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☆ WeWork shares sink after warning of bankruptcy risk
▼ + stars: | 2023-08-09 | by ( ) www.reuters.com time to read: +2 min

The WeWork logo is displayed on a screen during the company's IPO on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., October 21, 2021. REUTERS/Brendan McDermid/File photoAug 9 (Reuters) - WeWork (WE.N) on Tuesday warned of a possible bankruptcy after reporting yet another quarterly loss, in a stunning reversal of fortune for the shared workspace provider that was valued at $47 billion in 2019. WeWork said it may need to consider strategic options, including raising more money or obtaining relief under the U.S. Bankruptcy Code. WeWork eventually went public in 2021 through a SPAC (special purpose acquisition company) merger amid persistent doubts over its business model. WeWork burnt $646 million in cash in the first six months of 2023 and as of June end is left with $205 million in hand.

Persons: Brendan McDermid, WeWork, Adam Neumann, Neumann, Ananta Agarwal, Chavi Mehta, Shivansh, Abhijith, Anil D'Silva, Arun Koyyur Organizations: New York Stock Exchange, REUTERS, U.S, Thomson Locations: New York City, U.S, Bengaluru

☆ Bombardier quarterly profit beats estimates on demand for business jets
▼ + stars: | 2023-08-03 | by ( ) www.reuters.com time to read: +2 min

REUTERS/Christinne Muschi/File PhotoMONTREAL, Aug 3 (Reuters) - Canada's Bombardier Inc (BBDb.TO) on Thursday reported better-than-expected quarterly profit and higher revenue despite supply chain pressures, helped by demand for flying and maintaining private planes. The Montreal-headquartered business jet maker reported a second-quarter profit of $10 million from continuing operations, compared with a loss of $109 million a year earlier. CEO Eric Martel told analysts that despite "pressure points" such as smaller suppliers, the supply chain is improving and will "remain a key area of focus for the foreseeable quarters". Last month, Gulfstream jet maker Textron Inc (TXT.N) raised its full-year profit forecast on strong jet pricing. On a per share basis, quarterly adjusted profit was 72 cents, compared with a loss of 48 cents a year earlier.

Persons: Christinne, Eric Martel, Refinitiv, Allison Lampert, Abhijith, Saumyadeb Chakrabarty, Jan Harvey Organizations: Bombardier Global, REUTERS, MONTREAL, Bombardier Inc, Gulfstream, Textron Inc, Bombardier, Thomson Locations: Montreal, Quebec, Canada, Bengaluru

A Boeing 737 MAX-10 lands over the Spirit AeroSystems logo during a flying display at the 54th International Paris Air Show at Le Bourget Airport near Paris, France, June 22, 2023. The new labor agreement will add $80 million to annual costs, Spirit said. In the second quarter, the company absorbed $28.3 million in cost related to the new labor deal as well as $7.3 million in strike disruption charges. However, the strike did impact our production and deliveries, as reflected in earnings and cash flow," Chief Executive Officer Tom Gentile said. Cash burn was $211 million for the three months through June, the company said, compared to $79 million a year earlier.

Persons: Benoit Tessier, Spirit, Tom Gentile, Cash, Refinitiv, Abhijith Ganapavaram, Valerie Insinna, Sriraj Kalluvila, Mark Porter Organizations: Boeing, International Paris Air, Le, REUTERS, International Association of Machinists, Aerospace Workers, Airbus, Revenue, Thomson Locations: Le Bourget, Paris, France, Wichita , Kansas, Wichita

Shares of the company rose 7% to hit a 1-1/2 year high after Boeing also posted second-quarter results above Wall Street expectations. The planemaker is now transitioning its 737 production line - including the MAX models that make up the vast majority of 737 production - to building 38 jets per month, up from 31, the company said. Calhoun later added the company is already in "prep mode" to raise monthly 737 production to 42, but wouldn't specify whether Boeing would do so in 2023, as Boeing Commercial Airplanes head Stan Deal said told Bloomberg TV in June. 'ENCOURAGING' RESULTS AMID CHALLENGESA photo of Boeing 737 MAX airplanes parked on the tarmac at the Boeing Factory in Renton, Washington, U.S. March 21, 2019. Boeing expects to deliver most of the 228 MAXs in its inventory by the end of 2024, making it critical that Boeing step up production.

