Boeing Co reports 9.4 pp ROIC growth from 29.5% to 38.9% in 2015 and 5.9% Revenue growth
27 Jan 2016 • About Boeing Co (
$BOE) • By InTwits
Boeing Co reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is relatively stable: 9.7% in 2015 vs. 10.3% in 2014 vs. 10.9% in 2011
- Boeing Co has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.4%. At the same time it's in pair with industry average of 3.1%.
- CAPEX is quite volatile: 2,516 in 2015, 4,103 in 2014, 9,997 in 2013, 14,978 in 2012, 20,502 in 2011
- The company has highly profitable business model: ROIC is at 38.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Boeing Co ($BOE) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 68,735 | 81,698 | 86,623 | 90,762 | 96,114 | 5.9% |
| Gross Profit | 12,868 | 13,033 | 13,355 | 14,010 | 14,026 | 0.1% |
| SG&A | 3,408 | 3,717 | 3,956 | 3,767 | 3,525 | -6.4% |
| EBITDA | 7,504 | 8,101 | 8,406 | 9,379 | 9,276 | -1.1% |
| Net Income | 4,018 | 3,900 | 4,585 | 5,446 | 5,176 | -5.0% |
Balance Sheet
|
|---|
| Cash | 10,049 | 10,341 | 9,088 | 11,733 | 11,302 | -3.7% |
| Short Term Debt | 2,353 | 1,436 | 1,563 | 929 | 1,234 | 32.8% |
| Long Term Debt | 10,018 | 8,973 | 8,072 | 8,141 | 8,730 | 7.2% |
Cash flow
|
|---|
| Capex | 1,713 | 1,703 | 2,098 | 2,236 | 2,450 | 9.6% |
Ratios
|
|---|
| Revenue growth | 6.9% | 18.9% | 6.0% | 4.8% | 5.9% | |
| EBITDA growth | 12.0% | 8.0% | 3.8% | 11.6% | -1.1% | |
| Gross Margin | 18.7% | 16.0% | 15.4% | 15.4% | 14.6% | -0.8% |
| EBITDA Margin | 10.9% | 9.9% | 9.7% | 10.3% | 9.7% | -0.7% |
| Net Income Margin | 5.8% | 4.8% | 5.3% | 6.0% | 5.4% | -0.6% |
| SG&A, % of revenue | 5.0% | 4.5% | 4.6% | 4.2% | 3.7% | -0.5% |
| CAPEX, % of revenue | 2.5% | 2.1% | 2.4% | 2.5% | 2.5% | 0.1% |
| ROIC | 33.4% | 31.8% | 25.4% | 29.5% | 38.9% | 9.4% |
| ROE | 127.9% | 83.1% | 44.2% | 46.3% | 69.0% | 22.7% |
| Net Debt/EBITDA | 0.3x | 0.0x | 0.1x | -0.3x | -0.1x | 0.1x |
Revenue and profitability
The company's Revenue increased on 5.9% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 2.9 pp from 13.3% to 10.4% in 2015.
Gross Margin decreased slightly on 0.84 pp from 15.4% to 14.6% in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign decreased slightly on 0.62 pp from 6.0% to 5.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 2.5% in 2015. CAPEX/Revenue showed almost no change from 2012 to 2015. It's average CAPEX/Revenue for the last three years was 2.5%.
Return on investment
The company operates at high and attractive ROIC (38.93%) and ROE (69.01%). ROIC increased on 9.4 pp from 29.5% to 38.9% in 2015. ROE jumped on 22.7 pp from 46.3% to 69.0% in 2015.
Leverage (Debt)
Debt level is -0.1x Net Debt / EBITDA and 1.1x Debt / EBITDA. Net Debt / EBITDA surged on 0.1x from -0.3x to -0.1x in 2015. Debt increased on 9.9% in 2015 while cash decreased on 3.7% in 2015.
