REG-Boeing Co: Earnings
29/07/2020 12:35
Boeing Reports Second-Quarter Results
CHICAGO, July 29, 2020 /PRNewswire/ --
* Financial results continue to be significantly impacted by COVID-19 and the
737 MAX grounding
* Revenue of $11.8 billion, GAAP loss per share of ($4.20) and core
(non-GAAP)* loss per share of ($4.79)
* Operating cash flow of ($5.3) billion; cash and marketable securities of
$32.4 billion
* Total backlog of $409 billion, including more than 4,500 commercial
airplanes
Table 1. Summary Financial Results Second Quarter First Half
(Dollars in Millions, except per share data) 2020 2019 Change 2020 2019 Change
Revenues $11,807 $15,751 (25)% $28,715 $38,668 (26)%
GAAP
Loss From Operations ($2,964) ($3,380) NM ($4,317) ($1,030) NM
Operating Margin (25.1)% (21.5)% NM (15.0)% (2.7)% NM
Net Loss ($2,395) ($2,942) NM ($3,036) ($793) NM
Loss Per Share ($4.20) ($5.21) NM ($5.31) ($1.40) NM
Operating Cash Flow ($5,280) ($590) NM ($9,582) $2,198 NM
Non-GAAP*
Core Operating Loss ($3,319) ($3,745) NM ($5,019) ($1,759) NM
Core Operating Margin (28.1)% (23.8)% NM (17.5)% (4.5)% NM
Core Loss Per Share ($4.79) ($5.82) NM ($6.49) ($2.60) NM
*Non-GAAP measure; complete definitions of Boeing's non-GAAP measures are on page 6, "Non-GAAP Measures Disclosures."
The Boeing Company [NYSE: BA] reported second-quarter revenue of
$11.8 billion, GAAP loss per share of ($4.20) and core loss per share
(non-GAAP)* of ($4.79), primarily reflecting the impacts of COVID-19 and the
737 MAX grounding (Table 1). Boeing recorded operating cash flow of ($5.3)
billion.
"We remained focused on the health of our employees and communities while
proactively taking action to navigate the unprecedented commercial market
impacts from the COVID-19 pandemic," said Boeing President and Chief Executive
Officer Dave Calhoun. "We're working closely with our customers, suppliers and
global partners to manage the challenges to our industry, bridge to recovery
and rebuild to be stronger on the other side."
In the second quarter, Boeing restarted production operations across key sites
following temporary pauses to protect its workforce and introduce rigorous new
health and safety procedures. Despite the challenges, Boeing continued to
deliver across key commercial, defense, space and services programs. The
company also resumed early stages of production on the 737 program with a
focus on safety, quality and operational excellence. Following the lead of
global regulators, Boeing made steady progress toward the safe return to
service of the 737, including completion of FAA certification flight tests.
To align to the sharp reduction in commercial market demand in light of
COVID-19, the company is taking several actions including further adjusting
commercial airplane production rates and reducing employment levels.
"The diversity of our balanced portfolio and our government services, defense
and space programs provide some critical stability for us in the near-term as
we take tough but necessary steps to adapt for new market realities," Calhoun
said. "We are taking the right action to ensure we're well positioned for the
future by strengthening our culture, improving transparency, rebuilding trust
and transforming our business to become a better, more sustainable Boeing. Air
travel has always proven to be resilient - and so has Boeing."
Table 2. Cash Flow Second Quarter First Half
(Millions) 2020 2019 2020 2019
Operating Cash Flow ($5,280) ($590) ($9,582) $2,198
Less Additions to Property, Plant & Equipment ($348) ($421) ($776) ($922)
Free Cash Flow* ($5,628) ($1,011) ($10,358) $1,276
*Non-GAAP measure; complete definitions of Boeing's non-GAAP measures are on page 6, "Non-GAAP Measures Disclosures."
