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BOEING REPORTS 1993 THIRD QUARTER RESULTS

 Nine Months Ended
 Sept. 30 3rd Quarter
 1993 1992 1993 1992
 Dollars in millions except per share data
 Sales $19,782 $22,687 $5,153 $6,897
 Net earnings(A) $ 940 $ 1,197 $ 189 $ 345
 Earnings per share(A) $ 2.77 $ 3.52 $ 0.56 $ 1.02
 Average shares (millions) 339.6 340.5 339.8 339.2
 (A) 1992 earnings reflect restatement for adoption of the SFAS No. 106 accounting change for retiree health care, exclusive of first quarter 1992 restatement for the transition obligation cumulative adjustment of $1,002 million or $2.94 per share.
 SEATTLE, Oct. 25 /PRNewswire/ -- Sales of $19.8 billion and net earnings of $940 million or $2.77 per share for the first nine months of 1993 were reported by Frank Shrontz, Boeing chairman and chief executive officer. Comparable figures for 1992 were sales of $22.7 billion and net earnings of $1,197 million or $3.52 per share, exclusive of the one-time cumulative adjustment for the Statement of Financial Accounting Standards (SFAS) No. 106 accounting change for retiree health care.
 The lower earnings in the first nine months of 1993 compared to the same period in the prior year were primarily due to lower sales in both the commercial aircraft and defense and space business segments, together with lower corporate investment income and continued high levels of research and development expenditures, principally for the 777 program. These factors were partially offset by increased income from customer financing. A total of 269 commercial jet transports were delivered in the first nine months of 1993, compared with 339 for the same period in 1992. Defense and space business sales were approximately 20 percent lower.
 Third quarter sales declined to $5.2 billion, compared to second quarter sales of $7.98 billion, reflecting both lower commercial jet transport production rates and the timing and model mix of commercial deliveries. Third quarter 1993 commercial jet transport deliveries totaled 67, including eight 747s, compared with 109 deliveries in the second quarter, including 17 747s. Planned deliveries for the fourth quarter of 1993 total 65, including 16 747s.
 Based on current programs and schedules, fourth quarter sales and earnings will be well above the third quarter, with total sales for the year 1993 now projected to be in the $25.5 billion range. The trend of lower sales will continue through 1994, reflecting the previously announced planned commercial production rates for 1994. Production rate changes are currently being implemented to reduce the 737 rate to 10 per month, the 757 to five per month, and the 767 to three per month. In early 1994 the 747 production rate will be reduced from five to three per month. Quarterly deliveries will continue to fluctuate relative to production rates based on contractual delivery schedules.
 Economic growth in the major airline traffic markets worldwide continues to be weak, particularly in Western Europe and Japan. Consequently, airline industry profitability, although improving in the aggregate, is expected to remain below historical levels in the near term. In this environment, the company continues to review airline requirements and associated production rates for late 1994 and beyond. There is no assurance that rates will be maintained at currently announced levels for all models; however, deliveries of the new 777 model beginning in 1995 will provide a substantial offset to sales reductions associated with potential production rate changes on other models.
 New orders for 142 commercial jet transports valued at $9.8 billion were announced by customers during the first nine months of 1993, compared with 158 aircraft valued at $11.5 billion for the same period of 1992. Although new order activity in the present environment remains depressed, the company has been successful at maintaining its historical market share.
 Operating profit margins on commercial transport programs, exclusive of research and development expenditures for new and derivative models, are expected to be substantially maintained through efficiencies gained by process improvements in all aspects of operations. Consequently, the Company should be well positioned for the next growth cycle in the commercial jet transport market. Additionally, efficiencies being realized in the defense and space segment as a result of organizational consolidations and emphasis on continuous process improvements will help ensure a competitive cost structure in the changing defense and space environment.
 Major assembly of the company's new 777 twinjet continues on schedule, with the aircraft's first flight planned for June 1994. The first complete 777 wing was assembled in July and will be joined to the body sections by early December. The expansion of the Everett, site to accommodate 777 production was essentially complete at the end of the third quarter. Announced orders for the 777 from 13 customers worldwide total 130, and announced options total 94. Marketing activities with additional international customers are continuing.
