Boss invests his own £100k in Rolls

ROLLS-ROYCE boss Warren East has put his money where his mouth is – by investing £100,000 of his own cash in the business.

East, who was unveiled as the successor to John Rishton in April, has a plan to breathe new life into the troubled British engineering powerhouse.

He bought 17,300 shares at £5.77 each earlier this week.

The purchase, which cost him £99,853, comes after East stripped out a layer of management to speed up decision-making.

The executive cull forms part of a turnaround strategy that East predicts could save £200m a year by 2017.

Andy Chambers, an analyst at Edison Investment Research, said the plan was ‘indicative of the need to improve accountability throughout the business, which in turn should improve the ability of the group to respond more rapidly to market requirements and trading conditions’.

Rolls-Royce has spooked investors with a series of cuts to its profit forecasts, ending in a warning last month that it might cut its dividend.

It is expected to report a 21pc fall in pre-tax profit for 2015 to around £1.3bn, a year after it reported a fall in profits that broke a decadelong run of earnings growth.

The engineer has also said it faces a £650m hit next year from a slowdown in aircraft servicing and weakness in marine engineering due to the low oil price.

But it could gain from a stronger dollar following the Federal Reserve’s recent interest rate rise, because most of its sales are made in the US currency.

Shares have drifted down 34pc so far this year but rose 3p to 576.5p yesterday.