Rolls-Royce full-year profits more than double

Full-year 2023 underlying operating profit came in at £1.6bn, up from £652m a year earlier, with revenues rising to £15.4bn from £12.7bn. Analysts were expecting operating profit of £1.4bn.

Underlying operating profit in the civil aerospace business surged 497% to £850m.

Return on capital more than doubled to 11.3%, "reflecting improved operating profit, disciplined capital allocation and working capital management," it said. Rolls-Royce also hailed record free cash flow of £1.3bn, up from £505m.

For 2024, the company expects underlying operating profit of £1.7bn to £2bn and free cash flow of £1.7bn to £1.9bn.

Chief executive Tufan Erginbilgic said: "Our transformation has delivered a record performance in 2023, driven by commercial optimisation, cost efficiencies and progress on our strategic initiatives. This step-change has been achieved across all our divisions, despite a volatile environment with geopolitical uncertainty, supply chain challenges and inflationary pressures.

"We are managing the business differently and our significant performance improvement in the year reflects the hard work and focused actions of all our teams. We are also continuing to invest to drive future sustainable growth. Our strong delivery in 2023 gives us confidence in our 2024 guidance and is a significant step towards our mid-term targets. We are unlocking our full potential as a high-performing, competitive, resilient, and growing Rolls-Royce."