Tax settlement and air travel boom boost Boeing
The results topped analysts' expectations for EPS and revenues, and could alleviate worries that US industrial firms will all be big losers from the US-China trade conflict
New York — Boeing's profits surged in the third quarter after a favourable US tax settlement, and the company raised some key annual projections on Wednesday as its order book stayed robust.
The aerospace giant, which has benefited from a multiyear investment boom in global air travel, reported profits of $2.4bn for the quarter ending September 30, a 30.6% jump from the same period of the prior year. Revenues rose 3.8% to $25.1bn.
Boeing lifted its full-year revenue forecast range by $1bn to $98bn-100bn.
CEO Dennis Muilenburg pointed to "strong underlying performance" as well as growth "across our businesses ... throughout the year" as factors in boosting 2018 revenue and earnings forecasts.
Commercial aircraft deliveries actually fell compared with a year earlier, but profit margins in the business surged on higher production of key planes.
The company booked 171 net orders, a decline from the second quarter, but well above the prior year's level.
Boeing's defence business turned in an operating loss due to $691m in one-time costs connected to investment programs. But the company scored major new defense contracts during the quarter.
Boeing also set aside $112m in higher costs for the KC-46 transport aircraft, the latest over-runs on the programme.
But those hits were partly offset by a $412m benefit from a 2013-2014 tax settlement.
The results topped analyst expectations for earnings-per-share and revenues, and could alleviate worries that US industrial companies will all be big losers from the US-China trade conflict. Boeing has been seen as vulnerable on that front because of its substantial China business.
The company's share price surged 4.1% to $364.50 in pre-market trading.