Rolls-Royce 'on target' in 2009

Rolls-Royce said its order book increased to a record £57.5bn

Aircraft engine manufacturer Rolls-Royce has said it is on track to meet its full-year financial targets after posting a 9% rise in half-year profits.

It made pre-tax profits of £445m in the first six months of 2009, against £410m for the same period last year.

Revenues in the period rose 27% to £5.1bn, helped by the weakness of the pound, the firm said.

On Tuesday, Rolls-Royce said it planned to build four new UK manufacturing sites, creating or securing 800 jobs.

Increasing orders

"Our growing order book, the breadth of the portfolio, our robust balance sheet and the early action we have taken on costs underpin our investment in the business," said chief executive John Rose.

The company reiterated its guidance for the full-year, saying it expected revenue growth in 2009 and profits to be "broadly similar" to those achieved in 2008.

There is concern that a slowdown in commercial deliveries next year could force the company to revise earnings guidance if they adjust production rates Saj Ahmad, Aviation analyst

It said its order book had increased by £2bn from the end of 2008 to stand at a record £57.5bn.

However, the firm added that the global trading environment remained very difficult and it expected the recovery to be slow.

Shares in Rolls-Royce were up 8% to 406 pence in afternoon trading.

But aviation analyst Saj Ahmad said Rolls-Royce could be hit by the downturn affecting aircraft manufacturers.

"There is concern that a slowdown in commercial deliveries next year could force the company to revise earnings guidance if they adjust production rates - I suspect they'll have little choice [but] to do so," he said.

However, he added that the firm was in "great shape".