Boeing Reports
Fourth-Quarter Results and Provides 2016 Guidance
CHICAGO, Jan. 27, 2016 --
Fourth-Quarter
2015
- Core EPS (non-GAAP)* of $1.60
on revenue of $23.6 billion; GAAP EPS
of $1.51
- Strong operating cash flow of $3.1
billion on solid core operating performance
Full Year 2015
- Record revenue of $96.1
billion on record commercial deliveries
- Operating cash flow increased to $9.4
billion; strong liquidity of $12.1
billion in cash and marketable securities
- Backlog remains strong at $489
billion, including $83 billion
of net orders during the year
Outlook for
2016
- 2016 Core EPS* guidance of between $8.15 and $8.35; GAAP EPS guidance of between
$8.45 and $8.65
- Revenue guidance of between $93 and
$95 billion reflects commercial deliveries of between 740
and 745
- Reaffirming planned production rate increases over the next
several years
- Operating cash flow guidance of approximately $10 billion
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Table 1. Summary Financial Results |
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Fourth
Quarter |
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Full Year |
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(Dollars in Millions, except per share
data) |
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2015 |
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2014 |
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Change |
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2015 |
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2014 |
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Change |
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Revenues |
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$23,573 |
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$24,468 |
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(4)% |
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$96,114 |
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$90,762 |
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6% |
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Non-GAAP* |
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Core Operating Earnings |
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$1,259 |
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$2,344 |
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(46)% |
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$7,741 |
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$8,860 |
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(13)% |
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Core Operating Margin |
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5.3% |
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9.6% |
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(4.3)
Pts |
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8.1% |
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9.8% |
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(1.7) Pts |
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Core Earnings Per Share |
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$1.60 |
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$2.31 |
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(31)% |
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$7.72 |
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$8.60 |
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(10)% |
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Operating Cash Flow Before Pension
Contributions |
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$3,137 |
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$5,032 |
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(38)% |
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$9,421 |
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$9,642 |
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(2)% |
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GAAP |
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Earnings From Operations |
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$1,161 |
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$2,025 |
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(43)% |
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$7,443 |
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$7,473 |
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0% |
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Operating Margin |
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4.9% |
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8.3% |
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(3.4)
Pts |
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7.7% |
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8.2% |
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(0.5)
Pts |
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Net Earnings |
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$1,026 |
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$1,466 |
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(30)% |
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$5,176 |
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$5,446 |
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(5)% |
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Earnings Per Share |
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$1.51 |
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$2.02 |
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(25)% |
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$7.44 |
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$7.38 |
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1% |
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Operating Cash Flow |
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$3,119 |
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$4,998 |
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(38)% |
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$9,363 |
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$8,858 |
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6% |
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* |
Non-GAAP measures. Complete
definitions of Boeing's non-GAAP measures are on page 7, "Non-GAAP
Measures Disclosures." |
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The Boeing Company [NYSE: BA] reported fourth-quarter revenue of
$23.6 billion and core earnings per
share (Non-GAAP)* of $1.60 (Table 1).
Fourth quarter 2015 results reflect the previously announced
$569 million after-tax charge
($0.84 per share) on the 747 program
as a result of a slow recovery in the air cargo market which was
partially offset by solid core operating performance across the
company. GAAP earnings per share was $1.51.
Revenue rose 6 percent in the full year to a record $96.1 billion reflecting record commercial
deliveries. Core earnings per share (Non-GAAP)* totaled
$7.72 for the full year, reflecting
the KC-46 Tanker (2Q) and 747 program (4Q) charges ($1.61 per share) partially offset by strong core
operating performance across the company. GAAP earnings per share
totaled $7.44 for the full year.
Core earnings per share (non-GAAP)* guidance for 2016 is set at
between $8.15 and $8.35, while GAAP
earnings per share is established at between $8.45 and $8.65. Revenue guidance is between
$93 and $95 billion, including
commercial deliveries of between 740 and 745. Operating cash flow
is expected to be approximately $10
billion.
"Building on our foundation of solid core operating performance
and customer focus, Boeing extended its leadership of the aerospace
industry in 2015 with record deliveries and revenues in commercial
airplanes, and solid sales and healthy margins in our defense and
space business. We also generated significant cash flow to fuel
investments in innovation and our people, and provide compelling
returns to our shareholders," said Boeing President and Chief
Executive Officer Dennis
Muilenburg. "With clear strategies and strong
positions in our markets, a large and diverse order backlog worth
nearly $500 billion, and multiple
additional production rate increases planned yet this decade, we
are well positioned for profitable growth and higher cash flow as
we move into our second century in business."
