MARKET REPORT: Rolls-Royce climbs after US Army helicopter deal

Rolls-Royce shares benefited after the US Army awarded a major contract for long-range assault helicopters.

The Biden administration selected industrial conglomerate Textron’s Bell V-280 Valor as part of the US’s Future Long-Range Assault Aircraft (FLRAA) programme. 

That was good news for Rolls, which makes engines for the Valor.

America has selected Textron’s Bell V-280 Valor (pictured) as part of the US’s Future Long-Range Assault Aircraft programme

Rolls shares gained 3.2 per cent, or 2.9p, to 93.49p.

The Valor fleet, which endured more than 200 hours of flight tests, is expected to be rolled out from 2030. 

In becoming the US Army’s latest long-range assault aircraft, it will replace the Black Hawk helicopters which have been used for more than 40 years.

With Rolls chosen to be the main engine manufacturer, the company is set to help shape the future of US Army aviation.

The value of the V-280 programme for Rolls could reach up to £4.9billion in production and £5.7billion in services if 5,000 engines are delivered, according to analyst Jefferies. 

The broker added that the contract will provide a ‘significant long-term boost’ for the engine maker’s defence division, which made up 32 per cent or £3.4billion of group sales last year.

Textron chairman and chief executive Scott C Donnelly said: ‘We are honoured that the US Army has selected the Bell V-280 Valor as its next-generation assault aircraft.

Stock Watch – ADVFN

ADVFN shares tumbled after it posted disappointing results and went cap in hand to shareholders for fresh funds.

The financial data site group said it faced challenges such as increased market volatility. 

Revenue fell 14 per cent to £7.8million for the year to the end of June, falling short of its £8.7million target. 

The group – which appointed Amit Tauman as boss last month – also swung to a loss of £1.4million, having made a £1.6million profit 12 months earlier. 

Shares tumbled 21.1 per cent, or 10p, to 37.5p.

‘We intend to honour that trust by building a truly remarkable and transformational weapon system to meet the Army’s mission requirements. We are excited to play an important role in the future of Army Aviation.’

The FTSE 100 fell 0.6 per cent, or 46.15 points, to 7521.39 and the FTSE 250 was down 1.2 per cent, or 229.5 points, to 19100.08.

The price of oil fell below $80 a barrel for the first time since January amid fresh fears over the outlook for the global economy.

Brent crude fell as low as $79.36 as investors fretted that high inflation and weakening growth would hit demand for oil.

‘A stickier inflation outlook increases the prospect of a weaker economy heading into 2023,’ said Michael Hewson, chief market analyst at CMC Markets (down 2.1 per cent, or 5p, to 233p) in the UK. BP dipped 1.8 per cent, or 8.85p, to 474.65p and Shell dropped 0.7 per cent, or 17p, to 2358.5p.

Mondi took a hit after Credit Suisse downgraded the packaging firm to ‘underperform’ from ‘outperform’ and cut the target price to 1600p from 1800p. Shares fell 4.7 per cent, or 73p, to 1468p.

AJ Bell suffered a similar fate. The investment platform sank 3.8 per cent, or 14.4p, to 369p after Exane BNP Paribas lowered its rating to ‘neutral’ from ‘outperform’. Over at Phoenix, the insurer set a target of generating around £1.5billion of new business by 2025.

The group said it expects to deliver about £1.2billion of business this year, driven by the Standard Life brand. Shares rose 2.6 per cent, or 15.2p, to 611.4p.

Ashtead cashed in on rising demand for rental equipment.

The firm saw its revenue soar 28 per cent to £2.1billion in the three months to October. Profit jumped 40 per cent to £541.2million in the period.

After the upbeat results, Ashtead – whose shares rose 0.6 per cent, or 32p, to 5068p – hiked its interim dividend by 20 per cent and said its full- year results should be ahead of previous expectations.

There was also good news for one of the UK’s biggest mortgage and loan providers.

Paragon Banking Group added 4.7 per cent, or 21.8p, to 486.2p after hailing its use of new digital services and cost savings measures at the end of an ‘outstanding’ financial year. 

Lending rose 23.6 per cent to £3.21billion in the year to September. Profit jumped 95.6 per cent to £417.9million.

This post first appeared on Dailymail.co.uk