Boeing Likely to Post Loss for 2nd Quarter

SEATTLE — One-time costs of Boeing Co.’s early retirement program will reduce second-quarter earnings by $600 million, making it virtually certain the company will lose money in the quarter.

It would be only the second quarter in at least 20 years that Boeing has reported a loss.

When the retirement program was announced in March as a way to reduce layoffs, it was expected to generate a one-time earnings charge of $350 million to $400 million, but more employees signed up than expected.

The higher charge was announced before the stock market opened Friday. Boeing’s stock closed off 75 cents per share at $64.75 on the New York Stock Exchange.

About 9,500 of the more than 14,000 eligible workers, each at least 55 years old with at least 10 years at Boeing, took advantage of the offer.

In addition, Boeing’s plan to eliminate 12,000 jobs this year is about complete, and few layoffs are likely over the rest of the year, spokesman Christopher Villiers said.

“Barring any unforeseen changes in our status, we are about at the employment level where we wanted to be at the end of the year,” he said.

This year’s 12,000 job cuts continue employment reductions that began after employment peaked at 165,787 in 1989.

Boeing has cut 60,000 jobs from its work force during the past four years as airlines have delayed or canceled orders and the company has learned to make planes faster with fewer people.

The one-time, non-recurring charge for the retirement program is virtually certain to generate Boeing’s first quarterly loss since the fourth quarter of 1992 when it complied with an accounting rule change for computing retiree medical benefits.

Boeing had first-quarter earnings of $181 million, a 38% drop from $292 million a year earlier. The company earned $222 million in last year’s second quarter.