Boeing Co. will revise its full-year profit forecast because of a $536 million after-tax charge due to higher costs to develop a new U.S. Air Force refueling tanker.
A new projection for 2015 earnings per share will be released July 22 with second-quarter financial results, Boeing said Friday in a statement. Boeing had given a range of $8.20 to $8.40 for annual earnings per share, excluding pension expense.
The charge is the second in the past year related to the KC-46, following a $272 million after-taxes expense for cost overruns in July 2014. Boeing said it will stick to the original schedule of delivering 18 tankers to the Air Force by August 2017 and building 179 by 2027. The company forecasts an $80 billion global market for refueling aircraft.
“Here we are a year later,” Robert Stallard, an RBC Capital Markets analyst, said in a note to clients. “This is yet another reminder of how financially perilous it is” for contractors to take on the development of defense projects at a fixed price.