UK's Rolls-Royce confident on outlook despite Middle East disruption
Rolls-Royce Maintains Profit Guidance Amid Regional Challenges
LONDON, April 30 (Reuters) - British engineering company Rolls-Royce said it was sticking to guidance for profit to rise at least 16% this year and would be able to fully mitigate disruption caused by the war in the Middle East.
Impact of Middle East Conflict on Airline Customers
Rolls-Royce provides engines that power Airbus A350 and Boeing 787 widebody jets, meaning its airline customers were affected by the severe disruption to global air travel in the first few weeks of the Iran War which began in late February.
Recovery in Air Travel and Engine Flying Hours
Air travel has since recovered somewhat, although airlines, which pay Rolls for the hours they fly using its engines, continue to face higher fuel prices as a result of the conflict.
Regional Performance and Capacity Reallocation
Rolls said in a trading update on Thursday that it had seen a recovery in engine flying hours from Middle Eastern airlines, with some engines now back at pre-conflict levels, and there had been growth in other regions as carriers reallocate capacity.
Financial Outlook and Mitigation Strategies
"We expect to fully mitigate the current financial impact of the disruption to our business," chief executive Tufan Erginbilgic said in a statement.
Profit Guidance and Business Segments
Rolls-Royce, whose power systems also run data centres and which has nuclear power and defence units, is guiding to operating profit of between 4 billion pounds and 4.2 billion pounds ($5.39-5.66 billion) for 2026.
Exchange Rate Information
($1 = 0.7427 pounds)
Reporting Credits
(Reporting by Sarah Young, editing by Paul Sandle)
