Boeing Military Aircraft (BMA) first-quarter revenue was $2.7 billion, reflecting planned timing of deliveries and mix; operating margin was 9.5 percent. During the quarter, BMA was awarded contracts for 43 Apache helicopters.
Network & Space Systems (N&SS) first-quarter revenue was $1.7 billion, reflecting lower satellites and missile defense system program volume partially offset by higher volume on the Commercial Crew program. Operating margin increased to 9.6 percent on strong performance related to our United Launch Alliance joint venture. During the quarter, the first two all-electric Boeing 702SP satellites were launched on a single rocket.
Global Services & Support (GS&S) first-quarter revenue was $2.2 billion, reflecting slightly lower volume in integrated logistics. Operating margin increased to 14.1 percent on strong operating performance and program mix. During the quarter, GS&S was awarded a combat logistics support agreement with the U.S. Defense Logistics Agency.
Backlog at Defense, Space & Security was $60 billion, of which 37 percent represents orders from international customers.
Additional Financial Information
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Table 6. Additional Financial Information |
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First Quarter | ||||||
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(Dollars in Millions) |
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2015 |
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2014 | ||||
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Revenues |
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Boeing Capital |
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$86 |
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$82 | ||||
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Unallocated items, eliminations and other |
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($27) |
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$13 | ||||
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Earnings from Operations |
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Boeing Capital |
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$20 |
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$44 | ||||
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Unallocated pension/postretirement |
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($113) |
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($553) | ||||
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Other unallocated items and eliminations |
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($248) |
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($229) | ||||
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Other (loss)/income, net |
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($12) |
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$9 | ||||
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Interest and debt expense |
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($61) |
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($92) | ||||
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Effective tax rate |
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31.3% |
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33.9% | ||||
At quarter-end, Boeing Capital's net portfolio balance was $3.4 billion, down from $3.5 billion at the beginning of the year (Table 6). Total pension expense for the first quarter was $785 million, down from $1,035 million in the same period of the prior year. Unallocated pension expense in 2014 included a $334 million non-cash charge related to retirement plan changes.
Outlook
The company's 2015 financial and delivery guidance (Table 7) is reaffirmed and reflects continued strong performance across the company.
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Table 7. 2015 Financial Outlook |
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(Dollars in Billions, except per share data) |
2015 |
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The Boeing Company |
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Revenue |
$94.5 - 96.5 |
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Core Earnings Per Share* |
$8.20 - 8.40 |
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GAAP Earnings Per Share |
$8.10 - 8.30 |
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Operating Cash Flow |
> $9 |
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Commercial Airplanes |
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Deliveries |
750 - 755 |
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Revenue |
$64.5 - 65.5 |
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Operating Margin |
9.5% - 10.0% |
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Defense, Space & Security (revised for business realignment) |
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Revenue |
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Boeing Military Aircraft |
~$12.5 |
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Network & Space Systems |
~$8.0 |
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Global Services & Support |
~$9.5 |
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Total BDS Revenue |
$29.5 - 30.5 |
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Operating Margin |
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Boeing Military Aircraft |
~9.5% |
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Network & Space Systems |
~9.0% |
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Global Services & Support |
~11.0% |
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Total BDS Operating Margin |
9.75% - 10.0% |
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Boeing Capital |
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Portfolio Size |
Stable |
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Revenue |
~$0.3 |
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Pre-Tax Earnings |
~$0.05 |
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Research & Development |
~ $3.5 |
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Capital Expenditures |
~ $2.8 |
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Pension Expense 1 |
~ $2.1 |
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Effective Tax Rate 2 |
~ 30.5% |
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1 Approximately $0.3 billion is expected to be recorded in unallocated items and eliminations |
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2 Assumes the extension of the research and development tax credit |
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* Non-GAAP measures. Complete definitions of Boeing's non-GAAP measures are on page 6, "Non-GAAP Measures Disclosures." |
