Rolls Royce reiterates full-year guidance for sales and cash

30th Jul 2015 09:01

(ShareCast News) - Engine manufacturer Rolls Royce stuck to its current full-year 2015 guidance and chose to emphasise the positive outlook for the year thanks to continued growth in its order book.Management however was still smarting after it was forced to downgrade its guidance for free cash-flow generation on 6 July.In updated guidance provided to investors at the start of the month the company said it now expected free cash-flow for all of 2015 to be between -£150m and £150m, instead of the previous range of £50m to £350m. As a result, it chose to discontinue its share buy-back programme, sending its shares into a nosedive.On that occassion, the company also trimmed its guidance for underlying profit before tax to between £1.33bn to £1.475bn, compared to previous guidance of £1.4bn to £1.6bn, reflecting the deterioration in its offshore division.For the six months ended on 30 June Rolls Royce said sales were 3% lower to reach £6.3bn but profits before tax dropped 32% to £439m, both on an underlying basis.Warren East, Chief Executive, said in a statement: "Despite the disappointment of our recent update, our second half outlook remains positive and full-year guidance for revenue, profit and cash issued on July 6th remains unchanged. The continued growth in our order book demonstrates the long-term demand for our innovative products and services, and underpins my confidence in the fundamental strength of our business."