Rolls-Royce transformation ‘continues to deliver’ after strong first half of year

Rolls-Royce has upgraded its guidance after a strong first half of 2026 in which revenues and profits surged.

In its recently published financial results for the six months to 30 June, the engineering giant, which has its civil aerospace and defence divisions, in Derby, reported revenues of £11.27 billion, up from £9.49 billion in the same period last year.

Pre-tax profits went from £4.84 billion to £1.93 billion but, on an adjusted level, they surged from £1.68 billion to £2.49 billion.

Rolls-Royce now expects full-year underlying operating profits of £4.7 billion to £4.9 billion.

Chief executive Tufan Erginbilgic said: “Our transformation continues to deliver, and we are demonstrating that Rolls-Royce is now a very different company to that of the past.

“We have unlocked new growth opportunities across the group and created a resilient and diversified portfolio, with three strong businesses that can respond to changes in the external environment with agility and pace.

“We have made significant operational and strategic progress in the first half of the year.”

At the Farnborough International Airshow last month, Rolls-Royce announced new deals for its Trent aero engines.

And it officially began work on the expansion of its Raynesway site in Derby, effectively doubling its size, as it ramps up production for UK and Australian submarine programmes.

Meanwhile, Rolls-Royce SMR also announced plans to open a new £12 million facility in Derby, which will play a key role in the delivery of mini nuclear power stations both in the UK and overseas.

Pioneer Works will be Rolls-Royce SMR’s first manufacturing development centre where it will establish the build processes, precision assembly and advanced testing needed to de-risk the delivery of its Small Modular Reactor projects in the UK, Czechia and Sweden.

Mr Erginbilgic said: “In civil aerospace, where we continued to improve our aftermarket profitability, we have also effectively eliminated aircraft on ground, providing a significant operational benefit to our customers.

“In defence, we continued to establish our leading position in autonomous propulsion with several key milestones achieved in the period.

“In power systems, we captured further profitable growth in data centres, including growing prime power demand.

“Following its recent win in Sweden, Rolls‑Royce SMR has now been successful in every competitive European nuclear tender and is uniquely positioned to become a global market leader.”

Mr Erginbilgic said that despite the conflict in the Middle East, the strong start to the year has enabled the company to raise its guidance for 2026.

He added: “We now expect to deliver underlying operating profit of £4.7 billion to £4.9 billion and free cash flow of £3.8 billion and 4 billion. This builds further confidence in our mid-term targets.

“The actions that we have taken and investments we have made will drive significant profitable growth to the mid-term and beyond.”