13th May 2021 09:31
(Alliance News) - Rolls-Royce Holdings PLC on Thursday said trading has been in line with expectations and it still anticipates turning free cash flow positive "at some point" in the second half of 2021.
In the first four months of 2021 large engine flying hours were around 40% of 2019 levels, supported by demand for cargo flights and the maintenance of key routes, said the jet engine maker said ahead of its annual general meeting. This is broadly unchanged from the run rate at the end of 2020 and consistent with planning assumptions.
Rolls-Royce said performance in Power Systems is on track despite the challenging environment, with government demand resilient and after-market demand increasing.
In Defence, the London-based company said it has continued to perform resiliently with high levels of backlog cover following a strong period of order intake in recent years.
While the outlook is uncertain, the firm said vaccination programmes, particularly in the US and UK are "encouraging".
Rolls-Royce added that it has made good progress on its targeted GBP1.3 billion of annualised cost savings, and has an "encouraging range" of interested parties for the sale of its ITP Aero business in Spain.
"Looking ahead, we are confident that the significant restructuring actions we have taken in 2020 will deliver permanent cost reductions, positioning us well for the rebound in international air travel," said Chief Executive Warren East.
Rolls-Royce shares were trading 3.4% lower in London on Thursday morning at 101.32 pence each.
The company said it will publish its half-year results on August 5.
By Evelina Grecenko; [email protected]
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