Political turmoil sees Rolls-Royce keep Brexit stockpiling

Engine giant Rolls-Royce is sticking with its Brexit stockpiling plan due to ongoing uncertainty in Westminster.

The jumbo jet engine makers, based in Derby, is building up one month's worth of inventory in warehouses near Derby as a “contingency measure” in case a hard Brexit disrupts supplies from Germany and Spain.

As a precaution, Rolls has also shifted design approval for engines to Germany from the UK and is working with the European Aviation Safety Agency on the plan. The change is not likely to lead to job moves.

“We have been liaising with all our suppliers and have reviewed our logistics options and have the required capacity available,” said the company.

Rolls chief executive Warren East confirmed in November the company was stockpiling parts due to Brexit.

The firm, which has faced production headaches this year, gave investors some good news today, saying profits and cash flow for the full year would be at the upper end of its forecasts.

The aerospace giant has had a rough ride recently due to rotor blade problems on the Trent 1000 engine and slower production of the Trent 7000, cutting forecasts from 550 large engines delivered to 500. The firm gave an upbeat outlook on deliveries for 2019, predicting a “significant increase” in production and delivery volumes.

Shares were up 2.74%, gaining 21.40p to 802.4p.

Rolls makes money from the time planes spend in the air and the company said strong flying hour growth in the first half had carried on into the second half period. The company group operating profit guidance is £300 million to £500 million.