 NASAUs recent selection of Boeing Defense & Space Group as the prime contractor for the Space Station program is an acknowledgment of the Group's ability to effectively manage large, complex integration projects, and represents an assignment of great importance to both the company and the country's manned space program. Boeing will be responsible for the design, development, physical integration, test, and launch preparation of the Space Station, as well as performing on its existing contract to build the habitat and laboratory modules.
 As a result of Department of Defense efforts to reduce budget expenditures and prioritize programs, the U.S. Navy recently terminated for the government's convenience the production contract to build an additional 120 A-6 Intruder aircraft composite wingsets. Boeing will continue to provide logistics support for previous deliveries.
 The contract for the initial two 767 aircraft for an Airborne Warning and Control System (AWACS) for the government of Japan was recently signed, and a separate contract for the mission systems is presently being definitized. Complete system deliveries are scheduled for 1998. Japanese officials have indicated they intend to seek funding for two additional 767 AWACS next year. Boeing continues to discuss potential 767 AWACS sales with other countries.
 THE BOEING CO.
 OTHER FINANCIAL AND OPERATING DATA
 (Dollars in millions)
 Nine Months Ended
 Sept. 30 3rd Quarter
 1993 1992 1993 1992
 Revenues:
 Commercial transportation $16,175 $18,205 $3,936 $5,166
 Defense and space 3,276 4,057 1,143 1,580
 Other industries 331 425 74 151
 Income associated with
 notes receivable and
 sales-type leases
 included in commercial
 transportation revenues 112 39 44 14
 Corporate investment and 134 184 36 62
 other income
 Research and development 1,338 1,359 434 459
 expense
 Effective income tax
 rate (percents) 31.6 31.1 30.8 31.0
 The effective income tax rates for the third quarter and nine-month period of 1993 reflect the cumulative impact of the statutory federal income tax rate increase from 34% to 35% effective Jan. 1, 1993, including the impact on deferred tax balances as of the beginning of the year. Additionally, Foreign Sales Corporation tax benefits increased in the third quarter as a percent of pre-tax earnings.
 Net earnings and earnings per share before and after cumulative effect of change in accounting for retiree health care in accordance with SFAS No. 106:
 Nine months ended Sept. 30, 1993 1992
 Dollars in millions except per share data
 Net earnings, after adoption
 of SFAS No. 106, but
 before cumulative effect
 of change in accounting $ 940 $1,197
 Per share $2.77 $ 3.52
 Net earnings, including
 cumulative effect of
 SFAS No. 106
 accounting change $ 195
 Per share $0.58
 Sept. 30 June 30 Dec. 31
 1993 1993 1992
 Dollars in billions
 Cash & short-term investments $3.1 $3.6 $3.6
 Borrowings 2.5 2.3 1.8
 Inventories:
 Gross 10.3 9.9 11.1
 Net 3.3 2.4 2.7
 Customer financing 3.5 3.4 2.3
 Net plant and equipment 7.1 7.0 6.7
 Firm backlog:
 Commercial and foreign govt. $74.0 $76.3 $82.6
 U.S. Government 3.4 4.5 5.3
 Total $77.4 $80.8 $87.9
 Additional debt of $125 million due in 2043 was issued in October 1993.
 Research and development expenditures are projected to remain at a relatively high level as the company invests in new and derivative jet transport developments for longer-term growth. However, requirements for new facilities and equipment expenditures will be substantially reduced for the next several years. Inventory build-up on the new 777 commercial transport program will contribute significantly to cash requirements through 1994.
 Not included in firm backlog are purchase options and announced orders for which definitive contracts have not been executed and orders from customers who have filed for bankruptcy. U.S. Government and foreign military firm backlog is limited to amounts obligated to contracts. If recognition were given to unobligated amounts on U.S. Government contracts, unfilled orders at Sept. 30, 1993, would be increased by $6.9 billion.
 JET TRANSPORT DELIVERIES
 Nine Months 3rd Quarter
 1993 1992 1993 1992
 737 122 173 30 48
 747 40 46 8 12
 757 63 72 17 21
 767 44 48 12 15
 Total commercial 269 339 67 96
 707 derivatives 0 5 0 0
 Total deliveries 269 344 67 96
 -0- 10/25/93
 /CONTACT: Russ Young of The Boeing Co., 206-655-6123/
 (BA)


CO: The Boeing Co. ST: Washington IN: AIR ARO SU: ERN

JH -- SE002 -- 6135 10/25/93 08:46 EDT
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Date:Oct 25, 1993
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