Bond Market News

American plane manufacturer Boeing made a net loss of $3.3bn in Q3 2022 compared to a net loss of $132mn a year prior, despite revenue increasing 4% to $16bn. This was primarily as a result of $2.8bn of losses from fixed-price defense programs, which include that of the KC-46 tanker and Air Force One. Despite the elevated losses, Dave Calhoun, Boeing President and CEO emphasized that the company had a strong operating cash flows of $3.2bn vs. an outflow of $262mn a year prior. He also mentioned that the company is “on a solid path to achieving positive free cash flow 2022”. On the balance sheet, Boeing has $762mn in cash holdings, 90.7% down from year end 2021, while its debt maturities coming in the next year stand at $5.4bn. That said, its total debt has decreased 1.5% to $57.2bn. In terms of outlook, Boeing expects supply chain challenges to persist even until next year and resultantly guided that it will deliver less of 737 MAXs. Brian West, Boeing CFO said, “Our path to recovery is taking a bit longer than expected, driven by the challenging macro environment.”

Boeing’s 5.705% 2040s are trading 1.14 points higher at 88.68 cents on the dollar, yielding 6.82%.