Boeing’s Profit Soars 15% on Stronger Sales

Boeing Co. said Thursday that earnings rose 15% in the second quarter, bolstered by stronger sales of the company’s commercial aircraft.

The world’s largest maker of jet aircraft reported that profit from operations rose to $292 million, or 84 cents a share, from $254 million, or 74 cents, a year earlier.

The earnings beat analysts’ expectations, sending Boeing’s shares up $2.25 to $88.125 on the New York Stock Exchange. The consensus earnings estimate had been 80 cents a share, based on the average forecast of 14 analysts.

A number of analysts had raised their estimates to 90 cents earlier this month, after Seattle-based Boeing said it delivered a larger-than-expected order of 62 aircraft in the second quarter, up from 60 a year ago.

Boeing said its profit margin from operations narrowed to 10.6% in the first six months of the year from 12% in first-half 1995. The company attributed the poorer margins to delivery of three times as many of its new 777s in the first half of 1996 than a year ago. Boeing makes less profit on newer models because development costs are larger early in production.

Gains of $176 million, or 51 cents a share, for tax benefits and the settlement of defense and space contract issues gave Boeing second-quarter income of $468 million, or $1.35. A year earlier, a $600-million charge for an early-retirement program gave Boeing a loss of $231 million, or 68 cents a share.

Second-quarter revenue rose 13%, to $6.28 billion from $5.56 billion.

Analysts expect Boeing’s earnings to grow in coming quarters as a spate of orders for its aircraft turn into deliveries.

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Unocal said its second-quarter earnings more than doubled on higher crude oil and natural gas prices and increased profit from refinery operations.

The El Segundo-based company said profit from operations rose to $205 million, or 79 cents a share, from $101 million, or 37 cents, in the year-earlier period.

Wall Street was expecting the oil company to earn 68 cents a share. Per-share results reflect payments of preferred dividends.

Chairman and Chief Executive Roger C. Beach had predicted the company’s operating profit for the first six months of the year would equal its earnings for all of 1995.

“Improved earnings in our oil and gas, refining and marketing, and agricultural products operations gave us the best quarter ever for Unocal,” Beach said. “This spring, we predicted 1996 would be a breakthrough year, and these results are proving our prediction was correct.”

For the first six months, net income more than doubled to $362 million, or $1.39 a share, from $152 million, or 56 cents.

At a Glance:

Quaker Oats said its earnings more than doubled in the second quarter, although sluggish demand for its Snapple drinks and cereals overshadowed higher sales of other beverages and increased food profit. Net income rose to $63.6 million, or 47 cents a share, compared with a gain of $369.6 million, or $2.77 a share, from the sales of businesses.

Xerox said second-quarter earnings rose 15%, in line with analysts’ estimates, to $293 million, or 85 cents a share, compared with $238 million, or 69 cents a share, in the same period a year ago. The year-ago results include a $16-million loss from discontinued insurance operations.

Avon Products said its second-quarter earnings rose 11% to $85.7 million, or 64 cents a share, from profit from operations of $77.4 million, or 57 cents, a year earlier. The per-share figures reflect a 2-for-1 split in Avon’s common shares on May 15.

Southwest Airlines reported a 43% increase in its second-quarter profit, earning $85.3 million, or 56 cents a share, up from $59.7 million, or 41 cents, a year ago.

Dow Chemical said its second-quarter earnings fell a less-than-expected 19% to $546 million, or $2.20 a share, contrasted with profit of $672 million, or $2.46, a year ago.

Pixar Animation reported second-quarter net income of $4.8 million, or 10 cents a share, compared with $5.1 million, or 13 cents, for the year-ago period.

Morrison Knudsen said its second-quarter loss doubled to $28.1 million, or 85 cents a share, from $12.4 million, or 37 cents, in the year-ago quarter.

US West reported second-quarter net income of $324 million, or 68 cents, compared with $293 million, or 62 cents, for the 1995 period.

USX’s second-quarter net income fell 19%, to $154 million from $190 million in the year-earlier quarter.

Starbucks, which announced it plans to open 325 more coffee shops in fiscal 1997, reported a 38% rise in third-quarter earnings of $9.45 million, or 12 cents a share, from $6.85 million, or 9 cents, a year earlier.

Giant Group reported a second-quarter net income of $12.1 million, or $2.35 a share, contrasted with a net loss of $861,000, or 17 cents, in the year-ago quarter.

Transamerica said its second-quarter earnings fell 14% to $95.2 million, or $1.36 a share, from $111.2 million, or $1.54, a year earlier.

Reliance Steel & Aluminum reported second-quarter net income of $7.8 million, or 74 cents a share, compared with $5.6 million, or 55 cents, for the same period last year.

Tenneco said second-quarter earnings rose 25% to $161 million, or 93 cents a share, compared with $129 million, or 72 cents, in the year-ago period.