Rolls-Royce Holdings plc · LSE:RR.
Rolls-Royce — H1 2010 Earnings Presentation
29 slides from Rolls-Royce's earnings presentation, July 2010
Slide 1: Rolls-Royce Group Plc Half-Yearly Results 2010
Rolls-Royce Group Plc Half-Yearly Results 2010
Slide 2: Half-Yearly Results 2010
Half-Yearly Results 2010 John Rose Andrew Shilston Mike Terrett ikl Rolls-Royce
Slide 3: Half-Yearly Results 2010 - John Rose
Half-Yearly Results 2010 John Rose
Slide 4: Delivering today, investing for the future
Delivering today, investing for the future @ Macroeconomic fundamentals remain uncertain, but e Access to growth markets important e Portfolio is increasingly resilient e Focus on execution underpinning performance @ Investing to expand the portfolio, capability and capacity @ Strong balance sheet,
Slide 5: Encouraging first-half performance
Encouraging first-half performance Benefiting from a broad portfolio A resilient order book (£bn) Good revenue growth (£bn) Growing underlying profits (£m) 1 1 T 4.9 445 HY 09 HY 10 HY 09 HY 10 HY 09 HY 10 Improving average net cash (£m) Growing payments to shareholders (p/share) +155m 46.7% t ! HY
Slide 6: Financial Review
Half-Yearly Results 2010 Financial Review Andrew Shilston ikl Rolls-Royce
Slide 7: FX impact on reported results
FX impact on reported results @ Headline loss before tax of £475m (2009 — £2,515m profit) e Primarily caused by USD and Euro spot rate changes in H1 e Revaluations of financial instruments e Overseas businesses impacted by translation rates (€, $ and NOK) @ Underlying performance — H1 UPBFCT benefit
Slide 8: Components of UPBFCT growth
Components of UPBFCT growth H1 2010 550 £m a | (YD) Trading/mix 500 + 28 9 450 a 7 7 + 7 - 7 2009 H1 FX Restructuring R&D Trading and 2010H1 UPBFCT One-offs UPBFCT Rolls-Royce
Slide 9: Civil Aerospace — H1
Civil Aerospace — H1 Revenues * Profit * Order Book** @ Development programmes progressing well @ Order book — resilient, significant visibility @ Revenues flat — mix and new launch programmes @ Services up 7% in H1 e Volcanic ash disruption / T&M held back growth e Inventory logistics agreement com
Slide 10: Defence Aerospace — H1
Defence Aerospace — H1 Revenues * Profit * Order Book** @ Good progress on development programmes e JSF LiftFan and F136, A400M @ Good order flow — increasing service contracts @ Transport continues to grow — C130-J, V-22 activity @ Margins stronger reflecting mix and reduced restructuring @ 2010 —
Slide 11: Marine — H1
Marine — H1 Revenues * Profit * Order Book** @ LCS, Astute, Type 45 all going well @ Some order activity @ ODIM acquisition completed in April e Minimal profit contribution in 2010 @ Service revenues growing strongly, OE weaker in H2 @ Margins — lower charges, good operational performance @ 2010 — H
Slide 12: Energy — H1
Energy — H1 Revenues * Profit * Order Book** @ Stable order book — better demand for power generation @ Exceptional OE revenue growth @ Progressing technology programmes @ £26m retrofit charges held back first-half @ 2010 — Increasing volumes and cost control support strong profit growth for the FY
Slide 13: Underlying first-half financing costs
Underlying first-half financing costs 2010 2009 £m £m Interest (22) (18) Financial RRSPs (9) (14) Other 2 (1) Underlying financing costs (29) (33) Rolls-Royce 1B
Slide 14: Financial strength
Financial strength © Strong liquidity e Average net cash increased to £915m e Strong credit rating — committed to maintaining A rating @ Pensions e Nochange to funding requirements @ Customer and supplier financing e Commitments remain modest Rolls-Royce 14
Slide 15: 2010 — H1 cashflow
2010 — H1 cashflow 632 (643) 500 | | 167 (356) Underlying Depinand Capex Pensions, Payments Deposits M&A FX Cash flow PBT Amortisation and tax and to NWC Translation Intangibles other shareholders Rolls-Royce 15
Slide 16: 2010 FY Guidance
2010 FY Guidance @ Revenue e FY ~ High single digit growth — FX, ODIM, Power Generation © Profitability e Civil~ FY as expected, modestly lower than 2009 e Defence ~ Strong FY profit growth e Marine ~ H2 slightly lower than H1 — Strong FY growth e Energy ~ Strong FY growth e FX ~Achieved rate improv
Slide 17: Operational Review
Half-Yearly Results 2010 Operational Review Mike Terrett ik Rolls-Royce 17
Slide 18: Extending the portfolio
Extending the portfolio LCS - USS Freedom Type 45 — HMS Daring Legacy 650 MANTIS UAV Lynx Wildcat Completed sea trials 1** commissioned 1" flight 1" flight 1%" flight 15% June 2009 23°4 July 2009 23'4 September 2009 21* October 2009 12" November 2009 Astute Gulfstream G650 Airbus A400M Boeing 787 JS
Slide 19: Continuing the Trent heritage
Continuing the Trent heritage Trent XWB for the Airbus A350XWB = ak = e Engine ran on time in June e EIS expected 2013 e@ >1,000 engines in order book e At planned annual production e 250 engines p.a. e Circa 20m Ibs/thrust e Equivalent to 80% of current Civil deliveries Strengthening our widebody p
Slide 20: Investing in new facilities
Investing in new facilities Creating world class facilities Rolls-Royce 20
Slide 21: Seletar Aerospace Park — Singapore
Seletar Aerospace Park — Singapore Transforming operational capability Key technologies —- WCFB manufacture 21
Slide 22: Seletar Aerospace Park — Singapore
Seletar Aerospace Park — Singapore Transforming operational capability Doubling large engine assembly 22
Slide 23: Seletar Aerospace Park — Singapore
Seletar Aerospace Park — Singapore Transforming operational capability ‘State of the art’ testing facilities 23
Slide 24: Crosspointe — Virginia
Crosspointe — Virginia Enabling growth and productivity go... Veni) On target — expect to be operational in 2011 ik Rolls-Royce 24
Slide 25: Enhancing manufacturing capabilities
Enhancing manufacturing capabilities "Nuclear ~ Derby Investing in manufacturing capability 25
Slide 26: Investing for long-term growth
Investing for long-term growth @ New programmes underpin organic growth e Strong load growth over the next decade e Investing today in product, facilities and tooling @ Developing a more flexible supply chain e Investing for productivity and growth e Continued globalisation of supply chain @ Managin
Slide 27: Summary
Half-Yearly Results 2010 Summary John Rose ikl Rolls-Royce 27
Slide 28: Progress in an uncertain world
Progress in an uncertain world ® Continued macroeconomic uncertainty ®@ Consistent strategy has enabled a broad and resilient business @ Exposure to growth markets @ Focusing on improved operational capability @ Investing for growth and productivity FY 2010: e Underlying profits modestly above 2009
Slide 29: Half-Yearly Results 2010
Half-Yearly Results 2010 29