Rolls-Royce profits tumble

The fall in profit at FTSE 100-listed Rolls was less than analysts expected, but it did cut its dividend by half to 7.1p a share, as it bids to conserve cash.

The business said the restructuring programme it started in November “continues to make good progress”, and that its trading outlook for 2016 was unchanged.

Last year chief executive Warren East, who joined the firm last July, said he would scrap the current Aerospace and Land & Sea divisional structure.

Rolls said the move will cut out a layer of senior management, with the group instead comprising five businesses from January - civil aerospace, defence aerospace, marine, nuclear and power systems.

The shake-up came amid a major revival plan to boost performance and slash costs by between £150m and £200m a year.

Mr East said: “In the context of challenging trading conditions our overall performance for the year was in line with the expectations we set out in July 2015.

“It was a year of considerable change for Rolls-Royce: in our management, in some market conditions and in our near-term outlook.

“At the same time, there were some important constants: the underlying growth of our long-term markets, the quality of our mission critical technology and services, and strength of customer demand for these, which are reflected in our growing order book.”