Rolls Royce sees no immediate impact from Brexit; trading in line

by Jonathan Adams

Rolls-Royce said the UK’s decision to leave the EU would not have an immediate impact on day-to-day business, adding that the medium and long-term effects would depend on whatever post-Brexit deal is agreed.

In a trading statement, Rolls-Royce said it remains committed to the UK “where we are headquartered, directly employ over 23,000 talented and committed workers and where we carry out a significant majority of our research and development”.

It also is confirmed there has been no change to its outlook with overall trading in the first five months of the year broadly in line with expectations and the outlook for the year as a whole is unchanged.

“As outlined in May, underlying profit before financing charges and tax for the first six months of the year is expected to be close to breakeven, with our performance significantly weighted towards the second half,” Rolls-Royce said.

“This reflects the previously identified headwinds expected in 2016 and the resulting lower level of overall performance compared to the prior year. Looking to the balance of the year, the second half outlook reflects increased large engine deliveries, good underlying growth in aftermarket revenues and expected incremental benefits from ongoing restructuring programmes.”

“The 2016 full year outlook also excludes the year-on-year effect of foreign exchange translation. Should rates for the full year remain at the average levels seen in the first five months of 2016 (USD:GBP 1.44; EUR:GBP 1.29) the movement would improve underlying revenues by around £400m and improve underlying profit before tax by around £40m.”

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