Portfolio

Deutsche Bank casts doubt on Rolls-Royce achieving guidance

By Michele Maatouk

Date: Monday 17 May 2021

Deutsche Bank casts doubt on Rolls-Royce achieving guidance

(Sharecast News) - Engine maker Rolls-Royce reaffirmed its FY21 guidance last week but Deutsche Bank said on Monday that achieving the guidance "looks a bit daunting".

"In the first four months of 2021, large engine flying hours (EFH) were around 40% of 2019 levels, lower than the 43% for full-year 2020 and below the 55% target for 2021," the bank noted.

It said this implies that in the next eight months, the company will need to see EFH improve to 63% of 2019, with the fourth quarter practically at more than 70%.

"While we believe that the run-rate at the end of April was probably better (more than 40%) than the troughs of Feb, it is still unclear whether traffic is improving as swiftly as desired, considering its engine portfolio," it said.

At 1055 BST, the shares were down 3% at 104.38p.

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