Operating cash flow was ($5.3) billion in the quarter, primarily reflecting
lower commercial deliveries and services volume due to COVID-19 and the 737
MAX grounding, as well as timing of receipts and expenditures (Table 2).
Table 3. Cash, Marketable Securities and Debt Balances Quarter-End
(Billions) Q2 20 Q1 20
Cash $20.0 $15.0
Marketable Securities (1) $12.4 $0.5
Total $32.4 $15.5
Debt Balances:
The Boeing Company, net of intercompany loans to BCC $59.5 $36.9
Boeing Capital, including intercompany loans $1.9 $2.0
Total Consolidated Debt $61.4 $38.9
(1) Marketable securities consists primarily of time deposits due within one year classified as "short-term investments."
Cash and investments in marketable securities increased to $32.4 billion,
compared to $15.5 billion at the beginning of the quarter, driven by the
issuance of new debt (Table 3). Debt was $61.4 billion, up from $38.9 billion
at the beginning of the quarter due to the issuance of new debt, partially
offset by repayment of maturing debt.
Total company backlog at quarter-end was $409 billion.
Segment Results
Commercial Airplanes
Table 4. Commercial Airplanes Second Quarter First Half
(Dollars in Millions) 2020 2019 Change 2020 2019 Change
Commercial Airplanes Deliveries 20 90 (78)% 70 239 (71)%
Revenues $1,633 $4,722 (65)% $7,838 $16,544 (53)%
Loss from Operations ($2,762) ($4,946) NM ($4,830) ($3,773) NM
Operating Margin (169.1)% (104.7)% NM (61.6)% (22.8)% NM
Commercial Airplanes second-quarter revenue and operating margin decreased
reflecting lower delivery volume, partially offset by a lower 737 MAX customer
consideration charge of $551 million in the quarter compared to a $5.6 billion
charge in the same period last year. Second-quarter operating margin was also
negatively impacted by $712 million of abnormal production costs related to
the 737 program, $468 million of severance expense and $133 million of
abnormal production costs from the temporary suspension of operations in
response to COVID-19.
The 737 program resumed early stages of production in May and expects to
continue to produce at low rates for the remainder of 2020. The COVID-19
pandemic has significantly impacted air travel and reduced near-term demand,
resulting in lower production and delivery rate assumptions. Commercial
Airplanes expects to gradually increase the 737 production rate to 31 per
month by the beginning of 2022, with further gradual increases to correspond
with market demand. Estimated potential concessions and other considerations
to customers related to the 737 MAX grounding increased by $551 million in the
quarter. There was no material change to estimated abnormal production costs.
Commercial Airplanes has further updated its production rate assumptions this
quarter to reflect impacts of COVID-19 on its demand outlook, and will
continue to assess them on an ongoing basis. The 787 production rate will be
reduced to 6 per month in 2021. The 777/777X combined production rate will be
gradually reduced to 2 per month in 2021, with 777X first delivery targeted
for 2022. At this time, production rate assumptions have not changed on the
767 and 747 programs.
Commercial Airplanes delivered 20 airplanes during the quarter, and backlog
included over 4,500 airplanes valued at $326 billion.
Defense, Space & Security
Table 5. Defense, Space & Security Second Quarter First Half
(Dollars in Millions) 2020 2019 Change 2020 2019 Change
Revenues $6,588 $6,579 — $12,630 $13,166 (4)%
Earnings from Operations $600 $975 (38)% $409 $1,827 (78)%
Operating Margin 9.1% 14.8% (5.7) Pts 3.2% 13.9% (10.7) Pts
Defense, Space & Security second-quarter revenue was $6.6 billion, reflecting
COVID-19 impact on derivative aircraft programs, partially offset by higher
volume across the remainder of the portfolio (Table 5). Second-quarter
operating margin decreased to 9.1 percent primarily due to a gain on sale of
property in the second quarter of 2019 and a $151 million KC-46A Tanker charge
primarily driven by additional fixed cost allocation resulting from lower
commercial airplane production volume due to COVID-19.
