TIDMBOE
Boeing Reports Strong Second-Quarter Results and Raises 2013 EPS Guidance
CHICAGO, July 24, 2013 --
* Core EPS (non-GAAP)* rose 13 percent to $1.67 on strong operating
performance; GAAP EPS of $1.41
* Revenue increased 9 percent to $21.8 billion reflecting higher deliveries
on the 787 and 737 programs
* Backlog grew to a record $410 billion, including $40 billion of net orders
during the quarter
* Operating cash flow before pension contributions* more than doubled to $3.5
billion
* 2013 Core EPS guidance increased to between $6.20 and $6.40; GAAP EPS to
between $5.10 and $5.30
Table 1. Summary
Financial Results Second Quarter First Half
(Dollars in
Millions, except 2013 2012 Change 2013 2012 Change
per share data)
Revenues $21,815 $20,005 9% $40,708 $39,388 3%
Non-GAAP*
Core Operating
Earnings $2,028 $1,787 13% $3,895 $3,560 9%
Core Operating
Margin 9.3% 8.9% 0.4 Pts 9.6% 9.0% 0.6 Pts
Core Earnings Per
Share $1.67 $1.48 13% $3.40 $2.88 18%
Operating Cash
Flow Before
Pension
Contributions $3,480 $1,671 108% $4,004 $2,508 60%
GAAP
Earnings From
Operations $1,716 $1,542 11% $3,244 $3,107 4%
Operating Margin 7.9% 7.7% 0.2 Pts 8.0% 7.9% 0.1 Pts
Net Earnings $1,088 $967 13% $2,194 $1,890 16%
Earnings Per Share $1.41 $1.27 11% $2.85 $2.49 14%
Operating Cash
Flow $3,467 $908 282% $3,991 $1,745 129%
* Non-GAAP measures (core operating earnings, core operating margin and core
earnings per share) exclude certain components of pension and post retirement
benefit expense that the company believes are not reflective of underlying
business performance. Complete definitions of Boeing's non-GAAP measures begin
on page 6, "Non-GAAP Measures Disclosures."
The Boeing Company (NYSE: BA) reported second-quarter core earnings per share
(non-GAAP) increased 13 percent* to $1.67, driven by strong performance across
the company's businesses (Table 1). Second-quarter core operating earnings
(non-GAAP) also increased 13 percent* to $2.0 billion from the same period of
the prior year. Second-quarter revenue was $21.8 billion, GAAP earnings from
operations was $1.7 billion and earnings per share was $1.41. Core earnings per
share guidance increased to between $6.20 and $6.40 and GAAP earnings per share
guidance increased to between $5.10 and $5.30, reflecting the strong
performance. The company also increased its revenue guidance to between $83 and
$86 billion on higher Defense, Space & Security revenues, and reaffirmed its
2013 operating cash flow outlook.
"Continued strong core operating performance drove higher earnings, revenue and
operating cash flow during the quarter, and we returned significant value to
shareholders through share repurchases and increased dividends," said Boeing
Chairman, President and CEO Jim McNerney. "We also further strengthened our
market-leading position in commercial airplanes with the successful launch of
the 787-10 and $40 billion of new orders, while our defense, space and security
business delivered improved margins and market share in a tough market.
Overall, our strong first-half performance and positive outlook allows us to
raise our 2013 earnings and revenue guidance, and our team remains intensely
focused on execution, productivity and quality to meet our customer commitments
and further drive growth."
Table 2. Cash Flow Second Quarter First Half
(Millions) 2013 2012 2013 2012
Operating Cash Flow Before Pension
Contributions* $3,480 $1,671 $4,004 $2,508
Pension Contributions ($13) ($763) ($13) ($763)
Operating Cash Flow $3,467 $908 $3,991 $1,745
Less Additions to Property, Plant
& Equipment ($455) ($356) ($976) ($780)
Free Cash Flow* $3,012 $552 $3,015 $965
Operating cash flow in the quarter was $3.5 billion, reflecting higher
commercial airplane production rates, strong core operating performance and
timing of receipts and expenditures (Table 2). During the quarter, the company
repurchased 10.2 million shares for $1 billion and paid $0.4 billion in
dividends, reflecting a 12 percent increase in dividends paid compared to the
prior period.
