BOE.L Regulatory News (BOE)

Boeing Reports Record Revenue and Backlog and Provides 2013 Guidance

CHICAGO, Jan. 30, 2013 --

Fourth-Quarter 2012

* Core EPS (non-GAAP)* of $1.46 on strong operating performance; GAAP EPS of

$1.28

* Revenue rose to $22.3 billion on increased commercial airplane deliveries

Full Year 2012

* Core EPS (non-GAAP)* of $5.88 on record revenue of $81.7 billion; GAAP EPS

of $5.11

* Operating cash flow rose to $7.5 billion, including $1.6 billion of pension

contributions

* Backlog grew to a record $390 billion including $114 billion of orders

during the year

Outlook for 2013

* Core EPS (non-GAAP)* guidance of $6.10 to $6.30; GAAP EPS guidance of $5.00

to $5.20

* Operating cash flow guidance of greater than $6.5 billion includes $1.5

billion of pension contributions

Table 1. Summary Financial Results (Dollars in Millions, Fourth Quarter Full Year except per share data) 2012 2011 Change 2012 2011 Change Revenues $22,302 $19,555 14% $81,698 $68,735 19% Non-GAAP * Core Operating Earnings $1,841 $1,690 9% $7,210 $6,361 13% Core Operating Margin 8.3% 8.6% (0.3)Pts 8.8% 9.3% (0.5)PtsCore Earnings Per Share $1.46 $1.92 (24%) $5.88 $5.79 2% Operating Cash Flow Before Pension Contributions $4,204 $2,962 42% $9,058 $4,554 99% GAAP Earnings From Operations $1,629 $1,597 2% $6,311 $5,844 8% Operating Margin 7.3% 8.2% (0.9)Pts 7.7% 8.5% (0.8)PtsNet Income $978 $1,393 (30%) $3,900 $4,018 (3%) Earnings per Share $1.28 $1.84 (30%) $5.11 $5.34 (4%) Operating Cash Flow $4,167 $2,931 42% $7,508 $4,023 87% * Non-GAAP measures. New non-GAAP earnings measures (core operating earnings, core operating margin and core earnings per share) exclude certain components of pension and post retirement benefit expense that the company believes are not reflective of underlying business performance. Complete definitions of Boeing's use of non-GAAP measures begin on page 7, "Non-GAAP Measure Disclosures." The Boeing Company (NYSE: BA) reported record fourth-quarter revenue of $22.3billion (Table 1) and core operating earnings (non-GAAP) that increased by 9percent to $1.8 billion, driven by strong performance across the company'sbusinesses and higher deliveries of commercial airplanes. Fourth-quarter 2012core earnings per share (non-GAAP) of $1.46 increased 4 percent* from the sameperiod last year when excluding a $0.52 per share impact related to a favorabletax settlement recognized in the fourth-quarter 2011. The company reportedfourth-quarter earnings from operations of $1.6 billion and earnings per shareof $1.28.Core operating earnings (non-GAAP) rose 13 percent in the full-year to $7.2billion, compared to $6.4 billion in 2011. 2012 core earnings per share(non-GAAP) of $5.88 increased 12 percent* from 2011 when excluding the impactof the 2011 favorable tax settlement ($0.53 per share for the year). Full-year2012 revenue was a record $81.7 billion, with earnings from operations of $6.3billion and earnings per share of $5.11.Core earnings per share guidance (non-GAAP) for 2013 is set at between $6.10and $6.30, while earnings per share guidance is established at between $5.00and $5.20. Revenue guidance is between $82 and $85 billion and operating cashflow is expected to be greater than $6.5 billion, which includes $1.5 billionof discretionary pension contributions."Strong fourth-quarter operating performance capped a year of significantgrowth and solid execution, driving higher earnings and cash flow for ourcompany," said Boeing Chairman, President and Chief Executive Officer JimMcNerney. "In a year of considerable achievement, Boeing was the commercialaviation market leader for both orders and deliveries, with more than 600airplanes delivered, including the first three Charleston-built 787Dreamliners. Significant new international orders for Defense, Space & Securityand more than 900 orders for the 737 MAX also contributed to our record companybacklog.""Our first order of business for 2013 is to resolve the battery issue on the787 and return the airplanes safely to service with our customers. At the sametime, we remain focused on our ongoing priorities of profitable ramp up incommercial airplane production, successful execution of our developmentprograms, and continued growth in core, adjacent and international defense andspace markets."Table 2. Cash Flow Fourth Quarter Full Year(Millions) 2012 2011 2012 2011 Operating Cash Flow Before Pension Contributions* $4,204 $2,962 $9,058 $4,554 Pension Contributions ($37) ($31) ($1,550) ($531) Operating Cash Flow $4,167 $2,931 $7,508 $4,023

