Boeing Co. BA -0.64% reported its biggest-ever annual loss and took a big financial hit on its new 777X jetliner, reflecting the pandemic’s worsening toll on the plane maker.
The write-down comes just as the 737 MAX re-enters service and Boeing tries to recover from a series of botched jetliner and military programs that more than halved its market value over the past two years. That was even before the coronavirus pandemic brought a decadelong boom in aircraft sales to a halt, prompting the company to shed 31,000 jobs.
The company took a $6.5 billion pretax charge on the 777X to reflect lower profits over the life of the wide-body plane that is now expected to enter service in 2023, three years late. Airlines have shied away from big jets like the 777X as international travel demand collapsed.
More on Boeing
Boeing’s fourth-quarter loss lifted its annual deficit to $11.94 billion, with sales for the year slipping 24% to $58.2 billion. That dropped Boeing to fourth spot by that measure behind Raytheon Technologies Corp. , Lockheed Martin Corp. and Airbus SE.
Chicago-based Boeing didn’t provide any financial guidance on Wednesday. Analysts expect sales to increase this year with the resumption of 787 deliveries following quality problems that halted customers taking any new jets since October.
The return of the MAX will also boost revenue. It restarted deliveries of the MAX in December from a backlog of 450 finished planes. European regulators on Wednesday approved the aircraft to resume commercial flights.
Boeing burned through $18.4 billion in cash last year as aircraft deliveries halved from 2019. It doesn’t expect to be cash flow positive until next year.
Monthly production of the MAX is still expected to spool up to 31 in early 2022, with output of the 787 dropping to five later this year. Boeing said 787 output remains under review because of the parlous state of international travel demand amid quarantines and other restrictions.
Boeing’s per-share loss of $14.65 in the latest quarter compared with the $1.60 consensus among analysts polled by FactSet. It included a previously announced $744 million charge after a $2.5 billion settlement with the Justice Department related to the MAX that included a fine and additional compensation for crash victims’ families and customers.
The company also took another $275 million charge for the KC-46A military tanker.
Boeing shares were down almost 4% in premarket trading.
Write to Doug Cameron at [email protected]
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