Jan. 26, 2022, © Leeham News: Boeing reported its first cash flow positive quarter, the fourth quarter, since early 2019 today as it issued its 2021 financial results. The 737 MAX was grounded worldwide March 10-13, 2019. The company was cash flow positive by $700m.
For the full year, Boeing remained cash flow negative, at $3.4bn. Boeing recorded a $3.4bn non-cash, pre-tax charge of $3.5bn on the 787 program. Deliveries have been stalled since October 2020.
“The company continues to perform rework on 787 airplanes in inventory and is engaged in detailed discussions with the FAA regarding required actions to resume deliveries,” Boeing said in its earnings press release. “In the fourth quarter, the company determined that these activities will take longer than previously expected, resulting in further delays in customer delivery dates and associated customer considerations. Accordingly, Commercial Airplanes recorded a $3.5b pre-tax non-cash charge on the 787 program. The program is producing at a very low rate and will continue to do so until deliveries resume, with an expected gradual return to five per month over time. The company now anticipates 787 abnormal costs will increase to approximately $2bn, with most being incurred by the end of 2023, including $285m recorded in the quarter.” Another $402m non-cash charge was recorded on the KC-46A program.
Boeing will boost the production rate of the 777/777X program to 3/mo some time this year.
Revenues for the year were $62.3bn, up 7% vs. 2020. Boeing closed the year with $16.2bn in cash and marketable securities. Operating losses narrowed from $12.77bn to $2.9bn. Net losses narrowed from $11.9bn to $4.29bn.
In a letter to employees, CEO David Calhoun said 2021 was a year of rebuilding. Production of the 737 MAX is now at 26/mo, with a target of 31/mo shortly.
Boeing’s earnings call is at 10:30am EST. The call may be accessed here.
The earnings press release may be accessed here.
The earnings presentation may be found here.