Less Additions to Property,

Plant & Equipment ($495) ($571) ($1,703) ($1,713)Free Cash Flow* $3,672 $2,360 $5,805 $2,310

Operating cash flow in the quarter was $4.2 billion, driven by highercommercial airplane deliveries, continued strong operating performance andtiming of receipts and expenditures. Free cash flow was $3.7 billion in thequarter (Table 2).

Table 3. Cash, Marketable Securities and Debt Balances Quarter-End (Billions) 4Q12 3Q12 Cash $10.3 $6.6 Marketable Securities(1) $3.2 $4.6 Total $13.5 $11.2 Debt Balances: The Boeing Company $7.9 $8.6 Boeing Capital Corporation $2.5 $2.6 Total Consolidated Debt $10.4 $11.2

(1) Marketable securities consists primarily of time deposits due within one yearclassified as "short-term investments."

Cash and investments in marketable securities totaled $13.5 billion at year-end(Table 3), up from $11.2 billion at the beginning of the quarter. Debt was$10.4 billion, down from $11.2 at the beginning of the quarter.

Total company backlog at year-end was a record $390 billion, up from $378billion at the beginning of the quarter, and included net orders for thequarter of $35 billion. Backlog is up $35 billion from prior year-end,reflecting $114 billion of net orders in 2012.

Segment Results

Commercial Airplanes

Table 4. Commercial Airplanes Operating Results Fourth Quarter Full Year (Dollars in Millions) 2012 2011 Change 2012 2011 Change Commercial Airplanes Deliveries 165 128 29% 601 477 26% Revenues $14,161 $10,695 32% $49,127 $36,171 36% Earnings from Operations $1,266 $981 29% $4,711 $3,495 35% Operating Margins 8.9% 9.2% (0.3) Pts 9.6% 9.7% (0.1) Pts Boeing Commercial Airplanes fourth-quarter revenue increased to $14.2 billionand full-year revenue increased to a record $49.1 billion on higher deliveryvolume. Fourth-quarter operating margin was 8.9 percent and full-year operatingmargin was 9.6 percent, both reflecting the dilutive impact of 787 and 747-8deliveries and higher period costs partially offset by the higher volume andlower R&D (Table 4).During the quarter, Commercial Airplanes achieved a five-per-month productionrate on the 787 program and, as of year-end, had won over 1,000 firm orders forthe 737 MAX since launch. The 737 program broke the company's single-yearrecord for both orders and deliveries in 2012. During the year, CommercialAirplanes delivered the first 747-8 Intercontinental, began major assembly onthe 787-9 and successfully executed a total of five production rate increases.On January 16, 2013, the Federal Aviation Administration (FAA) issued anairworthiness directive that resulted in all in-service 787s temporarilyceasing operations. The company is committed to working with the FAA and otherapplicable regulatory authorities to return aircraft to service with the fullconfidence of customers and the traveling public. While production continues onthe 787, the company is suspending deliveries until clearance is granted by theFAA.

Commercial Airplanes booked 394 net orders during the quarter. Backlog remainsstrong with nearly 4,400 airplanes valued at a record $319 billion.

Boeing Defense, Space & Security

Table 5. Defense, Space & Security Operating Results Fourth Quarter Full Year (Dollars in Millions) 2012 2011 Change 2012 2011 Change Revenues Boeing Military Aircraft $4,157 $3,949 5% $16,384 $14,947 10% Network & Space Systems $1,912 $1,961 (2%) $7,584 $8,654 (12%) Global Services & Support $2,274 $2,561 (11%) $8,639 $8,375 3% Total BDS Revenues $8,343 $8,471 (2%) $32,607 $31,976 2% Earnings from Operations Boeing Military Aircraft $336 $374 (10%) $1,581 $1,526 4% Network & Space Systems $118 $168 (30%) $478 $679 (30%) Global Services & Support $297 $323 (8%) $1,009 $953 6% Total BDS Earnings from Operations $751 $865 (13%) $3,068 $3,158 (3%) Operating Margins 9.0% 10.2% (1.2) Pts 9.4% 9.9% (0.5) Pts

Boeing Defense, Space & Security's (BDS) fourth-quarter revenue was $8.3billion, while operating margin was 9.0 percent (Table 5). For the full year,revenue was $32.6 billion, while operating margin was 9.4 percent.