During the quarter, Defense, Space & Security received an award for three
additional MQ-25 unmanned aerial refueling aircraft for the U.S. Navy, as well
as contracts for Cruise Missile Systems for the U.S. Navy and a contract for
24 AH-64E Apache helicopters for the Kingdom of Morocco. Defense, Space &
Security completed Critical Design Review for the T-7A advanced trainer,
achieved first flight and delivery of the F/A-18 U.S. Navy Block III Super
Hornet, and achieved first flight of the F-15 Qatar Advanced aircraft.
Defense, Space & Security also delivered the 100(th) U.S. Navy P-8A Poseidon,
the 400(th) V-22 Osprey, and the 2,500(th) AH-64 Apache.
Backlog at Defense, Space & Security was $64 billion, of which 31 percent
represents orders from customers outside the U.S.
Global Services
Table 6. Global Services Second Quarter First Half
(Dollars in Millions) 2020 2019 Change 2020 2019 Change
Revenues $3,488 $4,543 (23)% $8,116 $9,162 (11)%
(Loss)/Earnings from Operations ($672) $687 NM $36 $1,340 NM
Operating Margin (19.3)% 15.1% NM 0.4% 14.6% NM
Global Services second-quarter revenue decreased to $3.5 billion, driven by
lower commercial services volume due to COVID-19, partially offset by higher
government services volume (Table 6). Second-quarter operating margin
decreased to (19.3) percent primarily due to lower commercial services volume,
less favorable mix of products and services, and $923 million of charges
related to asset impairments and severance costs as a result of the COVID-19
market environment.
During the quarter, Global Services was awarded a contract modification for
P-8A integrated logistics support for the U.S. Navy. Global Services captured
an order for four 767-300 freighter conversions for DHL and was awarded a
contract for F-15 pre-delivery training support for the Qatar Emiri Air Force.
Global Services also delivered the first F/A-18 Super Hornet test aircraft
modified for the U.S. Navy Blue Angels.
Additional Financial Information
Table 7. Additional Financial Information Second Quarter First Half
(Dollars in Millions) 2020 2019 2020 2019
Revenues
Boeing Capital $69 $75 $134 $141
Unallocated items, eliminations and other $29 ($168) ($3) ($345)
Earnings from Operations
Boeing Capital ($7) $37 $17 $57
FAS/CAS service cost adjustment $355 $365 $702 $729
Other unallocated items and eliminations ($478) ($498) ($651) ($1,210)
Other income, net $94 $107 $206 $213
Interest and debt expense ($553) ($154) ($815) ($277)
Effective tax rate 30.0% 14.2% 38.4% 27.5%
At quarter-end, Boeing Capital's net portfolio balance was $2.1 billion.
Revenue from other unallocated items and eliminations increased primarily due
to reserves related to cost accounting litigation recorded in the second
quarter of 2019. Interest and debt expense increased due to higher debt
balances. The second quarter effective tax rate reflects tax benefits related
to the 5 year net operating loss carryback provision in the Coronavirus Aid,
Relief, and Economic Security (CARES) Act as well as the impact of pre-tax
losses.
Non-GAAP Measures Disclosures
We supplement the reporting of our financial information determined under
Generally Accepted Accounting Principles in the United States of America
(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
the FAS/CAS service cost adjustment. The FAS/CAS service cost adjustment
represents the difference between the FAS pension and postretirement service
costs calculated under GAAP and costs allocated to the business segments. 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 the FAS/CAS
service cost adjustment and Non-operating pension and postretirement expenses.
Non-operating pension and postretirement expenses represent the components of
net periodic benefit costs other than service cost. Pension costs, comprising
service and prior service costs computed in accordance with GAAP are allocated
to Commercial Airplanes and BGS businesses supporting commercial customers.