Appendix 1: Peers in Aerospace & Defense
Below we provide Boeing Co benchmarking against other companies in Aerospace & Defense industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cobham ($85GU) | | | 2.3% | 3.5% | 11.9% |
| Bae Systems ($BA.) | -12.1% | -7.2% | -0.3% | -3.7% | |
| Rolls-Royce Hldgs ($RR.) | 0.4% | 9.3% | 20.4% | -6.2% | |
| Chemring Group ($BC88) | | | -36.2% | -14.7% | -6.4% |
| Qinetiq Group ($QQ.) | | -13.7% | -9.6% | -41.1% | -2.4% |
| |
|---|
| Median (5 companies) | -5.9% | -7.2% | -0.3% | -6.2% | -2.4% |
|---|
| Boeing Co ($BOE) | | 18.9% | 6.0% | 4.8% | 5.9% |
Top companies by Gross margin, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chemring Group ($BC88) | | 25.4% | 31.1% | 31.4% | 27.8% |
| Cobham ($85GU) | | 32.9% | 31.8% | 30.3% | 32.0% |
| Rolls-Royce Hldgs ($RR.) | 22.0% | 22.4% | 21.6% | 23.3% | |
| |
|---|
| Median (3 companies) | 22.0% | 25.4% | 31.1% | 30.3% | 29.9% |
|---|
| Boeing Co ($BOE) | 18.7% | 16.0% | 15.4% | 15.4% | 14.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Qinetiq Group ($QQ.) | 7.7% | 28.8% | -5.4% | 16.8% | 17.9% |
| Chemring Group ($BC88) | | 11.1% | -0.4% | 16.1% | 11.4% |
| Rolls-Royce Hldgs ($RR.) | 13.3% | 13.9% | 14.5% | 14.8% | |
| Cobham ($85GU) | | 20.5% | 21.8% | 13.4% | 12.9% |
| Bae Systems ($BA.) | 12.4% | 13.1% | 12.4% | 12.1% | |
| |
|---|
| Median (5 companies) | 12.4% | 13.9% | 12.4% | 14.8% | 12.9% |
|---|
| Boeing Co ($BOE) | 10.9% | 9.9% | 9.7% | 10.3% | 9.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Rolls-Royce Hldgs ($RR.) | 3.7% | 3.6% | 4.6% | 4.7% | |
| Cobham ($85GU) | | 2.8% | 3.2% | 3.4% | 4.7% |
| Qinetiq Group ($QQ.) | 1.2% | 1.5% | 2.0% | 3.1% | 3.2% |
| Chemring Group ($BC88) | | 4.1% | 2.6% | 2.7% | 2.2% |
| Bae Systems ($BA.) | 2.0% | 2.2% | 1.4% | 1.7% | |
| |
|---|
| Median (5 companies) | 2.0% | 2.8% | 2.6% | 3.1% | 3.2% |
|---|
| Boeing Co ($BOE) | 2.5% | 2.1% | 2.4% | 2.5% | 2.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Bae Systems ($BA.) | 21.6% | 26.3% | 12.8% | 26.0% | |
| Qinetiq Group ($QQ.) | 6.1% | 44.3% | -17.2% | 17.4% | 26.8% |
| Rolls-Royce Hldgs ($RR.) | 18.4% | 18.0% | 15.8% | 13.8% | |
| Chemring Group ($BC88) | | 4.9% | -6.3% | 4.4% | 1.4% |
| Cobham ($85GU) | | 13.9% | 9.0% | 2.6% | 0.5% |
| |
|---|
| Median (5 companies) | 18.4% | 18.0% | 9.0% | 13.8% | 1.4% |
|---|
| Boeing Co ($BOE) | 33.4% | 31.8% | 25.4% | 29.5% | 38.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cobham ($85GU) | | 1.0x | 1.2x | 4.9x | 4.5x |
| Chemring Group ($BC88) | | 3.0x | | 2.1x | 3.6x |
| Bae Systems ($BA.) | 0.5x | -0.2x | 0.4x | 0.5x | |
| Rolls-Royce Hldgs ($RR.) | -0.1x | -0.7x | -0.8x | -0.3x | |
| Qinetiq Group ($QQ.) | 2.1x | 0.3x | | -1.3x | -1.3x |
| |
|---|
| Median (5 companies) | 0.5x | 0.3x | 0.4x | 0.5x | 3.6x |
|---|
| Boeing Co ($BOE) | 0.3x | 0.0x | 0.1x | -0.3x | -0.1x |
