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Boeing on Target

It cites record backlog.
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Boeing (BA) - Get Boeing Company Report beat first-quarter targets and reaffirmed full-year guidance.

The Chicago-based airplane maker earned $877 million, or $1.13 a share, for the quarter ended March 31, up from the year-ago $692 million, or 88 cents a share. Revenue rose to $15.37 billion from $14.26 billion a year earlier.

Analysts surveyed by Thomson Financial were looking for a $1.02-a-share profit on sales of $15.04 billion.

"These results are in line with our expectations for the quarter and represent solid progress toward the high goals we have for ourselves in 2007 and beyond," said CEO Jim McNerney. "Our record backlog, increasing productivity, and the progress of our development programs have us on track to achieve our growth and profitability objectives."

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Boeing said earnings from operations rose 36% to $1.3 billion, yielding an 8.5% operating margin. The higher first-quarter operating margin reflects the company's exit from the Connexion by Boeing wireless business and lower expense from compensation plan changes, both of which were implemented and disclosed during 2006. The margin also reflects a planned and previously disclosed increase in research and development spending, which is expected to moderate later this year. Given anticipated performance for the remainder of the year, including growth in airplane deliveries and expansion of business unit margins, Boeing reaffirmed its financial guidance for 2007 and 2008.

The 787 program has won 544 firm orders to date from 44 customers, the most ever achieved by a commercial jet program within three years of program launch. Rollout of the first airplane is scheduled in July, first flight is targeted for late August and entry into service is scheduled for May 2008. While risks inherent in the latter stages of major airplane development programs remain for the 787, Boeing continues to expect that the 787 will be delivered on time and in accord with its contractual obligations.