"Our priorities for 2016 and beyond are to build on our existing
strengths to deliver on current plans and commitments, and to
stretch beyond them by accelerating progress on key enterprise
growth and productivity initiatives, investing in our team, and
creating more value and opportunity for our customers, shareholders
and employees," Muilenburg said.
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Table 2. Cash Flow |
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Fourth
Quarter |
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Full Year |
(Millions) |
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2015 |
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2014 |
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2015 |
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2014 |
Operating Cash Flow Before Pension
Contributions* |
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$3,137 |
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$5,032 |
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$9,421 |
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$9,642 |
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Pension
Contributions |
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($18) |
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($34) |
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($58) |
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($784) |
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Operating Cash Flow |
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$3,119 |
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$4,998 |
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$9,363 |
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$8,858 |
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Less Additions to Property, Plant &
Equipment |
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($623) |
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($668) |
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($2,450) |
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($2,236) |
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Free Cash Flow* |
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$2,496 |
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$4,330 |
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$6,913 |
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$6,622 |
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Operating cash flow in the quarter was $3.1 billion, reflecting commercial airplane
production rates, solid core operating performance and the timing
of receipts and expenditures in the prior period (Table 2). During
the quarter, the company repurchased 5 million shares for
$0.8 billion and paid $0.6 billion in dividends. For the full year, the
company repurchased 47 million shares for $6.8 billion and paid $2.5
billion in dividends. Based on strong cash generation and
outlook, in December, the board of directors raised the share
repurchase authorization to $14
billion, replacing the authorization approved in 2014 of
which $5.3 billion was remaining, and
increased the quarterly dividend 20 percent. Share repurchases
under the new authorization are expected to be made over the next
two to three years.
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Table 3. Cash, Marketable Securities and Debt
Balances |
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Quarter-End |
(Billions) |
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Q4 15 |
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Q3 15 |
Cash |
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$11.3 |
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$9.4 |
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Marketable Securities1 |
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$0.8 |
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$0.5 |
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Total |
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$12.1 |
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$9.9 |
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Debt Balances: |
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The Boeing Company, net of intercompany loans to
BCC |
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$7.6 |
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$6.6 |
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Boeing Capital, including intercompany loans |
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$2.4 |
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$2.4 |
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Total Consolidated Debt |
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$10.0 |
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$9.0 |
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1 |
Marketable securities consists
primarily of time deposits due within one year classified as
"short-term investments." |
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Cash and investments in marketable securities totaled
$12.1 billion, up from $9.9 billion at the beginning of the quarter,
primarily due to the timing of cash flows. Debt was $10.0 billion, up from $9.0 billion at the beginning of the quarter,
primarily due to the issuance of new debt (Table 3).
Total company backlog at quarter-end was $489 billion, up from $485
billion at the beginning of the quarter, and included net
orders for the quarter of $28
billion. Net orders for the full year totaled $83 billion.
Segment Results
Commercial Airplanes
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Table 4. Commercial Airplanes |
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Fourth
Quarter |
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Full Year |
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(Dollars in Millions) |
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2015 |
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2014 |
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Change |
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2015 |
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2014 |
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Change |
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Commercial Airplanes Deliveries |
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182 |
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195 |
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(7)% |
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762 |
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723 |
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5% |
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Revenues |
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$16,098 |
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$16,839 |
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(4)% |
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$66,048 |
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$59,990 |
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10% |
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Earnings from Operations |
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$566 |
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$1,562 |
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(64)% |
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$5,157 |
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$6,411 |
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(20)% |
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Operating Margin |
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3.5% |
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9.3% |
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(5.8)
Pts |
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7.8% |
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10.7% |
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(2.9)
Pts |
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Commercial Airplanes fourth-quarter revenue decreased slightly
to $16.1 billion on lower delivery
volume (Table 4). Fourth-quarter operating margin was 3.5 percent,
reflecting the previously announced $885
million pre-tax charge on the 747 program and higher R&D
partially offset by strong performance on production programs.
During the quarter, Commercial Airplanes won orders for 203 737
MAX airplanes. The 737 program has captured nearly 3,100 orders for
the 737 MAX since launch. Also during the quarter, the company
completed detailed design for the 787-10 Dreamliner, final systems
definition on the 777X, and rolled out the first 737 MAX
airplane.
Commercial Airplanes booked 321 net orders during the quarter
and 768 net orders in 2015. Backlog remains strong with nearly
5,800 airplanes valued at $432
billion.
