By Bethel Habte
Boeing Co. reported a 19 percent increase in profits and record revenues in its fourth quarter. The stock rose 5.4 percent.
The company credited its strong showing to a wave of new orders in the commercial sector and international contracts.
The aircraft manufacturer made $1.47 billion in profits in the quarter-ended Dec. 31, compared with $1.23 billion in the year-earlier quarter. Boeing’s earnings per diluted share widened to $2.02 from $1.61.
Omitting certain one-time charges, the company reported $2.31 earnings per share, blowing past the consensus estimate of $2.07.
The company also boasted record revenues – nearly $24.5 billion from $23.8 billion in the year-earlier quarter.
Analyst Neal Dihora of Morningstar Inc. said Boeing delivered on reassurances that operating cash flows would bounce back after a third-quarter slump. Net operating cash flow reached $5 billion in the fourth quarter. In the third quarter the company reported $3.86 billion in net operating cash flows, a 43.2 percent decline from the year-earlier quarter’s $6.8 billion. The company expects operating cash flow to be greater than $9 billion in 2015.
“Strong operating performance in the final quarter of 2014 propelled us to some of our best-ever results and sealed a fifth consecutive year of core operating earnings growth,” Boeing CEO and Chairman Jim McNerney stated in a press release Wednesday.
Dihora said the cash flow figures confirmed the company’s ability to deliver on promises, which was more significant than any rise in stock price. Overall, though, Dihora believed Boeing’s performance was consistent for the environment the company finds itself in.
“They have strong visibility and demand from commercial customers and decreased demand from defense customers,” he said.
Boeing also has a backlog of 5,800 airplanes, totaling $502 billion, which will take eight years to clear at current production rates.
In the full year 2014, Boeing earned $5.4 billion, or $7.38 per diluted share, on revenues of $90.76 billion, compared with $4.59 billion, or $5.96 per diluted share, on revenues of $86.62 billion in 2013.
The company expects between $94.5 billion and $96.5 billion in full-year revenues and between $8.10 and $8.30 earnings per diluted share.
The stock closed at $139.64 Wednesday, up $7.16.