Persons: there'll, Dave Calhoun, Calhoun, Stan Deal, Brian West, Lindsey Wasson, Peter McNally, Refinitiv, Valerie Insinna, Abhijith Ganapavaram, Anil D'Silva, Nick Zieminski Organizations: Boeing, Boeing Commercial Airplanes, Bloomberg TV, Boeing Factory, REUTERS, Commercial Aerospace, Thomson Locations: Renton , Washington , U.S, West

☆ Boeing boosts monthly 737 production to 38, posts upbeat earnings
▼ + stars: | 2023-07-26 | by ( ) www.reuters.com time to read: +2 min

Shares of the company jumped 4% before the bell after the company also posted second-quarter results that beat Wall Street expectations. The push to build 38 MAXs a month comes amid heightened travel demand, as airlines seek to grow their fleets post-pandemic. Boeing Commercial Airplanes head Stan Deal said in June that the company would ramp up narrow-body production to 38 a month "very soon." Although Boeing set a deadline to ramp 737 production by the end of the year, executives signaled to its supply chain that the boost to 38 a month would begin in June. Those plans faltered in April when a supplier defect involving the improper installation of a 737 bracket was discovered, though Boeing maintained it would still ramp to 38 jets by year-end.

Persons: Dave Calhoun, Stan Deal, Refinitiv, Valerie Insinna, Abhijith Ganapavaram, Anil D'Silva Organizations: Boeing, Boeing Commercial Airplanes, Paris Air Show, Air India, Airbus, Thomson

GE's aerospace unit, which makes engines for jets of Boeing Co (BA.N) and Airbus (AIR.PA), posted double-digit growth in orders, revenue, and operating profit from a year earlier. Its services revenue was up 31% in the second quarter from a year ago. The Boston-based company now expects 2023 adjusted profit per share of $2.10 to $2.30, compared with its previous forecast of $1.70 to $2.00. Free cash flow for the year is estimated to be in a range of $4.1 billion to $4.6 billion, up from $3.6 billion to $4.2 billion expected previously. GE said operating profit at its aerospace business was now expected to be in a range of $5.6 billion to $5.9 billion this year, up from $5.3 billion to $5.7 billion estimated earlier.

Persons: Larry Culp, France's Safran, Culp, Rajesh Kumar Singh, Kirsten Donovan, Mark Potter, Louise Heavens Organizations: General Electric Co, Boeing Co, Airbus, Boeing, GE, Thomson Locations: Boston, Chicago, Bengaluru

July 7 (Reuters) - U.S. private equity firm 777 Partners has said it is in talks with Boeing Co (BA.N) and Franco-Italian turboprop maker ATR over a new jet order, as it looks to enter more markets amid a boom in air travel. The talks come amid a rush for planes by airlines eager to tap into a greater-than-expected recovery in air travel. Earlier this year, Air India placed an order for 470 jets with Boeing and Airbus SE (AIR.PA) - which was later eclipsed by rival IndiGo's order for 500 Airbus planes. 777's business model involves buying jets and leasing them to airlines which it backs, such as Canadian low-cost carrier Flair Airlines and Australian airline Bonza. Reporting by Abhijith Ganapavaram in Bengaluru; Editing by Pooja DesaiOur Standards: The Thomson Reuters Trust Principles.

Persons: We've, Josh Wander, Wander, Flair, Abhijith, Pooja Desai Organizations: Partners, Boeing Co, Boeing, ATR, Air, Airbus, Flair Airlines, Bonza, Capital Ltd, Thomson Locations: Italian, Miami, Air India, Asia, South America, York, Bengaluru

June 29 (Reuters) - AIP Capital said it was in talks to pick up a 10% stake in Eastar Jet as the aviation asset management arm of U.S.-based private equity firm 777 Partners seeks to tap into the travel resurgence in Asia. AIP would also lease five Boeing 737 MAX 8 jets to the South Korean low-cost airline, it said without disclosing the additional terms of the deal, which is expected to close mid-July. In 2021, Eastar Jet had filed for court receivership as the COVID-19 pandemic battered the travel industry. Earlier this year, South Korean private equity firm VIG Partners bought the airline and agreed to inject 100 billion Korean Won ($75.98 million) into the carrier, according to a DealStreet report. Separately, AIP announced that it has closed a minority investment and joint venture agreement with consulting and investment firm Dreamstone Aviation Partners.

