Rolls-Royce withdraws from engine competition as it slips into the red

Rolls-Royce has reported an loss of £1.2bn for the year ending 31 December, putting the disappointing performance down to the troubles it has experienced with its Trent 1000 engine.

The news means that the Derby firm swug from a £3.9bn profit in the previous year.

Rolls-Royce also said Airbus scrapping its A380 aircraft meant that it recorded an exceptional item of £186m.

Despite this, underlying operating profit, which strips out the exceptional items, rose 71% to £633m for 2018, up from £317m in the previous year.

Meanhile, Rolls-Royce has said it has withdrawn from a competition to provide engines Boeing’s planned mid-market aircraft because it could not meet the timetable.

Chris Cholerton, Rolls-Royce, president – civil aerospace, said: “This is the right decision for Rolls-Royce and the best approach for Boeing. Delivering on our promises to customers is vital to us and we do not want to promise to support Boeing’s new platform if we do not have every confidence that we can deliver to their schedule.”

Warren East, chief Executive, said: “Despite the challenges we faced on Trent 1000 in-service issues, solid progress has been made realising our ambition to make 2018 a breakthrough year, both strategically and financially. Underlying financial results are ahead of expectations, with good growth in profit and cash flow. Following the restructuring we announced in June last year we are starting to see the crucial behavioural changes needed to sustain our momentum.”