PREVIEW: Big earnings day for Boeing Commercial Airplanes

Boeing Commercial Airplanes (BCA) expects later this morning to post a good second quarter, and we’ll wait for the final tally to decide if we should further modify ‘good’ with ‘very’. It’s the first time that’s possible to say without any major caveats since 2007. With the 787 and 747-8 finally certified amidst swelling demand for commercial aircraft, BCA can have a nice quarter for once.

The numbers don’t lie. Operating earnings for the BCA segment have plunged even as revenues have stabilized. Aircraft deliveries hit a five-year low in what was already a down-cycle in 2010, and then barely improved in 2011. This year, BCA already has reported delivering 150 aircraft in the second quarter, including 13 total 787s and 747-8s.

Although that’s a huge improvement, BCA will have to work hard to meet its full-year delivery guidance of between 35 and 42 787s. The airframer has delivered only 11 787s in the first half of the year. Meeting that delivery target is essential for BCA to begin unwinding its mountainous stockpile of 787 inventories.

BCA ($m) 2008 2009 2010 2011 2012
Revenues 8567 8431 7433 8843 11843
Operating Earnings 777 817 920 920 1211
R&D expense 770 659 693 771 560
Assets 18893 20497 28341 33379  
Liabilities 16556 17141 19663 21018  
           
Aircraft deliveries 126 125 114 118 150
737 100 99 95 94 109
747 5 2     7
767 3 3 3 5 6
777 18 21 16 19 22
787         6
           
Total inventories   18568 26550 32592  
787 work in progress, including deferred production   3885 9461 12684  
787 Supplier advances   2187 1956 1852  
Tooling & non-recurring   1231 1447 1677