Defense, Space & Security
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Table 5. Defense, Space & Security |
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Fourth
Quarter |
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Full Year |
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(Dollars in Millions) |
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2015 |
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2014 |
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Change |
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2015 |
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2014 |
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Change |
Revenues1 |
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Boeing Military Aircraft |
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$3,199 |
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$2,991 |
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7% |
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$13,482 |
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$13,500 |
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0% |
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Network & Space Systems |
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$1,954 |
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$2,180 |
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(10)% |
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$7,751 |
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$8,003 |
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(3)% |
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Global Services & Support |
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$2,632 |
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$2,417 |
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9% |
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$9,155 |
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$9,378 |
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(2)% |
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Total BDS Revenues |
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$7,785 |
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$7,588 |
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3% |
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$30,388 |
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$30,881 |
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(2)% |
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Earnings from Operations1 |
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Boeing Military Aircraft |
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$438 |
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$366 |
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20% |
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$1,318 |
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$1,301 |
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1% |
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Network & Space Systems |
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$163 |
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$191 |
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(15)% |
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$726 |
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$698 |
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4% |
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Global Services & Support |
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$362 |
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$360 |
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1% |
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$1,230 |
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$1,134 |
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8% |
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Total BDS Earnings from Operations |
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$963 |
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$917 |
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5% |
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$3,274 |
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$3,133 |
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5% |
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Operating Margin |
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12.4% |
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12.1% |
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0.3 Pts |
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10.8% |
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10.1% |
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0.7 Pts |
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1 |
During the first quarter of 2015,
certain programs were realigned between Boeing Military Aircraft
and Global Services & Support. |
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Defense, Space & Security's fourth-quarter revenue was
$7.8 billion with an operating margin
of 12.4 percent (Table 5).
Boeing Military Aircraft (BMA) fourth-quarter revenue increased
to $3.2 billion and operating margin
increased to 13.7 percent, reflecting higher volume and delivery
mix. During the quarter, BMA was awarded a contract for 15 EA-18G
Growlers and Japan selected the
KC-46 tanker to meet their tanker requirement.
Network & Space Systems (N&SS) fourth-quarter revenue
was $2.0 billion, reflecting lower
satellite volume. Operating margin was 8.3 percent, reflecting
lower performance on a development program. During the quarter,
NASA awarded Boeing its second commercial contract for a human
spaceflight mission as part of the existing Commercial Crew
contract.
Global Services & Support (GS&S) fourth-quarter revenue
increased to $2.6 billion, reflecting
the timing of Airborne Surveillance, Command and Control
deliveries. Operating margin was 13.8 percent reflecting program
mix. During the quarter, GS&S delivered the final
AEW&C aircraft to Turkey.
Backlog at Defense, Space & Security was $58 billion, of which 40 percent represents
orders from international customers.
Additional Financial Information
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Table 6. Additional Financial
Information |
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Fourth
Quarter |
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Full Year |
(Dollars in Millions) |
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2015 |
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2014 |
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2015 |
|
2014 |
Revenues |
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Boeing Capital |
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$98 |
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$153 |
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$413 |
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$416 |
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Unallocated items, eliminations and other |
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($408) |
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($112) |
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($735) |
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($525) |
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Earnings from Operations |
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Boeing Capital |
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$9 |
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$26 |
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$50 |
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$92 |
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Unallocated pension/postretirement |
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($98) |
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($319) |
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($298) |
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($1,387) |
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Other unallocated items and eliminations |
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($279) |
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($161) |
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($740) |
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($776) |
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Other (loss)/income, net |
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$10 |
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($14) |
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($13) |
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($3) |
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Interest and debt expense |
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($72) |
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($81) |
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($275) |
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($333) |
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Effective tax rate |
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6.6% |
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24.0% |
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27.7% |
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23.7% |
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At quarter-end, Boeing Capital's net portfolio balance was
$3.4 billion, unchanged from the
beginning of the quarter. Unallocated items and eliminations
revenue totaled $408 million at
quarter end, up from $112 million in
the same period of the prior year, primarily due to the timing of
eliminations for intercompany aircraft deliveries. Total pension
expense for the fourth quarter was $529
million, down from $772
million in the same period of the prior year. The company's
income tax expense was $73 million in
the quarter, compared to $464 million
in the same period of the prior year.
Outlook
The company's 2016 financial and delivery guidance (Table 7)
reflects continued solid performance across the company.
