Boeing Reports Strong First-Quarter Results; Raises Cash Flow and EPS Guidance

Apr 25, 2018

CHICAGO, April 25, 2018 /PRNewswire/ --

  • Revenue increased to $23.4 billion reflecting 184 commercial deliveries and higher defense and services volume
  • GAAP EPS of $4.15 and core EPS (non-GAAP)* of $3.64 on strong performance across the company
  • Strong operating cash flow of $3.1 billion; repurchased 8.9 million shares for $3.0 billion
  • Backlog grew to $486 billion, including over 5,800 commercial aircraft
  • Cash and marketable securities of $9.9 billion provide strong liquidity
  • Operating cash flow, EPS and Commercial Airplanes margin guidance increased on performance







Table 1. Summary Financial Results

First Quarter



(Dollars in Millions, except per share data)

2018


2017


Change







Revenues

$23,382


$21,961


6%








GAAP






Earnings From Operations

$2,875


$2,206


30%


Operating Margin

12.3%


10.0%


2.3 Pts


Net Earnings

$2,477


$1,579


57%


Earnings Per Share

$4.15


$2.54


63%


Operating Cash Flow

$3,136


$2,098


49%


Non-GAAP*






Core Operating Earnings

$2,510


$1,860


35%


Core Operating Margin

10.7%


8.5%


2.2 Pts


Core Earnings Per Share

$3.64


$2.17


68%



* Non-GAAP measures. Complete definitions of Boeing's non-GAAP measures are on page 7, "Non-GAAP Measures Disclosures."     

The Boeing Company [NYSE: BA] reported first-quarter revenue of $23.4 billion reflecting higher commercial deliveries and mix, defense contract volume and services growth (Table 1). GAAP earnings per share increased to $4.15 and core earnings per share (non-GAAP)* increased to $3.64 reflecting strong performance across the company.

The company's cash flow guidance is increased to between $15.0 and $15.5 billion, driven by improved performance. Full year EPS guidance is increased by $0.50 to between $16.40 and $16.60, and core earnings per share (non-GAAP)* guidance is increased to between $14.30 and $14.50 on performance.

"Across Boeing, our teams performed at a high level in the quarter, driving revenue and earnings growth at all three business units, increasing profitability and operating cash flow, and delivering more value to our customers," said Boeing Chairman, President and Chief Executive Officer Dennis Muilenburg. "Customers continue to recognize the value of our products and services, with strong orders booked in the quarter for defense, services and commercial offerings, including 221 net commercial aircraft orders."

"During the quarter we captured important new business, including an initial contract for 28 F/A-18 Super Hornets for Kuwait, a Ground-based Midcourse Defense program contract extension from the Missile Defense Agency, and we delivered the first Space Launch System intertank hardware to NASA. We achieved the first flight of the 737 MAX 7, and delivered the first 787-10 Dreamliner and the first 737 MAX 9. Within our services business, we received a follow-on contract to support the Royal Canadian Air Force's Chinook fleet, captured a landing gear exchange contract for Aeromexico, and released Self-Service Analytics to complement our digital solutions portfolio. All of these milestones demonstrated the value we bring to our customers through the strength of our One Boeing offerings."

"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 programs, gives us a solid foundation to raise our guidance for the year. Going forward, we remain focused on our disciplined growth strategy, improved profitability and cash flow to ensure we meet our commitments to our customers and our shareholders."






Table 2. Cash Flow

First Quarter

(Millions)

2018


2017

Operating Cash Flow

$3,136


$2,098


Less Additions to Property, Plant & Equipment

($394)


($466)


Free Cash Flow*

$2,742


$1,632



* Non-GAAP measures. Complete definitions of Boeing's non-GAAP measures are on page 7, "Non-GAAP Measures Disclosures."

Operating cash flow in the quarter of $3.1 billion reflects planned higher commercial airplane production rates, improved performance, and favorable timing of receipts and expenditures (Table 2). During the quarter, the company repurchased 8.9 million shares for $3.0 billion, leaving $15.0 billion remaining under the current repurchase authorization which is expected to be completed over approximately the next two years. The company also paid $1.0 billion in dividends in the quarter, reflecting a 20 percent increase in dividends per share compared to the same period of the prior year.






