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Rolls-Royce says recovery on track as long-haul flights rebound

Engine maker Rolls-Royce has reassured investors its recovery is on track amid a rebound in long-haul flights.

However, shares in the company slipped on Thursday morning after the London-based firm revealed new engine deliveries towards the lower end of financial guidance.

Rolls-Royce has seen its shares slip more than a third since the start of the year amid caution over soaring costs and the rate of recovery for international travel following the pandemic.

The FTSE 100 company revealed that large engine flying hours rebounded to 65% of 2019 levels over the four months to the end of October.

Rolls-Royce held firm on its guidance for the current financial year as a result.

It added that recent volatility in interest rates and weakness in the pound have not impacted its cash position for the year.

Rolls-Royce chief executive Warren East said: “The continued recovery in large engine flying hours, record order intake in power systems and a resilience in the defence business give us confidence in the future.

“Our more agile operations and sustainably lower cost base position us well for the uncertain pace of the recovery from the pandemic, market volatility and changes in economic conditions.

“We continue to focus on operational execution and delivering on our commitments and we have maintained our group financial guidance for 2022.”

The firm highlighted continued cost inflation but said it has used long-term contracts to help mitigate the impact of energy, materials and wages.

It added that it is looking to recoup some of the impact of higher costs through efficiencies as well as price increases.

Shares were down 5.4% at 78.5p on Thursday.