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Table 7. 2016 Financial Outlook |
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(Dollars in Billions, except per share
data) |
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2016 |
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The Boeing Company |
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Revenue |
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$93.0 - 95.0 |
Core Earnings Per Share* |
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$8.15 - 8.35 |
GAAP Earnings Per Share |
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$8.45 - 8.65 |
Operating Cash Flow |
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~$10.0 |
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Commercial Airplanes |
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Deliveries |
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740 - 745 |
Revenue |
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$64.0 - 65.0 |
Operating Margin |
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~9.0% |
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Defense, Space & Security |
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Revenue |
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Boeing Military Aircraft |
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~$12.3 |
Network & Space Systems |
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~$7.3 |
Global Services & Support |
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~$9.4 |
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Total BDS Revenue |
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$28.5 - 29.5 |
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Operating Margin |
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Boeing Military Aircraft |
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~10.0% |
Network & Space Systems |
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~9.0% |
Global Services & Support |
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~11.5% |
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Total BDS Operating Margin |
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>10.0% |
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Boeing Capital |
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Portfolio Size |
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Stable |
Revenue |
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~$0.3 |
Pre-Tax Earnings |
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~$0.05 |
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Research & Development |
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~ $3.6 |
Capital Expenditures |
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~ $2.8 |
Pension Expense 1 |
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~ $2.1 |
Effective Tax Rate |
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~ 30.0% |
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1 |
Approximately ($0.1) billion is
expected to be recorded in unallocated items and eliminations |
* |
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 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. A reconciliation
between the GAAP and non-GAAP measures is provided on page 14.
Operating Cash Flow Before Pension Contributions
Operating cash flow before pension contributions is defined as
GAAP operating cash flow without 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
