Rolls-Royce Civil Aerospace revenue up 14% in 1H2017

Rolls-Royce reported (01-Aug-2017) the following highlights for its Civil Aerospace business for 1H2017:

• Underlying revenue up 14%, principally due to:
  • Original equipment (OE): 27% increase in deliveries of Trent engines;
  • Services (AM): Strong growth, led by in production fleet and time & materials activities on older engines;
  • Good progress on Rolls-Royce powered aircraft transitions;
• Underlying profit before financing of GBP173 million, up from GBP31 million in 2016. Profit was helped by aftermarket growth and a higher than expected benefit from long term contract accounting adjustments (a net gain of GBP56m v 2016, including a GBP77 million benefit arising from a change to a customer credit rating risk assessment);
• Progress on new engine programmes:
  • Ongoing flight testing of Trent 1000 TEN and Trent XWB97; shipped first set of Trent 7000 test engines to Airbus in Jun-2017;
  • Large engine production ramp up continuing;
  • Further work to deliver 2017 targets after solid start including good further progress improving Trent XWB OE economics;
  • Expects increased activity in 2H2017 related to Trent 1000 maintenance programme to address a number of technical issues;
• Rolls-Royce continues working with customers to minimise disruption;
• Full year outlook unchanged, with increasing deliveries driving original equipment growth. [more - original PR]