City briefs: Rolls-Royce; Frasers Group

Rolls-Royce says it is on target to make savings of £1bn during 2021.

In a trading update to the end of November, the Derby manufacturing giant said that it has now axed 8,500 jobs as part of its restructuring plan and that it’s free cash outflow this year is expected to be better than previous guidance of £2bn.

Chief executive Warren East said: “We are delivering on the elements within our control and are focused on our commitments. We have achieved good results with our fundamental restructuring programme, as we sustainably reduce costs and deliver a leaner and more efficient company and are firmly on course to complete our disposals programme. While external uncertainties clearly remain, we have seen continued gradual recovery in our Civil Aerospace business, a growing order book in Power Systems and have secured a significant contract win in Defence. We are investing in the net zero technologies and solutions that we need across the group to grasp the tremendous commercial opportunity of the global energy transition and drive long-term value. This all underpins our strategy of creating a better quality and more balanced business which can deliver significantly improved returns and cash flow into the future.”

Shirebrook-based Frasers Group has seen group revenue increase by 23.6% to almost £2.4bn for the half year to Octover 24.

The firm has also seen profits rise by over 75% during the period, to £186m.

A statement from the firm said: “Our performance continues to be strong in both our store estate and online. We do however remain cautious with a number of well publicised macroeconomic headwinds on the horizon in the form of but not limited to cost increases, supply chain issues and potential squeezes on consumer spending power. There is also still the risk that Covid-19 measures could adversely affect outlook and we are now seeing restrictions return, including lockdowns in Europe.

“Notwithstanding the above risks, which are appropriately considered in our forecasts including for impairments, we do believe the Group can achieve an adjusted profit before tax of between £300m to £350m for the period ended 24 April 2022 on the proviso there are no substantial lockdowns imposed in the UK, particularly over the important Christmas period.”