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Rolls Royce profits lift; INDUSTRY: Delight at engineering giant.

Byline: By Chris Morley

MIDLAND engineering giant Rolls Royce cheered shareholders today with a 22 per cent lift in underlying halfyear profits and an order book worth pounds 25 billion.

Shares in Rolls - among the London market's best performing stocks last year - rose four per cent in the wake of the figures for the first six months of 2006.

Helped by a rising proportion of aftermarket business, the company said sales reached pounds 3.39 billion and were ahead nine per cent on an underlying basis.

Chief executive Sir John Rose said: "We have continued to make good progress, despite the challenges of a weak US dollar and increased raw material costs."

The company added that optimism about prospects had led it to increase its half-year dividend payment to shareholders by ten per cent to 3.67p a share. The order book of pounds 25.1 billion compares with a figure of pounds 23 billion a year earlier.

Sales growth came from three of the company's four operating divisions, including civil aerospace after a rise of pounds 100 million to pounds 1.78 billion.

Rolls said the figure represented strong growth and resulted from its broad portfolio of aero engines, which power aircraft ranging from corporate jets to the largest airliners.

Profits from the division rose 23 per cent to pounds 246 million, reflecting the continued growth of aftermarket sales, which increased by eight per cent and accounted for 60 per cent of civil aerospace business.

Rolls said it expected sales in this area to grow by more than ten per cent for the full year. In defence aerospace, sales were up to pounds 761 million, from pounds 677 million, while profits before financing costs rose by pounds 1 million to pounds 95 million.
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Title Annotation:Business
Publication:Birmingham Mail (England)
Date:Jul 27, 2006
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