Annual ReportAnnual ReportBoeingBoeing

By Jose FloresBy Jose Flores

Executive SummaryExecutive Summary

The Boeing Company is the world's largest The Boeing Company is the world's largest aerospace company. The leader in commercial aerospace company. The leader in commercial aircraft, military aircraft and missiles, and space aircraft, military aircraft and missiles, and space markets, Boeing employs close to 167,000 people markets, Boeing employs close to 167,000 people and serves customers in 145 nations. The and serves customers in 145 nations. The company has headquarters in Chicago, Ill., and is company has headquarters in Chicago, Ill., and is the largest exporter in the United States, with the largest exporter in the United States, with revenues of more than $58 billion in 2001.revenues of more than $58 billion in 2001.

http://www.boeing.com/companyoffices/financial/fihttp://www.boeing.com/companyoffices/financial/finreports/annual/04annualreport/BOEING_04AR.pnreports/annual/04annualreport/BOEING_04AR.pdf#search='the%20boeing%20company%202005df#search='the%20boeing%20company%202005%20annual%20report%20annual%20report' '

Part A. IntroductionPart A. Introduction Name of chief executive officer:Name of chief executive officer: Philip Philip

Condit Boeing Chairman and CEOCondit Boeing Chairman and CEO Location of home office: Location of home office: 100 North 100 North

Riverside Plaza Chicago, IL 60606-1599 Riverside Plaza Chicago, IL 60606-1599 USA.USA.

Phone: Phone: 312-544-2000312-544-2000 Ending date of latest fiscal year: Ending date of latest fiscal year:

December 31December 31 Description of principal products or Description of principal products or

services that the company provides:services that the company provides: Operates as an aerospace firm in six Operates as an aerospace firm in six principal segments: Commercial principal segments: Commercial Airplanes; Aircraft and Weapon Systems, Airplanes; Aircraft and Weapon Systems, Network Systems, Support Systems and Network Systems, Support Systems and Launch and Orbital Systems, collectively Launch and Orbital Systems, collectively Integrated Defense Systems and Boeing Integrated Defense Systems and Boeing Capital Corporation.       Capital Corporation.       

Main geographic area of activity: Main geographic area of activity: United States, Asia other than china, United States, Asia other than china, Oceania, China, Europe, Africa, Canada, Oceania, China, Europe, Africa, Canada, Latin America, Caribbean and other.Latin America, Caribbean and other.

Part A. Audit ReportPart A. Audit Report

Name of the company’s independent Name of the company’s independent auditors: auditors: Deloitte & Touche LLPDeloitte & Touche LLP

What did the auditors say about the What did the auditors say about the company? company? After reviewing the faineances After reviewing the faineances the auditor concluded with no objections. the auditor concluded with no objections. They compare their report with other They compare their report with other auditor’s reports on Boeing and concluded auditor’s reports on Boeing and concluded that the financial statements are free of that the financial statements are free of material misstatement. material misstatement.

Part A. Stock Market InformationPart A. Stock Market Information

DJIA 10,292.31, +5.21 S&P 1,195.90, +4.41 NASDAQ 2,090.35, +6.27

Last Prev. Close Day Range EPS Div Shares Outstanding

67.30 67.93 66.65 - 67.71 2.14 $1.00 839,434,000

Change % Change 52 Week Range Volume P/E Yield Market Cap

- 0.63 0.93 48.10 - 68.48 3,562,700 30.00 1.61 41,703,088,000

Part A. Stock Market InformationPart A. Stock Market Information

Chart Options:

3 month 6 month 1 year 3 year 5 year

The split-adjusted activity for one share of BA stock bought on October 07, 2005 is:

Part A. Stock Market InformationPart A. Stock Market Information

The split-adjusted activity for one share of BA The split-adjusted activity for one share of BA stock bought on October 07, 2005 is: stock bought on October 07, 2005 is:

High $67.71High $67.71 Low $66.65Low $66.65 Open $67.71Open $67.71 Close $67.30Close $67.30 Volume 3,607,600Volume 3,607,600 Base on the market information and the Base on the market information and the

introduction of a new airplane, I believe that it will introduction of a new airplane, I believe that it will be a good idea to buy this company stock.be a good idea to buy this company stock.

Part B. Industry Situation and Part B. Industry Situation and Company PlansCompany Plans

The Boeing Company operates in the The Boeing Company operates in the aerospace industry worldwide. This company aerospace industry worldwide. This company is divided in different segments some of these is divided in different segments some of these are Commercial Airplanes, Integrated are Commercial Airplanes, Integrated Defense Systems (IDS), Boeing Capital Defense Systems (IDS), Boeing Capital Corporation (BCC), and Other. Because being Corporation (BCC), and Other. Because being such a big industry in its field the Boeing such a big industry in its field the Boeing Company is growing dramatically as years go. Company is growing dramatically as years go. Several new improvements have been made Several new improvements have been made in the industry, one of the resent ones are the in the industry, one of the resent ones are the launch of the new airbus 350 and 787 launch of the new airbus 350 and 787 Dreamliner. The 787 is a family of three Dreamliner. The 787 is a family of three super-efficient airplanes that will provide super-efficient airplanes that will provide passengers with a better flying experience, passengers with a better flying experience, including an improved cabin environment with including an improved cabin environment with more room and more conveniences. So, by more room and more conveniences. So, by making the passengers fell more comfortable making the passengers fell more comfortable this will make the Boeing Company able to this will make the Boeing Company able to sell more plains and grow more in their field. sell more plains and grow more in their field.

http://www.boeing.com/news/releases/http://www.boeing.com/news/releases/ http://www.boeing.com/news/flash.htmlhttp://www.boeing.com/news/flash.html

Part C. Income StatementPart C. Income Statement

PERIOD ENDING 31-Dec-04 31-Dec-03 31-Dec-02

Total Revenue 52,457,000   50,485,000   54,069,000  

Gross Profit 7,782,000   6,623,000   8,570,000  

Operating Income or Loss

2,266,000   891,000   3,868,000  

Net Income 1,872,000   718,000   492,000  

All numbers in thousandsMultistep Formathttp://finance.yahoo.com/q/is?s=BA&annual

As years pass from 2002 the net income for Boeing Company increased dramatically, as expected for new technology in the market of airplanes. In respect to their operations through the last three years there have been some ups and downs in the company.

