Boeing defense unit expecting ‘flattish’ year

By Dow Jones Newswires
Posted Dec. 2, 2010 at 6:31 a.m.

The defense arm of Boeing Co. is expecting a lackluster year followed by a modest pickup in 2012, the head of the unit said Wednesday.

The company’s overall defense outlook is for “a flattish” year, followed by “moderate, sustained growth in ‘12 and beyond,” Dennis Muilenburg said at a Credit Suisse defense and aerospace conference in New York.

Muilenburg cautioned that his comments were not meant to indicate guidance on the financial outlook of the defense unit of the world’s biggest aerospace company.

Boeing prefers steady growth to volatility, he said, adding the company was “being realistic” about prospects and was focused on having a robust portfolio “against a wide variety of scenarios.”

With U.S. military spending cutbacks looming, Boeing sees strong growth potential internationally, especially in the Middle East, he said, noting a pending U.S.-Saudi Arabia mega arms deal.

The $60 billion deal, one of the largest U.S. arms sales in history, includes 84 new Boeing F-15 fighter jets as well as upgrades for 70 used F-15s, 70 Boeing Apache attack helicopters, 72 tactical Boeing Black Hawk helicopters and 36 light helicopters.

The delivery of the weapons to oil-rich Saudi Arabia would be spread over 15 to 20 years.

Congress raised no objection to the sale, clearing the way for President Barack Obama’s administration to proceed.

Saudi Arabia has the option to buy the entire package of parts of it.

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