Rolls-Royce Lays Bare Entrenched Failings to Stunned Investors
- CEO says engine maker too slow to respond when markets shift
- Earnings to take near-$1 billion hit on marginal products
Rolls-Royce Shares Plummet on 2016 Profit Warning
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Rolls-Royce Holdings Plc Chief Executive Officer Warren East revealed the full extent of the earnings meltdown facing Britain’s leading manufacturing company and said he’s uncovered issues with its organization and management that run deeper than was apparent when he took over in July.
Pretax profit will take a 650 million-pound ($990 million) hit from a slide in demand that Rolls is unable to mitigate because of an inflexible approach to costs, East said Thursday, ordering a review of dividend payments. The announcement extended a series of profit warnings that have battered the company for two years, sending the stock down the most since 2000.