Rolls-Royce says cash flow better than expected
By Sean Farrell
Date: Thursday 09 Dec 2021
(Sharecast News) - Rolls-Royce said annual free cash flow would be better than expected after trading improved but sales at its civil aerospace were lower than forecast.
The FTSE 100 engine maker said it also benefited from a delay to about £300m of outflows from 2021 to 2022. As a result, free cash outflow in 2021 is expected to be better than earlier guidance for £2bn.
Rolls-Royce said defence trading was in line with expectations but civil aerospace engine sales and aftermarket activity were at the low end of guidance. Orders are improving for power systems but the business is facing supply-chain disruption, the company said.
The company also said its restructuring programme was achieving cost savings quicker than expected. Rolls-Royce expects to have cut 8,500 jobs by the end of 2021 with the pace of cuts running ahead of its original plan.
Chief Executive Warren East said: "We are delivering on the elements within our control and are focused on our commitments. We have achieved good results with our fundamental restructuring programme, as we sustainably reduce costs and deliver a leaner and more efficient company and are firmly on course to complete our disposals programme."
Rolls-Royce was already struggling to overhaul its business after a series of profit warnings before the pandemic caused the biggest crisis in the aviation industry's history.
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