4th Nov 2014 14:23
LONDON (Alliance News) - Rolls-Royce Holdings PLC Tuesday announced its plans to accelerate its cost cutting plans, with 2,600 jobs to go over the next 18 months, primarily in its aerospace division.
In a separate statement Tuesday, the FTSE 100-listed engineering and aerospace group said it has appointed David Smith as its new chief financial officer, with immediate effect. Smith, who joined Rolls-Royce earlier this year, and is chief financial officer of the Aerospace Division, will replace Mark Morris.
The company has been embarking on a restructuring programme to improve operational efficiency and reduce cost across the group. However, Rolls-Royce said its latest headcount reductions alongside other restructuring efforts will save around GBP80 million in yearly cost benefit when fully implemented.
"We now propose a restructuring plan that will reduce headcount by 2,600 over the next 18 months, principally in our Aerospace division. The majority of this reduction will be achieved in 2015," the company said in its statement Tuesday.
It said that alongside cost cutting in its aerospace division, it will continue to pursue further cost improvements in "all areas", including in its Land & Sea division.
Rolls-Royce said it expects to book around GBP120 million in restructuring costs over the next two years.
"The investment we have made in technology and new capacity, alongside the organisational changes we have made to simplify the group, have enabled us to increase output and improve efficiency," it said.
Chief Executive Officer John Rishton said, "The measures announced today will not be the last, however they will contribute towards Rolls-Royce becoming a stronger and more profitable company. We will work closely with employees and their representatives to achieve the necessary reductions on a voluntary basis where possible, while making sure we retain the skills needed for the future."
Rolls-Royce shares were trading 1.1% higher Tuesday afternoon at 845.00 pence.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
Rolls-Royce