Boeing’s first quarter operating profits nosedived by 21% as it faced the impact of the worldwide grounding of the 737 Max aircraft.

The type remains out of service following fatal crashes in Indonesia in October and Ethiopia last month, which killed 346 people.

The US manufacturer dropped its full-year financial guidance “due to the uncertainty of the timing and conditions surrounding return to service of the 737 Max fleet”.

Reporting the 21% slump in core operating earnings to $1.98 billion for the first three months of the year, Boeing said it was  making “steady progress on the path to final certification for a software update for the 737 Max” with 135 test and production flights of the software update complete.

“The company continues to work closely with global regulators and our airline partners to comprehensively test the software and finalise a robust package of training and educational resources,” the company added.

Boeing has cut production of the 737 from 52 to 42 aircraft a month on a temporary basis.

President and chief executive Dennis Muilenburg said: “Across the company, we are focused on safety, returning the 737 Max to service, and earning and re-earning the trust and confidence of customers, regulators and the flying public.

“As we work through this challenging time for our customers, stakeholders and the company, our attention remains on driving excellence in quality and performance and running a healthy sustained growth business built on strong, long-term fundamentals.”

First-quarter revenue for Boeing’s commercial aircraft division fell by 9% year-on-year to $11.8 billion reflecting lower 737 deliveries. Divisional profits dropped by 17% to $1.17 billion.

Aircraft deliveries were down to 149 from 184 in the same period last year, although production of the long-range 787 Dreamliner increased to 14 a month.

Boeing captured several orders for wide-body aircraft, including 18 777Xs for British Airways parent company IAG, 20 787s for Lufthansa, and ten 787s for Bamboo Airways.

The first 777X flight test aircraft rolled out of the factory, with the programme on track for flight testing this year and the first delivery in 2020.

Boeing described its backlog of orders as remaining healthy with more than 5,600 commercial aircraft valued at $399 billion.

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