Pension costs allocated to BDS and BGS businesses supporting government
customers are computed in accordance with U.S. Government Cost Accounting
Standards (CAS), which employ different actuarial assumptions and accounting
conventions than GAAP. CAS costs are allocable to government contracts. Other
postretirement benefit costs are allocated to all business segments based on
CAS, which is generally based on benefits paid. 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 non-service 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 13.
Free Cash Flow
Free cash flow is GAAP operating cash flow reduced by capital expenditures for
property, plant and equipment. 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 of free cash flow to GAAP operating 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 generally 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 expectations and
assumptions that we believe to be reasonable when made, but that 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) the COVID-19 pandemic and related government actions, including with
respect to our operations, our liquidity, the health of our customers and
suppliers, and future demand for our products and services; (2) the 737 MAX,
including the timing and conditions of 737 MAX regulatory approvals, lower
than planned production rates and/or delivery rates, and increased
considerations to customers and suppliers, (3) general conditions in the
economy and our industry, including those due to regulatory changes; (4) our
reliance on our commercial airline customers; (5) the overall health of our
aircraft production system, planned commercial aircraft production rate
changes, our commercial development and derivative aircraft programs, and our
aircraft being subject to stringent performance and reliability standards; (6)
changing budget and appropriation levels and acquisition priorities of the
U.S. government; (7) our dependence on U.S. government contracts; (8) our
reliance on fixed-price contracts; (9) our reliance on cost-type contracts;
(10) uncertainties concerning contracts that include in-orbit incentive
payments; (11) our dependence on our subcontractors and suppliers, as well as
the availability of raw materials; (12) changes in accounting estimates; (13)
changes in the competitive landscape in our markets; (14) our non-U.S.
operations, including sales to non-U.S. customers; (15) threats to the
security of our or our customers' information; (16) potential adverse
developments in new or pending litigation and/or government investigations;
(17) customer and aircraft concentration in our customer financing portfolio;
(18) changes in our ability to obtain debt on commercially reasonable terms
and at competitive rates; (19) realizing the anticipated benefits of mergers,
acquisitions, joint ventures/strategic alliances or divestitures; (20) the
adequacy of our insurance coverage to cover significant risk exposures; (21)
potential business disruptions, including those related to physical security
threats, information technology or cyber-attacks, epidemics, sanctions or
natural disasters; (22) work stoppages or other labor disruptions; (23)
substantial pension and other postretirement benefit obligations; and (24)
potential environmental liabilities.
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: Maurita Sutedja or Keely Moos (312) 544-2140
Communications: Michael Friedman media@boeing.com
The Boeing Company and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
Six months ended June 30 Three months ended June 30
(Dollars in millions, except per share data) 2020 2019 2020 2019
Sales of products $23,254 $33,319 $9,063 $13,094
Sales of services 5,461 5,349 2,744 2,657
Total revenues 28,715 38,668 11,807 15,751
Cost of products (25,091) (31,910) (10,378) (15,672)
Cost of services (4,632) (4,511) (2,589) (2,122)
Boeing Capital interest expense (23) (34) (11) (16)
Total costs and expenses (29,746) (36,455) (12,978) (17,810)
(1,031) 2,213 (1,171) (2,059)
(Loss)/income from operating investments, net (47) 5 (45) (15)
General and administrative expense (2,034) (1,856) (1,161) (672)
Research and development expense, net (1,297) (1,692) (625) (826)
Gain on dispositions, net 92 300 38 192
Loss from operations (4,317) (1,030) (2,964) (3,380)
Other income, net 206 213 94 107
Interest and debt expense (815) (277) (553) (154)
Loss before income taxes (4,926) (1,094) (3,423) (3,427)
Income tax benefit 1,890 301 1,028 485
Net loss (3,036) (793) (2,395) (2,942)
