Rolls Royce powers ahead in first half 2021

Profit and orders are up at Rolls Royce Power Systems, maker of mtu engines
Engines, Components & Tyres / August 9, 2021 1 minute Read
By David Arminas
Rolls-Royce will create a Remanufacturing and Overhaul Regional Center at its mtu Aiken manufacturing facility in US, similar to operations at the company’s plant in Magdeburg, Germany, as seen here (image courtesy Rolls Royce Power Systems)

Rolls-Royce Power Systems, maker of the mtu brand of large engines, reports a strong half-year 2021, including an €11 million boost in profit to €47 million.

Order intake is also up 19% on the same period last year, notes the company which is headquartered in Friedrichshafen, southern Germany, and employs around 9,000 people.

“Our financial results are in line with our expectations,” said Louise Öfverström, chief financial officer of Rolls-Royce Power Systems.

At €1.36 billion, revenue was broadly in line with last year's comparative period (H1 2020: €1.366 billion).

Adjusted profit increased by €11 million to €47 million. The company noted that the 19% improvement in order intake in the first half of this year bodes well for continued progress, said Öfverström.

The economic upswing as the COVID-19 pandemic recedes is already driving up service revenue, a 13% increase as customers regain the ability to use their mtu products and consequently placing more service orders.

As for new sales of mtu products and solutions, the Chinese market, which regained strength early on, again made a significant contribution to sales and earnings. However, the strongest-performing segment in terms of sales – representing 32% of Power Systems revenue – is once again the solutions business for distributed power supplies, above all standby power systems for vulnerable facilities such as data centres and hospitals.
 
“We can see from the order intake that business is returning to a more normal level,” said Öfverström. At €1.6 billion, the order intake was 19% higher than last year at this. “This will have a favourable impact on results in the second half of the year, which at Power Systems is generally stronger than the first half.”

In June, Rolls-Royce announced a US$17.4 million investment at its mtu Aiken manufacturing facility in Graniteville in the US state of South Carolina for the addition of a new Remanufacturing and Overhaul Regional Centre. The factory expansion will be a dedicated remanufacturing and overhaul operation and create 20 jobs.

The new centre will be built next to the mtu Aiken plant’s existing engine manufacturing operations and bring currently outsourced workshop and warehouse operations in-house. The focus will be on  remanufacturing mtu Series 2000 and 4000 engines and components, the overhaul of mtu brand and customer-owned engines, plus internal and external rework services to help customers and distributors their maintenance and performance metrics.

Rolls Royce fully acquired mtu in 2014.