Boe­ing beats 2Q profit fore­casts, raises full-year out­look

The Guardian (Charlottetown) - - OBITUARIES/NEWS -

Boe­ing re­ported high­erthan-ex­pected earn­ings for the sec­ond quar­ter de­spite lower rev­enue, and it raised its fore­cast for full-year profit on Wed­nes­day, send­ing both the air­craft maker’s stock and the Dow higher.

The com­pany is ben­e­fit­ing as prof­itable air­lines con­tinue to order new planes. With a back­log of or­ders ap­proach­ing a half tril­lion dol­lars, Boe­ing said that it will buy back $10 bil­lion of its own stock this year, mak­ing the re­main­ing shares more valu­able, and re­duce its taxes by pay­ing down its pen­sion li­a­bil­ity.

The shares jumped $20.99, or 9.9 per cent, to close at $233.45. It was the stock’s big­gest one­day gain in per­cent­age terms since Oc­to­ber 2008.

The Boe­ing bump added nearly 144 points to the Dow Jones in­dus­trial av­er­age, lift­ing it to 21,711. Boe­ing said its back­log grew to $482 bil­lion at the end of June, in­clud­ing $27 bil­lion in new net or­ders dur­ing the sec­ond quar­ter. Nearly 90 per cent of that value is from the back­log of more than 5,700 com­mer­cial air­lin­ers, with Boe­ing’s de­fence busi­ness ac­count­ing for the rest.

The Chicago com­pany and Euro­pean ri­val Air­bus fig­ure to ben­e­fit for years to come from grow­ing de­mand for travel and the planes that will be needed to carry pas­sen­gers around the world, although man­u­fac­tur­ers in China, Ja­pan and Rus­sia aim to be­come big­ger play­ers too.

Boe­ing is gear­ing up to in­crease pro­duc­tion of its most pop­u­lar air­liner, the sin­gle-aisle 737 that is a main­stay on short and medium-haul routes. De­mand for so-called wide­body, two-aisle planes that are used on many in­ter­na­tional routes is not as strong.

The com­pany cut 6,500 jobs in the first half of this year, and it is mak­ing progress at con­trol­ling pro­duc­tion costs for its 787 “Dream­liner” plane.

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