Rolls-Royce may need to be taken to pieces to fix

THE future of an embattled British aviation pioneer could become a bit clearer this week.

Rolls- Royce, the plane engine maker, is due to release its first-half results on Thursday, and they are set to lay bare the crisis facing the historic engineering company.

Echoing Winston Churchill, chief executive Warren East has called the pandemic Rolls-Royce’s ‘darkest hour’ since it went bust in 1971. And this week’s results are likely to underline this.

Scribblers at the Swiss bank UBS are pencilling in a 32 per cent fall in t urnover t o £ 5 bi l l i on, which will translate into an operating loss of around £200 million. Rolls-Royce has already warned that it will have burnt through £ 3 billion of cash in the first six months of 2020.

But all eyes in the City will be on the balance sheet and how desperately it needs a cash injection.

Reports last month said t hat t he company was weighing up a rights issue to raise £1.5 billion.

So far Rolls-Royce has said l i t t l e about t hose plans, other than that it is reviewing all options.

Perhaps this week it will say more – or go as far as fleshing out share sale plans, which also depend on selling off parts of the business.

IS IT time for the owner of Paddy Power itself to take a punt on its future prospects?

Like many companies during the crisis, Flutter Entertainment, the FTSE 100 gambling giant which also owns Betfair, removed guidance for i nvestors given the path ahead was so uncertain.

But now that sporting events are back on the agenda, it is expected to follow in the footsteps of rival GVC and lay out its guidance for the year.

Number- crunchers at the investment banking s p e c i a l i s t P e e l Hu n t believe it will use this T h u r s d a y ’s h a l f - y e a r results to reveal that it hopes to make about £1 billion in profits for 2020.

DATA that has come out in recent weeks hasn’t painted a very pretty picture of the state of the UK economy.

But it will be worth keeping an eye on the annual results from recruitment firm Hays, which are due out on Thursday.

This is especially true in view of the jobs bloodbath that many are predicting is on its way.

Recruiters such as Hays also tend to be a useful barometer for gauging how an economy is faring more generally.

Often, the number of jobs being advertised or figures for how many people are competing for each role can be handy indicators of what is to come.

Let’s hope for an upbeat outlook t hen from t he FTSE 250 company. jamie.nimmo @mailonsunday.co.uk