Boeing posts third annual loss in a row as Dreamliner prices hit $5.5 billion

Boeing a major milestone in its year-long 737 Max crisis deliveries jump helped generate cash in the fourth quarter for the first time in almost three years.

But now the company is facing mounting spending on its 787 Dreamliner program, which on Wednesday revealed $5.5 billion in costs related to manufacturing defects that have prevented Boeing from making these new ones over the past 15 months Handing over jets to customers.

Shares of the company fell more than 5% in afternoon trade, more than the broader market.

The manufacturer took a pre-tax charge of $3.5 billion for the Dreamliner in the fourth quarter. It expects an additional $2 billion in costs after cutting production of the planes, double its previous estimate.

“We can’t rush it”

Boeing first disclosed the flaws – tiny, improper clearances on some fuselages – in 2020. Defects were also found in other parts of some aircraft, and Boeing had to inspect the undelivered jets.

“While I don’t like any of the allegations, the progress has been significant,” CEO Dave Calhoun told CNBC.screeching in the streeton Wednesday about the 787. He declined to say when he expects regulators to grant approval and deliveries to resume. “We can’t rush it.”

Boeing reported free cash flow of $494 million for the fourth quarter, up from an outflow of $4.27 billion a year earlier, a milestone Boeing executives previously said they wouldn’t hit until 2022. It was spurred by a surge in 737 Max deliveries last year after regulators lifted bans on the jets following fatal crashes in 2018 and 2019.

China

China, a key customer for Boeing and the first country to ground the Max after the second crash, the last month was approaching lift its ban in the planes.

CFO Brian West told analysts on the quarterly conference call that shipments to China could resume “as early as the first quarter” of 2022, which could help the company generate more cash.

Here’s how Boeing compared to analyst estimates prepared by Refinitiv:

  • Adjusted Results: A loss of $7.69 per share versus an expected loss of 42 cents per share.
  • Revenue: $14.79 billion versus $16.59 billion expected.

Boeing lost $4.29 billion last year, its third consecutive annual loss Covid pandemic and production problems continued to affect the bottom line. That’s an improvement from 2020, when the company had a loss of $11.94 billion.

For the fourth quarter, Boeing reported a net loss of $4.16 billion, less than half the $8.44 billion it lost a year earlier. Revenue fell 3% year over year to $14.79 billion, down from $16.59 billion that analysts had expected.

‘renovation year’

“2021 was an important recovery year for us, and together we overcame significant hurdles,” Calhoun said in a note to employees on Wednesday. “While we still have work to do, I am confident that we are well positioned to accelerate our progress in 2022 and beyond.”

Chicago-based Boeing aircraft sales and deliveries increased last year, but deliveries of new planes to airlines still lagged behind European rival Airbus. The US company said it has increased production of the 737 Max to 26 a month, closer to the 31 a month it expects this year and up from the 19 a month it released in its last quarterly report.

But Boeing has been paralyzed for months by halting deliveries of its 787 Dreamliners for much of the past year due to a series of manufacturing defects that have left customers baffled American Airlines and Hawaiian Airlines.

American Airlines said last month it would be cutting its international flight schedule over 787 delivery delays. The airline’s CFO, Derek Kerr, said in an earnings call last week that Boeing is already paying penalties for the delays and “will compensate us for the losses” if there are more delays.

More delays

Kerr had said American expects to start deliveries of the Dreamliner again in mid-April, a timeframe Boeing CEO Calhoun did not confirm on Wednesday. “All I’m saying is that customers know everything we do,” Calhoun said, adding that airlines and Boeing “share the same regulator.”

“The company continues to perform follow-up work on 787 aircraft in inventory and is in detailed discussions with the FAA on the actions needed to resume deliveries,” Boeing said in a earnings release. “In the fourth quarter, the Company determined that these activities will take longer than previously anticipated, which will result in further delays in customer delivery dates and related customer considerations.”

CFO West referred to labor, material and supply chain shortages as “observation posts.”

Boeing’s large fleet of aircraft — 335 Max jets expected to be delivered by the end of 2023 — will provide a buffer, Calhoun said.

“When I think about the supply chain constraints that are out there, I hate that we got here this way, but having a stock of finished aircraft, particularly in relation to the Max, is at this moment beneficial,” Calhoun told CNBC.

recovery from travel

Calhoun said he expects the worst is behind the aviation sector after the pandemic crushed demand for air travel and new planes. Airline executives said in early January they expect international travel bookings to rebound this spring and summer after entry restrictions were lifted in recent months.

The company reiterated on Wednesday that it expects passenger traffic to return to 2019 levels next year or 2024.

Suppliers to Boeing and Airbus General Electric on Tuesday forecast a 20% increase in sales this year at its main aerospace division, which manufactures and repairs aircraft engines.

However, the recovery was bumpy. airlines incl delta, United and American earlier this month predicted the rapid spread of the Omicron variant, which began late last year delay a rebound travel demand by about two months. Executives at those airlines said they expect a strong spring and summer travel season.

On Tuesday, the Transportation Security Administration screened 1.06 million people, the fewest since April 2021.

Mario Lopez had row over greatest facet of stage | Leisure

Mario Lopez “got into a bit of an argument” with Elizabeth Berkley at the People’s Choice Awards.

The ‘Saved by the Bell’ co-stars, who were jointly unveiled at the November 2020 ceremony, and the 47-year-old presenter announced that he and his friends were talking to each other shortly before they arrived on stage about who was on the The stage was allowed to stand to the left of the stage.

Mario interviewed Elizabeth as the guest host of ‘The Ellen DeGeneres Show’ on an episode that aired on Monday (03/29/21) Fights Backstage. “

With a picture of them on stage on the screen, he added, “As you can see, I want to warn our viewers that you are on the left – you are standing on the left – which is usually the side I like to stand on, purely for superstitious reasons, it’s like a luck.

You like to do it because you rock your hair in a certain way and because of the part, right? “

The 48-year-old actress insisted that her series was just “playful jokes”.

She quipped, “No, no, no! Superstitious, or do you like this site?

“No, we didn’t get into a real fight. It was our playful joke, but like brother-sister.”

Mario agreed: “No, we always laugh and tease each other.”

Mario recently paid tribute to another Saved by the Bell co-star, Dustin Diamond, following his death from cancer at the age of 44.

He said, “He was like a little brother to me, we kept in touch over the years. I just spoke to him a few weeks ago after he got his diagnosis. Even then, he was full of energy and so optimistic. Life is just so fragile and not something you can take for granted. Our prayers are with Dustin’s family and friends. “