Boeing Military Aircraft (BMA) fourth-quarter revenue increased to $4.2billion, driven primarily by the KC-46 Tanker and P-8A programs. Operatingmargin decreased to 8.1 percent, driven by delivery mix. During the quarter,the U.S. Navy ordered 13 additional F/A-18 aircraft and BMA started productionof the first KC-46 Tanker refueling boom.

Network & Space Systems (N&SS) fourth-quarter revenue was $1.9 billion.Operating margin decreased to 6.2 percent, reflecting lower earnings onGround-based Midcourse Defense and several satellite programs. During thequarter, N&SS was awarded a contract with NASA for the Space Launch System(SLS) and completed the preliminary design review for the SLS core stage andavionics.

Global Services & Support (GS&S) fourth-quarter revenue decreased to $2.3billion, primarily due to lower revenue in integrated logistics. Operatingmargin increased to 13.1 percent, reflecting improved performance in integratedlogistics. During the quarter, GS&S was awarded the C-17 Globemaster IIIIntegrated Sustainment Program from the U.S. Air Force and a contract toupgrade 68 F-15s for an international customer.

Backlog at BDS was $71 billion, more than two times projected 2013 revenue.

Additional Financial Information

Table 6. Additional Financial Information Fourth Quarter Full Year (Dollars in Millions) 2012 2011 2012 2011 Revenues

Boeing Capital Corporation $116 $104 $441 $520

Other segment $40 $43 $133 $150

Unallocated items and eliminations ($358) $242 ($610) ($82)

Earnings from Operations Boeing Capital Corporation ($20) ($20) $82 $113 Other segment $44 $55 ($159) $66 Unallocated items and eliminations ($412) ($284) ($1,391) ($988) Other income, net $23 ($29) $62 $47 Interest and debt expense ($117) ($124) ($463) ($498)Effective tax rate 36.3% 3.9% 34.0% 25.6%

At year-end, Boeing Capital Corporation's (BCC) portfolio balance was $4.1billion, unchanged from the beginning of the quarter and down from $4.3 billionat the beginning of the year. BCC's debt-to-equity ratio was 5.0-to-1.

The loss in unallocated items and eliminations increased due to higher pensionexpense. Total pension expense for the fourth quarter was $576 million up from$344 million in the same period last year.The company's income tax expense was $557 million in the quarter, compared to$57 million in the same period of last year. Fourth-quarter 2011 included a$397 million non-cash gain due to an IRS settlement. The full year effectivetax rate was 34 percent compared with 25.6 percent in 2011.

Outlook

The company's current 2013 financial guidance (Table 7) assumes no significantfinancial impact from the FAA directive. The guidance reflects continued strongcore performance, generating an expected 5 percent increase in core earningsper share (non-GAAP).Table 7. Financial Outlook (Dollars in Billions, except per-share data) 2013 The Boeing Company Revenue $82 - 85 Core Earnings Per Share* $6.10 - 6.30 Earnings Per Share $5.00 - 5.20 Operating Cash Flow Before Pension Contributions* > $8 Operating Cash Flow(1) > $6.5 Boeing Commercial Airplanes Deliveries (2) 635 - 645 Revenue $51 - 53 Operating Margin ~ 9.5% Boeing Defense, Space & Security Revenue Boeing Military Aircraft ~ $15.5 Network & Space Systems ~ $7.3 Global Services & Support ~ $8.2 Total BDS Revenue $30.5 - 31.5 Operating Margin Boeing Military Aircraft ~ 9.0% Network & Space Systems ~ 7.5% Global Services & Support ~ 10.5% Total BDS Operating Margin > 9.0% Boeing Capital Corporation Portfolio Size Lower Revenue ~ $0.3 Return on Assets ~ 0.5% Research & Development ~ $3.4 Capital Expenditures $2.3 - 2.5 Pension Expense (3) ~ $3.2 Effective Tax Rate ~ 30%

(1) After discretionary cash pension contributions of $1.5 billion and assuming

new aircraft financings under $0.5 billion. (2) Assumes greater than 60 787 deliveries. (3) Approximately $1.4 billion is expected to be recorded in unallocated items and eliminations.

