Rolls-Royce boosted by aero growth
Underlying pre-tax profit has reached £595m at Derby-based Rolls-Royce. The manufacturer attributed the 28 per cent boost to "one-off trading items" and strong growth in its civil aerospace division. Rolls-Royce added it had achieved a record level of orders in the first half of the year of £8.7bn.
The company’s order book now stands at £61.4bn. Underlying pre-tax profit was given a 28 per cent boost from £465m in the comparable 2010 period, while underlying revenues were up four per cent to £5.46bn over the six-month period.
Rolls-Royce said a 25 per cent fall in revenues in its marine original equipment division was offset by "strong" growth in its civil aerospace sector.
During the first half of the year, Rolls-Royce announced it would acquire Tognum AG in a £4.8bn joint venture with Daimler AG. The company said it now had more than 94 per cent of shareholders' approval to forge ahead with the deal.
John Rishton, chief executive, said: "Since taking over from Sir John Rose in April, I have had the chance to travel extensively, meeting customers and seeing a broad range of Rolls-Royce’s capabilities. It has confirmed my view that this is an outstanding company with a proven strategy and many choices about how and where it can grow in the future.
"Performance in the first half of the year was strong with our order book and underlying profit showing solid growth, enabling an increased payment to shareholders. This demonstrates the resilience of our strategy that is based on a diverse portfolio and access to global markets.
"Completion of the acquisition, with Daimler, of the German diesel engines group Tognum will give us further opportunities for profitable growth and add significantly to the breadth and balance of our portfolio."
Rolls-Royce reported a "modest" cash outflow of £82m over the period, which it said was the result of its continued investment programme; an increase in net working capital; lower customer deposits, mainly in its marine and energy divisions, and the purchase of shares in Tognum AG.
Rishton said: "For the full year, we continue to expect good growth in underlying profit and, excluding the effect of the Tognum investment, a modest cash inflow."
