Rolls-Royce says supply chain ‘challenging’ but sales remain on track

Engineering giant Rolls-Royce has said supply chain conditions remain “challenging” but sales are on track amid its transformation programme.

The company said it has been supported by strong demand in its civil aerospace business.

It said flying hours in this division grew by 18% for the 10 months to October compared with the same period a year earlier.

Rolls-Royce said it was therefore still on track to meet its financial forecasts, expecting operating profits of between £2.1 billion and £2.3 billion for this year.

In defence, demand was also “strong with significant progress across key platforms”, the company said.

The FTSE 100 firm told shareholders that the aerospace industry supply chain has remained “challenged” but that interventions with a number of suppliers have helped to drive improvements.

Rolls-Royce chief executive Tufan Erginbilgic said: “Our transformation of Rolls-Royce into a high-performing, competitive, resilient and growing business continues with pace and intensity.

“Continued good performance year to date gives us further confidence in the delivery of our 2024 guidance despite a supply chain environment which remains challenging.

“We are also making good progress towards our mid-term targets, with a front-end loaded delivery of profit and cash flow improvements.”

Shares in the company were 3.8% lower in early trading.