Rolls-Royce has maintained its full-year guidance as the engineering behemoth continues to reap the benefits of skyrocketing demand for its aircraft engines and increased defence expenditure.
In a trading update released this morning, the FTSE 100 company projected an underlying operating profit of between £2.1bn to £2.3bn for the current year and free cash flow of £2.1bn to £2.2bn, consistent with a previous forecast in August, as reported by .
The firm, which has major 海角视频 bases in Derby and near Bristol, highlighted ongoing robust demand in Civil Aerospace, where large engine flying hours have increased by 18 per cent year-on-year to 102 per cent, exceeding the levels observed prior to the pandemic's decimation of passenger numbers.
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Flying hours are anticipated to reach between 100 to 110 per cent of pre-pandemic levels for the full year, with approximately 500 to 550 deliveries expected.
Defence demand also remained strong following years of surging government spending triggered by Vladimir Putin's invasion of Ukraine and conflict in the Middle East.
Shares have seen a staggering 91 per cent increase this year to date.
Rolls-Royce warns on outlook
However, Rolls-Royce cautioned about persistent challenges in the aerospace industry's supply chain. The company was held responsible for the cancellation of several British Airways flights last month due to issues with its Trent 1000 engines, installed on the airline's Boeing 787 aircraft.
Since the pandemic, the sector has experienced ongoing challenges. The top two aerospace companies, Airbus and Boeing, have faced issues keeping up with the surging global demand for air travel, causing widespread delays in aircraft deliveries to leading airlines.
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Nonetheless, the engineering behemoth expects to bring back dividends for shareholders by the year's end, intending initially to offer a 30 per cent payout ratio of its underlying post-tax profit, followed by consistently dispensing between 30 to 40 per cent afterwards.
Chief Executive Tufan Erginbilgic remarked on the company's performance since his appointment in January 2023: "Our transformation of Rolls-Royce into a high-performing, competitive, resilient and growing business continues with pace and intensity."
He went on to express optimism about meeting future targets saying, "Continued good performance year to date gives us further confidence in the delivery of our 2024 guidance despite a supply chain environment which remains challenging. We are also making good progress towards our mid-term targets, with a front-end loaded delivery of profit and cash flow improvements."