Table 3. Cash, Marketable Securities and Debt Balances

Quarter-End

(Billions)

Q1 18


Q4 17

Cash

$9.2


$8.8


Marketable Securities 1

$0.7


$1.2


Total

$9.9


$10.0


Debt Balances:




The Boeing Company, net of intercompany loans to BCC

$10.0


$8.6


Boeing Capital, including intercompany loans

$2.5


$2.5


Total Consolidated Debt

$12.5


$11.1



1 Marketable securities consists primarily of time deposits due within one year classified as "short-term investments."

Cash and investments in marketable securities totaled $9.9 billion, compared to $10.0 billion at the beginning of the quarter (Table 3). Debt was $12.5 billion, up from $11.1 billion at the beginning of the quarter, primarily due to the issuance of new debt.

Total company backlog at quarter-end was $486 billion and included net orders for the quarter of $34 billion. Backlog was up from $475 billion at the beginning of the quarter, which has been adjusted to reflect the adoption of the new revenue recognition standard (ASC 606).

Segment Results

Commercial Airplanes








Table 4. Commercial Airplanes

First Quarter



(Dollars in Millions)

2018


2017


Change







Commercial Airplanes Deliveries

184


169


9%








Revenues

$13,652


$12,953


5%


Earnings from Operations

$1,508


$870


73%


Operating Margin

11.0%


6.7%


4.3 Pts


Commercial Airplanes first-quarter revenue was $13.7 billion reflecting higher deliveries and mix (Table 4). First-quarter operating margin increased to 11.0 percent, reflecting strong operating performance on production programs.

During the quarter, Commercial Airplanes delivered 184 airplanes, including delivery of the first 787-10 Dreamliner to Singapore Airlines and delivery of the first 737 MAX 9 to Lion Air Group. The 737 program reached additional milestones during the quarter, including first flight of the 737 MAX 7 and firm configuration of the 737 MAX 10. The 737 program has captured over 4,400 orders since launch for the 737 MAX, including a recent order from Jet Airways for 75 additional airplanes. Reflecting the strength of the cargo market, we now plan to increase the production rate on the 767 program from 2.5 to 3 per month beginning in 2020. Development on the 777X program remains on track as production began on the first 777X fuselage for structural testing.

Commercial Airplanes booked 221 net orders during the quarter. Backlog remains robust with over 5,800 airplanes valued at $415 billion.

Defense, Space & Security








Table 5. Defense, Space & Security

First Quarter



(Dollars in Millions)

2018


2017


Change







Revenues

$5,762


$5,112


13%


Earnings from Operations

$649


$549


18%


Operating Margin

11.3%


10.7%


0.6 Pts


Defense, Space & Security first-quarter revenue increased to $5.8 billion driven by C-17, international fighters, and weapons volume (Table 5). First-quarter operating margin increased to 11.3 percent on solid execution and mix.

During the quarter, Defense, Space & Security was awarded an initial contract for 28 F/A-18 Super Hornets for Kuwait, a contract for the final C-17 for India, and an extension for Ground-based Midcourse Defense development and sustainment from the Missile Defense Agency. We continue to progress on development programs as the KC-46 Tanker program completed fuel on-load certification testing, the first Space Launch System intertank hardware was delivered to NASA, and the second Commercial Crew spacecraft successfully achieved power-on.

Backlog at Defense, Space & Security was $50 billion, of which 36 percent represents orders from international customers.

Global Services








Table 6. Global Services

First Quarter



(Dollars in Millions)

2018


2017


Change







Revenues

$3,943


$3,653


8%


Earnings from Operations

$644


$623


3%


Operating Margin

16.3%


17.1%


(0.8) Pts


Global Services first-quarter revenue increased to $3.9 billion, reflecting growth in commercial services (Table 6). First-quarter operating margin was 16.3 percent reflecting product and services mix.

