BOEING REPORTS NET INCOME OF US$0.8 BLN FOR Q2

KUALA LUMPUR, July 29 (Bernama) -- The Boeing Company reported a net income
of US$0.8 billion for its second quarter ended June 30, 2010, or US$1.06 per
share, on revenue of US$15.6 billion, reflecting solid performance across the
company's core businesses on lower volumes.

The company also reaffirmed its 2010 revenue, earnings per share and
operating cash flow outlook.

"Continued strong results from our major businesses drove another solid
quarter of operational performance for the company," Jim McNerney, Boeing
chairman, president and chief executive officer said.

"We are making progress on key commercial and military development programs,
our production programmes and services businesses are running well, and our
enterprise focus on productivity improvement is funding investment in growth
while maintaining our financial strength," he said.

"With our commercial markets recovering, and the priorities of our
government customers gaining clarity, we remain well positioned for growth in
2011 and beyond," McNerney said in a statement released on Wednesday in Chicago.

Boeing's quarterly operating cash flow was US$0.3 billion, reflecting
continued investment in development programmes.

Cash and investments in marketable securities totaled US$10.0 billion at
quarter-end, down US$0.4 billion on planned investments in development
programmes.

Debt was unchanged in the quarter, and the company did not acquire any of its
shares.

Total company backlog at quarter-end was $312 billion, down one per cent in
the quarter, as backlog for Defense, Space & Security declined during the period
and was somewhat offset by an increase in Commercial Airplanes backlog.

Boeing Commercial Airplanes second-quarter revenue was US$7.4 billion, on
nine per cent fewer airplane deliveries driven by anticipated seat supplier
challenges and lower planned wide-body deliveries.

Operating margin was 9.2 per cent as strong performance partially offset the
impact of lower deliveries, it said.

Commercial Airplanes booked 88 gross orders during the quarter while 20
orders were removed from its order book.

This contrasts with the year-ago period when net orders were five airplanes.
Contractual backlog remains strong with 3,304 airplanes valued at US$252
billion, more than seven times the unit's projected 2010 revenue.

The 787 programme continued flight test during the quarter, as a fifth
airplane joined the four airplanes already in the flight test programme. The
Dreamliner completed key flight test milestones, including extreme weather,
icing and cruise performance testing.

On July 1, the program completed another key milestone with the completion
of 787-9 firm configuration. First delivery continues to be planned for the end
of this year, although there is added pressure to the schedule and risk that
initial delivery may move a few weeks as the company completes flight test and
certification requirements.

Total firm orders for the 787 program at quarter-end were 863 airplanes from
56 customers.

As for Boeing Defense, Space & Security, it said the second-quarter revenue
declined eight per cent to US$8.0 billion primarily on lower Network & Space
Systems volume. Operating margins were 8.9 per cent on lower margins in military
aircraft and services.

As for outlook, Boeing said the 2010 financial guidance has been reaffirmed
for revenue, earnings per share, and operating cash flow, although the business
segment margin guidance has been adjusted. Capital expenditures guidance has
been decreased.

Boeing's 2010 revenue guidance has been reaffirmed at US$64 billion to US$66
billion.

Earnings guidance for 2010 remains at US$3.50 to US$3.80 per share and
continues to include some provision for risks.

Operating cash flow guidance was reaffirmed at approximately zero in 2010,
with the company continuing to build inventory on key commercial development
programmes.

The company also expects 2011 revenue to be higher than 2010, primarily
driven by projected 787 and 747-8 deliveries.

Combining higher projected deliveries with spending plans for research and
development investments and other factors, operating cash flow in 2011 is still
expected to be greater than US$5 billion, Boeing said.

Commercial Airplanes' 2010 delivery guidance remained unchanged at between
460 and 465 airplanes and sold out.

It included the first few 787 and 747-8 deliveries. The unit's 2010 revenue
guidance was reaffirmed at US$31 billion to US$32 billion and operating margin
guidance increased to between 7.5 per cent and 8.5 per cent, up from 6.5
per cent to 7.5 per cent on strong core operating performance.

Also reaffirmed was the Defense, Space & Security's revenue for 2010 at
between US$32 billion and US$33 billion with operating margins reduced to
approximately 9.5 per cent, from approximately 10 per cent, reflecting
performance to date and the current contracting environment.

Boeing Capital Corporation also reaffirmed its expectation that its aircraft
finance portfolio will continue to reduce as its expected new aircraft financing
for 2010 remained at less than US$0.5 billion, below normal portfolio runoff
through customer payments and depreciation.

Boeing also retained its 2010 research and development (R&D) forecast at
US$3.9 billion to US$4.1 billion on continued investment in development
programmes.

It expects R&D to decrease at an amount greater than US$0.5 billion in 2011.

Capital expenditures for 2010 meanwhile was reduced to approximately US$1.7
billion, down from US$1.9 billion. The company's 2010 non-cash pension expense
is expected to be approximately US$1.2 billion.

--BERNAMA



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