ErnieBilco
11月前
Rolls-Royce (LSE: RR., ADR: RYCEY) today announces it is expanding U.S. manufacturing capabilities with a $75M investment in its Aiken, South Carolina engine plant for mtu Series 4000 production. The investment will increase machining capabilities and grow the facility’s footprint, creating 60 new jobs in the United States with a total of 434 full-time positions at the facility. The South Carolina Coordinating Council for Economic Development approved job development credits related to the project.
Earlier this year, Rolls-Royce announced a $24M expansion of its Mankato, Minnesota facility, adding 100 jobs to its Power Systems division in the U.S. These investments reflect the rapid growth of data centers in the U.S., increasing pressure on electric grids and the critical need for reliable power generation.
Demand for high-power mission critical backup generators from Rolls-Royce has grown considerably over the past decade. The mtu Series 4000 engines that power these systems are built in Aiken and then assembled into complete generator sets at the Rolls-Royce facility in Mankato.
Adam Wood, Managing Director for Rolls-Royce’s Power Systems division in America said:
The increased investment strengthens our ability to serve our U.S. customers – especially in the fast-growing American data center industry. By increasing our machining capabilities in Aiken, we can supply more engines to Mankato, enabling us to deliver more gensets with shorter lead times. These investments reflect our commitment to supporting U.S. customers with reliable, locally produced solutions.”
With this investment, Rolls-Royce will machine additional mtu Series 4000 components in the U.S. Currently, most of the components are machined in Germany and sent to the U.S. as finished goods. To meet demand, additional in-country machining is essential.
Henry McMaster, Governor of South Carolina said:
Rolls-Royce’s expansion in Aiken County further positions South Carolina as a leader in advanced manufacturing. This investment and the 60 jobs it will bring represent a big win for the community, and we are proud of the success Rolls-Royce has found in our state.”
The facility will be expanded in two phases. Phase one will grow the existing manufacturing footprint by 37,000 sq.ft. In a potential further phase, another 22,000 sq. ft. of manufacturing space could be added (60,000 sq. ft. in total). Construction for Phase 1 will begin in Q1 2026 with production set to begin in July 2027.
Adam Riddle, CEO, Rolls-Royce North America, said:
Today’s announcement underscores Rolls-Royce’s commitment to the U.S. market and demonstrates our robust manufacturing capabilities. We are proud to support America’s growing demand for reliable, domestically made energy systems that strengthen our nation’s energy independence and security. With more than half the world’s hyperscale data centers located here in the U.S., this will continue to be a key growth market for many years to come.”
Last year sales of power generation products for the data center segment grew almost 50%. As much as $1 trillion is expected to be spent globally on AI data centers, components and associated infrastructure over the next few years. In addition to data centers, Rolls-Royce provides high performance backup generators to power critical U.S. infrastructure including hospitals, municipalities and government installations.
Since the start of production in 2010, Rolls-Royce’s Aiken campus has been the site of continuous innovation and expansion. It now encompasses a 395,000 square foot campus with state-of-the-art production capabilities, an engine testing facility, office space, a research and development center, four large engine test stands and a remanufacturing and overhaul center. In 2017, the company added a 1.35 MW ground-mounted solar array on approximately 7 acres and has an additional microgrid that generates enough solar power from panels on its covered parking lot to supply its entire administration building.
The Aiken facility pioneered a nationally recognized High School Apprenticeship Program which was the first-ever vocational apprenticeship program for high school students in the state, training more than 70 students since its inception in 2012. Modelled after the German dual-education system to help cultivate the next generation of skilled manufacturing professionals, successful graduates earn certifications recognized by both the U.S. Department of Labor and Apprenticeship Carolina.
Rolls-Royce’s transformation program is enabling it to deliver on its strategic choices. The investment in Aiken is an example of that transformation in action, as it supports the company’s strategic initiative to grow its power generation business.
