Published February 2001

Boeing reports 14 percent earnings increase in 2000

By Bryan Corliss
Herald Economy Writer

Boeing ended 2000 showing a $2.1 billion profit, and an almost $90 billion order backlog in the commercial airplane group should keep profits strong for the next two years, whatever the U.S. economy does, company officials said recently.

The profit would have been $2.5 billion for the year but for one-time charges related to the purchase of Hughes’ space and communications and flight information service provider Jeppesen Sanderson Inc., Boeing officials said while announcing the company’s year-end and fourth-quarter earnings last month.

The report continued Boeing’s trend of lower sales but increased profits. Revenues for the year dropped 12 percent compared to 1999, to $51.3 billion. But earnings were up 14 percent to $2.5 billion — setting aside the one-time charges.

For the quarter, revenue was down 3 percent, to $14.7 billion, while earnings increased 32 percent to $877 million, again excluding the one-time charges.

It was a good, solid quarter to finish the year. And — setting aside those one-time events — it was just about in line with analysts’ expectations for the company, said Ragen MacKenzie analyst Peter Jacobs in Seattle.

“The outlook over the next couple of years is more than satisfactory,” Jacobs added. Boeing has orders for about 1,500 airplanes, Jacobs said. And while orders are likely to drop from 2000’s high levels, all it will take is a “reasonably healthy” level of orders to keep Boeing strong for the next several years.

That was the message Boeing Chairman Phil Condit gave in a conference call with analysts and reporters last month.

“There will be some lumpiness in the order picture,” Condit said. But “the real big thing is the backlog,” he added. “The important thing is what rolls out the door and is delivered.”

Boeing projects delivering 530 planes in both 2001 and 2002, he said. It already has orders for 95 percent of the 2001 planes, and more than two-thirds of those projected for 2002, he said.

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