Boeing has released its fourth-quarter and full-year 2020 financial results, which do not make good reading. The company reported fourth-quarter revenue of US$15.3 billion, reflecting lower commercial deliveries and services volume primarily due to COVID-19 as well as 787 production issues, partially offset by a lower 737 MAX customer considerations charge in the quarter compared to the same period last year. GAAP loss per share of (US$14.65) and core loss per share (non-GAAP) of (US$15.25) reflected a US$6.5 billion pre-tax charge on the 777X program and a tax valuation allowance, partially offset by a lower 737 MAX customer considerations charge. Boeing recorded operating cash flow of US$4.0 billion.
Beyond taking a hefty US$6.5 billion charge on the all-new 777X, a larger version of the 777 mini-jumbo, Boeing now anticipates further delays in the aircraft’s launch, now slated for late 2023, owing to a longer and costlier certification process after scrutiny over the 737 MAX. According to Reuters news agency, Boeing is making “prudent design modifications” to the 777X, including hardware changes to the actuator control electronics, in response to regulator expectations, Boeing Chief Executive Officer Dave Calhoun told analysts.
The substantial annual loss has, unsurprisingly, been attributed to the effect of the COVID-19 on the aerospace industry and which has halted deliveries of some 80 787s to airlines, along with the two-year grounding of the troubled 737 MAX, heavily impacting cash flow. Boeing unveiled US$8.3 billion in operating charges on Wednesday, including a US$468 million charge for abnormal 737 production costs, $275 million over KC-46 aerial refueling tanker production issues, and US$744 million linked to its 737 MAX settlement with the U.S. Department of Justice over a fraud conspiracy charge. The company’s net loss rose to US$8.44 billion in the fourth quarter ended Dec. 31, from US$1.01 billion a year earlier, taking its full-year loss to a record US$11.94 billion. Revenue fell 15% to US$15.30 billion in the quarter.