Latest News | 8 August 2022

Rolls-Royce chief hails engineering giant’s progress

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The boss of engineering giant Rolls-Royce has hailed the firm’s progress after it posted a rise in half-year revenues.

For the six months to 30 June, the firm, which has its civil aerospace and defence divisions in Derby, reported statutory revenue of £5.6 billion, compared to £5.1 billion for the same period last year.

Statutory operating profits also grew from £38 million to £223 million.

Rolls-Royce said that demand for its products and services were growing, adding that its civil aerospace business was continuing its recovery, while its defence business had a strong order book.

Chief executive Warren East said Rolls-Royce had “progressed well in the first half of the year”.

He said: “As a result of the actions we have taken over the last few years, our civil aerospace business is becoming leaner and more agile.

“This is setting us up to deliver on our commitments this year and in the future.”

In its half-year results, the firm conceded that outside factors were having an impact on the business.

It said that the war in Ukraine, inflationary pressures, and supply chain constraints, were all affecting the business.

Rolls-Royce said it expected these issues to persist into 2023, with the company taking steps to address and minimise the impact, such as keeping a tight control on costs and consolidating its supply chain, focusing on the best performing suppliers.

Mr East said: “We are actively managing the impacts of a number of challenges, including rising inflation and ongoing supply chain disruption, with a sharper focus on pricing, productivity and costs.”

Rolls-Royce said it was working across the business to increase the productivity and efficiency of its operations, particularly in manufacturing.

In Derby, the company is working to develop new engine technology, such as the UltraFan.

In its results, Rolls-Royce said that new engines programmes were “driving fleet growth”.

As for the full-year, the company said it remained on course to deliver low-to-mid-single digit underlying revenue growth.

The firm added: “Our full-year guidance is based on expected improvement in civil aerospace in the second half, driven by planned higher spare large engine sales and large engine shop visits.

“We are well positioned to deliver on our near and medium-term commitments despite the increasing challenges and risks around the pace of global economic growth, supply chain disruption and rising inflation that are expected to persist into next year.”

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