Before an Alaska Airlines 737-9 Max plane exploded in mid-flight, Boeing seemed to be sailing ahead financially. While waiting to see the impact this episode would have on its production process and customer confidence, the company closed last year with a loss of $2,222 million (about 2,050 million euros). Although these are red numbers, they amount to less than half of last year’s $4,935 million deficit. Furthermore, earnings were growing and cash generation was accelerating, according to accounts published by the company this Wednesday. Now, Boeing has refrained from giving a forecast for the current year.
There are some positive signs. Boeing’s revenue in 2023 overall increased by 17% to $77,794 million, operating loss decreased by 78% to $773 million, and operating cash flow increased by 70% on the year to $5,960 million.
If a magnifying glass is placed on the accounts for the last quarter of the year, the operating result is positive, with profits of 283 million (compared to losses of 345 million a year earlier), with net losses reduced from 634 to 23 million. The dollar and commercial aircraft divisions made profits. Revenue from that commercial aircraft division rose 13% in the fourth quarter to $10,481 million, with an operating profit of $41 million, partly due to lower extraordinary costs. Boeing’s shares have increased rapidly in the stock market this Wednesday.
“Although we often use this time of year to share or update our financial and operational goals, now is not the time for that,” Calhoun told employees in a memo released by the company. Investors are accustomed to carefully studying the company’s financial indicators and annual objectives. The fourth-quarter report is particularly relevant because the aircraft maker typically presents annual forecasts for cash flow and deliveries of its two most important products: the 737 Max and 787 Dreamliner. The company is avoiding those forecasts this time to focus on guaranteeing the safety and quality of its planes.
“We created the problem”
Calhoun made a serious statement this Wednesday in a conference call with analysts, in which he commented on the possible effects of the 737 Max 9 incident on the results of the current fiscal year. “We created the problem, and we understand that. No matter what the conclusions are, Boeing is responsible for what happened. Whatever the specific cause of the accident, this type of incident should not happen on an aircraft coming out of one of our factories. We must improve,” he said.
“We are writing to you from the home of the 737 Max family. We are living in the here and now. And we are working with all our people. And I couldn’t be more impressed by their commitment, dedication and the broad nature of what they’re looking at. We will get it. I’m confident that we’ll focus on whatever we need to learn to be precise and move forward,” he said.
In an interview on CNBC, Calhoun said he did not want to predict what the National Transportation Safety Board (NTSB), which is investigating the incident, would find as to the cause. But he assured that he is confident that he has the issue of the exposed piece, which was a cover for a hole in an emergency door, “completely under control.”
The company is taking steps to strengthen quality in the 737 program, including additional inspections at its factories and key suppliers, increased oversight by airlines and halting 737 production for a day to refocus its employees on quality. Involves taking decisions. Boeing has also hired an external expert to lead an in-depth independent assessment of the quality management system. The 737 program continues to deliver aircraft and its production rate is now 38 per month. The US aviation authority, the FAA, has limited production of the 737 to current levels until quality improves and all Boeing factories are subject to strict monitoring.
Five years loss
During 2023, Boeing will deliver 528 commercial aircraft and add 1,576 net orders. The company’s total order book grew to $520 billion, including more than 5,600 commercial aircraft worth $441 billion.
This is the fifth consecutive year of losses for Boeing. Since the catastrophic crashes of the 737 Max in 2018, it has not reared its head and just when it seemed ready, new incidents have occurred, although much less serious than them. The company had already suffered a loss of $636 million in 2019, which increased to a record $11,873 million in 2020. After this, it suffered a loss of Rs 4,202 million in 2021 and Rs 4,935 million in 2022. With the results of 2023, it has suffered a loss of approximately $23,800 million. five years.
“As we report our financial results today, we are focused on taking comprehensive steps to strengthen quality across Boeing, including listening to our 737 employees who do this job every day,” Boeing said Dave Calhoun, President and CEO. , through a statement. “As we move forward, we will support our customers, work transparently with our regulator and ensure we take all actions necessary to regain the confidence of our stakeholders,” he said.