ROLLER IN THE DEEP

Rolls-Royce reveals £4.6billion loss — one of the biggest losses in UK corporate history

The engine maker was affected by a bribery scandal and the weak pound

RHODRI PHILLIPS

Published: 1:46, 15 Feb 2017
Updated: 11:04, 3 Jul 2017

ROLLS-ROYCE unveiled a £4.6billion loss yesterday — one of the biggest in UK history.

The engine maker was hit by a bribery scandal and the weak pound.

Rolls-Royce revealed losses of £4.6billion — Rolls-Royce revealed losses of £4.6billionCredit: Reuters

It was fined £671million over multi-million-pound backhanders and gifts of luxury cars to officials during deal talks.

A judge blasted the FTSE-100 giant for “the most serious breaches of criminal law bribery and corruption”.

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Rolls-Royce also revealed yesterday a £4.4billion writedown from sterling’s collapse.

Neil Wilson, senior market analyst at ETX CAPITAL, confirmed: “The company has chalked up one of the biggest losses in corporate history.”

The engine maker was hit by a bribery scandal and the weak pound — The engine maker was hit by a bribery scandal and the weak poundCredit: Alamy

Shares fell five per cent in early trading but rallied slightly to close four per cent down for the day.

Rolls-Royce’s underlying profits, which strip out exceptional charges, were £813million. But that was just over half the £1.4billion it recorded in 2015.

Chief Warren East, who took over the reins in 2015, admitted: “2017 remains a challenging year.

“We have lots of operational improvements to do. It’s now time to look further ahead.”

Rolls-Royce’s underlying profits were £813million — Rolls-Royce’s underlying profits were £813millionCredit: Alamy

The firm said it was making savings and was set for modest improvement in its 2017 performance.

However, JEFFERIES analyst Sandy Morris said: “The question is whether a corner has been turned.”

ROYAL BANK OF SCOTLAND posted Britain’s biggest ever corporate loss of £24.1billion in 2008 — the year taxpayers bailed it out. LLOYDS made a £10.8billion loss the same year. And TESCO posted annual £6.4billion losses for 2015 after its accounting scandal.

Rolls-Royce makes engines for jets, trains, ships, subs and nuclear stations — Rolls-Royce makes engines for jets, trains, ships, subs and nuclear stationsCredit: Alamy

But Rolls-Royce’s loss is worse than the £3.1billion hit BP took in 2010 following the Deepwater Horizon oil disaster.

Rolls-Royce makes engines for jets, trains, ships, subs and nuclear stations worldwide.

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