Rolls-royce Holdings Plc · LSE:RR.
Rolls-royce — H1 2023 Earnings Presentation
18 slides from Rolls-royce's earnings presentation, Aug 3, 2023
Slide 1: 2023 Half Year Results
2023 Half Year Results 3 August 2023 © 2023 Rolls-Royce
Slide 2: Safe harbour statement
Safe harbour statement This announcement contains certain forward-looking statements. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. In particular, all statements that express forecasts, expectations and projections with re
Slide 3: Welcome – Tufan Erginbilgic, CEO
Welcome Tufan Erginbilgic CEO The information in this document is proprietary and confidential to Rolls-Royce and is available to authorised recipients only – copying and onward distribution is prohibited other than for the purpose for which it was made available. Rolls-Royce content only. Page 3 ©
Slide 4: Half Year 2023: Highlights
Half Year 2023: Highlights Operational delivery Transformation Financial • Improved operational metrics • Stronger H1 performance and full • Accelerated financial delivery across the group year guidance helped by with materially higher transformation underlying operating profit and • Time-on-wing in
Slide 5: Financial metrics improved in the first half of the year
Financial metrics improved in the first half of the year Underlying Free Cash EBIT Margin Total Cash Cost / Credit Rating operating profit Flow Gross Margin* Moody’s Ba3 / Positive £673m £356m 9.7% 0.6 Fitch BB- / Positive S&P BB* / Positive HY22: £125m; FY22: £652m HY22: £(68)m; FY22: £505m HY22: 2
Slide 6: Half Year 2023 Results – Panos Kakoullis, CFO
Half Year 2023 Results Panos Kakoullis CFO The information in this document is proprietary and confidential to Rolls-Royce and is available to authorised recipients only – copying and onward distribution is prohibited other than for the purpose for which it was made available. Rolls-Royce content on
Slide 7: 2023 Half Year underlying results
2023 Half Year underlying results Underlying results Organic Organic Improved financial results reflected continued end £m 2023 H1 2022 H1 Change1 Change %1 market growth, commercial improvements and cost efficiencies Revenue 6,950 5,308 1,487 28% Gross profit 1,515 942 535 55% Higher operating prof
Slide 8: Civil Aerospace
Civil Aerospace Large engine Total Civil Aerospace operational inputs operational inputs 115 144 6.2m 188 591 7.7m OE Major LTSA engine OE Total LTSA LTSA engine deliveries shop visits flying hours (EFH) deliveries shop visits flying hours (EFH) Underlying results Organic Organic 2023 H1 2022 H1 £m
Slide 9: Defence
Defence Order intake Order backlog £2.7bn Up 87% £8.9bn 2023 sales cover 1.4x book to bill c.100% Underlying results Organic Organic 2023 H1 2022 H1 £m Change Change % Underlying revenue splits Revenue 1,913 1,609 244 15% 12% Gross profit 379 326 43 13% 32% Gross margin % 19.8% 20.3% (0.3)pt 44% 21%
Slide 10: Power Systems
Power Systems Order intake Order backlog £1.9bn Down 14% £3.9bn 2023 sales cover 1.1x book to bill c.100% Underlying results Organic Organic 2023 H1 2022 H1 £m Change Change % Underlying revenue splits Revenue 1,774 1,371 334 24% 9% Gross profit 452 401 32 8% 26% 34% Gross margin % 25.5% 29.2% (3.8)
Slide 11: New Markets
New Markets Employees R&D Spend c.1,200 (+11% vs FY22) £64m (+£27m vs HY22) (FTE at period end) Underlying results Organic Organic 2023 H1 2022 H1 £m Change Change % £490m SMR committed funds £64m R&D spend Revenue 1 1 - - 10% Gross loss - (2) 2 - Operating loss (78) (48) (29) 60% 43% 45% 55% Tradin
Slide 12: Summary funds flow
Summary funds flow £m 2023 H1 2022 H1 Change Underlying operating profit 673 125 548 Operating profit from discontinued operations Depreciation, amortisation and impairment 489 - 68 455 (68) 34 1 £0.8bn Operating performance Movement in provisions (95) (116) 21 improvement Movement in Civil LTSA bal
Slide 13: Stronger Future – Tufan Erginbilgic, CEO
Stronger Future Tufan Erginbilgic CEO Page 13 © 2023 Rolls-Royce
Slide 14: Our philosophy
Our philosophy Safety is our priority Take care of our people and products Significantly improve Deliver efficiency Generate cash, Develop a clear Play a key operating profit and improvements reduce debt and and granular role in the cash improve shareholder strategy energy transition returns Focus o
Slide 15: Transformation programme
Transformation programme • Reduce indirect costs and control headcount Efficiency & • Third party cost savings Governance Simplification • Productivity improvements Efficiency & Working Simplification Capital • LTSA margin improvements and T&M pricing Business Commercial • Focus on onerous contracts
Slide 16: Guidance and outlook
Guidance and outlook 2023 group guidance Operating profit £1.2bn - £1.4bn FCF £0.9bn – £1.0bn Based on… Civil large EFH at 80%-90% of 2019 level Total Civil shop visits approx. 1,200-1,300 Additional guidance details on page 3 of appendices slides Page 16 © 2023 Rolls-Royce
Slide 17: Q&A
Q&A Questions will be taken live in the room. For those on the webcast please use the questions functionality to submit your questions which will be read out if time allows or responded to by the IR team after the call. Page 17 © 2023 Rolls-Royce
Slide 18: Slide 18