Part C Balance SheetPart C Balance SheetPERIOD ENDINGPERIOD ENDING 31-Dec-0431-Dec-04 31-Dec-0331-Dec-03 31-Dec-0231-Dec-02

Total AssetsTotal Assets 53,963,000  53,963,000   53,035,000  53,035,000   52,342,000  52,342,000  

Total LiabilitiesTotal Liabilities 42,677,000  42,677,000   44,896,000  44,896,000   44,646,000  44,646,000  

Total Stockholder Total Stockholder EquityEquity 11,286,000  11,286,000   8,139,000  8,139,000   7,696,000  7,696,000  

Net Tangible AssetsNet Tangible Assets $8,383,000  $8,383,000   $5,191,000  $5,191,000   $3,808,000  $3,808,000  

http://finance.yahoo.com/q/bs?s=BA&annual

Since 2002 assets have increase dramatically in this company. As consequently its liabilities have decrease during the last three years. In

the liabilities area were I saw a bigger change during the years was in the Long Term Debt were its decrease was dramatically. And last in its

owner’s equity it increase by doubling its Retained Earnings from 2003 to 2004.

Part C. Statement of Cash FlowPart C. Statement of Cash Flow

PERIOD ENDINGPERIOD ENDING 31-Dec-0431-Dec-04 31-Dec-0331-Dec-03 31-Dec-0231-Dec-02

Net IncomeNet Income 1,872,000  1,872,000   718,000  718,000   492,000  492,000  

Total Cash Flow From Total Cash Flow From Operating ActivitiesOperating Activities 3,458,000  3,458,000   3,881,000  3,881,000   4,375,000  4,375,000  

Total Cash Flows From Total Cash Flows From Investing ActivitiesInvesting Activities (1,369,000)(1,369,000) (1,060,000)(1,060,000) (3,421,000)(3,421,000)

Total Cash Flows From Total Cash Flows From Financing ActivitiesFinancing Activities (3,518,000)(3,518,000) (521,000)(521,000) 746,000  746,000  

Change In Cash and Cash Change In Cash and Cash Equivalents Equivalents ($1,429,000)($1,429,000) $2,300,000  $2,300,000   $1,700,000  $1,700,000  

Part D. Accounting PoliciesPart D. Accounting Policies With respect to result of operations, related charges have average less With respect to result of operations, related charges have average less

than 1% of historical annual revenue. The Boeing Company believes it than 1% of historical annual revenue. The Boeing Company believes it is not reasonable likely that identifying environmental contingencies will is not reasonable likely that identifying environmental contingencies will result in additional cost that will have a material adverse on their result in additional cost that will have a material adverse on their financial position or to their operation results and cash flow trends. financial position or to their operation results and cash flow trends.

Summary of significant accounting policies, Standards issued & not yet Summary of significant accounting policies, Standards issued & not yet implemented, 717 program completion, goodwill & acquired implemented, 717 program completion, goodwill & acquired intangibles, Earning per share, income tax, accounts receivable, intangibles, Earning per share, income tax, accounts receivable, inventories, discontinued operations commercial financial services, inventories, discontinued operations commercial financial services, customer financing, property, plant, equipment, investments, differed customer financing, property, plant, equipment, investments, differed lease income, debt, postretirement plans, share-base compensation, lease income, debt, postretirement plans, share-base compensation, shareholders equity, derivative financial instruments, arrangements shareholders equity, derivative financial instruments, arrangements with off-balance sheet risk, significant group concentrations of risk, with off-balance sheet risk, significant group concentrations of risk, disclosures about fair value of financial instruments, contingencies, disclosures about fair value of financial instruments, contingencies, segment information, Boeing capital corporation (BCC), statement of segment information, Boeing capital corporation (BCC), statement of cash flow and subsequent events (Unaudited). cash flow and subsequent events (Unaudited).

Part E. Financial Analysis Liquidity Part E. Financial Analysis Liquidity RatiosRatios

20042004 20032003

Working CapitalWorking Capital 1128600011286000 81390008139000

Current RatioCurrent Ratio 1.261.26 1.181.18

Part E. Financial Analysis Part E. Financial Analysis Profitability RatiosProfitability Ratios

20042004 20032003

Profit marginProfit margin .52.52 .22.22

Asset turnoverAsset turnover .066.066 .061.061

Return on assetsReturn on assets .034.034 .014.014

Return on equityReturn on equity .17.17 .14.14

Part E. Financial Analysis Solvency Part E. Financial Analysis Solvency RatioRatio

20042004 20032003

Debt to EquityDebt to Equity .378.378 .552.552

Part E. Financial Analysis Market Part E. Financial Analysis Market Strength RatiosStrength Ratios

2005

Price earning per share 67.987

Forward annual dividend yield 1.50%

Trailing annual dividend yield 1.41%