Table 3. Cash, Marketable Securities and Debt Balances Quarter-End
(Billions) Q2 13 Q1 13
Cash $8.7 $8.3
Marketable Securities(1) $5.6 $3.5
Total $14.3 $11.8
Debt Balances:
The Boeing Company, net of intercompany loans to BCC $7.0 $6.7
Boeing Capital Corporation, including intercompany loans $2.6 $2.5
Total Consolidated Debt $9.6 $9.2
(1) Marketable securities consists primarily of time deposits due within one year
classified as "short-term investments."
Cash and investments in marketable securities totaled $14.3 billion at
quarter-end (Table 3), up from $11.8 billion at the beginning of the quarter.
Debt was $9.6 billion, up from $9.2 billion at the beginning of the quarter,
primarily due to the issuance of new debt.
Total company backlog at quarter-end was a record $410 billion, up from $392
billion at the beginning of the quarter, and included net orders for the
quarter of $40 billion.
Segment Results
Commercial Airplanes
Table 4. Commercial
Airplanes Second Quarter First Half
(Dollars in Millions) 2013 2012 Change 2013 2012 Change
Commercial Airplanes
Deliveries 169 150 13% 306 287 7%
Revenues $13,624 $11,843 15% $24,314 $22,780 7%
Earnings from
Operations $1,453 $1,211 20% $2,672 $2,292 17%
Operating Margins 10.7% 10.2% 0.5 Pts 11.0% 10.1% 0.9 Pts
Boeing Commercial Airplanes second-quarter revenue increased to $13.6 billion
on higher delivery volume. Second-quarter operating margin improved to 10.7%,
reflecting lower R&D and the higher deliveries partially offset by the dilutive
impact of 787 deliveries (Table 4).
During the quarter, the company completed the retrofit of 787 battery
enhancements on previously delivered airplanes and delivered sixteen 787
airplanes. Also during the quarter, the 787-9 Dreamliner began final assembly
and the launch of the 787-10 was announced.
Commercial Airplanes booked 481 net orders during the quarter. Backlog remains
strong with nearly 4,800 airplanes valued at a record $339 billion.
Boeing Defense, Space & Security
Table 5. Defense, Space
& Security Second Quarter First Half
(Dollars in Millions) 2013 2012 Change 2013 2012 Change
Revenues
Boeing Military Aircraft $3,889 $4,050 (4)% $7,998 $8,272 (3)%
Network & Space Systems $2,049 $1,960 5% $4,009 $3,832 5%
Global Services &
Support $2,248 $2,182 3% $4,289 $4,321 (1)%
Total BDS Revenues $8,186 $8,192 - $16,296 $16,425 (1)%
Earnings from Operations
Boeing Military Aircraft $373 $353 6% $803 $752 7%
Network & Space Systems $137 $136 1% $293 $245 20%
Global Services &
Support $266 $259 3% $512 $493 4%
Total BDS Earnings from
Operations $776 $748 4% $1,608 $1,490 8%
Operating Margins 9.5% 9.1% 0.4 Pts 9.9% 9.1% 0.8 Pts
Boeing Defense, Space & Security's second-quarter revenue was $8.2 billion,
while operating margin was 9.5 percent (Table 5).
Boeing Military Aircraft (BMA) second-quarter revenue was $3.9 billion,
primarily reflecting lower delivery volume. Operating margin increased to 9.6
percent, as the prior year included an inventory adjustment on A-160. During
the quarter, BMA was awarded CH-47 Chinook and V-22 Osprey multi-year
contracts.
Network & Space Systems (N&SS) second-quarter revenue was $2.0 billion,
reflecting higher revenue in commercial satellites and the Space Launch System
program. Operating margin was 6.7 percent, reflecting lower earnings in
electronic & information solutions. During the quarter, N&SS was awarded a
contract by ViaSat to design and deliver one 702HP spacecraft and was also
awarded a contract for four 702MP satellites for Intelsat S.A.
Global Services & Support (GS&S) second-quarter revenue was $2.2 billion, due
to higher volume in maintenance, modifications & upgrades. Operating margin was
11.8 percent, reflecting strong performance. During the quarter, GS&S was
awarded a contract by the Royal Netherlands Air Force for maintenance and spare
parts for Chinook and Apache helicopters.
Backlog at Defense, Space & Security increased to $71 billion, of which 37
percent represents orders with international customers.