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 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 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) 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,
epidemics, sanctions 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 Ben Hackman (312) 544-2140 |
Communications: |
|
Bernard Choi (312) 544-2002 |
The Boeing Company
and Subsidiaries |
Consolidated
Statements of Operations |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended
December 31 |
|
Three months ended
December 31 |
(Dollars in millions, except per share
data) |
2015 |
|
|
2014 |
|
|
2015 |
|
|
2014 |
|
Sales of products |
|
$85,255 |
|
|
|
$80,688 |
|
|
|
$20,847 |
|
|
|
$21,768 |
|
Sales of services |
10,859 |
|
|
10,074 |
|
|
2,726 |
|
|
2,700 |
|
Total revenues |
96,114 |
|
|
90,762 |
|
|
23,573 |
|
|
24,468 |
|
|
|
|
|
|
|
|
|
Cost of products |
(73,446) |
|
|
(68,551) |
|
|
(18,426) |
|
|
(18,528) |
|
Cost of services |
(8,578) |
|
|
(8,132) |
|
|
(2,201) |
|
|
(2,167) |
|
Boeing Capital interest expense |
(64) |
|
|
(69) |
|
|
(15) |
|
|
(16) |
|
Total costs and expenses |
(82,088) |
|
|
(76,752) |
|
|
(20,642) |
|
|
(20,711) |
|
|
14,026 |
|
|
14,010 |
|
|
2,931 |
|
|
3,757 |
|
Income from operating investments, net |
274 |
|
|
287 |
|
|
67 |
|
|
75 |
|
General and administrative expense |
(3,525) |
|
|
(3,767) |
|
|
(931) |
|
|
(1,040) |
|
Research and development expense, net |
(3,331) |
|
|
(3,047) |
|
|
(905) |
|
|
(755) |
|
(Loss)/gain on dispositions, net |
(1) |
|
|
(10) |
|
|
(1) |
|
|
(12) |
|
Earnings from operations |
7,443 |
|
|
7,473 |
|
|
1,161 |
|
|
2,025 |
|
Other (loss)/income, net |
(13) |
|
|
(3) |
|
|
10 |
|
|
(14) |
|
Interest and debt expense |
(275) |
|
|
(333) |
|
|
(72) |
|
|
(81) |
|
Earnings before income taxes |
7,155 |
|
|
7,137 |
|
|
1,099 |
|
|
1,930 |
|
Income tax expense |
(1,979) |
|
|
(1,691) |
|
|
(73) |
|
|
(464) |
|
Net earnings |
|
$5,176 |
|
|
|
$5,446 |
|
|
|
$1,026 |
|
|
|
$1,466 |
|
|
|
|
|
|
|
|
|
Basic earnings per share |
|
$7.52 |
|
|
|
$7.47 |
|
|
|
$1.52 |
|
|
|
$2.05 |
|
|
|
|
|
|
|
|
|
Diluted earnings per share |
|
$7.44 |
|
|
|
$7.38 |
|
|
|
$1.51 |
|
|
|
$2.02 |
|
|
|
|
|
|
|
|
|
Cash dividends paid per share |
|
$3.64 |
|
|
|
$2.92 |
|
|
|
$0.91 |
|
|
|
$0.73 |
|
|
|
|
|
|
|
|
|
Weighted average diluted shares
(millions) |
696.1 |
|
|
738.0 |
|
|
681.2 |
|
|
724.8 |
|
The
Boeing Company and Subsidiaries |
Consolidated Statements of Financial Position |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
(Dollars in millions, except per share
data) |
December 31
2015 |
|
|
December 31
2014 |
|
Assets |
|
|
|
Cash and cash equivalents |
|
$11,302 |
|
|
|
$11,733 |
|
Short-term and other investments |
750 |
|
|
1,359 |
|
Accounts receivable, net |
8,713 |
|
|
7,729 |
|
Current portion of customer financing, net |
212 |
|
|
190 |
|
Inventories, net of advances and progress
billings |
47,257 |
|
|
46,756 |
|
Total current assets |
68,234 |
|
|
67,767 |
|
Customer financing, net |
3,358 |
|
|
3,371 |
|
Property, plant and equipment, net of accumulated
depreciation of $16,286 and $15,689 |
12,076 |
|
|
11,007 |
|
Goodwill |
5,126 |
|
|
5,119 |
|
Acquired intangible assets, net |
2,657 |
|
|
2,869 |
|
Deferred income taxes |
265 |
|
|
317 |
|
Investments |
1,284 |
|
|
1,154 |
|
Other assets, net of accumulated amortization of
$451 and $479 |
1,408 |
|
|
1,317 |
|
Total assets |
|
$94,408 |
|
|
|
$92,921 |
|
Liabilities and equity |
|
|
|
Accounts payable |
|
$10,800 |
|
|
|
$10,667 |
|
Accrued liabilities |
14,014 |
|
|
13,462 |
|
Advances and billings in excess of related
costs |
24,364 |
|
|
23,175 |
|
Short-term debt and current portion of long-term
