 soared on Tuesday, after half year results showed its turnaround plan is beginning to have an effect.){kind=link}
Shares in troubled aeronautical firm Rolls Royce (LON:RR) soared on Tuesday, after half year results showed its turnaround plan is beginning to have an effect.
The group reported revenue of £7.57 billion for the six months to the end of June, up from £6.46 billion a year ago, with pre-tax profit soaring to £1.94 billion. This compares to a £2.15 billion loss last year.
However, results were strongly influenced by positive currency movements, with the company having a”hedge book” of foreign exchange deals aimed at protecting it from currency fluctuations. Stripping out currency movements, revenue was £6.87 billion, up 6 percent, with pre-tax profit up 148 percent at £287 million.
Commenting on the results, Warren East, Chief Executive, said the group had made “encouraging year-on-year operational progress”.
Restructuring savings were ahead of plan, he confirmed, together with a higher than expected benefit from long-term contract accounting adjustments.
“This resulted in a good set of results, with financial performance ahead of our expectations for the first half. Looking to the balance of the year, execution and delivery of a number of important milestones across our businesses will be key to achieving our full year expectations. Our outlook for full year profit and cash remains unchanged”, East concluded.
The result came in way ahead of forecasts, with analysts expecting underlying revenue of £6.58 billion and underlying pre-tax profit of £193 million.
Shares in Rolls Royce are currently up 6.08 percent at 942.00 (0920GMT).