Rolls-Royce (LSE:RR.) shares moved higher after the company said it expects to fully offset the impact of disruption linked to the Middle East conflict, while reaffirming its financial outlook for 2026.
The Rolls-Royce maintained its forecast for underlying operating profit of £4.0 billion to £4.2 billion and free cash flow of £3.6 billion to £3.8 billion for the year.
“The conflict in the Middle East has created uncertainty for the industry. We are taking the necessary actions to support our employees, customers, and suppliers,” the company said.
Shares rose 2.4% in early London trading following the update.
Civil Aerospace delivers strong start to the year
The Civil Aerospace division reported solid momentum, with large engine flying hours reaching 115% of 2019 levels in the first quarter, up 5% year over year. Deliveries of large original equipment engines increased 18%, while business aviation flying hours exceeded internal expectations.
Rolls-Royce continues to project full-year large engine flying hours at between 115% and 120% of 2019 levels, indicating sustained recovery in long-haul travel demand.
Defence segment supports growth momentum
The Defence division also showed strong performance, with improved aftermarket activity and original equipment deliveries rising more than 20% compared to the prior year.
The company noted continued robust demand across both established and newer defence programmes.
“We remain strongly positioned to deliver our mid-term targets, with substantial growth beyond the mid-term from both our existing and new businesses,” Rolls-Royce added.
More about Rolls-Royce
Rolls-Royce is a UK-based engineering group specialising in power and propulsion systems for aerospace, defence, and energy markets. The company’s Civil Aerospace division is a major supplier of aircraft engines for long-haul travel, while its Defence segment supports military aviation and naval programmes globally.
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