Less: net loss attributable to noncontrolling interest (32) (19)
Net loss attributable to Boeing Shareholders ($3,004) ($793) ($2,376) ($2,942)
Basic loss per share ($5.31) ($1.40) ($4.20) ($5.21)
Diluted loss per share ($5.31) ($1.40) ($4.20) ($5.21)
Weighted average diluted shares (millions) 566.1 566.6 566.4 565.3
The Boeing Company and Subsidiaries
Consolidated Statements of Financial Position
(Unaudited)
(Dollars in millions, except per share data) June 30 2020 December 31 2019
Assets
Cash and cash equivalents $19,992 $9,485
Short-term and other investments 12,438 545
Accounts receivable, net 2,793 3,266
Unbilled receivables, net 8,570 9,043
Current portion of customer financing, net 115 162
Inventories 83,745 76,622
Other current assets, net 2,624 3,106
Total current assets 130,277 102,229
Customer financing, net 2,054 2,136
Property, plant and equipment, net of accumulated depreciation of $19,863 and $19,342 12,182 12,502
Goodwill 8,064 8,060
Acquired intangible assets, net 3,019 3,338
Deferred income taxes 729 683
Investments 1,066 1,092
Other assets, net of accumulated amortization of $617 and $580 5,481 3,585
Total assets $162,872 $133,625
Liabilities and equity
Accounts payable $13,700 $15,553
Accrued liabilities 22,493 22,868
Advances and progress billings 53,367 51,551
Short-term debt and current portion of long-term debt 2,922 7,340
Total current liabilities 92,482 97,312
Deferred income taxes 404 413
Accrued retiree health care 4,427 4,540
Accrued pension plan liability, net 15,663 16,276
Other long-term liabilities 2,821 3,422
Long-term debt 58,457 19,962
Total liabilities 174,254 141,925
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 6,648 6,745
Treasury stock, at cost - 447,840,938 and 449,352,405 shares (54,829) (54,914)
Retained earnings 47,478 50,644
Accumulated other comprehensive loss (16,025) (16,153)
Total shareholders' equity (11,667) (8,617)
Noncontrolling interests 285 317
Total equity (11,382) (8,300)
Total liabilities and equity $162,872 $133,625
The Boeing Company and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
Six months ended June 30
(Dollars in millions) 2020 2019
Cash flows – operating activities:
Net loss ($3,036) ($793)
Adjustments to reconcile net loss to net cash (used)/provided by operating activities:
Non-cash items –
Share-based plans expense 115 104
Depreciation and amortization 1,103 1,067
Investment/asset impairment charges, net 280 70
Customer financing valuation adjustments 9 249
Gain on dispositions, net (92) (300)
Other charges and credits, net 815 145
Changes in assets and liabilities –
Accounts receivable 143 588
Unbilled receivables 285 (222)
Advances and progress billings 1,822 1,842
Inventories (6,741) (5,233)
Other current assets 433 (887)
Accounts payable (3,181) 2,002
Accrued liabilities 514 4,959
Income taxes receivable, payable and deferred (1,894) (921)
Other long-term liabilities (109) (509)
Pension and other postretirement plans (357) (390)
Customer financing, net 62 347
Other 247 80
Net cash (used)/provided by operating activities (9,582) 2,198
Cash flows – investing activities:
Property, plant and equipment additions (776) (922)
Property, plant and equipment reductions 96 331
Acquisitions, net of cash acquired (492)
Contributions to investments (12,557) (496)
Proceeds from investments 543 758
Purchase of distribution rights (20)
Other 8 (12)
Net cash used by investing activities (12,686) (853)
Cash flows – financing activities:
New borrowings 42,302 11,670
Debt repayments (8,265) (6,422)
Contributions from noncontrolling interests 7
Stock options exercised 27 47
Employee taxes on certain share-based payment arrangements (164) (238)
Common shares repurchased (2,651)
Dividends paid (1,158) (2,317)
Net cash provided by financing activities 32,742 96
Effect of exchange rate changes on cash and cash equivalents, including restricted (11) (2)
Net increase in cash & cash equivalents, including restricted 10,463 1,439
Cash & cash equivalents, including restricted, at beginning of year 9,571 7,813
Cash & cash equivalents, including restricted, at end of period 20,034 9,252
Less restricted cash & cash equivalents, included in Investments 42 85
Cash and cash equivalents at end of period $19,992 $9,167
The Boeing Company and Subsidiaries
Summary of Business Segment Data
(Unaudited)
Effective at the beginning of 2020, certain programs were realigned between
our Defense, Space & Security segment and Unallocated items, eliminations and
other. Business segment data for 2019 has been adjusted to reflect the
realignment.
