McDonnell Douglas Stock Drop Tied to MD-80 Cuts

McDonnell Douglas Shares dropped $3.875 in trading Wednesday on the New York Stock Exchange. Analysts attributed the action to a series of disclosures made earlier this week to the Securities & Exchange Commission.

Securities analysts cited the firm’s disclosure in its quarterly 10K report that it has trimmed its planned production of MD-80 jetliners at its Long Beach plant to 90 aircraft in 1992 from 100.

The firm also reported that it lost 27 firm orders and 141 options and reserves for MD-80s during 1991. The firm also said its cash flow in the first half of 1992 would be negative.

In a separate SEC filing, McDonnell disclosed that it is preparing to issue $1.5 billion in new debt securities, including consolidation of some existing debt. The firm also faces financial obligations, under new accounting standards, of $1.2 billion to $1.8 billion for retiree health care, according to the filings.