LONDON, (Reuters) – Rolls-Royce raised its full-year outlook far beyond market expectations after it posted a 46% jump in first-half operating profit on a better performance in the civil aircraft aftermarket and increased demand in defence.
The British engineering company said it now expected to make £4.7 billion to £4.9 billion in underlying operating profit, up from previous guidance of £4.0 billion to £4.2 billion.
Before Thursday’s update, analysts were expecting £4.2 billion, according to a company-supplied poll.
Chief Executive Tufan Erginbilgic said his transformation of the company continued to deliver, with significant operational and strategic progress in the period.
“In Civil Aerospace, where we continued to improve our aftermarket profitability, we have also effectively eliminated aircraft on ground, providing a significant operational benefit to our customers,” he said.
“In Defence, we continued to establish our leading position in autonomous propulsion with several key milestones achieved in the period.”
The company’s power systems business was boosted by demand from data centres, he added.
Higher profitability across all of its divisions resulted in Rolls-Royce reporting £2.5 billion in underlying operating profit for the first half.
Reporting by Paul Sandle; Editing by Kate Holton and Sarah Young
