Shares of jet engine manufacturer Rolls-Royce Holdings (LSE: RR) rallied 8.6% to 358.00p on Thursday after the company reported swinging to a £2.43 billion pretax profit in 2023 from a £1.50 billion loss the prior year. Revenue also rose 22% to £16.49 billion.
Rolls-Royce hailed the results as a “step-change” in performance and credited ongoing transformation efforts, commercial optimisation, cost efficiencies, and progress on strategic initiatives.
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Cash flow reached a record £1.29 billion, supporting Rolls-Royce’s 2024 profit and cash flow guidance. Achieving over 50% of its medium-term financial targets two years early raises confidence in sustainable growth.
While Rolls-Royce did not restore dividends, the improving outlook suggests payouts could return. While investors might be disappointed, the company’s focus on debt reduction and future growth seems to resonate with the market for now.
“Our strong delivery in 2023 gives us confidence in our 2024 guidance and is a significant step towards our mid-term targets,” said CEO Tufan Erginbilgic.
Rolls-Royce shares are up 233% over the past 12 months.
