Record Year Likely for Gulfstream

Gulfstream Aerospace's earnings per share are up 91%, revenues have increased 35%, and income is 19 %higher, when comparing the first three quarters of 1998 to the same quarters in 1997, according to William Boisture, the firm's president and CEO.

"We're confident that we will have a record year, but we don't make predictions," he said. Year to date, Gulfstream has logged 58 aircraft sales, a 78% increase over the comparable period last year. Its current order book stands at 102 aircraft, representing a $3.2 billion backlog, prior to the Monday morning Executive Jet announcement of an MOU for 36 more aircraft.

The EJI order, which includes completion and service agreements, boosts future revenues by an additional $1.3 billion.

Boom times in the business aircraft industry, though, have created widespread supply-side problems for Gulfstream. To ease the strain, production rates of green aircraft will be boosted to 65 aircraft in 1999, according to James Johnson, president of Gulfstream Aircraft, the firm's manufacturing division. Productivity and process improvements potentially could boost the rate to 70 aircraft per year without having to make "brick and mortar" capital investments, Johnson said.

The recent acquisition of K-C Aviation is helping to relieve completion pressures. The average GIVSP/GV completion time is down to eight to nine months, according to Boisture. His goal is to shrink completion time to 24 to 30 weeks.

By Fred George