Additional Financial Information
Table 6. Additional Financial Information Second Quarter First Half
(Dollars in Millions) 2013 2012 2013 2012
Revenues
Boeing Capital Corporation $104 $113 $209 $238
Other segment $27 $28 $54 $52
Unallocated items and eliminations ($126) ($171) ($165) ($107)
Earnings from Operations
Boeing Capital Corporation $19 $39 $63 $72
Other segment expense ($43) ($64) ($101) ($143)
Unallocated items and eliminations
included in core operating earnings ($177) ($147) ($347) ($151)
Unallocated pension/postretirement
expense ($312) ($245) ($651) ($453)
Other income, net $13 $10 $22 $22
Interest and debt expense ($96) ($106) ($195) ($220)
Effective tax rate 33.4% 33.1% 28.6% 35.0%
At quarter-end, Boeing Capital Corporation's (BCC) net portfolio balance was
$4.1 billion and debt-to-equity ratio was 5.0-to-1. Unallocated items and
eliminations included in core operating earnings increased in the second
quarter of 2013 due to higher deferred compensation expense as a result of
stock price appreciation. Total pension expense for the second quarter was $753
million, up from $593 million in the same period last year.
Outlook
The company's 2013 financial guidance (Table 7) has been updated to reflect
continued strong performance in both businesses, generating an expected 7
percent year over year increase in core earnings per share (non-GAAP).
Table 7. Financial Outlook
(Dollars in Billions, except per share data) 2013
The Boeing Company
Revenue $83 - 86
Core Earnings Per Share* $6.20 - 6.40
Earnings Per Share $5.10 - 5.30
Operating Cash Flow Before Pension Contributions* greater than $8
Operating Cash Flow (1) greater than $6.5
Boeing Commercial Airplanes
Deliveries (2) 635 - 645
Revenue $51 - 53
Operating Margin greater than 9.5%
Boeing Defense, Space & Security
Revenue
Boeing Military Aircraft $16.0
Network & Space Systems $7.8
Global Services & Support $8.2
Total BDS Revenue $31.5 - 32.5
Operating Margin
Boeing Military Aircraft 9.0%
Network & Space Systems 7.5%
Global Services & Support 10.5%
Total BDS Operating Margin greater than 9.0%
Boeing Capital Corporation
Portfolio Size Lower
Revenue $0.3
Pre-Tax Earnings $0.05
Research & Development $3.3
Capital Expenditures $2.3
Pension Expense (3) $3.2
Effective Tax Rate 31%
(1) After discretionary cash pension contributions of $1.5 billion and assuming
new aircraft financings under $0.5 billion.
(2) Assumes greater than 60 787 deliveries.
(3) Approximately $1.4 billion is expected to be recorded in unallocated items
and eliminations.
* Non-GAAP measures. Complete definitions of Boeing's use of non-GAAP measures
begin on page 6, "Non-GAAP Measures Disclosures."
Core earnings per share guidance for 2013 increased to between $6.20 and $6.40,
up from between $6.10 and $6.30, and earnings per share guidance increased to
between $5.10 and $5.30, up from between $5.00 and $5.20, both reflecting the
strong operating performance. Total company 2013 revenue increased to between
$83 and $86 billion, from between $82 and $85 billion, on higher Defense, Space
& Security revenue.
Commercial Airplanes' operating margin increased to greater than 9.5 percent,
up from approximately 9.5 percent.
Defense, Space & Security's revenue guidance increased to between $31.5 and
$32.5 billion, from between $30.5 and $31.5 billion, reflecting international
volume and mix.
Research and development expense for 2013 is now expected to be approximately
$3.3 billion, down from approximately $3.4 billion. Capital expenditures for
2013 is revised to approximately $2.3 billion, down from between $2.3 and $2.5
billion. The 2013 effective tax rate is now expected to be approximately 31
percent, up from approximately 30 percent.
Non-GAAP Measures Disclosures
We supplement the reporting of our financial information determined under U.S.
generally accepted accounting principles (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
unallocated pension and post-retirement expense. 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 unallocated pension and post-retirement
expense. Unallocated pension and post-retirement expense represents the portion
of pension and other post-retirement costs that are not recognized by business
segments for segment reporting purposes. 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 unallocated pension and post-retirement
costs, which primarily represent costs driven by market factors and costs not
allocable to government contracts.
Operating Cash Flow Before Pension Contributions
Operating cash flow before pension contributions is defined as GAAP operating
cash flow less pension contributions. Management believes operating cash flow
before pension contributions provides additional insights into underlying
business performance. Management uses operating cash flow before pension
contributions as a measure to assess both business performance and overall
liquidity. Table 2 provides a reconciliation between GAAP operating cash flow
and operating cash flow before pension contributions.
