Rolls-royce Holdings Plc · LSE:RR.
Rolls-royce — H1 2009 Earnings Presentation
28 slides from Rolls-royce's earnings presentation, 2009
Slide 1: First Half Results - 2009
First Half Results - 2009 ik Rolls-Royce
Slide 2: First Half Results 2009
First Half Results 2009 John Rose Andrew Shilston Mike Terrett 2
Slide 3: First Half Results 2009 - John Rose
First Half Results 2009 John Rose 3
Slide 4: Continuing resilience
Continuing resilience z Economic fundamentals remain weak z Strong portfolio and financial position z Well balanced, broadly based z Early action taken on costs z Managing demand and supply volatility z Financial strength z First half performance confirms FY expectation z Revenue growth, broadly sim
Slide 5: Investing for long-term growth
Investing for long-term growth z Disciplined strategy and consistent investment z Improving market position z Delivering long-term growth z Evolving portfolio improving mix reduced cyclicality z Strong financial position enabling z Investment in capability z Investment in the portfolio z Flexibility
Slide 6: First half performance
First half performance A well balanced and resilient portfolio 6
Slide 7: First Half Results 2009 - Andrew Shilston
First Half Results 2009 Andrew Shilston 7
Slide 8: FX ~ volatile markets
FX ~ volatile markets z Increased FX volatility z Translation z Mark to market z Impact - Income statement - Balance sheet - Cash flow z Risk management – continuing policy z Capturing better rates z Hedge book at $21bn 8
Slide 9: FX ~ impacting reported results
FX ~ impacting reported results Income statement: Balance sheet: z £1.9bn mark to market benefit z Financial assets and liabilities z H1 translation benefits z FX working capital - UPBFCT up £35m Cash flow: z £194m negative revaluation z Equally Civil, Defence and Marine 9
Slide 10: FX ~ an improved outlook
FX ~ an improved outlook z Continuing FX policy z Locked in better rates over the last year z Hedge book more than doubled in last year z $21.1bn with average rate of $1.63 z 2009 Achieved Rate 2¢~3¢ better than 2008 10
Slide 11: Components of UPBFCT growth
Components of UPBFCT growth ~ H1 2009 11
Slide 12: Civil Aerospace – H1
Civil Aerospace – H1 Revenues * Profit * Order Book** 2009 2008 2009 2008 2009 2008 £m £m £m £m £bn £bn 2,280 2,102 257 272 46.7 43.5 z Growing order book z Deliveries – WB remain strong, reduced C&R z Minimal customer financing in H1 z Modest services growth ~ up 1% z Profitability being held back
Slide 13: Defence Aerospace – H1
Defence Aerospace – H1 Revenues * Profit * Order Book** 2009 2008 2009 2008 2009 2008 £m £m £m £m £bn £bn 969 769 136 104 5.4 5.5 z Broad portfolio providing medium term visibility z Services represent 51% of revenues z Military transport underpinning revenue growth z First half OE up 44% z Growth i
Slide 14: Marine – H1
Marine – H1 Revenues * Profit * Order Book** 2009 2008 2009 2008 2009 2008 £m £m £m £m £bn £bn 1,227 1,016 110 87 4.3 5.2 z Strong backlog enabling load and revenue growth z Broad portfolio provides resilience z Investing in capability z 4 new service centres z ODIM z Improving margins and strong pr
Slide 15: Energy – H1
Energy – H1 Revenues * Profit * Order Book** 2009 2008 2009 2008 2009 2008 £m £m £m £m £bn £bn 447 324 1 (8) 1.1 1.3 z Order book supporting strong revenue growth z OE and services both 38% higher z Broadening the portfolio z Reduced investment in fuel cell programme z Continuing productivity improv
Slide 16: Underlying financing costs
Underlying financing costs 2009 H1 2008 H1 £m £m Interest (18) (5) Financial RRSPs (14) (12) Other (1) - Underlying financing costs (33) (17) 16
Slide 17: Financial Strength
Financial Strength z Continue to preserve flexibility z Strong credit rating – committed to maintaining A rating z Extending maturities – £500m 10yr Sterling bond z Pensions z Addressed future volatility z Valuation ongoing z Foreign exchange z Rates moving in our favour z Customer and supplier fina
Slide 18: H1 Components of Cashflow
700 500 300 —m 8 500 ik) Rolls-Royce 595 H1 Components of Cashflow (542) Underlying Depreciation PBT & Amortisation Caper! Intangibles Pensions, Payments tax & to NWC other shareholders Deposits FX Ca: Translation sh flow 18
Slide 19: H1 Summary
H1 Summary Strong revenue growth (£bn) Growing underlying profits (£m) +17% +9% f 1 H108 H109 H108 H109 E.PS. benefiting from tax (p/share) Improving average Net Cash (£m) 19.64 +15% +495m 17.15 i x H1 08 H109 H108 H109 Reiterating guidance for full year ik Rolls-Royce
Slide 20: First Half Results 2009 - Mike Terrett
First Half Results 2009 Mike Terrett 20
Slide 21: Investing for growth
Investing for growth z Market position underpinning long-term growth z Focused on make ~ buy z Significant future load growth across the supply chain z Investing in world class capability – improving productivity 21
Slide 22: Strong progress despite challenges
Strong progress despite challenges z Significant progress on major programmes z BR725 certification z Trent XWB z LCS Sea Trials z JSF – Liftfan z Extending service facilities – Civil and Marine z Productivity and efficiency programmes z Process and functional improvements z Focus on matching load a
Slide 23: Managing change and risk
Managing change and risk z Change – managing load across the network z New programme delays and slower services growth z Changes in OE mix z Impacting working capital z Managing investment and spend z Phasing of new investments in UK, Singapore and the US z Focus on discretionary spend z Taking acti
Slide 24: Operations summary
Operations summary z New programmes underpin long-term growth z Delivering strong load growth over the next decade z Developing a more flexible supply chain z Investing for productivity and growth z Expanding footprint – UK, US and Singapore z Managing short-term volatility z Matching near-term inve
Slide 25: Summary - John Rose
Summary ny MES ees + arf John Rose 25
Slide 26: 2009 Guidance – no change
2009 Guidance – no change z Revenue z Continued revenue growth z Profitability z Civil ~ profits down year on year z Marine and Defence ~ continuing revenue and profit growth z Energy ~ modest profit z Continuing focus on cost and efficiency z FX ~ achieved rate improving by 2¢ to 3¢ z Group underly
Slide 27: Summary
Summary z Continuing to grow in a very challenging environment z We have put ourselves in a stronger position z Balance sheet strong z Taking action on cost/capacity – more improvement to come z Continued investment in products, services and facilities to support growth z Increased payments to share
Slide 28: Safe Harbour Statement
Safe Harbour Statement This Half Yearly Results 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