Six months ended June 30 Three months ended June 30
(Dollars in millions) 2020 2019 2020 2019
Revenues:
Commercial Airplanes $7,838 $16,544 $1,633 $4,722
Defense, Space & Security 12,630 13,166 6,588 6,579
Global Services 8,116 9,162 3,488 4,543
Boeing Capital 134 141 69 75
Unallocated items, eliminations and other (3) (345) 29 (168)
Total revenues $28,715 $38,668 $11,807 $15,751
Earnings/(loss) from operations:
Commercial Airplanes ($4,830) ($3,773) ($2,762) ($4,946)
Defense, Space & Security 409 1,827 600 975
Global Services 36 1,340 (672) 687
Boeing Capital 17 57 (7) 37
Segment operating loss (4,368) (549) (2,841) (3,247)
Unallocated items, eliminations and other (651) (1,210) (478) (498)
FAS/CAS service cost adjustment 702 729 355 365
Loss from operations (4,317) (1,030) (2,964) (3,380)
Other income, net 206 213 94 107
Interest and debt expense (815) (277) (553) (154)
Loss before income taxes (4,926) (1,094) (3,423) (3,427)
Income tax benefit 1,890 301 1,028 485
Net loss (3,036) (793) (2,395) (2,942)
Less: Net loss attributable to noncontrolling interest (32) (19)
Net loss attributable to Boeing Shareholders ($3,004) ($793) ($2,376) ($2,942)
Research and development expense, net:
Commercial Airplanes $786 $1,062 $361 $498
Defense, Space & Security 330 374 167 190
Global Services 65 73 35 33
Other 116 183 62 105
Total research and development expense, net $1,297 $1,692 $625 $826
Unallocated items, eliminations and other:
Share-based plans ($43) ($36) ($25) ($22)
Deferred compensation 73 (129) (120) (27)
Amortization of previously capitalized interest (50) (45) (27) (21)
Customer financing impairment (250)
Research and development expense, net (116) (183) (62) (105)
Eliminations and other unallocated items (515) (567) (244) (323)
Sub-total (included in core operating loss) (651) (1,210) (478) (498)
Pension FAS/CAS service cost adjustment 513 549 258 275
Postretirement FAS/CAS service cost adjustment 189 180 97 90
FAS/CAS service cost adjustment 702 729 $355 $365
Total $51 ($481) ($123) ($133)
The Boeing Company and Subsidiaries
Operating and Financial Data
(Unaudited)
Deliveries Six months ended June 30 Three months ended June 30
Commercial Airplanes 2020 2019 2020 2019
737 9 113 4 24
747 1 4 1 2
767 14 22 4 10
777 10 22 (1) 4 12
787 36 78 7 42
Total 70 239 20 90
Note: Aircraft accounted for as revenues by BCA and as operating leases in consolidation identified by parentheses
Defense, Space & Security
AH-64 Apache (New) 11 10 9 4
AH-64 Apache (Remanufactured) 32 35 18 13
C-17 Globemaster III — — — —
C-40A — — — —
CH-47 Chinook (New) 15 7 6 —
CH-47 Chinook (Renewed) 1 9 — 5
F-15 Models 3 5 3 1
F/A-18 Models 9 10 4 3
KC-46 Tanker 6 12 1 5
P-8 Models 6 8 3 5
Commercial and Civil Satellites — 1 — 1
Military Satellites — — — —
Total backlog (Dollars in millions) June 30 2020 December 31 2019
Commercial Airplanes $325,674 $376,593
Defense, Space & Security 64,286 63,691
Global Services 18,168 22,902
Unallocated items, eliminations and other 522 217
Total backlog $408,650 $463,403
Contractual backlog $385,389 $436,473
Unobligated backlog 23,261 26,930
Total backlog $408,650 $463,403
The Boeing Company and Subsidiaries
Reconciliation of Non-GAAP Measures
(Unaudited)
The tables provided below reconcile the non-GAAP financial measures core
operating loss, core operating margin, and core loss per share with the most
directly comparable GAAP financial measures, loss from operations, operating
margin, and diluted loss per share. See page 6 of this release for additional
information on the use of these non-GAAP financial measures.
