Rolls-Royce Bounces into Profit in 2009

Despite upbeat results, Rolls-Royce warned that the outlook was challenging with the prospect of slow worldwide economic growth in the coming years.

British engine maker Rolls-Royce said Thursday that it bounced back into the black last year with net profits of 2.22 billion pounds (US$ 3.47 billion) as sales soared. The strong performance sharply contrasted with a net loss of 1.34 billion pounds in 2008, Rolls-Royce said in a results statement.

Revenues climbed 14.7% to 10.414 billion pounds and its order book hit a record 58.3 billion pounds. The company also raised the shareholder dividend.

"Rolls-Royce has delivered a solid set of results despite difficult trading conditions. This demonstrates the resilience of our business," said CEO John Rose in comments accompanying the earnings release.

"Our record order book, the breadth of the portfolio across all four sectors, our strong balance sheet and the early action we have taken to reduce costs will enable us to manage short-term difficulties and deliver long-term growth."

He added, "In 2010 we expect underlying revenues and profits to be broadly similar to those achieved in 2009."

Despite the upbeat outlook and results, Rolls-Royce warned that the outlook was challenging with the prospect of slow worldwide economic growth in the coming years.

"The economic environment remains challenging, and it seems likely that world growth will be slower in the years ahead than it has been in the past decade," it said. "However Rolls-Royce will benefit from its ability to access the world's faster growing markets where there continues to be demand for investment in transport and infrastructure."

Restated net profits, incorporating recent changes to accounting rules, stood at 1.799 billion pounds in 2009, after a loss of 782 million pounds in 2008, the group added on Thursday.

Copyright Agence France-Presse, 2010

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