* Non-GAAP measures. Complete definitions of Boeing's use of non-GAAP measures begin on page 7, "Non-GAAP Measure Disclosures."

Boeing's 2013 revenue guidance is between $82 and $85 billion. Core earningsper share (non-GAAP) guidance for 2013 is set at between $6.10 and $6.30.Earnings per share guidance is established at between $5.00 and $5.20. Totalpension expense in 2013 is expected to be approximately $3.2 billion (of whichapproximately $1.8 billion is expected to be recorded in core operatingearnings with $1.4 billion recorded in unallocated items and eliminations).Operating cash flow before pension contributions (non-GAAP) is expected to begreater than $8 billion. Operating cash flow is expected to be greater than$6.5 billion in 2013, including $1.5 billion of discretionary pensioncontributions.Commercial Airplanes' 2013 deliveries are expected to be between 635 and 645airplanes, which includes greater than 60 787 deliveries. Commercial Airplanes'2013 revenue is expected to be between $51 and $53 billion with operatingmargins of approximately 9.5 percent.

Defense, Space & Security's revenue for 2013 is expected to be between $30.5and $31.5 billion with operating margins greater than 9 percent.

Boeing Capital Corporation expects that its aircraft finance portfolio willcontinue to decline in 2013, as new aircraft financing of less than $0.5billion is expected to be lower than normal portfolio runoff through customerpayments and depreciation.

Boeing's 2013 R&D forecast is approximately $3.4 billion. Capital expendituresfor 2013 are expected to be between $2.3 and $2.5 billion. Boeing's effectivetax rate is expected to be approximately 30 percent in 2013 reflecting thebenefit of research and development credits for 2012 and 2013.

Non-GAAP Measure Disclosures

We supplement the reporting of our financial information determined under U.S.generally accepted accounting principles (GAAP) with certain non-GAAP financialinformation. The non-GAAP financial information presented excludes certainsignificant items that may not be indicative of, or are unrelated to, resultsfrom our ongoing business operations. We believe that these non-GAAP measuresprovide investors with additional insight into the company's ongoing businessperformance. These non-GAAP measures should not be considered in isolation oras a substitute for the related GAAP measures, and other companies may definesuch measures differently. We encourage investors to review our financialstatements and publicly-filed reports in their entirety and not to rely on anysingle financial measure. The following definitions are provided:Core Operating Earnings, Core Operating Margin and Core Earnings Per ShareCore operating earnings is defined as GAAP earnings from operations excludingunallocated pension and post-retirement expense. Core operating margin isdefined as core operating earnings expressed as a percentage of revenue. Coreearnings per share is defined as GAAP earnings per share excluding the netearnings per share impact of unallocated pension and post-retirement expense.Unallocated pension and post-retirement expense represents the portion ofpension and other post-retirement costs that are not recognized by businesssegments for segment reporting purposes. The business segments havetraditionally been allocated pension and other post-retirement costs using U.S.government Cost Accounting Standards (CAS), which employ different actuarialassumptions and accounting conventions than GAAP. Beginning in 2013, pensioncosts at Commercial Airplanes will be allocated based on GAAP service and priorservice costs instead of CAS. Defense Space & Security will continue to beallocated CAS pension costs which are allocable to government contracts. Otherpost-retirement costs will continue to be allocated to business segments basedon CAS, which is generally based on benefits paid. Management uses coreoperating earnings, core operating margin and core earnings per share forpurposes of evaluating and forecasting underlying business performance.Management believes these core earnings measures provide investors additionalinsights into operational performance as they exclude unallocated pension andpost-retirement costs, which primarily represent costs driven by market factorsand costs not allocable to government contracts.

Increase in Core Earnings Per Share Excluding Favorable Tax Settlement

The company is disclosing the increase in core earnings per share in 2012 over2011 excluding the impact of the favorable federal tax audit settlement infourth quarter 2011. The company believes it is useful to occasionally excludecertain items that are not reflective of underlying business performance andthat can distort period to period performance comparisons. Management usessimilar measures for purposes of evaluating and forecasting underlying businessperformance.

Operating Cash Flow Before Pension Contributions

Operating cash flow before pension contributions is defined as GAAP operatingcash flow less pension contributions. Management believes operating cash flowbefore pension contributions provides additional insights into underlyingbusiness performance. Table 2 provides a reconciliation between GAAP operatingcash flow and operating cash flow before pension contributions.

