Rolls-Royce ‘progressing strongly’ despite tariffs uncertainty

The chief executive of Rolls-Royce has said the engineering giant is “progressing strongly” despite uncertainties associated with tariffs and continued supply chain challenges.

In a recent trading update, the firm, which has its civil aerospace and defence divisions in Derby, said progress on its transformation gave it the confidence to set its guidance for 2025 at £2.7 billion to £2.9 billion of underlying operating profit and £2.7 billion to £2.9 billion of free cash flow.

Rolls-Royce said it had enjoyed a strong start to the year, with all divisions performing well.

In civil aerospace, large engine flying hours grew to 110% of 2019 levels in the three months to 31 March.

Certification of a new blade for the Trent 1000, which will double the time on wing of this engine, is expected in the coming weeks and the firm remains on track to deliver a further 30% time on wing improvement for the Trent 1000 and Trent 7000 by the end of the year.

The Airbus A350-900 aircraft, powered by Rolls-Royce’s new Trent XWB-84 EP engine variant, which will improve fuel consumption by more than 1%, was certified in April.

In Rolls-Royce SMR, the firm’s mini nuclear power stations business, the Czech Republic state utility, ČEZ Group, made a strategic investment into the business in March.

The firm also submitted its final tender to Great British Nuclear in April and expects a decision in June.

In his address to shareholders at the company’s AGM last week, chief executive Tufan Erginbilgic said: “Our transformation of Rolls-Royce is progressing strongly, and we continue to expand the earnings and cash potential of the business.

“We are creating a more resilient and agile Rolls-Royce that is better equipped to respond to changes in the external environment. As a result, we have had a strong start to the year.

“The recently announced global tariff increases have created a degree of uncertainty for the industry.

“We expect to offset the impact of announced tariffs on our business through the mitigating actions we are  taking.

“We are closely monitoring the potential indirect impact on economic growth and inflation and will continue to take the necessary actions.”