Persons: Eastar Jet, Jared Ailstock, 1,316.2100, Abhijith, Shilpi Majumdar Organizations: AIP, Jet, Partners, Boeing, South, VIG Partners, Won, Dreamstone Aviation Partners, Thomson Locations: U.S, Asia, Dreamstone, Bengaluru

☆ Ford signs battery material supply deals to charge up EV output
▼ + stars: | 2023-05-22 | by ( ) www.reuters.com time to read: +2 min

May 22 (Reuters) - Ford Motor Co (F.N) on Monday unveiled three deals for the supply of lithium products, including lithium hydroxide, as the automaker ramps up electric vehicle (EV) production to 2 million units by the end of 2026. The deals come as North American automakers race to secure supplies of battery materials to boost EV output and catch up with market leader Tesla Inc (TSLA.O) amid surging demand for environment-friendly vehicles. The long-term deal with Canada's Nemaska Lithium is for the supply of up to 13,000 tons of lithium hydroxide every year, while the contract with EnergySource Minerals will help Ford receive lithium hydroxide from the Imperial Valley, California site, expected to be operational in 2025. Ford also disclosed a five-year agreement with Albemarle Corp (ALB.N) to supply more than 100,000 metric tons of battery-grade lithium hydroxide for about 3 million future Ford EV batteries. The lithium hydroxide produced by Nemaska should help qualify Ford vehicles for consumer tax benefits under the U.S. Inflation Reduction Act, the automaker said.

May 19 (Reuters) - AIP Capital, the aviation asset management arm of 777 Partners, plans to invest up to $200 million in small and medium aerospace suppliers by the end of next year, at a time when the lower rungs of the supply chain are facing financial difficulties. The investments may include a first lien loan, and a single investment will range between $10 million and $30 million, AIP Capital Managing Partner Mathew Adamo told Reuters in an interview. AIP, which was launched earlier this week, has entered into a servicing agreement with 777 Partners to manage all commercial aircraft owned by the private-equity firm. Stamford, Connecticut-based AIP said supply chain investments would focus on companies in developed countries. It is targeting to raise $300 million to $500 million by the end of this year overall for private credit investments.

☆ GE finance chief Dybeck Happe to step down
▼ + stars: | 2023-05-18 | by ( ) www.reuters.com time to read: +1 min

May 18 (Reuters) - General Electric Co (GE.N) said on Thursday Carolina Dybeck Happe would step down as finance chief of the industrial giant, as it prepares to complete the spin-offs of its businesses next year. Rahul Ghai will become the CFO of GE, effective Sept. 1, while retaining his role as the finance chief of GE Aerospace, which he has held since August 2022, the company said in a statement. "Since Rahul joined GE Aerospace, we have benefited greatly from his leadership, including his wealth of experience as a public company CFO and with the spin-off process," GE CEO Larry Culp said. Moller-Maersk executive, Dybeck Happe took over as GE's CFO in early 2020. In late 2021, GE announced it would split into three public companies that would focus on energy, healthcare and aviation.

☆ Spirit AeroSystems takes $110 million in charges, profit hit on Boeing 737
▼ + stars: | 2023-05-03 | by ( Valerie Insinna | Abhijith Ganapavaram | ) www.reuters.com time to read: +3 min

WASHINGTON (Reuters) -Spirit AeroSystems Holdings Inc on Wednesday took a hefty $110 million loss in reach-forward charges on Airbus and Boeing jet production and expects a further hit of $31 million to full-year gross profit from disruptions related to a Boeing 737 MAX fuselage production problem. Slideshow ( 2 images )The company announced $110 million in charges on the Airbus A220, Airbus A350 and Boeing 787 during its first-quarter results. Spirit now expects cash burn of about $100 million to $150 million in 2023 due to the risk of lowered 737 fuselage deliveries. The company has also started to build and deliver production-conforming 737 fuselages under a revised process, it said. Cash burn was $69 million in the first quarter, compared with a cash burn of $298 million a year ago.

☆ Boeing supplier Spirit Aero flags $31 million hit from 737 fuselage defect
▼ + stars: | 2023-05-03 | by ( Valerie Insinna | Abhijith Ganapavaram | ) www.reuters.com time to read: +3 min

(Reuters) -Spirit AeroSystems Holdings Inc said on Wednesday it expects a $31 million hit to full-year gross profit from disruptions and rework related to a Boeing 737 MAX fuselage production problem, and that more related costs are anticipated. “Additional costs are expected, including costs Boeing may assert to repair certain models of previously delivered units in their factory and warranty costs related to affected 737 units in service,” Spirit said. Rework costs for affected 737 fuselages at Spirit’s Wichita, Kansas-based production facility are projected to amount to $5 million, an expense of about $100,000-$150,000 per plane. The company has also started to build and deliver production-conforming 737 fuselages under a revised process, it said. Losses on the A220 amounted to about $81 million, including $46 million in non-recurring supply chain costs as well as other costs related to production schedule changes.

