LONDON: Rolls-Royce Holdings Plc said it’s set to exceed a target of 1 billion pounds ($1.3 billion) in free cash flow by 2020 following the announcement of 4,600 jobs affecting white-collar staff.
Rolls has set a “mid-term” ambition of achieving more than 1 pound per share in free cash, the London-based company said in a statement Friday.
“We are coming out of a significant investment cycle and are poised to deliver much improved returns,” Chief Financial Officer Stephen Daintith said in the release, adding that the company needs to focus on reducing the loss it books per engine delivery while boosting margins from the overhaul and maintenance activities that drive earnings.
The per-share cash flow goal points to a figure of about 1.9 billion pounds in the next five years, Jefferies International analyst Sandy Morris said in a note to clients.
Job cuts announced Thursday will see about 8% of posts eliminated and the business reduced to three units in an effort to sharpen Rolls’s focus on supplying turbines to Airbus SE and Boeing Co.