By Robert Wall
LONDON--Rolls-Royce Holdings PLC (RR.LN) on Thursday said profit
and sales retreated amid sustained weakness in key markets.
The British maker of jetliner engines for Boeing Co. (BA) and
Airbus Group SE (AIR.FR) planes reported first-half net profit of
360 million pounds ($561.41 million), down from GBP532 million a
year earlier. The company's more closely watched underlying pre-tax
profit slipped 32% to GBP439 million, slightly ahead of the GBP390
million to GBP430 million range Rolls-Royce gave earlier this
month.
Underlying sales slumped 3% to GBP6.3 billion, the London-based
company said.
Rolls-Royce's earnings have been repeatedly hit by deteriorating
conditions in key markets that caused the engineering company to
halt its first ever share repurchase. A slowdown in sales of its
profitable Trent 700 aircraft engines that power Airbus A330
widebodies is weighing on its aerospace business, which is also
struggling with sales for regional jet and business aircraft. Low
crude prices have caused sales in the marine sector to stall.
"Despite the disappointment of our recent update, our second
half outlook remains positive," said Chief Executive Warren East,
who has been in the job less than a month.
Rolls-Royce maintained its full-year outlook. The company
earlier this month cut its outlook for underlying pre-tax profit to
a range of GBP1.33 billion to GBP1.48 billion. It also lowered its
cash flow expectation.
-Write to Robert Wall at robert.wall@wsj.com
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