Rolls-Royce Holdings plc 2013 Full Year Results

Civil Aerospace

Financial
 The order book increased 22%, including new orders of £18.9bn (£10.3bn in 2012). Trent engines and aftermarket services now constitute 73% of the Civil Aerospace order book.
2013 was a significant year for widebody orders, with agreements to power 334 aircraft. We were also pleased to finalise previously announced orders with Air France-KLM and Philippine Airlines. Significant orders in 2013 included:
o Trent XWB engines and TotalCare for 227 Airbus A350 XWB’s, including orders from Etihad, Japan Airlines, Singapore Airlines, United Airlines, Air Lease Corporation, Lufthansa, and IAG;
o Trent 1000 engines and TotalCare for 75 Boeing 787 Dreamliners, including orders from Singapore Airlines, IAG, and Air Lease Corporation;
o Trent 700 engines and TotalCare for 32 Airbus A330’s, including orders from Qatar, SriLankan Airlines, SAS and CIT Aerospace.
 Revenue increased 3%, including 3% growth in OE revenue. There was a 20% increase in business jet engine deliveries and a small increase in Trent engines. Revenue growth was offset by Trent 1000 launch pricing and lower V2500 revenue. Aftermarket revenue increased 3%, where growth in the installed fleet was tempered by a 20% decline in RB-211 revenue.
 Profit increased 14%, reflecting higher volumes, the £112m higher benefit from the restructured trading relationship with IAE and £26m higher entry fees. Profit growth was offset by additional investments in future programmes and slow progress on unit cost. Unit costs deteriorated, in part because some of our factories experienced low utilisation levels as they prepared to ramp up deliveries in 2014 and 2015.
 In 2014, we expect modest growth in revenue and good growth in profit. We continue to see stable aftermarket growth, consistent with our large installed base. Revenue growth will be tempered by launch pricing, declining utilization of older engines and lower deliveries of business jets. We expect a return to good growth in 2015.

Portfolio
 Our Trent XWB is the world’s most fuel-efficient, large turbofan, with over 1,600 engines ordered. With over 200 flights, more than 800 flying hours and over 6,000 testing hours, the engine is performing well and is on schedule to power the A350 XWB’s entry into service later this year.
 Our Corporate and Regional business delivered the 3,000th BR700 series engine. We also delivered more business jet engines in 2013, than ever before.
 We affirmed our commitment to develop engines for the next generation of mid-size aircraft, while ending our potential collaboration with United Technologies Corp in this market segment.