenues in the third quarter, up 9.1 percent at 16.7 billion dollars, were also below market expectations.

"The 787 cost reclassification and the 747 charge for increased costs and difficult market conditions clearly overshadowed what continues to be otherwise solid performance across our commercial production programs and defense business," said Boeing chairman and chief executive Jim McNerney.

"We look forward to getting the 787 and 747-8 in the air soon and moving forward with flight test and certification for these two important programs."

Because of the problems on the two aircraft, Boeing sharply cut its profit outlook for 2009 to between 1.35 and 1.55 dollars per share, from a previous range of 4.70 to 5.00 dollars. But it maintained projections for revenues and aircraft deliveries.

The weaker-than-anticipated results drew sharp criticism from analyst Douglas McIntyre at 24/7 Wall Street.

"Financial results and news out of Boeing has been getting worse by the month as the company delayed its new 787 and a revamped version of the 747," he said.

"It is clear now that the board of Boeing must ask Jim McNerney to leave as CEO. He has already pushed out his head of commercial aircraft which leaves no one else for the board to blame."

Advertisement. Scroll to continue reading.
Also Read:  Porsche says it has contested the results of VW general assembly

Shares in Boeing slumped 1.5 percent in early trades to 51.10 dollars.

Boeing had announced on June 23 a fifth delay in the 787 Dreamliner program to fix a structural problem on the side of the aircraft, which is seen as key to the company\’s future.

The much-delayed 787 Dreamliner airplane will be delivered to Japanese launch customer ANA in late 2010, more than two years behind the initial timetable.

In October, the Chicago-based company announced a one billion dollar charge against third-quarter earnings due to increased production costs and a difficult market for its 747-8 program.

The Boeing Commercial Airplanes unit suffered an operating loss of 2.8 billion dollars due to the charges, even though revenues increased 13 percent to 7.9 billion dollars.

Boeing Integrated Defense Systems had an operating profit of 885 million dollars as revenues rose three percent to 8.7 billion for the unit focused on military and space operations.

Click to comment

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...


NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...


NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...


NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...


NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...