Selling fuel-efficient Trent engines to aircraft manufacturers guaranteed Rolls-Royce a solid first half. Another £9bn of new orders are in the bag, too, so little surprise chief executive John Rishton is promising good earnings growth this year, justifying our faith in this iconic UK company.
Civil aerospace is where the growth is. Underlying revenue there rose 17 per cent to over £3bn and underlying pre-tax profit rose almost a quarter to £310m. Revised trading arrangements with International Aero Engines will add another £70m in 2012. The order book swelled, too. Rolls now has 3,300 engines to build after winning £6bn of work during the period. And, despite airlines saving cash by deferring orders and destocking spares, revenue from the high-margin after-market grew by a tenth to £1.7bn and still generates over half the division's sales. Predictably, the defence division had a quiet six months, reflecting military spending cuts. While a 6 per cent profit drop at marine was a little on the heavy side and another small loss at the energy operation was disappointing. But both defence and energy are tipped to improve profits for the year and marine should still come in flat.