Free Cash Flow

Free cash flow is defined as GAAP operating cash flow less capital expendituresfor property, plant and equipment additions. Management believes free cash flowprovides investors with an important perspective on the cash available forshareholders, debt repayment, and acquisitions after making the capitalinvestments required to support ongoing business operations and long term valuecreation. Free cash flow does not represent the residual cash flow availablefor discretionary expenditures as it excludes certain mandatory expendituressuch as repayment of maturing debt. Management uses free cash flow internallyto assess both business performance and overall liquidity. Table 2 provides areconciliation between GAAP operating cash flow and free cash flow.

Caution Concerning Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning ofthe Private Securities Litigation Reform Act of 1995. Words such as "may,""should," "expects," "intends," "projects," "plans," "believes," "estimates,""targets," "anticipates," and similar expressions are used to identify theseforward-looking statements. Examples of forward-looking statements includestatements relating to our future financial condition and operating results, aswell as any other statement that does not directly relate to any historical orcurrent fact. Forward-looking statements are based on our current expectationsand assumptions, which may not prove to be accurate. These statements are notguarantees and are subject to risks, uncertainties, and changes incircumstances that are difficult to predict. Many factors could cause actualresults to differ materially and adversely from these forward-lookingstatements. Among these factors are risks related to: (1) general conditions inthe economy and our industry, including those due to regulatory changes; (2)our reliance on our commercial airline customers; (3) the overall health of ouraircraft production system, planned production rate increases across multiplecommercial airline programs, our commercial development and derivative aircraftprograms, and our aircraft being subject to stringent performance andreliability standards; (4) changing acquisition priorities of the U.S.government; (5) our dependence on U.S. government contracts; (6) our relianceon fixed-price contracts; (7) our reliance on cost-type contracts; (8)uncertainties concerning contracts that include in-orbit incentive payments;(9) our dependence on our subcontractors and suppliers, as well as theavailability of raw materials, (10) changes in accounting estimates; (11)changes in the competitive landscape in our markets; (12) our non-U.S.operations, including sales to non-U.S. customers; (13) potential adversedevelopments in new or pending litigation and/or government investigations;(14) customer and aircraft concentration in Boeing Capital's customer financingportfolio; (15) changes in our ability to obtain debt on commerciallyreasonable terms and at competitive rates in order to fund our operations andcontractual commitments; (16) realizing the anticipated benefits of mergers,acquisitions, joint ventures/strategic alliances or divestitures; (17) theadequacy of our insurance coverage to cover significant risk exposures; (18)potential business disruptions, including those related to physical securitythreats, information technology or cyber-attacks or natural disasters; (19)work stoppages or other labor disruptions; (20) significant changes in discountrates and actual investment return on pension assets; (21) potentialenvironmental liabilities; and (22) threats to the security of our or ourcustomers' information.Additional information concerning these and other factors can be found in ourfilings with the Securities and Exchange Commission, including our most recentAnnual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reportson Form 8-K. Any forward-looking statement speaks only as of the date on whichit is made, and we assume no obligation to update or revise any forward-lookingstatement, whether as a result of new information, future events, or otherwise,except as required by law.

Contact:

Investor Relations: Stephanie Pope or Matt Welch (312) 544-2140Communications: Chaz Bickers (312) 544-2002

The Boeing Company and Subsidiaries Consolidated Statements of Operations (Unaudited) Twelve months ended Three months ended December 31 December 31 (Dollars in millions, 2012 2011 2012 2011 except per share data) Sales of products $71,234 $57,401 $19,793 $16,960 Sales of services 10,464 11,334 2,509 2,595 Total revenues 81,698 68,735 22,302 19,555 Cost of products (60,309) (46,642) (17,206) (14,307) Cost of services (8,247) (9,097) (1,816) (1,920) Boeing Capital interest expense (88) (128) (19) (34) Total costs and expenses (68,644) (55,867) (19,041) (16,261) 13,054 12,868 3,261 3,294 Income from operating investments, net 268 278 57 76 General and administrative expense (3,717) (3,408) (943) (864) Research and development expense, net (3,298) (3,918) (753) (913) Gain on dispositions, net 4 24 7 4 Earnings from operations 6,311 5,844 1,629 1,597 Other income/(expense), net 62 47 23 (29) Interest and debt expense (463) (498) (117) (124) Earnings before income taxes 5,910 5,393 1,535 1,444 Income tax expense (2,007) (1,382) (557)

