Friday, July 26, 2013

News: Rolls-Royce profits from engine demand

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World-renowned engineers, Rolls-Royce, announced that it is close to completing its turbine blade facility in Rotherham as it reported a 34% rise in profits.

In its financial results for the first half of 2013, the group reported that it had increased its order book by 15%, underlying revenue by 27% and underlying profit by 34%.

Underlying profit before tax was £840m and included an increase by 59% to £486m from the civil aerospace sector. In June, Rolls-Royce increased its order book and confirmed plans for its most advanced Trent 1000 civil engine at the Paris Air Show.

During the first half of the year the group saw new orders of £10.9 billion in civil aerospace as the order book increased by 14%. In Paris significant new orders and agreements were announced for engines and services with a number of customers including Philippine Airlines, Air France-KLM, and United Airlines.

The group anticipates modest growth in revenue and strong growth in profit in the sector for the rest of 2013.

Other highlights in the financial period included the successful maiden flight of the Airbus A350 XWB, powered by the world's most fuel-efficient engine, the Trent XWB. Major orders for the Trent XWB have been placed by United Airlines, Air France-KLM and SriLankan Airlines, while the market leading Trent 700 was selected by Philippine Airlines, Oman Air and Sri Lankan Airlines to power Airbus A330 aircraft.

John Rishton, chief executive of Rolls-Royce, said that "the whole organisation was excited by the first flight of the Airbus A350 powered by our Trent XWB engines and we made good progress on our customer initiatives."

The new Rotherham facility is currently under construction on the Advanced Manufacturing Park. The Advanced Blade Casting Facility will produce single crystal turbine blades, which play a critical role in jet engines and are required to withstand centrifugal loads of up to ten tonnes while operating at up to 200 degrees above the melting point of their alloy.

There are over 65 turbine blades in every iconic Trent engine and the 14,900 sq m facility will be capable of manufacturing 100,000 blades per year when it becomes fully operational in 2014.

Despite the impressive leap in profits, Rolls-Royce actually posted a loss of £358m after taking into account changes to finance costs and taxes.

John Rishton, added: "While underlying profits were up 34% ... it is clear we have a lot more to do on cost (and cash). Fortunately we have significant opportunities to improve both, but this will take time and firm resolve to deliver.

"We maintain our full year guidance for the Group."

Rolls-Royce website

Images: BAM Construction / twitter

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