[1/2] Airplane fuselages bound for Boeing's 737 Max production facility sit in storage at their top supplier, Spirit AeroSystems Holdings Inc, in Wichita, Kansas, U.S. December 17, 2019. "Additional costs are expected, including costs Boeing may assert to repair certain models of previously delivered units in their factory and warranty costs related to affected 737 units in service," Spirit said. Rework costs for affected 737 fuselages at Spirit's Wichita, Kansas-based production facility are projected to amount to $5 million, an expense of about $100,000-$150,000 per plane. The company has also started to build and deliver production-conforming 737 fuselages under a revised process, it said. Boeing CEO Dave Calhoun last week called the 737 manufacturing defect "gnarly" and "difficult to find", but noted that Spirit and Boeing had quickly identified affected planes and begun the rework.

☆ Southwest sees 'solid' Q2 profit, flags 20 fewer jet deliveries from Boeing
▼ + stars: | 2023-04-27 | by ( ) www.reuters.com time to read: +2 min

April 27 (Reuters) - Southwest Airlines Co (LUV.N) said on Thursday it expects "solid profits" in the current quarter on strong summer bookings, and flagged 20 fewer deliveries of the MAX jets this year from Boeing Co (BA.N). Delay in MAX deliveries is expected to increase operating costs for airlines and limit their ability to meet travel demand, hitting revenue. The company expects "solid profits" in the second quarter as well as the full year, but did not provide specific numbers. Analysts polled by Refinitiv expect an adjusted profit per share of $1.05 for the second quarter and $2.73 for 2023. "Travel demand and revenue trends in March were strong and resulted in solid profitability for the month," Jordan added.

Boeing shares rose 2.5% in early afternoon trade after the company reaffirmed its plans to generate $3 billion to $5 billion in free cash flow this year, as well as deliver 400 to 450 737 MAXs and 70 to 80 787 Dreamliners. Deliveries will increase to about 40 MAXs a month during the back half of the year, he said. Reuters reported earlier this month that Boeing's schedule called for suppliers to produce 38 737 MAXs a month from June. Reuters GraphicsBoeing's first-quarter cash burn slowed to $786 million from $3.57 billion a year earlier on higher jet deliveries. Reporting by Abhijith Ganapavaram in Bengaluru and Valerie Insinna in Washington; Editing by Anil D'SilvaOur Standards: The Thomson Reuters Trust Principles.

April 26 (Reuters) - Boeing Co (BA.N) said on Wednesday that it planned to ramp up production of its 737 MAX jets to 38 per month by year-end, while backing its annual cash-flow goal, offering some relief to investors after a new manufacturing snafu threatened to derail deliveries. Reuters reported earlier this month that Boeing's schedule called for suppliers to ramp up to 38 737 MAXs a month in June. Overall, Boeing reaffirmed plans to generate $3 billion to $5 billion in free cash flow this year, as well as deliver 400 to 450 737 MAXs and 70 to 80 787 Dreamliners. Boeing reported an adjusted loss per share of $1.27, wider than analyst expectations of a loss of $1.07 per share, per Refinitiv data. Boeing executives are expected to detail the scope of the problem on an investor call later in the day.

April 20 (Reuters) - Union Pacific Corp's (UNP.N) chief executive officer said on Thursday the railroad operator was considering slowing down the pace of hiring in the second half of the year amid a cloudy economic outlook, becoming the latest U.S. company to evaluate its staffing plans. CEO Lance Fritz told Reuters in an interview the outlook was turning a "little cloudier" for consumer-facing companies, which is making railroad volume difficult to predict. A possible slowdown in hiring comes at a time when railroads are struggling to move cargo on time, which has invited severe criticisms from regulators and customers. Shares of Union Pacific, which connects West Coast ports to key terminals such as Chicago, lost its gains in the day to trade flat in the afternoon session. Operating revenue for the quarter ended March 31 rose 3% to $6.06 billion, in line with analysts' estimates.

