LONDON (dpa-AFX) - Rolls Royce Holdings plc. (RYCEF.PK, RR.L, RYCEY.PK) announced evaluation of strategic options for Commercial Marine operation and a reduction from five operating businesses to three core units based around Civil Aerospace, Defence and Power Systems.
As part of the restructuring, the company plans to consolidate Naval Marine and Nuclear Submarines operations within existing Defence business, and Civil Nuclear operations within Power Systems business.
The company said it is in the process of defining the restructuring and further details will be given at the time of 2017 financial results on 7 March 2018 and a fuller discussion at a Capital Markets event later this year.
Regardless of the outcome of strategic review, Rolls-Royce will retain the Marine operations which supply complex power and propulsion systems to Naval customers, including the Royal Navy and US Navy. During the first quarter of 2018, these Naval operations will become part of an enlarged Defence business named Rolls-Royce Defence, comprising the current Defence Aerospace business and our Nuclear Submarines operation. The company will also continue to have a successful engine business serving marine customers within Power Systems.
In order to further simplify business from five operating businesses to three focused units, the company intends to integrate existing Nuclear operations into our Defence and Power Systems businesses. Nuclear Submarines operation, which is the sole provider and technical authority for the Royal Navy's nuclear submarine fleet, will form part of Rolls-Royce Defence, while Civil Nuclear operations will be placed within Rolls-Royce Power Systems, which already provides services to the nuclear industry such as emergency diesel generators.
The company expects these changes to take effect during the first quarter of 2018. In 2016, Nuclear business reported revenues of 777 million pounds and generated a profit of 45 million pounds.
The company said it does not anticipate any reduction in the skilled operational and engineering roles that it requires to support current ramp-up in Civil Aerospace engine production.
Rolls-Royce will be announcing its final results for the year ending 31 December 2017 on 7 March 2018. It remains comfortable with market expectations.
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