During the quarter, Global Services was awarded a follow-on contract from the Royal Canadian Air Force to provide full system logistics, engineering support, supply chain, data analytics and training services to their fleet of Chinooks. Global Services also captured a contract from the Royal Saudi Air Force for F-15 repair support services and a contract from Aeromexico for the 787 landing gear exchange program. As part of Boeing AnalytX, we released Self-Service Analytics to complement our digital solutions portfolio, allowing customers to access data to develop deeper insights into their operations.

Additional Financial Information






Table 7. Additional Financial Information

First Quarter

(Dollars in Millions)

2018


2017

Revenues




Boeing Capital

$65


$92


Unallocated items, eliminations and other

($40)


$151


Earnings from Operations




Boeing Capital

$20


$39


FAS/CAS service cost adjustment

$365


$346


Other unallocated items and eliminations

($311)


($221)


Other income, net

$66


$26


Interest and debt expense

($102)


($87)


Effective tax rate

12.8%


26.4%


At quarter-end, Boeing Capital's net portfolio balance was $2.9 billion. Total pension expense for the first quarter was $40 million, down from $97 million in the same period of the prior year. Revenue in other unallocated items and eliminations decreased primarily due to the sale of aircraft previously leased to customers in the first quarter of 2017. The effective tax rate for the first quarter decreased from the same period in the prior year primarily due to the reduction of the federal tax rate to 21%.

Outlook

The Company's 2018 guidance is updated below (Table 8).





Table 8. 2018 Financial Outlook

Current


Prior

(Dollars in Billions, except per share data)

Guidance


Guidance





The Boeing Company




Revenue

$96.0 - 98.0


$96.0 - 98.0





GAAP Earnings Per Share

$16.40 - 16.60


$15.90 - 16.10

Core Earnings Per Share*

$14.30 - 14.50


$13.80 - 14.00





Operating Cash Flow

$15.0 - 15.5


~$15.0





Commercial Airplanes




Deliveries

810 - 815


810 - 815

Revenue

$59.5 - 60.5


$59.5 - 60.5

Operating Margin

~11.5%


>11.0%





Defense, Space & Security




Revenue

$21.5 - 22.5


$21.5 - 22.5

Operating Margin

~11.0%


~11.0%





Global Services




      Revenue

$15.0 - 15.5


$15.0 - 15.5

      Operating Margin

~15.5%


~15.5%





Boeing Capital




Portfolio Size

Stable


Stable

Revenue

~$0.2


~$0.2

Pre-Tax Earnings

~$0.05


~$0.05





Research & Development

~$3.7


~$3.7

Capital Expenditures

~$2.2


~$2.2

Pension Expense 1

~$0.1


~$0.1

Effective Tax Rate

~16.0%


~16.0%


1 Approximately $1.4 billion of pension expense is expected to be allocated to the business segments

* Non-GAAP measures. Complete definitions of Boeing's non-GAAP measures are on page 7, "Non-GAAP Measures Disclosures."

Non-GAAP Measures Disclosures

We supplement the reporting of our financial information determined under Generally Accepted Accounting Principles in the United States of America (GAAP) with certain non-GAAP financial information. The non-GAAP financial information presented excludes certain significant items that may not be indicative of, or are unrelated to, results from our ongoing business operations. We believe that these non-GAAP measures provide investors with additional insight into the company's ongoing business performance. These non-GAAP measures should not be considered in isolation or as a substitute for the related GAAP measures, and other companies may define such measures differently. We encourage investors to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. The following definitions are provided:

Core Operating Earnings, Core Operating Margin and Core Earnings Per Share

Core operating earnings is defined as GAAP earnings from operations excluding the FAS/CAS service cost adjustment. The FAS/CAS service cost adjustment represents the difference between the FAS pension and postretirement service costs calculated under GAAP and costs allocated to the business segments. Core operating margin is defined as core operating earnings expressed as a percentage of revenue. Core earnings per share is defined as GAAP diluted earnings per share excluding the net earnings per share impact of the FAS/CAS service cost adjustment and Non-operating pension and postretirement expenses. Non-operating pension and postretirement expenses represent the components of net periodic benefit costs other than service cost. Pension costs, comprising service and prior service costs computed in accordance with GAAP are allocated to Commercial Airplanes and BGS businesses supporting commercial customers. Pension costs allocated to BDS and BGS businesses supporting government customers are computed in accordance with U.S. Government Cost Accounting Standards (CAS), which employ different actuarial assumptions and accounting conventions than GAAP. CAS costs are allocable to government contracts. Other postretirement benefit costs are allocated to all business segments based on CAS, which is generally based on benefits paid. Management uses core operating earnings, core operating margin and core earnings/per share for purposes of evaluating and forecasting underlying business performance. Management believes these core earnings measures provide investors additional insights into operational performance as they exclude non-service pension and post-retirement costs, which primarily represent costs driven by market factors and costs not allocable to government contracts. A reconciliation between the GAAP and non-GAAP measures is provided on page 14.

Free Cash Flow

Free cash flow is defined as GAAP operating cash flow without capital expenditures for property, plant and equipment additions. Management believes free cash flow provides investors with an important perspective on the cash available for shareholders, debt repayment, and acquisitions after making the capital investments required to support ongoing business operations and long term value creation. Free cash flow does not represent the residual cash flow available for discretionary expenditures as it excludes certain mandatory expenditures such as repayment of maturing debt. Management uses free cash flow as a measure to assess both business performance and overall liquidity. Table 2 provides a reconciliation between GAAP operating cash flow and free cash flow.

Caution Concerning Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "may," "should," "expects," "intends," "projects," "plans," "believes," "estimates," "targets," "anticipates," and similar expressions generally identify these forward-looking statements. Examples of forward-looking statements include statements relating to our future financial condition and operating results, as well as any other statement that does not directly relate to any historical or current fact. Forward-looking statements are based on expectations and assumptions that we believe to be reasonable when made, but that may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties, and changes in circumstances that are difficult to predict. Many factors could cause actual results to differ materially and adversely from these forward-looking statements. Among these factors are risks related to: (1) general conditions in the economy and our industry, including those due to regulatory changes; (2) our reliance on our commercial airline customers; (3) the overall health of our aircraft production system, planned commercial aircraft production rate changes, our commercial development and derivative aircraft programs, and our aircraft being subject to stringent performance and reliability standards; (4) changing budget and appropriation levels and acquisition priorities of the U.S. government; (5) our dependence on U.S. government contracts; (6) our reliance on fixed-price contracts; (7) our reliance on cost-type contracts; (8) uncertainties concerning contracts that include in-orbit incentive payments; (9) our dependence on our subcontractors and suppliers, as well as the availability of raw materials; (10) changes in accounting estimates; (11) changes in the competitive landscape in our markets; (12) our non-U.S. operations, including sales to non-U.S. customers; (13) threats to the security of our or our customers' information; (14) potential adverse developments in new or pending litigation and/or government investigations; (15) customer and aircraft concentration in our customer financing portfolio; (16) changes in our ability to obtain debt on commercially reasonable terms and at competitive rates; (17) realizing the anticipated benefits of mergers, acquisitions, joint ventures/strategic alliances or divestitures; (18) the adequacy of our insurance coverage to cover significant risk exposures; (19) potential business disruptions, including those related to physical security threats, information technology or cyber-attacks, epidemics, sanctions or natural disasters; (20) work stoppages or other labor disruptions; (21) substantial pension and other postretirement benefit obligations; (22) potential environmental liabilities.

Additional information concerning these and other factors can be found in our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Any forward-looking statement speaks only as of the date on which it is made, and we assume no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.

Contact:




Investor Relations:


Maurita Sutedja or Ben Hackman (312) 544-2140

Communications:


Allison Bone (312) 544-2002

The Boeing Company and Subsidiaries
Consolidated Statements of Operations
(Unaudited)

In the first quarter of 2018, we adopted the following Accounting Standards Updates (ASU), which are reflected in the unaudited Consolidated Financial Statements on pages 9-14: ASU 2014-09, Revenue from Contracts with Customers (Topic 606); ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost; ASU 2016-18 Statement of Cash Flows (Topic 230) Restricted Cash; and ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.


