The gradual recovery in international flying combined with market recovery in Power Systems and resilience in Defence are “driving improvements” in trading performance, Rolls-Royce has said, while savings of more than £1bn have been made in 2021.
The company’s restructuring programme, launched in May 2020, is said to be delivering “sustainable cost savings more quickly than initially anticipated,” positioning Rolls-Royce well for its £1.3bn savings target by the end of 2022.
By the end of 2021 the business expects to have removed more than 8,500 roles, with the pace of restructuring running ahead of its original plan and footprint rationalisation continuing through the second half of the year.
Free cash outflow in 2021 is now expected to be better than previous guidance of £2bn.
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.
“While external uncertainties clearly remain, we have seen continued gradual recovery in our Civil Aerospace business, a growing order book in Power Systems and have secured a significant contract win in Defence.
“We are investing in the net zero technologies and solutions that we need across the group to grasp the tremendous commercial opportunity of the global energy transition and drive long-term value. This all underpins our strategy of creating a better quality and more balanced business which can deliver significantly improved returns and cash flow into the future.”
