Boeing Co borrowed in the bond and loan markets after two deadly plane crashes forced the company to scale back production of its most profitable aircraft and cut into cash flow.[NEW YORK] Boeing Co borrowed in the bond and loan markets after two deadly plane crashes forced the company to scale back production of its most profitable aircraft and cut into cash flow.
The combined financing is the company's biggest since its 737 Max plane crashed in Ethiopia in March, marking the second time the jet had gone down in the span of five months. Any decline in cash flow may reverse when deliveries resume, CreditSights analysts including Ashwin Tiruvasu wrote. The company is still a"fundamentally solid credit," they said. Boeing earned US$2.15 billion in the three months ended March 31, a 13 per cent decline from the same period last year.
Boeing had more than US$15.5 billion of debt outstanding at the end of March. It successfully approached capital markets soon after the first fatal crash, a Lion Air flight in Indonesia in October. The company was able to sell US$700 million of bonds the same day, with orders equal to nearly seven times the bonds for sale. It also sold US$1.5 billion of bonds in February.