By Robert Wall
LONDON--Rolls-Royce Holdings PLC (RR.LN) on Friday warned that
exchange-rate swings could crimp sales by GBP350 million ($540
million) this year, though the British engine maker maintained its
full-year earnings outlook excluding such impacts.
Rolls-Royce is dealing with multiple currency effects. Its home
currency, the British pound, has strengthened against the euro and
Norwegian kroner, though it has weakened against the U.S. dollar,
the London-based company said in a statement ahead of its annual
shareholder meeting. The hit to sales at current exchange rates,
which could vary throughout the year, comes from so-called
translation effects of repatriating revenue from overseas.
Rolls-Royce earlier this year said sales in 2015 should range
from GBP13.4 billion to GBP14.4 billion after coming in at GBP13.9
billion last year.
Rolls-Royce said last month that Chief Executive John Rishton
would leave the company and be replaced by board member Warren East
in July after a period of profit warnings for the British engine
maker.
"We expect performance to be more weighted towards the second
half," Rolls-Royce said in a statement. The company previously said
trading in the land and sea activities was slower than in the
year-ago period because of low oil prices. Cash generation also
should be backloaded in 2015, it said.
Rolls-Royce said about half the 2,600 aerospace job cuts
announced last year have been implemented. Those cuts are part of a
broader effort to boost profitability at the company, which has
lagged behind rivals.
Rolls-Royce said that since it announced full-year results in
February, "We have continued to grow our order book and to invest
in the future growth of our business." That includes a commitment
from Emirates Airline, the world's largest carrier by international
traffic, to use Rolls-Royce engines on a new batch of Airbus Group
NV A380 super-jumbos.
Write to Robert Wall at robert.wall@wsj.com