Equities Manufacturing

Rolls-Royce share price dips after AGM statement

Share this article!

Shares in Rolls-Royce Holdings (LON:RR) are in the red this morning even as the company said that trading was in line with expectations. The news comes after the blue-chip engine market suffered a blow earlier this week, getting the UK government’s Prompt Payment Code for having failed to pay suppliers on time.

As of 08:04 BST, Rolls-Royce’s share price had given up 0.48 percent to 911.40p. The decline is largely in line with losses in the broader UK market, with the benchmark FTSE 100 index currently standing 0.34 percent lower at 7,360.38p.

Rolls-Royce updates on trading

Rolls-Royce announced in an annual general meeting statement this morning that it remained confident in its underlying operating profit and free cash flow guidance of £700 million +/- £100m. In terms of seasonality, the company expects its cash flow phasing to have a strong second half bias with higher invoiced engine deliveries and planned inventory reductions in Civil Aerospace.

“I am pleased to report that trading is in-line with our expectations,” Rolls-Royce’s chief executive Warren East commented in the statement. “We continue to see a healthy market environment, with strong order intake year-to-date at Power Systems, good flying hour growth in Civil Aerospace and positive order momentum in Defence.”

The company further noted that it continued to  implement the fixes to improve the health of the Trent 1000 fleet, pointed out at its guidance for  in-service cash costs on the Trent 1000 in 2019 and 2020 disclosed in its full-year results remained unchanged.

Analysts on blue-chip company

Credit Suisse lifted its stance on the British engine maker to ‘outperform’ last week, also hiking its target on the Rolls-Royce share price from 1,065p to 1,200p. According to MarketBeat, the FTSE 100 group currently has a consensus ‘buy’ rating and an average price target of 1,051.73p.

Add Comment

Investing is speculative. When investing your capital is at risk. This site is not intended for use in jurisdictions in which the trading or investments described are prohibited and should only be used by such persons and in such ways as are legally permitted. Your investment may not qualify for investor protection in your country or state of residence, so please conduct your own due diligence. This website is free for you to use but we may receive commission from the companies we feature on this site. Click here for more information.