Boeing sees $3.5B money movement loss because of labor | finance news
Boeing (BA) reported preliminary fourth quarter outcomes on Thursday after the bell, estimating a whopping $3.5 billion working money movement loss due to the results of the IAM (Worldwide Affiliation of Machinists) work stoppage, alongside workforce reductions and adjustments to its protection business.
For the quarter, Boeing expects to report income of $15.2 billion versus $16.76 billion consensus estimates per Bloomberg on a GAAP loss per share of $5.46 versus a loss of $1.32 estimated. Boeing additionally expects to take pre-tax prices of $1.7 billion in its protection and space business.
Boeing shares have been down 1% in after-hours trade.
“Although we face near-term challenges, we took important steps to stabilize our business during the quarter including reaching an agreement with our IAM-represented teammates and conducting a successful capital raise to improve our balance sheet,” mentioned Kelly Ortberg, Boeing president and CEO. “We also restarted 737, 767 and 777/777X production and our team remains focused on the hard work ahead to build a new future for Boeing.”
Boeing mentioned the IAM strike, which concluded in November with a new four-year contract, will result in increased labor prices, leading to pre-tax prices of $1.1 billion for the 777X and 767 jet applications.
Following the eight-week strike, Boeing upped the pay of IAM members by 38% over 4 years; merged the prior $7,000 ratification bonus with a $5,000 lump sum fee for a whole $12,000 into 401(ok) plans or as a money payout; elevated its 401(Ok) match; and lowered health care premiums, amongst different issues.
In early December Boeing laid off lots of of staff at its base in Washington state and in California. The company had beforehand mentioned it could scale back its headcount by 10%.
Earlier this month Boeing reported that it delivered 57 planes within the fourth quarter: 36 737 MAX jets, 15 787 Dreamliners, and three 767 and three 777 jets. For the yr Boeing mentioned it delivered 348 business jets, down a third in comparison with a yr in the past.
In November, Boeing’s dwindling money place threatened the company’s investment credit ranking, which led to it saying that it could launch a $19 billion share sale to spice up money reserves. Boeing mentioned on the finish of This autumn money and investments in marketable securities stood at $26.3 billion.
Pras Subramanian is a reporter for Yahoo Finance. You possibly can observe him on X and on Instagram.
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