All eyes will be on jet engine maker Rolls-Royce when it unveils its half-year results.
In an unscheduled update this week, the FTSE 100 engineer said it expects profits of between £1.2billion and £1.4billion for the full year, up from its previous forecast of £800m to £1billion.
That sent shares flying to their highest level since March 2020, and they have almost doubled this year – a big boost for boss Tufan Erginbilgic, who took over in January.
So investors are eagerly awaiting the interim results on Thursday. Rolls-Royce expects half-year profits of between £660m and £680m, far above the £328m predicted on average by analysts.
Erginbilgic, a former BP executive who described Rolls as a ‘burning platform’ after taking over, has been carrying out a transformation programme.
‘Better profit and cash generation reflects greater productivity, efficiency and improved commercial outcomes,’ he says.
‘Despite a challenging external environment, notably supply chain constraints, we are starting to see the early impact of transformation in all divisions.’
Warren East, his predecessor, tried to lift profitability with a plan in 2018. The pandemic forced further restructuring, to stave off a collapse in revenue when travel stopped, battering investor confidence.
But Rolls has benefited from a return to the skies since the lockdowns ended. Investors will hope for a clear plan for growth to cash in on demand for defence and the bounce-back of the travel industry.