Higher costs and a shortage of available new parts are also delaying aircraft repairs, which risk pushing up air fares. Some makers of brand-name parts like General Electric Co (GE.N) stand to benefit because they also sell used parts, known as used serviceable material. Honeywell Aerospace Trading (HON.O), the U.S. conglomerate's used parts business, is among companies enjoying higher demand since 2021. Ultimately, the alternatives to new parts may bring relief but a congested supply chain must be fixed, said Benjamin Hockenberg, president of JSSI Parts & Leasing. "Certain models, certain situations, (used parts) will fill the void, but I think we also need to see a repaired supply chain," said Hockenberg.

The move to integrate FedEx Ground, its outsourced package delivery arm, with the FedEx Express overnight air delivery business was announced almost a year after activist investor D.E. FedEx Express is already handling FedEx Ground's pickup and deliveries in Alaska and Hawaii - fueling concerns that Ground contractors in the lower 48 states could be let go. John Smith will become president and CEO of U.S. and Canada ground operations at FedEx Express and assume leadership of surface operations across the FedEx Express, FedEx Ground and FedEx Freight businesses from April 16. FedEx Freight will continue to provide freight transportation services as a standalone company under the Federal Express Corp banner, the company added. Shares in FedEx, which also announced a 10% dividend boost on Wednesday, were up about 2% in mid-morning trade.

☆ FedEx to fold operating divisions into one organization in cost-cutting push
▼ + stars: | 2023-04-05 | by ( ) www.reuters.com time to read: +2 min

FedEx had come under criticism from investors last year for its subpar performance compared to UPS, which has a unionized workforce. In response, FedEx outlined extensive plans to cut costs, including parking planes and reducing headcount. The phased transition announced Wednesday will ultimately bring FedEx Express, FedEx Ground, FedEx Services and other FedEx operating companies into Federal Express Corporation and will be headed by present Chief Executive Officer Raj Subramaniam, the company said. John Smith will become president and CEO of U.S. and Canada Ground Operations at FedEx Express and assume leadership of surface operations across the FedEx Express, FedEx Ground and FedEx Freight businesses, effective April 16. FedEx Freight will continue to provide freight transportation services as a stand-alone company under the Federal Express Corp banner, the company added.

REUTERS/Dado Ruvic/IllustrationMarch 31 (Reuters) - General Electric Co (GE.N) has settled all its outstanding wind turbine technology patent disputes in the United States and Europe with Siemens Gamesa Renewable Energy S.A (GAM.HA), the companies said on Friday. Siemens Gamesa had sued GE for patent infringement in 2020 over the latter's Haliade-X turbines. Last year, a Boston federal judge barred GE from making and selling its Haliade-X wind turbines in the United States, after a jury found they infringed a patent owned by Siemens Gamesa. But GE was allowed to continue making and operating the turbines for existing projects off the coasts of Massachusetts and New Jersey with royalty payments to Siemens Gamesa. In February, the same judge ruled GE must double its patent royalty payments to Siemens Gamesa for the turbines it uses in a renewable energy project off the New Jersey coast.

March 24 (Reuters) - Financial sector headwinds are creating fresh openings for private equity investments in aerospace, as suppliers' need for capital to meet soaring demand for planes and parts risks further turbulence, executives said. He said he would not oppose a private equity investment, as long as he maintains control and the combination makes sense by lowering costs. Global private equity deals among companies with aerospace portfolios rose to 216 in 2022, more than double 2019's figure and the highest in over a decade, according to Refinitiv data. Permanent Equity wants to invest in repair stations and suppliers with large inventories of aerospace parts. In Canada, while bank loans remain accessible for small suppliers, rising rates have flattened real estate pricing.

REUTERS/Dado Ruvic/Illustration/File PhotoMONTREAL, March 23 (Reuters) - Business jet maker Bombardier Inc (BBDb.TO) on Thursday raised 2025 revenue and free cash flow targets at its investor day, and said it would produce more corporate planes, sending shares up 4.9% in morning trade. Corporate jet makers have reported swelling order backlogs on persistent strong demand for private flying in the U.S. He said Bombardier expects to produce about 150 business jets by 2025, and is targeting more than $9 billion in annual revenue, up from an earlier goal of $7.5 billion. With no announced 2025 capex target and the entry into service of its flagship Global 7500 in 2018, investors and analysts are expected to raise questions over plans for a new jet. Desjardins analyst Benoit Poirier said Bombardier's free cash, revenue and deliveries targets were stronger than expected and deemed the lack of a capex commitment less risky.

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