Free Cash Flow
Free cash flow is defined as GAAP operating cash flow less 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 are used to 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 our current expectations
and assumptions, which 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 production rate increases across multiple
commercial airline programs, our commercial development and derivative aircraft
programs, and our aircraft being subject to stringent performance and
reliability standards; (4) changing 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) potential adverse
developments in new or pending litigation and/or government investigations;
(14) customer and aircraft concentration in Boeing Capital's customer financing
portfolio; (15) changes in our ability to obtain debt on commercially
reasonable terms and at competitive rates in order to fund our operations and
contractual commitments; (16) realizing the anticipated benefits of mergers,
acquisitions, joint ventures/strategic alliances or divestitures; (17) the
adequacy of our insurance coverage to cover significant risk exposures; (18)
potential business disruptions, including those related to physical security
threats, information technology or cyber-attacks or natural disasters; (19)
work stoppages or other labor disruptions; (20) significant changes in discount
rates and actual investment return on pension assets; (21) potential
environmental liabilities; and (22) threats to the security of our or our
customers' information.
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: Troy Lahr or Matt Welch (312) 544-2140
Communications: Chaz Bickers (312) 544-2002
The Boeing Company and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
Six months ended Three months ended
June 30 June 30
(Dollars in millions, except per
share data) 2013 2012 2013 2012
Sales of products $35,556 $34,026 $19,238 $17,341
Sales of services 5,152 5,362 2,577 2,664
Total revenues 40,708 39,388 21,815 20,005
Cost of products (30,165) (28,420) (16,437) (14,759)
Cost of services (4,004) (4,342) (1,995) (1,962)
Boeing Capital interest expense (37) (58) (18) (25)
Total costs and expenses (34,206) (32,820) (18,450) (16,746)
6,502 6,568 3,365 3,259
Income from operating investments,
net 88 91 43 45
General and administrative expense (1,900) (1,858) (929) (903)
Research and development expense,
net (1,468) (1,692) (763) (857)
Gain/(loss) on dispositions, net 22 (2) (2)
Earnings from operations 3,244 3,107 1,716 1,542
Other income, net 22 22 13 10
Interest and debt expense (195) (220) (96) (106)
Earnings before income taxes 3,071 2,909 1,633 1,446
Income tax expense (878) (1,018) (546) (479)
Net earnings from continuing
operations 2,193 1,891 1,087 967
Net gain/(loss) on disposal of
discontinued operations, net of
taxes of $0, $1, $0 and $0 1 (1) 1
Net earnings $2,194 $1,890 $1,088 $967
Basic earnings per share from
continuing operations $2.88 $2.51 $1.43 $1.28
Net gain/(loss) on disposal of
discontinued operations, net of
taxes
Basic earnings per share $2.88 $2.51 $1.43 $1.28
Diluted earnings per share from
continuing operations $2.85 $2.49 $1.41 $1.27
Net gain/(loss) on disposal of
discontinued operations, net of
taxes
Diluted earnings per share $2.85 $2.49 $1.41 $1.27
Cash dividends paid per share $0.97 $0.88 $0.485 $0.44
Weighted average diluted shares
(millions) 770.1 760.7 771.8 762.0
The Boeing Company and Subsidiaries
Consolidated Statements of Financial Position
(Unaudited)
June 30 December 31
(Dollars in millions, except per share data) 2013 2012
Assets
Cash and cash equivalents $8,694 $10,341
Short-term and other investments 5,631 3,217
Accounts receivable, net 6,406 5,608
Current portion of customer financing, net 320 364
Deferred income taxes 25 28
Inventories, net of advances and progress billings 40,234 37,751
Total current assets 61,310 57,309
Customer financing, net 3,991 4,056
Property, plant and equipment, net of accumulated
depreciation of $14,717 and $14,645 9,814 9,660
Goodwill 5,043 5,035
Acquired intangible assets, net 3,011 3,111
Deferred income taxes 6,307 6,753
Investments 1,166 1,180
Other assets, net of accumulated amortization of 1,449 1,792
$464 and $504
Total assets $92,091 $88,896
Liabilities and equity
Accounts payable $10,437 $9,394
Accrued liabilities 12,412 12,995
Advances and billings in excess of related costs 18,145 16,672
Deferred income taxes and income taxes payable 5,072 4,485
Short-term debt and current portion of long-term debt 883 1,436
Total current liabilities 46,949 44,982
Accrued retiree health care 7,431 7,528
Accrued pension plan liability, net 20,070 19,651
Non-current income taxes payable 275 366
Other long-term liabilities 1,039 1,429
Long-term debt 8,695 8,973
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 4,181 4,122
Treasury stock, at cost - 258,226,771 and 256,630,628
