Rolls Royce PLC analysis

Topics: Rolls-Royce plc, Airbus, Rolls-Royce Pages: 22 (2656 words) Published: October 16, 2014


Rolls Royce plc.
Research Report

Content

1. Introduction..................................................................................3 2. Market..........................................................................................3

2.1 General market review..........................................3
2.2 Civil Aerospace market..........................................4
2.3 Market Share........................................................5 3. Analysis.........................................................................................7
3.1 PESTLE...................................................................7
3.2 Porter 5 force........................................................9
3.3 SWOT....................................................................10 4. Finance..........................................................................................11
4.1 Turnover and Revenue..........................................11
4.2 Balance Sheet.......................................................12
4.3 Profit and Loss......................................................13
4.4 Cash flow..............................................................14
4.5 Financial Ratios.....................................................15 5. Conclusion and Recommendations................................................17 6. Bibliography..................................................................................18

Introduction.
In this report we will be looking at the Rolls-Royce company. We will make a research in many areas such as company market, PESTLE, SWOT, 5 Force analysis and finance. Rolls-Royce is a manufacturing company founded by Charles Stewart Rolls and Sir Frederick Henry Royce in 1906 at the Midland Hotel in Manchester and had a name Rolls-Royce Limited. However in 1973 the automotive division was separated from the aero division and became Rolls-Royce Motors. Rolls-Royce Limited continued to work until it was privatized by the government in 1987 and became Rolls-Royce plc, which we can see today. Today Rolls-Royce plc is the second largest aircraft engine manufacturing company in the world and the first largest in Europe. They supply engines for Boeing 787 and Airbus A380 and have over 18 defense contractors all over the world . Only General Electric is ahead of them. The unique selling proposition of this company is the best quality of the products.[1]

Market.
Rolls-Royce plc has customers in 135 countries and own facilities in 14 countries. The company has considerably increased its profit over the past 10 years. The table below provides some data from the last 2 years.

The company works within 4 sections: Civil aerospace, Defense aerospace, Energy and Marine. The chart on the right shows the revenue from each section. As civil aerospace takes over the half of the revenue of the company we are going to look in more details on this section.[2]

Business Revenue 2012 from different segment of business Rolls-Royce plc Civil aerospace section operates within two market sectors:

1. New engine sales primary to the two major manufacturers such as Airbus Industrie and Boeing. Also sales to the Bombardier, Cessna, Embraer, Gulfstream, Raytheon Aircraft and Sino Swearingen, as well as airlines;

2. Engine parts sales to airlines who service and maintain aircraft.

The new engine market is the primary
market, which provides access to the
secondary market for the sales of
engine parts.[3]

Primary market is shared by different companies but there are 3 major players:

Pratt & Whitney(a subsidiary of United Technologies Corporation) GE Aviation (a subsidiary of General Electric)
Rolls-Royce.

The industry is also characterized by several partnerships:

CFM International (GE and Snecma)
International Aero Engine (Pratt & Whitney, Rolls-Royce, and MTU) Engine...


Bibliography: http://www.bis.gov.uk/assets/biscore/business-sectors/docs/r/12-954-reach-skies-strategic- vision-uk-aerospace.)
[6] Wall Street journal 2011 (http://online.wsj.com/news/articles/SB10001424052970203791904576608272097346238)
Airlines - UK - July 2013 Issues in market (http://academic.mintel.com/display/638217/)
BBC( http://www.bbc.co.uk/news/uk-england-derbyshire-21661506)
(http://www.airbus.com/company/market/forecast/?contentId=%5B_TABLE%3Att_content%3B FIELD%3Auid%5D%2C&cHash=22935adfac92fcbbd4ba4e1441d13383)
Rolls-Royce website (http://www.rolls-royce.com/reports/2011/business/sustainability.html)
[17] Global Post (http://www.globalpost.com/dispatch/news/afp/130214/rolls-royce-says-net- profits-surge-2012)
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