(Dollars in millions, except per share data) Second Quarter 2020 Second Quarter 2019
$ millions Per Share $ millions Per share
Revenues 11,807 15,751
Loss from operations (GAAP) (2,964) (3,380)
Operating margin (GAAP) (25.1)% (21.5%)
FAS/CAS service cost adjustment:
Pension FAS/CAS service cost adjustment (258) (275)
Postretirement FAS/CAS service cost adjustment (97) (90)
FAS/CAS service cost adjustment (355) (365)
Core operating loss (non-GAAP) ($3,319) ($3,745)
Core operating margin (non-GAAP) (28.1)% (23.8%)
Diluted loss per share (GAAP) ($4.20) ($5.21)
Pension FAS/CAS service cost adjustment ($258) (0.46) ($275) (0.49)
Postretirement FAS/CAS service cost adjustment (97) (0.17) (90) (0.16)
Non-operating pension expense (84) (0.14) (94) (0.17)
Non-operating postretirement expense 14 0.02 26 0.05
Provision for deferred income taxes on adjustments ( 1) 89 0.16 91 0.16
Subtotal of adjustments ($336) ($0.59) ($342) ($0.61)
Core loss per share (non-GAAP) ($4.79) ($5.82)
Weighted average diluted shares (in millions) 566.4 565.3
(1) The income tax impact is calculated using the U.S. corporate statutory tax rate.
The Boeing Company and Subsidiaries
Reconciliation of Non-GAAP Measures
(Unaudited)
The tables provided below reconcile the non-GAAP financial measures core
operating loss, core operating margin, and core loss per share with the most
directly comparable GAAP financial measures, loss from operations, operating
margin, and diluted loss per share. See page 6 of this release for additional
information on the use of these non-GAAP financial measures.
(Dollars in millions, except per share data) First Half 2020 First Half 2019
$ millions Per Share $ millions Per Share
Revenues 28,715 38,668
Loss from operations (GAAP) (4,317) (1,030)
Operating margin (GAAP) (15.0)% (2.7%)
FAS/CAS service cost adjustment:
Pension FAS/CAS service cost adjustment (513) (549)
Postretirement FAS/CAS service cost adjustment (189) (180)
FAS/CAS service cost adjustment (702) (729)
Core operating loss (non-GAAP) ($5,019) ($1,759)
Core operating margin (non-GAAP) (17.5)% (4.5%)
Diluted loss per share (GAAP) ($5.31) ($1.40)
Pension FAS/CAS service cost adjustment ($513) (0.91) ($549) (0.97)
Postretirement FAS/CAS service cost adjustment (189) (0.33) (180) (0.32)
Non-operating pension expense (171) (0.30) (187) (0.32)
Non-operating postretirement expense 27 0.05 53 0.09
Provision for deferred income taxes on adjustments ( 1) 178 0.31 181 0.32
Subtotal of adjustments ($668) ($1.18) ($682) ($1.20)
Core loss per share (non-GAAP) ($6.49) ($2.60)
Weighted average diluted shares (in millions) 566.1 566.6
(1) The income tax impact is calculated using the U.S. corporate statutory tax rate.
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