ErnieBilco
1年前
Strong 2024 results; Mid-term Guidance upgraded; £1bn share buyback in 2025
Significant transformation progress as we expand the earnings and cash flow potential of the Group
Underlying operating profit of £2.5bn with a margin of 13.8%, reflecting the impact of our strategic initiatives, commercial optimisation and cost efficiency benefits
Free cash flow of £2.4bn driven by strong operating profit and continued LTSA balance growth supporting a net cash balance of £475m at the end of the year
Dividend of 6.0p per share in respect of the full year 2024, based on a 30% payout ratio of underlying profit after tax 1,2
2025 guidance of £2.7bn-2.9bn underlying operating profit and £2.7bn-2.9bn free cash flow; delivering our Capital Markets Day mid-term targets two years earlier than planned
£1bn share buyback to commence immediately for completion through 2025
Upgraded mid-term targets of £3.6bn-£3.9bn underlying operating profit, 15%-17% operating margin, £4.2bn-£4.5bn free cash flow, and 18%-21% return on capital based on a 2028 timeframe
Tufan Erginbilgic, CEO said: “Strong 2024 results build on our progress last year, as we transform Rolls-Royce into a high-performing, competitive, resilient, and growing business. All core divisions delivered significantly improved performance, despite a supply chain environment that remains challenging.
We are moving with pace and intensity. Based on our 2025 guidance, we now expect to deliver underlying operating profit and free cash flow within the target ranges set at our Capital Markets Day, two years earlier than planned. Significantly improved performance and a stronger balance sheet gives us confidence to reinstate shareholder dividends and announce a £1bn share buyback in 2025.
Our upgraded mid-term targets include underlying operating profit of £3.6bn-£3.9bn and free cash flow of £4.2bn-£4.5bn. These mid-term targets are a milestone, not a destination, and we see strong growth prospects beyond the mid-term.”
Full Year 2024 Group Results
£ million Underlying 20243 Underlying 20233 Statutory 2024 Statutory 2023
Revenue 17,848 15,409 18,909 16,486
Operating profit 2,464 1,590 2,906 1,944
Operating margin % 13.8% 10.3% 15.4% 11.8%
Profit before taxation 2,293 1,262 2,234 2,427
Basic earnings per share (pence) 2 20.29 13.75 30.05 28.85
Free cash flow 2,425 1,285
Return on Capital (%) 2,4 13.8% 11.3%
Net cash flow from operating activities 3,782 2,485
Net cash/(debt) 475 (1,952)
1Subject to shareholder approval at the 2025 annual general meeting
2In 2024, the Group recognised a net £346m credit to underlying profit after tax (PAT), primarily in respect of deferred tax assets on UK tax losses. This £346m credit has been adjusted in the calculation of the proposed dividend per share, earnings per share and return on capital. For further details, see note 5, page 32
3All underlying income statement commentary is provided on an organic basis unless otherwise stated. A reconciliation of alternative performance measures to their statutory equivalent is provided on pages 49 to 52
4Adjusted return on capital is defined on page 52 and is abbreviated to return on capital
Full year 2024 performance summary
Strategic delivery: 2024 has been another year of strong strategic and financial delivery, building on our 2023 performance. Across these two years we have driven significantly improved performance: underlying operating profit has increased by £1.8bn to £2.5bn, operating margin by 8.7pts to 13.8%, free cash flow by £1.9bn to £2.4bn and return on capital has improved by 8.9pts to 13.8%.
Significantly growing operating margins: Underlying operating profit rose from £1.6bn in 2023 to £2.5bn in 2024, a 57% increase compared to the prior year, driven by our strategic initiatives including commercial optimisation and cost efficiency benefits across the Group. This was achieved despite ongoing supply chain challenges. Civil Aerospace’s operating margin rose to 16.6% (2023: 11.6%), driven by higher widebody aftermarket profit, stronger performance in business aviation and net contractual margin improvements. Defence delivered an operating margin of 14.2% (2023: 13.8%), with higher operating profit driven by stronger aftermarket performance alongside submarines growth. Power Systems delivered an operating margin of 13.1% (2023: 10.4%), primarily driven by stronger performance in power generation, supported by our business interventions. Delivery across all divisions has been supported by our cost efficiency actions.
