Rolls-Royce is set to double its profit as it cashes in on booming defence spending as tensions continue to rise across the world.
The engineering giant will report a £4.4 billion pre-tax profit in annual results on Thursday, up £2.2 billion on a year ago, with sales rising to £19.8 billion from £17.8 billion, said market data platform Refinitiv.
Investors will be hoping that the figures propel the FTSE 100 firm’s shares ever higher under the leadership of ‘Turbo’ Tufan Erginbilgic.
Since he took over in January 2023, Rolls-Royce shares have soared 14-fold on a surge in demand for defence equipment after Russia’s invasion of Ukraine.
Going up: Rolls-Royce’s LiftSystem is used in some F-35 stealth fighters
Last week rival defence group BAE Systems posted a record annual profit of £3.3 billion. Rolls-Royce is also cashing in on demand for passenger jet engines.
It plans to start making engines again for narrow-body, single-aisle passenger jets typically used by short-haul airlines such as Ryanair, having left that market in 2011.
Another sector that is surging is the manufacture of generators used by the vast data centres powering the artificial intelligence revolution.
There are hopes that Rolls-Royce will reap the rewards of a contract awarded by the UK Government last year to develop and build small modular reactors.
These are factory-produced nuclear power plants that will be cheaper to run than traditional reactors.
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