Three months ended
March 31

(Dollars in millions, except per share data)

2018


2017

Sales of products

$20,820


$19,367

Sales of services

2,562


2,594

Total revenues

23,382


21,961





Cost of products

(16,816)


(16,062)

Cost of services

(1,992)


(1,998)

Boeing Capital interest expense

(16)


(13)

Total costs and expenses

(18,824)


(18,073)


4,558


3,888

Income from operating investments, net

74


81

General and administrative expense

(997)


(929)

Research and development expense, net

(764)


(836)

Gain on dispositions, net

4


2

Earnings from operations

2,875


2,206

Other income, net

66


26

Interest and debt expense

(102)


(87)

Earnings before income taxes

2,839


2,145

Income tax expense

(362)


(566)

Net earnings

$2,477


$1,579





Basic earnings per share

$4.19


$2.57





Diluted earnings per share

$4.15


$2.54





Cash dividends paid per share

$1.71


$1.42





Weighted average diluted shares (millions)

597.2


621.2

 

The Boeing Company and Subsidiaries

Consolidated Statements of Financial Position

(Unaudited) 


(Dollars in millions, except per share data)

March 31
2018


December 31

2017

Assets




Cash and cash equivalents

$9,235


$8,813

Short-term and other investments

656


1,179

Accounts receivable, net

2,802


2,894

Unbilled receivables, net

9,822


8,194

Current portion of customer financing, net

244


309

Inventories

61,303


61,388

Other current assets

2,481


2,417

Total current assets

86,543


85,194

Customer financing, net

2,753


2,756

Property, plant and equipment, net of accumulated depreciation of $17,894 and $17,641

12,628


12,672

Goodwill

5,558


5,559

Acquired intangible assets, net

2,525


2,573

Deferred income taxes

325


321

Investments

1,248


1,260

Other assets, net of accumulated amortization of $514 and $482

1,969


2,027

Total assets

$113,549


$112,362

Liabilities and equity




Accounts payable

$12,613


$12,202

Accrued liabilities

10,983


13,069

Advances and progress billings

49,955


48,042

Short-term debt and current portion of long-term debt

1,981


1,335

Total current liabilities

75,532


74,648

Deferred income taxes

2,001


2,188

Accrued retiree health care

5,494


5,545

Accrued pension plan liability, net

16,279


16,471

Other long-term liabilities

2,474


2,015

Long-term debt

10,471


9,782

Shareholders' equity:




Common stock, par value $5.00 – 1,200,000,000 shares authorized; 1,012,261,159 shares issued

5,061


5,061

Additional paid-in capital

6,624


6,804

Treasury stock, at cost - 428,038,987 and 421,222,326 shares

(46,396)


(43,454)

Retained earnings

52,095


49,618

Accumulated other comprehensive loss

(16,162)


(16,373)

Total shareholders' equity

1,222


1,656

Noncontrolling interests

76


57

Total equity

1,298


1,713

Total liabilities and equity

$113,549


$112,362

 

The Boeing Company and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)



Three months ended
March 31

(Dollars in millions)

2018


2017

Cash flows – operating activities:




Net earnings

$2,477


$1,579

Adjustments to reconcile net earnings to net cash provided by operating activities:




Non-cash items – 




Share-based plans expense

45


50

Depreciation and amortization

501


468

Investment/asset impairment charges, net

20


23

Customer financing valuation (benefit)/expense

(1)


7

Gain on dispositions, net

(4)


(2)

Other charges and credits, net

60


58

Changes in assets and liabilities – 




Accounts receivable

92


(264)

Unbilled receivables

(1,628)


(568)

Advances and progress billings

1,917


1,375

Inventories

283


(1,491)

Other current assets

(103)


(117)

Accounts payable

591


616

Accrued liabilities

(1,337)


(282)

Income taxes receivable, payable and deferred

348


552

Other long-term liabilities

(243)


(72)

Pension and other postretirement plans

(50)


10

Customer financing, net

44


231

Other

124


(75)

Net cash provided by operating activities

3,136


2,098

Cash flows – investing activities:




Property, plant and equipment additions

(394)


(466)