debt |
1,234 |
|
|
929 |
|
Total current liabilities |
50,412 |
|
|
48,233 |
|
Deferred income taxes |
2,392 |
|
|
2,207 |
|
Accrued retiree health care |
6,616 |
|
|
6,802 |
|
Accrued pension plan liability, net |
17,783 |
|
|
17,182 |
|
Other long-term liabilities |
2,078 |
|
|
1,566 |
|
Long-term debt |
8,730 |
|
|
8,141 |
|
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 |
4,834 |
|
|
4,625 |
|
Treasury stock, at cost - 345,637,354 and
305,533,606 shares |
(29,568) |
|
|
(23,298) |
|
Retained earnings |
38,756 |
|
|
36,180 |
|
Accumulated other comprehensive loss |
(12,748) |
|
|
(13,903) |
|
Total shareholders' equity |
6,335 |
|
|
8,665 |
|
Noncontrolling interests |
62 |
|
|
125 |
|
Total equity |
6,397 |
|
|
8,790 |
|
Total liabilities and equity |
|
$94,408 |
|
|
|
$92,921 |
|
The Boeing Company
and Subsidiaries |
Consolidated
Statements of Cash Flows |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended
December 31 |
(Dollars in millions) |
2015 |
|
|
2014 |
|
Cash flows – operating
activities: |
|
|
|
Net earnings |
|
$5,176 |
|
|
|
$5,446 |
|
Adjustments to reconcile net earnings to net cash
provided by operating activities: |
|
|
|
Non-cash items – |
|
|
|
Share-based plans expense |
189 |
|
|
195 |
|
Depreciation and amortization |
1,833 |
|
|
1,906 |
|
Investment/asset impairment charges, net |
167 |
|
|
229 |
|
Customer financing valuation benefit |
(5) |
|
|
(28) |
|
Loss/(gain) on dispositions, net |
1 |
|
|
10 |
|
Other charges and credits, net |
364 |
|
|
317 |
|
Excess tax benefits from share-based payment
arrangements |
(157) |
|
|
(114) |
|
Changes in assets and liabilities – |
|
|
|
Accounts receivable |
(1,069) |
|
|
(1,328) |
|
Inventories, net of advances and progress
billings |
(1,110) |
|
|
(4,330) |
|
Accounts payable |
(238) |
|
|
1,339 |
|
Accrued liabilities |
2 |
|
|
(1,088) |
|
Advances and billings in excess of related
costs |
1,192 |
|
|
3,145 |
|
Income taxes receivable, payable and deferred |
477 |
|
|
1,325 |
|
Other long-term liabilities |
46 |
|
|
36 |
|
Pension and other postretirement plans |
2,470 |
|
|
1,186 |
|
Customer financing, net |
167 |
|
|
578 |
|
Other |
(142) |
|
|
34 |
|
Net cash provided by operating
activities |
9,363 |
|
|
8,858 |
|
Cash flows – investing activities: |
|
|
|
Property, plant and equipment additions |
(2,450) |
|
|
(2,236) |
|
Property, plant and equipment reductions |
42 |
|
|
34 |
|
Acquisitions, net of cash acquired |
(31) |
|
|
(163) |
|
Contributions to investments |
(2,036) |
|
|
(8,617) |
|
Proceeds from investments |
2,590 |
|
|
13,416 |
|
Other |
39 |
|
|
33 |
|
Net cash (used)/provided by investing
activities |
(1,846) |
|
|
2,467 |
|
Cash flows – financing activities: |
|
|
|
New borrowings |
1,746 |
|
|
962 |
|
Debt repayments |
(885) |
|
|
(1,601) |
|
Repayments of distribution rights and other asset
financing |
|
|
|
(185) |
|
Stock options exercised |
399 |
|
|
343 |
|
Excess tax benefits from share-based payment
arrangements |
157 |
|
|
114 |
|
Employee taxes on certain share-based payment
arrangements |
(96) |
|
|
(98) |
|
Common shares repurchased |
(6,751) |
|
|
(6,001) |
|
Dividends paid |
(2,490) |
|
|
(2,115) |
|
Other |
|
|
|
(12) |
|
Net cash used by financing activities |
(7,920) |
|
|
(8,593) |
|
Effect of exchange rate changes on cash and cash
equivalents |
(28) |
|
|
(87) |
|
Net (decrease)/increase in cash and cash
equivalents |
(431) |
|
|
2,645 |
|
Cash and cash equivalents at beginning of
year |
11,733 |
|
|
9,088 |
|
Cash and cash equivalents at end of
period |
|
$11,302 |
|
|
|
$11,733 |
|
The Boeing Company