(57) Net earnings from continuing operations 3,903 4,011 978 1,387

Net (loss)/gain on disposal of

discontinued operations, net of

taxes of $2, ($4), $0 and ($3) (3) 7 6 Net earnings $3,900 $4,018 $978 $1,393

Basic earnings per share from

continuing operations $5.15 $5.38 $1.29 $1.85 Net (loss)/gain on disposal of discontinued operations, net of taxes 0.01 0.01 Basic earnings per share $5.15 $5.39 $1.29 $1.86 Diluted earnings per share from continuing operations $5.11 $5.33 $1.28 $1.83 Net (loss)/gain on disposal of discontinued operations, net of taxes 0.01 0.01 Diluted earnings per share $5.11 $5.34 $1.28 $1.84 Cash dividends paid per share $1.76 $1.68 $0.44 $0.42 Weighted average diluted shares (millions) 763.8 753.1 768.3 757.1 The Boeing Company and Subsidiaries Consolidated Statements of Financial Position (Unaudited) December 31 December 31(Dollars in millions, except per share data) 2012 2011 Assets Cash and cash equivalents $ 10,341 $ 10,049 Short-term and other investments 3,217 1,223 Accounts receivable, net 5,608 5,793 Current portion of customer financing, net 364 476 Deferred income taxes 28 29 Inventories, net of advances and progress billings 37,751 32,240 Total current assets 57,309 49,810 Customer financing, net 4,056 4,296

Property, plant and equipment, net of accumulated

depreciation of $14,645 and $13,993 9,660 9,313 Goodwill 5,035 4,945 Acquired intangible assets, net 3,111 3,044 Deferred income taxes 6,753 5,892 Investments 1,180 1,043 Other assets, net of accumulated amortization of $504 and $717 1,792 1,643 Total assets $ 88,896 $ 79,986 Liabilities and equity Accounts payable $ 9,394 $ 8,406 Accrued liabilities 12,995 12,239 Advances and billings in excess of related costs 16,672 15,496 Deferred income taxes and income taxes payable 4,485

2,780 Short-term debt and current portion of long-term debt 1,436 2,353

Total current liabilities 44,982 41,274 Accrued retiree health care 7,528 7,520 Accrued pension plan liability, net 19,651 16,537 Non-current income taxes payable 366 122 Other long-term liabilities 1,429 907 Long-term debt 8,973 10,018 Shareholders' equity: Common stock, par value $5.00 - 1,200,000,000 shares authorized; 1,012,261,159 shares issued 5,061

5,061

Additional paid-in capital 4,122

4,033

Treasury stock, at cost - 256,630,628

and 267,556,388 shares (15,937)

(16,603)

Retained earnings 30,037

27,524

Accumulated other comprehensive loss (17,416)

(16,500)

Total shareholders' equity 5,867 3,515 Noncontrolling interest 100 93 Total equity 5,967 3,608 Total liabilities and equity $ 88,896 $ 79,986 The Boeing Company and Subsidiaries Consolidated Statements of Cash Flows (Unaudited) Twelve months ended December 31 (Dollars in millions) 2012 2011 Cash flows - operating activities: Net earnings $ 3,900 $ 4,018 Adjustments to reconcile net earnings to net cash provided by operating activities: Non-cash items - Share-based plans expense 193 186 Depreciation and amortization 1,811 1,675 Investment/asset impairment charges, net 84 119 Customer financing valuation benefit (10) (269) Loss/(gain) on disposal of discontinued operations 5 (11) Gain on dispositions, net (4) (24) Other charges and credits, net 694 500 Excess tax benefits from share-based payment arrangements (45) (36) Changes in assets and liabilities - Accounts receivable (27) (292) Inventories, net of advances and progress billings (5,681) (10,012) Accounts payable 1,199 1,164 Accrued liabilities 801 237 Advances and billings in excess of related costs 1,177 3,173 Income taxes receivable, payable and deferred 1,605 1,262 Other long-term liabilities 157 127 Pension and other postretirement plans 1,288 2,126 Customer financing, net 407 (6) Other (46) 86 Net cash provided by operating activities 7,508 4,023 Cash flows - investing activities: Property, plant and equipment additions (1,703)

(1,713)

Property, plant and equipment reductions 97 94 Acquisitions, net of cash acquired (124) (42) Contributions to investments (12,921)

(6,796)

