Rolls-Royce reports huge drop in profit
Rolls-Royce Holdings CEO Warren East considers unit disposals after its pretax profit declines 49% in 2016
London — Rolls-Royce Holdings CEO Warren East said the struggling aircraft-engine manufacturer will deepen cost cuts and restructure or sell the weakest parts of its business after profit dropped by almost half in 2016. While about 80% of activities are in "a reasonably strong position in an attractive market", the rest are on less solid ground and could be refocused or disposed of, East said on an earnings call on Tuesday. Rolls-Royce’s pretax profit fell 49% in 2016 and only a "modest" improvement is expected in 2017, the London-based company reported, sending the stock down as much as 5.6% and increasing the urgency for East, CEO since July 2015, to roll out the next stage of his turnaround plan. "It is now time to look further ahead," said the executive, who has previously played down the likelihood of disposals. "Over the next few months, we will conclude a review of our strengths and investment opportunities and set out an appropriate vision for the business." That will mostly...
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