Boeing ups forecasts, takes further air tanker charge

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(Reuters) – Boeing Co (BA.N) raised its full-year earnings and cash flow forecasts on Wednesday despite taking a $329 million charge related to its troubled KC-46 aerial refueling tanker.

FILE PHOTO – The new Boeing 787-10 Dreamliner taxis on the runway during it’s first flight at the Charleston International Airport in North Charleston, South Carolina, United States March 31, 2017. REUTERS/Randall Hill/File Photo

Boeing’s stock, up 70 percent this year, dipped less than 1 percent to $264 in premarket trading after it published the third quarter results.

The world’s biggest maker of jetliners said third-quarter core operating margin rose to 9.8 percent in the third quarter ended Sept. 30, from 9.2 percent a year earlier.

The company added, however, that the improvement in margins was partially offset by the charge on the KC-46 aerial refueling tanker, which it split between its commercial airlines and defence units.

The costs of the troubled tanker program had already weighed on Boeing results earlier this year and Chief Financial Officer Greg Smith said then that the cost would not recur in future quarters.

Boeing raised its operating cash flow forecast for the full year to about $12.5 billion from its previous forecast of $12.25 billion.

It also increased its 2017 core earnings per share forecast to $9.90-$10.10, from $9.80-$10.00, previously.

Revenue rose to $24.31 billion in the third quarter ended Sept. 30 from $23.90 billion. Core earnings were $2.72 per share, compared with $3.51 per share a year ago when it included a tax gain.

Reporting by Ankit Ajmera and Rachit vats in Bengaluru; Editing by Saumyadeb Chakrabarty and Patrick Graham

Our Standards:The Thomson Reuters Trust Principles.

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