Growing and sustainable cash flows: Strong free cash flow of £2.4bn (2023: £1.3bn) was achieved despite a challenging supply chain environment. This was driven by strong operating profit and continued net long-term service agreement (LTSA) balance growth, alongside a working capital release and higher net investments in the year. Civil Aerospace LTSA balance growth net of risk and revenue sharing arrangements (RRSAs) of £0.7bn (2023: £1.1bn) was supported by higher large engine flying hours (EFH) at 103% of 2019 levels (2023: 88%) and an improved EFH rate, partly offset by higher shop visits. Working capital was an inflow of £280m, compared to an outflow of £356m in the prior year. Since 2022, we have increased our net investments by £0.5bn and our working capital programme has helped to drive more than a 45 day improvement in inventory days and a 14 day improvement in days sales outstanding with more than a 40% decrease in overdue debt.
Strengthening our balance sheet and building resilience: Net cash stood at £475m at the end of 2024. This compares to a £2.0bn net debt position at the end of 2023. Gross debt was reduced by repaying a €550 million bond, and the remaining £1bn UK Export Finance (UKEF) supported undrawn loan facility was cancelled, both enabled by our growing and more resilient cash delivery. Liquidity remained robust at £8.1bn on 31 December 2024 (2023: £7.2bn). Our efforts to strengthen the balance sheet were recognised by all three credit ratings agencies, who rate us at investment grade with a positive outlook. In addition, the operating resilience of the Group has been improved. Total underlying cash costs as a proportion of underlying gross margin (TCC/GM) at year end was a best-in-class ratio of 0.47x (2023: 0.59x). We are creating a more robust and less volatile free cash flow delivery that is more resilient to the external environment.
Shareholder distributions: In line with our capital framework, now that the balance sheet is being strengthened, we are reinstating shareholder dividends in respect of the full year 2024. The cash dividend of 6p per share represents a 30% pay-out ratio of underlying profit after tax and will be paid subject to shareholder approval at our annual general meeting on 1 May 20251. We are also pleased to announce a £1bn share buyback to be completed over the course of 2025.
1 The dividend will be paid on 16 June 2025 to ordinary shareholders on the register on 22 April 2025. In addition to the cash dividend, shareholders will be offered a dividend reinvestment plan
ErnieBilco
2年前
Corporate Action Terms ROLLS-ROYCE HLDGS ORDFCORP ACT EXP: 05/31/24
Since you hold XXXXX share(s) of ROLLS-ROYCE HLDGS ORDF in your account, you may choose how your holdings will be treated for this Corporate Action. We must receive your response by May 28, 2024, 7:00 p.m. ET.You hold 65000 share(s) in this account.
What Has Occurred
We are writing to let you know about a corporate action event that you can participate in.
Offer details:
·Holders of the Rolls Royce C shares are being given the opportunity to redeem their C shares for cash. Those holders would receive 0.001 British Pounds (GBP) for each C share surrendered (approximately $0.0013 USD, based on the currency exchange rate as of May 3, 2024).
·Holders can elect to redeem the C shares and reinvest the proceeds to purchase additional Rolls Royce ordinary shares. Please note holders who elect this option will accrue costs of 0.50% Stamp Duty and 0.20% Commissions, which will be deducted automatically. These are not Schwab costs/fees.
·Holders who wish to retain their C shares do not need to take any action.
·Fractional shares will not be issued. Holders who choose to redeem or reinvest will not receive an allocation of fractional shares.
What this means for your account and your C shares:
·Redeem: Submit all or a portion of your C shares for cash.
·Redeem and Reinvest: Redeem all or a portion of your C shares and use the proceeds to purchase additional Rolls Royce Holdings ordinary shares.
·Decline/Take No Action: If you do not wish to participate in the offer, no further action is required, and you will retain your C shares.
How to participate in the offer:
1.The offering material contains important detailed information that must be read in its entirety before any decision is made with respect to this offer.
2.If you have any questions concerning the terms of the offer, or for a copy of the offering
materials, please contact Equiniti Limited (the Registrar) by phone at +44 (0)371 384 2637 (international call).
3.Follow the steps below to provide your instructions to Schwab.
Additional information:
·The currency exchange rate as of May 3, 2024 was 1.00 GBP = $1.26 USD.
·Once you have given instructions to Schwab, they cannot be changed or withdrawn.
·Participation in the offer may be subject to local tax withholding, if applicable.
Submit Instruction To Schwab
It is your responsibility to ensure you submit instructions by MAY 28, 2024,07:00 P.M. EST .
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