Rolls-Royce launches recapitalization plan – Aviation Journal

Rolls-Royce announces a recapitalization plan to the tune of 5 billion pounds. The British engine manufacturer is strongly impacted by the air transport crisis linked to the pandemic. In a statement, he said he got a two-year billion pound loan, and an extension of an existing loan guarantee of up to one billion pounds, from the public body UK Export Finance.

Added to this is the project to raise two billion pounds by granting preferential subscription rights to its shareholders, and a bond mission "of at least one billion pounds".

"These measures aim to improve the financial resilience of the company and endow it with a more appropriate balance sheet structure to deal with macroeconomic risks before the return of a capacity to generate significant liquidity expected in 2022", comments the industrial group. , among the most important in the United Kingdom, while considering that its "long-term outlook remains good".

The group expects reduced investments in its civil aviation division because "most of (its) development programs have been completed" and it expects its recent engine models to enable it to generate "cash flow. important (…) in the long term ".

Rolls-Royce finally said to see "good opportunities for growth in defense and electrical systems" in particular thanks to the energy transition.

He announced in May a major restructuring to adapt to the sharp fall in demand in civil aviation, with the objective of saving £ 1.3 billion at least by the end of 2022. This plan included "in less 9,000 job cuts "out of then 52,000 people.

Thursday, the group evokes a figure closer to 10,000 departures in its press release: "already 4,800 people had left the company at the end of August and another 5,000 should follow by the end of the year".

At the end of August, Rolls-Royce had posted a net loss of 5.4 billion pounds for the first half of the year, sharply widening its deficit compared to the previous year, when it was already in the red of 909 million pounds due to technical problems. on some engines.

Rolls-Royce expects a very slow recovery in its aerospace industry, estimating that engine orders will remain below 2019 levels through the middle of the decade.

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