Wednesday, April 30, 2014

April Three Month Moving Average 787 Line. (updated)

3MM average                      (Prior Month projected)

Goal +/-                          02/2014  03/2014     04/2014         +/-   *Projected Month May 
Month Deliveries              4               10      8        (8)        0            10
3 M-M-avg                       6.3             6.0      7.33  (7)        .33           9.33
Production Goal             10              10.      10      (10)       0           10
Production Trend (+/- ) -3.7            -4.                -2       (-3)     -.67         -.67

Conclusions: If April stands at 8 delivered, then the analysis is Boeing is building a strong WIP count, since it rolls 10 a month out its doors to the flight line or EMC. The backlog of production completed models will break out during May and June. Whether Boeing can sustain a 10 a month delivery remains the goal. I would look at Boeings next ninety days as a gradual march towards ten deliveries on a continuos basis. There may be 11 delivered in June with a dip down to 9 on an alternate month. The accounting will have entries reducing accounts receivables through an average  @10 units a month (cash values) delivered by end of summer,  sometimes up to twelve units a month by September. The profit numbers for the 787 will jump by year's end as a contribution on Boeing's bottom line. The cash flow section of Boeings books will reflect this increase as well. Cheers from the accounting section will be heard later on with the WSJ reports.
Pressure will return to sales, as Boeing will seek more Back-log growth starting in January 2015.