IBJNews

Rolls-Royce's profits in line with expectations

Back to TopCommentsE-mailPrintBookmark and Share

Rolls-Royce Holdings Plc, the world’s second-largest aircraft-engine maker, said profit rose in line with estimates, buoyed by a backlog of orders from Boeing Co. and Airbus SAS.

Pretax profit for the full-year 2011, including matured hedging positions, increased to 1.16 billion pounds ($1.8 billion) from 955 million pounds, the London-based company said Thursday. Analysts predicted profit of 1.13 billion pounds, according to the average of 19 estimates in a Bloomberg survey. Underlying sales added 4 percent, to 11.3 billion pounds.

The company, which employs about 4,500 people in Indianapolis, doesn't break out results for U.S. operations. North America CEO James Guyette noted that in 2011 the company expanded its operations in Virginia and Indiana, following a global competition for work within the company.

Rolls-Royce decided last fall to shift production of the banded stator jet-engine component to Indianapolis in 2013. The move will result in the building of a new production line and the hiring an additional 100 people through 2017.

The company recently announced it will spend $50 million to add a second jet-engine test stand in Mississippi, and Guyette said he anticipates additional investments in 2012. “Our investments will help Rolls-Royce fulfill its $96 billion order book in four global markets—civil aerospace, defense aerospace, marine and energy,” Guyette said in a prepared statement.

Rolls-Royce’s order book swelled to a record 62.2 billion pounds as customers Airbus and Boeing benefited from airlines upgrading to more fuel-efficient models and growth in air travel in emerging markets. Profit also got a boost from a 60 million-pound payment from the United Kingdom government for the early cancellation of contracts, including one for the Rolls-Royce-powered Harrier jumpjet.

“We continue to benefit from a broad portfolio, a large and growing customer base and access to markets where demand remains strong for our products and services,” CEO John Rishton said. “For 2012 we expect good growth in both underlying revenue and underlying profit with cash flow around break-even as we continue to invest in future growth.”

Boeing started deliveries of its 787 Dreamliner model, for which GE and Rolls supply engines. Rolls-Royce also competes with a joint venture of General Electric and Pratt & Whitney to build engines for the A380, the world’s largest passenger aircraft. Rolls-Royce is the only supplier for Airbus’s upcoming A350 wide-body aircraft.

Last year, the company incurred a one-time charge to fix a fault on A380 engines following the disintegration of a Trent 900 engine on a Qantas Airways Ltd. flight.

Rolls-Royce generates the majority of sales from the civil aerospace market, with the remainder spread across its marine, defense and energy businesses.

ADVERTISEMENT

  • Why then?
    If Rolls-Royce is doing so well then why do they feel the need to ask for a tax break from local(or was it state) properpty taxes. That article from a few months back indicated that they might move out of town if their exception from normal taxes request wasn't meet. Celadon trucking is/was doing the same thing while both companys claim to be doing great financially.

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. I am not by any means judging whether this is a good or bad project. It's pretty simple, the developers are not showing a hardship or need for this economic incentive. It is a vacant field, the easiest for development, and the developer already has the money to invest $26 million for construction. If they can afford that, they can afford to pay property taxes just like the rest of the residents do. As well, an average of $15/hour is an absolute joke in terms of economic development. Get in high paying jobs and maybe there's a different story. But that's the problem with this ask, it is speculative and users are just not known.

  2. Shouldn't this be a museum

  3. I don't have a problem with higher taxes, since it is obvious that our city is not adequately funded. And Ballard doesn't want to admit it, but he has increased taxes indirectly by 1) selling assets and spending the money, 2) letting now private entities increase user fees which were previously capped, 3) by spending reserves, and 4) by heavy dependence on TIFs. At the end, these are all indirect tax increases since someone will eventually have to pay for them. It's mathematics. You put property tax caps ("tax cut"), but you don't cut expenditures (justifiably so), so you increase taxes indirectly.

  4. Marijuana is the safest natural drug grown. Addiction is never physical. Marijuana health benefits are far more reaching then synthesized drugs. Abbott, Lilly, and the thousands of others create poisons and label them as medication. There is no current manufactured drug on the market that does not pose immediate and long term threat to the human anatomy. Certainly the potency of marijuana has increased by hybrids and growing techniques. However, Alcohol has been proven to destroy more families, relationships, cause more deaths and injuries in addition to the damage done to the body. Many confrontations such as domestic violence and other crimes can be attributed to alcohol. The criminal activities and injustices that surround marijuana exists because it is illegal in much of the world. If legalized throughout the world you would see a dramatic decrease in such activities and a savings to many countries for legal prosecutions, incarceration etc in regards to marijuana. It indeed can create wealth for the government by collecting taxes, creating jobs, etc.... I personally do not partake. I do hope it is legalized throughout the world.

  5. Build the resevoir. If built this will provide jobs and a reason to visit Anderson. The city needs to do something to differentiate itself from other cities in the area. Kudos to people with vision that are backing this project.

ADVERTISEMENT