and Subsidiaries |
Summary of Business
Segment Data |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended
December 31 |
|
Three months ended
December 31 |
(Dollars in millions) |
2015 |
|
|
2014 |
|
|
2015 |
|
|
2014 |
|
Revenues: |
|
|
|
|
|
|
|
Commercial Airplanes |
|
$66,048 |
|
|
|
$59,990 |
|
|
|
$16,098 |
|
|
|
$16,839 |
|
Defense, Space & Security: |
|
|
|
|
|
|
|
Boeing Military Aircraft |
13,482 |
|
|
13,500 |
|
|
3,199 |
|
|
2,991 |
|
Network & Space Systems |
7,751 |
|
|
8,003 |
|
|
1,954 |
|
|
2,180 |
|
Global Services & Support |
9,155 |
|
|
9,378 |
|
|
2,632 |
|
|
2,417 |
|
Total Defense, Space & Security |
30,388 |
|
|
30,881 |
|
|
7,785 |
|
|
7,588 |
|
Boeing Capital |
413 |
|
|
416 |
|
|
98 |
|
|
153 |
|
Unallocated items, eliminations and other |
(735) |
|
|
(525) |
|
|
(408) |
|
|
(112) |
|
Total revenues |
|
$96,114 |
|
|
|
$90,762 |
|
|
|
$23,573 |
|
|
|
$24,468 |
|
Earnings from operations: |
|
|
|
|
|
|
|
Commercial Airplanes |
|
$5,157 |
|
|
|
$6,411 |
|
|
|
$566 |
|
|
|
$1,562 |
|
Defense, Space & Security: |
|
|
|
|
|
|
|
Boeing Military Aircraft |
1,318 |
|
|
1,301 |
|
|
438 |
|
|
366 |
|
Network & Space Systems |
726 |
|
|
698 |
|
|
163 |
|
|
191 |
|
Global Services & Support |
1,230 |
|
|
1,134 |
|
|
362 |
|
|
360 |
|
Total Defense, Space & Security |
3,274 |
|
|
3,133 |
|
|
963 |
|
|
917 |
|
Boeing Capital |
50 |
|
|
92 |
|
|
9 |
|
|
26 |
|
Unallocated items, eliminations and other |
(1,038) |
|
|
(2,163) |
|
|
(377) |
|
|
(480) |
|
Earnings from operations |
7,443 |
|
|
7,473 |
|
|
1,161 |
|
|
2,025 |
|
Other (loss)/income, net |
(13) |
|
|
(3) |
|
|
10 |
|
|
(14) |
|
Interest and debt expense |
(275) |
|
|
(333) |
|
|
(72) |
|
|
(81) |
|
Earnings before income taxes |
7,155 |
|
|
7,137 |
|
|
1,099 |
|
|
1,930 |
|
Income tax expense |
(1,979) |
|
|
(1,691) |
|
|
(73) |
|
|
(464) |
|
Net earnings |
|
$5,176 |
|
|
|
$5,446 |
|
|
|
$1,026 |
|
|
|
$1,466 |
|
|
|
|
|
|
|
|
|
Research and development expense, net: |
|
|
|
|
|
|
|
Commercial Airplanes |
|
$2,340 |
|
|
|
$1,881 |
|
|
|
$627 |
|
|
|
$459 |
|
Defense, Space & Security |
986 |
|
|
1,158 |
|
|
271 |
|
|
292 |
|
Other |
5 |
|
|
8 |
|
|
7 |
|
|
4 |
|
Total research and development expense,
net |
|
$3,331 |
|
|
|
$3,047 |
|
|
|
$905 |
|
|
|
$755 |
|
|
|
|
|
|
|
|
|
Unallocated items, eliminations and other: |
|
|
|
|
|
|
|
Share-based plans |
|
($76) |
|
|
|
($67) |
|
|
|
($19) |
|
|
|
($1) |
|
Deferred compensation |
(63) |
|
|
(44) |
|
|
(53) |
|
|
(22) |
|
Amortization of previously capitalized
interest |
(90) |
|
|
(72) |
|
|
(20) |
|
|
(17) |
|
Eliminations and other unallocated items |
(511) |
|
|
(593) |
|
|
(187) |
|
|
(121) |
|
Sub-total (included in core operating
earnings) |
(740) |
|
|
(776) |
|
|
(279) |
|
|
(161) |
|
Pension |
(421) |
|
|
(1,469) |
|
|
(128) |
|
|
(334) |
|
Postretirement |
123 |
|
|
82 |
|
|
30 |
|
|
15 |
|
Total unallocated items, eliminations and
other |
|
($1,038) |
|
|
|
($2,163) |
|
|
|
($377) |
|
|
|
($480) |
|
The Boeing Company
and Subsidiaries |
Operating and
Financial Data |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deliveries |
|
Twelve months ended
December 31 |
|
Three months ended
December 31 |
|
Commercial Airplanes |
|
2015 |
|
|
2014 |
|
|
2015 |
|
|
2014 |
|
|
737 |
|
495 |
|
|
485 |
|
|
120 |
|
|
126 |
|
|
747 |
|
18 |
(3) |
|
19 |
(3) |
|
5 |
(2) |
|
7 |
(1) |
|
767 |
|
16 |
|
|
6 |
|
|
2 |
|
|
3 |
|
|
777 |
|
98 |
|
|
99 |
|
|
21 |
|
|
24 |
|
|
787 |
|
135 |
|
|
114 |
|
|
34 |
|
|
35 |
|
|
Total |
|
762 |
|
|
723 |
|
|
182 |
|
|
195 |
|
|
Note: Deliveries under operating