Property, plant and equipment reductions

27


9

Contributions to investments

(249)


(605)

Proceeds from investments

752


803

Purchase of distribution rights

(20)



Other

3


(1)

Net cash provided/(used) by investing activities

119


(260)

Cash flows – financing activities:




New borrowings

2,687


872

Debt repayments

(1,371)


(34)

Contributions from noncontrolling interests

20



Stock options exercised

51


174

Employee taxes on certain share-based payment arrangements

(226)


(107)

Common shares repurchased

(3,000)


(2,500)

Dividends paid

(1,006)


(868)

Net cash used by financing activities

(2,845)


(2,463)

Effect of exchange rate changes on cash and cash equivalents, including restricted

8


20

Net increase/(decrease) in cash & cash equivalents, including restricted

418


(605)

Cash & cash equivalents, including restricted, at beginning of year

8,887


8,869

Cash & cash equivalents, including restricted, at end of period

$9,305


$8,264

Less restricted cash & cash equivalents, included in Investments

70


74

Cash and cash equivalents at end of period

9,235


8,190

 

The Boeing Company and Subsidiaries

Summary of Business Segment Data

(Unaudited)



Three months ended
March 31

(Dollars in millions)

2018


2017

Revenues:




Commercial Airplanes

$13,652


$12,953

Defense, Space & Security

5,762


5,112

Global Services

3,943


3,653

Boeing Capital

65


92

Unallocated items, eliminations and other

(40)


151

Total revenues

$23,382


$21,961

Earnings from operations:




Commercial Airplanes

$1,508


$870

Defense, Space & Security

649


549

Global Services

644


623

Boeing Capital

20


39

Segment operating profit

2,821


2,081

Unallocated items, eliminations and other

(311)


(221)

FAS/CAS service cost adjustment

365


346

Earnings from operations

2,875


2,206

Other income, net

66


26

Interest and debt expense

(102)


(87)

Earnings before income taxes

2,839


2,145

Income tax expense

(362)


(566)

Net earnings

$2,477


$1,579





Research and development expense, net:




Commercial Airplanes

$549


$625

Defense, Space & Security

183


196

Global Services

34


28

Other

(2)


(13)

Total research and development expense, net

$764


$836





Unallocated items, eliminations and other:




Share-based plans

($18)


($21)

Deferred compensation

(29)


(50)

Amortization of previously capitalized interest

(25)


(24)

Eliminations and other unallocated items

(239)


(126)

Sub-total (included in core operating earnings)

(311)


(221)

Pension FAS/CAS service cost adjustment

283


262

Postretirement FAS/CAS service cost adjustment

82


84

FAS/CAS service cost adjustment

$365


$346

Total

$54


$125

 

The Boeing Company and Subsidiaries

Operating and Financial Data

(Unaudited)


Deliveries


Three months ended
March 31


Commercial Airplanes


2018


2017


737


132


113


747


2


1

(1)

767


4


2


777


12


21


787


34


32


Total


184


169


Note: Aircraft accounted for as revenues by BCA and as a note receivable in consolidation identified by parentheses







Defense, Space & Security






AH-64 Apache (New)




3


AH-64 Apache (Remanufactured)


6


13


C-17 Globemaster III






CH-47 Chinook (New)


4


3


CH-47 Chinook (Renewed)


4


9


F-15 Models


2


3


F/A-18 Models


5


6


P-8 Models


4


4


Commercial and Civil Satellites




1


Military Satellites
























Total backlog (Dollars in millions)


March 31
2018


Restated**
December 31
2017


Reported
December 31
2017

Commercial Airplanes


$415,377


$411,188


$421,345

Defense, Space & Security


50,404


44,049


49,577

Global Services


20,464


19,605


17,223

Total backlog


$486,245


$474,842


$488,145








Contractual backlog


$461,742


$457,186


$470,241

Unobligated backlog


24,503


17,656


17,904

Total backlog


$486,245


$474,842


$488,145


** The restated backlog reflects the impact of ASC 606

The Boeing Company and Subsidiaries
Reconciliation of Non-GAAP Measures
(Unaudited)

The tables provided below reconcile the non-GAAP financial measures core operating earnings, core operating margin, and core earnings per share with the most directly comparable GAAP financial measures, earnings from operations, operating margin, and diluted earnings per share. See page 7 of this release for additional information on the use of these non-GAAP financial measures.



















