Boeing's top priority for 2013: fix the 787
Instead, Boeing officials estimate the company will deliver 60 787s this year while expressing confidence the Dreamliner will be returned to commercial service soon.
"Our first order of business for 2013 is to resolve the battery issue on the 787 and return the airplanes safely to service with our customers," Jim McNerney, Boeing's CEO, said Wednesday while reporting the company's 2012 financial results.
It's not clear how long that will take, and Boeing didn't make any predictions on Wednesday. The 787s are grounded while investigators try to figure out what caused two battery incidents earlier this month, including a fire on a plane parked in Boston.
U.S. aviation officials have asked Boeing for a full operating history of the lithium-ion batteries on the 787s. Japan's All Nippon Airways confirmed that it had replaced batteries on its 787 aircraft 10 times because they didn't charge properly or connections with electrical systems failed. Japan Airlines also said it had replaced 787 batteries.
"Nothing we've learned yet has told us we made the wrong choice on the battery," McNerney said on Wednesday.
Boeing is still building 787s even though deliveries are halted. The company plans to reach a goal of building 10 787s per month by the end of this year.
Boeing said it expects to deliver 635 to 645 commercial jets this year, up from 601 deliveries in 2012, when it overtook Airbus for the first time since 2003. The European aircraft maker expects to deliver more than 600 planes this year.
Boeing earned $978 million in the latest quarter, or $1.28 per share. That was down 30 percent from a profit of $1.39 billion, or $1.84 per share, a year earlier, which included a big tax benefit of 52 cents per share.
The profit topped the $1.19 per share expected by analysts surveyed by FactSet.
Last year's deliveries of its new 787 as well as its revamped 747-8 brought in cash — the 787 lists for more than $200 million each — but they actually hurt profits because the planes cost more to build than what Boeing collects. Profit margins for commercial planes shrank slightly, even as revenue rose 32 percent to $14.16 billion in the fourth quarter, and profits rose 29 percent to $1.27 billion.
McNerney told journalists and analysts on Wednesday that the company continues its work on the 737 MAX and 787-9 despite the grounding of the 787-8. Boeing's CEO was optimistic about formally launching a stretched version of the Dreamliner, dubbed the 787-10, later this year.
"Our confidence is growing daily that that airplane is going to be a winner," he said.
Boeing also continues to look at updating its Everett-built 777. Boeing still has "more work to do" on the revamped version of that widebody jet, called the 777X, McNerney said.
Boeing Co. predicted 2013 earnings of $5 to $5.20 per share, with revenue of $82 billion to $85 billion. The outlook assumes "no significant financial impact" from the 787 being out of service.
Analysts had been expecting a 2013 profit of $5.17 per share on revenue of $88.13 billion.
For all of 2012, net income fell 3 percent to $3.9 billion, or $5.11 per share. Revenue rose 19 percent to $81.7 billion.
Boeing is also faced with a slowdown in its defense business. Defense profits fell 13 percent to $751 million in the fourth quarter. Defense revenue fell 2 percent to $8.34 billion.
Shares of Chicago-based Boeing Co. rose 85 cents to $74.50 in early trading.
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