shares (16,412) (15,937)
Retained earnings 31,490 30,037
Accumulated other comprehensive loss (16,794) (17,416)
Total shareholders' equity 7,526 5,867
Noncontrolling interest 106 100
Total equity 7,632 5,967
Total liabilities and equity $92,091 $88,896
The Boeing Company and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
Six months ended June 30
(Dollars in millions) 2013 2012
Cash flows - operating activities:
Net earnings $2,194 $1,890
Adjustments to reconcile net earnings to net cash provided
by operating activities:
Non-cash items -
Share-based plans expense 107 99
Depreciation and amortization 865 848
Investment/asset impairment charges, net 26 45
Customer financing valuation benefit (5) (1)
(Gain)/loss on disposal of discontinued operations (1) 2
(Gain)/loss on dispositions, net (22) 2
Other charges and credits, net 31 361
Excess tax benefits from share-based payment arrangements (47) (39)
Changes in assets and liabilities -
Accounts receivable (550) (310)
Inventories, net of advances and progress billings (2,614) (2,737)
Accounts payable 848 742
Accrued liabilities (682) (594)
Advances and billings in excess of related costs 1,472 (152)
Income taxes receivable, payable and deferred 608 705
Other long-term liabilities (60) (15)
Pension and other postretirement plans 1,638 686
Customer financing, net 188 216
Other (5) (3)
Net cash provided by operating activities 3,991 1,745
Cash flows - investing activities:
Property, plant and equipment additions (976) (780)
Property, plant and equipment reductions 44 16
Acquisitions, net of cash acquired (26) (18)
Contributions to investments (7,045) (6,396)
Proceeds from investments 4,632 3,596
Purchase of distribution rights (6)
Net cash used by investing activities (3,371) (3,588)
Cash flows - financing activities:
New borrowings 531 24
Debt repayments (1,361) (1,233)
Repayments of distribution rights financing (139) (72)
Stock options exercised, other 484 71
Excess tax benefits from share-based payment arrangements 47 39
Employee taxes on certain share-based payment arrangements (57) (68)
Common shares repurchased (1,000)
Dividends paid (735) (658)
Net cash used by financing activities (2,230) (1,897)
Effect of exchange rate changes on cash and cash (37) (4)
equivalents
Net decrease in cash and cash equivalents (1,647) (3,744)
Cash and cash equivalents at beginning of year $10,341 $10,049
Cash and cash equivalents at end of period $8,694 $6,305
The Boeing Company and Subsidiaries
Summary of Business Segment Data
(Unaudited)
Six months ended Three months ended
June 30 June 30
(Dollars in millions) 2013 2012 2013 2012
Revenues:
Commercial Airplanes $24,314 $22,780 $13,624 $11,843
Defense, Space & Security:
Boeing Military Aircraft 7,998 8,272 3,889 4,050
Network & Space Systems 4,009 3,832 2,049 1,960
Global Services & Support 4,289 4,321 2,248 2,182
Total Defense, Space & Security 16,296 16,425 8,186 8,192
Boeing Capital 209 238 104 113
Other segment 54 52 27 28
Unallocated items and eliminations (165) (107) (126) (171)
Total revenues $40,708 $39,388 $21,815 $20,005
Earnings from operations:
Commercial Airplanes $2,672 $2,292 $1,453 $1,211
Defense, Space & Security:
Boeing Military Aircraft 803 752 373 353
Network & Space Systems 293 245 137 136
Global Services & Support 512 493 266 259
Total Defense, Space & Security 1,608 1,490 776 748
Boeing Capital 63 72 19 39
Other segment (101) (143) (43) (64)
Unallocated items and eliminations (998) (604) (489) (392)
Earnings from operations 3,244 3,107 1,716 1,542
Other income, net 22 22 13 10
Interest and debt expense (195) (220) (96) (106)
Earnings before income taxes 3,071 2,909 1,633 1,446
Income tax expense (878) (1,018) (546) (479)
Net earnings from continuing 2,193 1,891 1,087 967
operations
Net gain/(loss) on disposal of
discontinued operations, net of
taxes of $0, $1, $0 and $0 1 (1) 1
Net earnings $2,194 $1,890 $1,088 $967
Research and development expense,
net:
Commercial Airplanes $865 $1,104 $446 $560
Defense, Space & Security 579 562 307 281
Other 24 26 10 16
Total research and development
expense, net $1,468 $1,692 $763 $857
Unallocated items and eliminations:
Share-based plans ($53) ($41) (22) (19)
Deferred compensation (102) (34) (46) 2
Capitalized interest (34) (37) (17) (16)
Eliminations and other (158) (39) (92) (114)
Sub-total (included in core (347) (151) (177) (147)
operating earnings)
Pension (689) (404) (331) (215)
Postretirement 38 (49) 19 (30)
Total unallocated items and ($998) ($604) ($489) ($392)
eliminations
The Boeing Company and Subsidiaries
Operating and Financial Data
Unaudited)
Deliveries Six months ended June 30 Three months ended June 30
Commercial Airplanes 2013 2012 2013 2012
737 218 208 116 109
747 12 13 6 7
767 12 13 8 6
777 47 42 23 22
787 17 (1) 11 16 (1) 6
Total 306 287 169 150
Note: Deliveries under operating lease are identified by parentheses.