(Dollars in millions, except per share data)

2018 Guidance


First Quarter 2018


First Quarter 2017


$ millions


Per Share


$ millions


Per Share


$ millions


Per Share

Revenues





23,382




21,961



Earnings from operations (GAAP)





2,875




2,206



Operating margins





12.3%




10.0%















FAS/CAS service cost adjustment:












Pension FAS/CAS service cost adjustment





(283)




(262)



Postretirement FAS/CAS service cost adjustment





(82)




(84)



FAS/CAS service cost adjustment

~($1,395)




(365)




(346)



Core operating earnings (non-GAAP)





$2,510




$1,860



Core operating margins (non-GAAP)





10.7%




8.5%















Diluted earnings per share (GAAP)



$16.40 - 16.60




$4.15




$2.54

Pension FAS/CAS service cost adjustment

~($1,395)




($283)


(0.47)


($262)


(0.42)

Postretirement FAS/CAS service cost adjustment





(82)


 

(0.14)


(84)


 

(0.14)

Non-operating pension expense

~($170)




(42)


(0.07)


(34)


(0.06)

Non-operating postretirement expense





24


0.04


30


0.05

Provision for deferred income taxes on adjustments 1





80


0.13


122


0.20

Subtotal of adjustments



($2.10)


($303)


($0.51)


($228)


($0.37)

Core earnings per share (non-GAAP)



$14.30 - 14.50




$3.64




$2.17













Weighted average diluted shares (in millions)

585 - 590






597.2




621.2


1 The income tax impact is calculated using  the U.S. corporate statutory tax rate i n effect for non-GAAP adjustments. 

Condensed Consolidated Statement of Financial Position

The impact to our Condensed Consolidated Statement of Financial Position as a result of adopting new accounting standards was as follows:







(Dollars in millions)

December 31, 2017

Assets

Reported


Impact of
New
Standards


Restated

Cash and cash equivalents

$8,813




$8,813

Short-term and other investments

1,179




1,179

Accounts receivable, net

10,516


($7,622)


2,894

Unbilled receivables, net



8,194


8,194

Current portion of customer financing, net

309




309

Inventories

44,344


17,044


61,388

Other current assets



2,417


2,417

Total current assets

65,161


20,033


85,194

Customer financing, net

2,740


16


2,756

Property, plant and equipment, net

12,672




12,672

Goodwill

5,559




5,559

Acquired intangible assets, net

2,573




2,573

Deferred income taxes

341


(20)


321

Investments

1,260




1,260

Other assets, net of accumulated amortization

2,027




2,027

Total assets

$92,333


$20,029


$112,362

Liabilities and equity






Accounts payable

$12,202




$12,202

Accrued liabilities

15,292


(2,223)


13,069

Advances and billings in excess of related costs

27,440


(27,440)



Advances and progress billings



48,042


48,042

Short-term debt and current portion of long-term debt

1,335




1,335

Total current liabilities

56,269


18,379


74,648

Deferred income taxes

1,839


349


2,188

Accrued retiree health care

5,545




5,545

Accrued pension plan liability, net

16,471




16,471

Other long-term liabilities

2,015




2,015

Long-term debt

9,782




9,782

Shareholders' equity:






Common stock

5,061




5,061

Additional paid-in capital

6,804




6,804

Treasury stock, at cost

(43,454)




(43,454)

Retained earnings

45,320


4,298


49,618

Accumulated other comprehensive loss

(13,376)


(2,997)


(16,373)

Total shareholders' equity

355


1,301


1,656

Noncontrolling interests

57




57

Total equity

412


1,301


1,713

Total liabilities and equity

$92,333


$20,029


$112,362

 

Cision View original content:http://www.prnewswire.com/news-releases/boeing-reports-strong-first-quarter-results-raises-cash-flow-and-eps-guidance-300636248.html

SOURCE Boeing

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