Rolls-Royce powers ahead with cost-cutting drive

Shareholders in the engine maker have suffered a bumpy ride. Picture: Rolls Royce/PA Wire

Shareholders in the engine maker have suffered a bumpy ride. Picture: Rolls Royce/PA Wire

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Engine maker Rolls-Royce is to ramp up cost savings after warning investors that it faced a mixed outlook.

In a trading update, the group said it was on track to deliver savings at the top end of its target to slash costs by between £150 million and £200m.

READ MORE: Rolls-Royce plans ‘painful’ overhaul to save £200m a year

It pointed to strong demand for engines for extra wide body civil aircraft, but a further weakening in business aviation and continuing woes in offshore oil and gas markets for marine, where the order book remains “very weak”.

Hargreaves Lansdown analyst George Salmon said: “Five profit warnings in the 20 months up to November 2015 means Rolls’ shareholders have had anything but a smooth ride recently. Operationally, the group is undergoing some major restructures.”

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