Defense, Space & Security
Boeing Military Aircraft
F/A-18 Models 24 24 12 12
F-15E Eagle 3 8 3
C-17 Globemaster III 6 5 3 3
CH-47 Chinook 17 22 8 12
AH-64 Apache 20 3 5 3
P-8 Models 5 1 3
AEW&C 2 2
Network & Space Systems
Commercial and Civil
Satellites 1 1
Military Satellites 3 1
June 30 March 31 December 31
Contractual backlog (Dollars in billions) 2013 2013 2012
Commercial Airplanes $337.7 $322.0 $317.3
Defense, Space & Security:
Boeing Military Aircraft 26.5 26.6 29.2
Network & Space Systems 10.2 9.6 10.1
Global Services & Support 14.8 15.4 15.8
Total Defense, Space & Security 51.5 51.6 55.1
Total contractual backlog $389.2 $373.6 $372.4
Unobligated backlog $21.1 $18.1 $17.9
Total backlog $410.3 $391.7 $390.3
Workforce 172,200 173,100 174,400
The Boeing Company and Subsidiaries
Reconciliation of Non-GAAP Measures
Core Operating Earnings, Core Operating Margin and Core Earnings Per Share
(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 6 of this release for
additional information on the use of these non-GAAP financial measures.
Six months ended June 30 Three months ended June 30
2013 2012 2013 2012
Revenues $40,708 $39,388 $21,815 $20,005
GAAP Earnings From Operations $3,244 $3,107 $1,716 $1,542
GAAP Operating Margin 8.0% 7.9% 7.9% 7.7%
Unallocated Pension/
Postretirement Expense $651 $453 $312 $245
Core Operating Earnings $3,895 $3,560 $2,028 $1,787
(non-GAAP)
Core Operating Margin (non-GAAP) 9.6% 9.0% 9.3% 8.9%
GAAP Diluted Earnings Per Share $2.85 $2.49 $1.41 $1.27
Unallocated Pension/
Postretirement Expense(1) $0.55 $0.39 $0.26 $0.21
Core Earnings Per Share
(non-GAAP) $3.40 $2.88 $1.67 $1.48
Weighted Average Diluted Shares
(millions) 770.1 760.7 771.8 762.0
Increase in GAAP Earnings Per
Share 14% 11%
Increase in Core Earnings Per
Share 18% 13%
(1) Earnings per share impact is presented net of the federal statutory tax rate
of 35.0 percent.
The Boeing Company and Subsidiaries
Reconciliation of Non-GAAP Measures
2013 Increase in Core Earnings Per Share
(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 6 of this release for
additional information on the use of these non-GAAP financial measures.
Year Ended December 31, Year Ended December 31, 2013
2012 Guidance
Earnings Per Share Earnings Per Share
GAAP Diluted
Earnings Per $5.11 $5.10 - 5.30
Share
Unallocated
Pension/
Postretirement
Expense 0.77 a 1.10 b
Core Earnings Per
Share (non-GAAP) $5.88 $6.20 - 6.40
Weighted average
diluted shares 763.8 768.0
(millions)
2013 Change in
GAAP Earnings per 2%
Share
2013 Increase in
Core Earnings per 7%
Share
a Represents the net earnings per share impact of unallocated pension and
postretirement expense of $899 million, net of the federal statutory tax rate
of 35.0 percent.
b Represents the net earnings per share impact of unallocated pension and
postretirement expense of approximately $1.3 billion, net of the federal
statutory tax rate of 35.0 percent.
SOURCE Boeing
END
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