lease are identified by parentheses. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Defense, Space & Security |
|
|
|
|
|
|
|
|
|
Boeing Military Aircraft |
|
|
|
|
|
|
|
|
|
AH-64 Apache (New) |
|
23 |
|
|
45 |
|
|
5 |
|
|
15 |
|
|
AH-64 Apache (Remanufactured) |
|
38 |
|
|
37 |
|
|
5 |
|
|
4 |
|
|
C-17 Globemaster III |
|
5 |
|
|
7 |
|
|
|
|
|
|
|
|
CH-47 Chinook (New) |
|
41 |
|
|
54 |
|
|
6 |
|
|
8 |
|
|
CH-47 Chinook (Renewed) |
|
16 |
|
|
|
|
|
10 |
|
|
|
|
F-15 Models |
|
12 |
|
|
14 |
|
|
4 |
|
|
4 |
|
|
F/A-18 Models |
|
35 |
|
|
44 |
|
|
7 |
|
|
8 |
|
|
P-8 Models |
|
14 |
|
|
11 |
|
|
4 |
|
|
5 |
|
|
|
|
|
|
|
|
|
|
|
|
Global Services & Support |
|
|
|
|
|
|
|
|
|
AEW&C |
|
1 |
|
|
3 |
|
|
1 |
|
|
|
|
|
C-40A |
|
1 |
|
|
1 |
|
|
|
|
|
1 |
|
|
|
|
|
|
|
|
|
|
|
|
Network & Space Systems |
|
|
|
|
|
|
|
|
|
Commercial and Civil Satellites |
|
3 |
|
|
5 |
|
|
2 |
|
|
2 |
|
|
Military Satellites |
|
1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contractual backlog (Dollars in
billions) |
|
December 31
2015 |
|
|
September 30
2015 |
|
|
December 31
2014 |
|
Commercial Airplanes |
|
|
$431.4 |
|
|
|
$426.0 |
|
|
|
$440.1 |
|
Defense, Space & Security: |
|
|
|
|
|
|
Boeing Military Aircraft |
|
20.0 |
|
|
21.2 |
|
|
21.1 |
|
Network & Space Systems |
|
7.4 |
|
|
8.3 |
|
|
8.9 |
|
Global Services & Support |
|
17.8 |
|
|
16.7 |
|
|
16.9 |
|
Total Defense, Space &
Security |
|
45.2 |
|
|
46.2 |
|
|
46.9 |
|
Total contractual backlog |
|
|
$476.6 |
|
|
|
$472.2 |
|
|
|
$487.0 |
|
Unobligated backlog |
|
|
$12.7 |
|
|
|
$12.6 |
|
|
|
$15.3 |
|
Total backlog |
|
|
$489.3 |
|
|
|
$484.8 |
|
|
|
$502.3 |
|
Workforce |
|
161,400 |
|
|
163,070 |
|
|
165,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 7 of this
release for additional information on the use of these non-GAAP
financial measures. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fourth
Quarter |
|
Full Year |
|
Guidance |
|
2015 |
|
2014 |
|
2015 |
|
2014 |
|
2016 |
Revenues |
|
$23,573 |
|
|
|
$24,468 |
|
|
|
$96,114 |
|
|
|
$90,762 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Earnings From Operations |
|
$1,161 |
|
|
|
$2,025 |
|
|
|
$7,443 |
|
|
|
$7,473 |
|
|
|
GAAP Operating Margin |
4.9% |
|
|
8.3% |
|
|
7.7% |
|
|
8.2% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Unallocated Pension/Postretirement
Expense |
|
$98 |
|
|
|
$319 |
|
|
|
$298 |
|
|
|
$1,387 |
|
|
~($300) |
|
Core Operating Earnings (non-GAAP) |
|
$1,259 |
|
|
|
$2,344 |
|
|
|
$7,741 |
|
|
|
$8,860 |
|
|
|
Core Operating Margin (non-GAAP) |
5.3% |
|
|
9.6% |
|
|
8.1% |
|
|
9.8% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase/(Decrease) in GAAP Earnings From
Operations |
(43%) |
|
|
|
|
0% |
|
|
|
|
|
Increase/(Decrease) in Core Operating Earnings
(non-GAAP) |
(46%) |
|
|
|
|
(13%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Diluted Earnings Per Share |
|
$1.51 |
|
|
|
$2.02 |
|
|
|
$7.44 |
|
|
|
$7.38 |
|
|
$8.45
- $8.65 |
|
Unallocated Pension/Postretirement
Expense1 |
|
$0.09 |
|
|
|
$0.29 |
|
|
|
$0.28 |
|
|
|
$1.22 |
|
|
|
($0.30) |
|
Core Earnings Per Share (non-GAAP) |
|
$1.60 |
|
|
|
$2.31 |
|
|
|
$7.72 |
|
|
|
$8.60 |
|
|
$8.15
- $8.35 |
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Diluted Shares
(millions) |
681.2 |
|
|
724.8 |
|
|
696.1 |
|
|
738.0 |
|
|
655 -
660 |
|
Increase/(Decrease) in GAAP Earnings Per
Share |
(25%) |
|
|
|
|
1% |
|
|
|
|
|
|
Increase/(Decrease) in Core Earnings Per Share
(non-GAAP) |
(31%) |
|
|
|
|
(10%) |
|
|
|
|
|
|
|
|
1 |
Earnings per share impact is
presented net of the federal statutory tax rate of 35.0
percent. |
SOURCE Boeing