Proceeds from investments 10,901

10,757

Receipt of economic development program funds 69 Purchase of distribution rights (7) Net cash (used)/provided by investing activities (3,757) 2,369 Cash flows - financing activities: New borrowings 60 799 Debt repayments (2,076) (930) Repayments of distribution rights financing (228)

(451)

Stock options exercised, other 120

114

Excess tax benefits from share-based payment arrangements 45

36

Employee taxes on certain share-based payment

arrangements (76) (24) Dividends paid (1,322) (1,244) Net cash used by financing activities (3,477) (1,700) Effect of exchange rate changes on cash and cash equivalents 18 (2) Net increase in cash and cash equivalents 292 4,690 Cash and cash equivalents at beginning of year 10,049 5,359 Cash and cash equivalents at end of period $ 10,341 $ 10,049 The Boeing Company and Subsidiaries Summary of Business Segment Data (Unaudited) Twelve months ended Three months ended December 31 December 31 (Dollars in millions) 2012 2011 2012 2011 Revenues: Commercial Airplanes $ 49,127 $ 36,171 $ 14,161 $ 10,695 Defense, Space & Security:

Boeing Military Aircraft 16,384 14,947 4,157 3,949

Network & Space Systems 7,584 8,654 1,912 1,961 Global Services & Support 8,639 8,375 2,274 2,561 Total Defense, Space & Security 32,607 31,976 8,343 8,471 Boeing Capital 441 520 116 104 Other segment 133 150 40 43 Unallocated items and eliminations (610) (82) (358) 242 Total revenues $ 81,698 $ 68,735 $ 22,302 $ 19,555 Earnings from operations: Commercial Airplanes $ 4,711 $ 3,495 $ 1,266 $ 981 Defense, Space & Security: Boeing Military Aircraft 1,581 1,526 336 374 Network & Space Systems 478 679 118 168 Global Services & Support 1,009 953 297 323 Total Defense, Space & Security 3,068 3,158 751 865 Boeing Capital 82 113 (20) (20) Other segment (159) 66 44 55 Unallocated items and eliminations (1,391) (988) (412) (284) Earnings from operations 6,311 5,844 1,629 1,597 Other income/(expense), net 62 47 23 (29) Interest and debt expense (463) (498) (117) (124) Earnings before income taxes 5,910 5,393 1,535 1,444 Income tax expense (2,007) (1,382) (557) (57) Net earnings from continuing 3,903 4,011 978 1,387 operations Net (loss)/gain on disposal of discontinued operations, net of taxes of $2, ($4), $0 and ($3) (3) 7 6 Net earnings $ 3,900 $ 4,018 $ 978 $ 1,393 Research and development expense, net: Commercial Airplanes $ 2,049 $ 2,715 $ 411 $ 524 Defense, Space & Security 1,189 1,138 321 365 Other 60 65 21 24

Total research and development

expense, net $ 3,298 $ 3,918 $ 753 $ 913 Unallocated items and eliminations: Share-based plans $ (81) $ (83) $ (17) $ (20) Deferred compensation (75) (61) (26) (65) Capitalized interest (70) (51) (17) (12) Eliminations and other (266) (276) (140) (94)

Sub-total (included in core

operating earnings) (492) (471) (200) (191) Pension (787) (269) (179) (53) Post-retirement (112) (248) (33) (40) Total unallocated items and eliminations $ (1,391) $ (988) $ (412) $ (284) The Boeing Company and Subsidiaries Operating and Financial Data (Unaudited) Twelve months ended Three months ended Deliveries December 31 December 31 Commercial Airplanes 2012 2011 2012 2011 737 415 372 105 91 747 31 9 10 9 767 26 20 6 6 777 83 73 21 20 787 46 (3) 3 23 (3) 2 Total 601 477 165 128 Note: Deliveries under operating lease are identified by parentheses. Defense, Space & Security Boeing Military Aircraft F/A-18 Models 48 49 12 11 F-15 Models 8 15 4 C-17 Globemaster 10 13 2 2 KC-767 International Tanker 3 2 CH-47 Chinook 51 32 11 10 AH-64 Apache 19 6 AEW&C 3 3 1 1 P-8A Poseidon 5 2 Network & Space Systems Commercial and Civil Satellites 3 1 1 Military Satellites 7 3 1 1 Contractual backlog December 31 September 30 December 31 (Dollars in billions) 2012 2012 2011 Commercial Airplanes $317.3 $305.4 $293.3 Defense, Space & Security: Boeing Military Aircraft 29.7 28.5 24.1 Network & Space Systems 9.7 9.7 9.0 Global Services & Support 15.7 14.1 13.3 Total Defense, Space & Security 55.1 52.3 46.4 Total contractual backlog $372.4 $357.7 $339.7 Unobligated backlog $17.9 $19.9 $15.8 Total backlog $390.3 $377.6 $355.5 Workforce 174,400 175,400 171,700 The Boeing Company and Subsidiaries Reconciliation of Non-GAAP Measures Core Operating Earnings, Core Operating Margin and Core

