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£150m aviation investment announced at Rolls-Royce

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Aircraft engine giant Rolls-Royce has announced £150m of investment in its civil engineering facilities in the UK.

The development at new and existing facilities is intended to provide for a plan to double engine production and will come onstream over the next few years, with the company developing and testing the next generation of aviation engines.

“This investment comes at a time of unprecedented growth in Rolls-Royce, said Eric Schulz, Rolls-Royce president. “We are doubling the production of new engines at the same time as introducing three new engines to the market.

“With this investment, we are creating the capacity and flexibility to deliver on our goals, while committing to sustain employment in the UK and I would like to thank the unions for their support in delivering this important package of investment.”

The group employs over 22,000 in the UK and the bulk of the investment will be formed by a civil aero engine testing facility at Derby. Derby’s maintenance repair and overhaul facility, its Derby manufacturing facility and its Nottinghamshire factory are also in line for investment, and the company announced a reversal of previously announced plans to close its Derby precision machining facility.

The news was welcomed by business secretary Greg Clark and Unite negotiator Simon Hemmings.

Shake up of the C-suite at Rolls Royce

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Rolls-Royce named Stephen Daintith as its new finance officer

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LONDON, Sept 22 (Reuters) – Rolls-Royce named Stephen Daintith as its new finance officer on Thursday as CEO Warren East completed a shake-up of his senior executive team tasked with turning around the aerospace and defence company.

Daintith, who is currently CFO at Daily Mail and General Trust, will replace David Smith in 2017, Rolls-Royce said in a statement on Thursday.

Daintith will join Rolls as East, who took the reins in July 2015, tries to streamline the company after difficulties in its aero-engine and marine businesses mean that profit is expected to halve this year.

Smith was appointed by East’s predecessor John Rishton in 2014 and will leave Rolls-Royce to pursue other business interests, the company said.

Daintith, 52, is Rolls-Royce’s second top management appointment in as many weeks, after the company said earlier in September that British high-speed rail boss Simon Kirby would be its new chief operating officer.

Shares in Rolls traded up 1.5 percent to 737 pence at 1208 GMT, recovering earlier losses of as much as 2 percent.

An analyst who declined to be named said Smith’s going was not a huge surprise. “David was never Warren’s hand-picked guy for the job. Warren’s got a massive job on his hands to transform Rolls, he needs to make sure his immediate team he’s got 110 percent confidence in them being the right people,” the analyst said.

But some analysts said that the departure of Smith, who was appointed in November 2014, was a surprise, given that he has been credited with some of the success of the turnaround so far, raising doubts about Rolls being on a more stable footing.

“It’s one of those things where people were of the view where we were getting to more of a steady state situation,” Barclays analyst Phil Buller said.

Daintith, at the Daily Mail publisher since 2011, having previously been CFO of Times publisher News International, will now be responsible for the finances of Britain’s pre-eminent engineering company.

Rolls has already started a process of preparing investors for a transition to new accounting system, IFRS 15, in 2018.

CEO East said in the statement that Daintith’s record of achievement in “change management” would be particularly relevant to Rolls-Royce.

A spokesman for Rolls-Royce said that the company was also in the process of recruiting a director of strategy and marketing and another person to strengthen its digital capabilities.

Daintith will be paid an annual salary of £680,000 pounds at Rolls-Royce plus a potential performance share award of 225 percent of his salary.

(Reporting by Sarah Young, editing by James Davey and Elaine Hardcastle)

Copyright(c) Thomson Reuters 2016.