Earnings Per Share

(Unaudited) The tables provided below reconcile the non-GAAP financial measures core

operating earnings, core operating margin and core earnings per share with the most directly comparable GAAP financial measures, earnings from operations,

operating margin and diluted earnings per share. See page 7 of this release for additional information on the use of these non-GAAP financial measures.

Dollars in millions Fourth Quarter Full Year (except per share data) 2012 2011 2012 2011 Revenues $22,302 $19,555 $81,698 $68,735 GAAP Earnings From Operations $ 1,629 $ 1,597 $ 6,311 $ 5,844 GAAP Operating Margin 7.3% 8.2% 7.7% 8.5% Unallocated Pension/ Postretirement Expense $ 212 $ 93 $ 899 $ 517 Core Operating Earnings (non-GAAP) $ 1,841 $ 1,690 $ 7,210 $ 6,361 Core Operating Margin (non-GAAP) 8.3% 8.6% 8.8% 9.3% GAAP Diluted Earnings Per Share $1.28 $1.84 $5.11

$5.34

Unallocated Pension/ Postretirement Expense $0.18 a $0.08 b $0.77 c

$0.45 d

Core Earnings Per Share (non-GAAP) $1.46 $1.92 $5.88

$5.79

Favorable Tax Settlement ($0.52)e ($0.53)e $1.46 $1.40 $5.88 $5.26 Weighted Average Diluted Shares (in millions) 768.3 757.1 763.8

753.1

Decrease in GAAP Earnings Per Share -30%

-4%

Increase in Core Earnings Per Share Excluding Favorable Tax Settlement 4%

12%

Represents the net earnings per share impact of unallocated pension and

a postretirement expense of $212 million. The earnings per share amount is

presented net of the federal statutory tax rate of 35.0 percent.

Represents the net earnings per share impact of unallocated pension and

b postretirement expense of $93 million. The earnings per share amount is

presented net of the federal statutory tax rate of 35.0 percent.

Represents the net earnings per share impact of unallocated pension and

c postretirement expense of $899 million. The earnings per share amount is

presented net of the federal statutory tax rate of 35.0 percent.

Represents the net earnings per share impact of unallocated pension and

d postretirement expense of $517 million. The earnings per share amount is

presented net of the federal statutory tax rate of 35.0 percent.

Represents favorable tax settlement of $397 million recorded in

e fourth-quarter 2011 related to Internal Revenue Service (IRS) settlement

for 2004 through 2006 tax years, expressed as earnings-per-share. The Boeing Company and Subsidiaries Reconciliation of Non-GAAP Measures 2013 Increase in Core Earnings Per Share (Unaudited) The tables provided below reconcile the non-GAAP financial measures core

operating earnings, core operating margin and core earnings per share with the most directly comparable GAAP financial measures, earnings from operations,

operating margin and diluted earnings per share. See page 7 of this release for additional information on the use of these non-GAAP financial measures.

Year Ended Year Ended December 31, 2012 December 31, 2013 - Guidance Earnings Per Share Earnings Per Share GAAP Diluted Earnings Per Share $5.11 $5.00 - 5.20 Unallocated Pension /Postretirement Expense $0.77 a $1.10 b Core Earnings Per Share (non-GAAP) $5.88 $6.10 - 6.30 Weighted Average Diluted Shares (in millions) 763.8 763.0 2013 Change in GAAP Earnings Per Share ~ 0% 2013 Increase in Core Earnings Per Share ~ 5% Represents the net earnings per share impact of unallocated pension and a postretirement expense of $899 million. The earnings per share amount is presented net of the federal statutory tax rate of 35.0 percent. Represents the net earnings per share impact of unallocated pension and b postretirement expense of approximately $1.3 billion. The earnings per share amount is presented net of the federal statutory tax rate of 35.0 percent.

SOURCE Boeing