Rolls-Royce takes off as profits head for £450m

SHARES in engineering giant Rolls-Royce were flying as it promised investors profits for the year would top £450m.

It is still struggling with problems on the Trent 1000 engine, used to power Boeing’s 787 Dreamliner aeroplanes. Earlier this year, blades on the engines were found to be wearing out faster than expected.

Though Rolls has increased its maintenance and repair capabilities, it said a ‘high level’ of aircraft were still grounded.

The business is also set to deliver 500 large engines to customers in 2018, which is 50 fewer than it planned in March, due to supplychain issues.

But it made up for its aerospace wobbles in other divisions. It saw strong growth in the power systems arm, which provides engines for trains and ships, and defence revenues were stable.

The firm had said its core profit would be £450m, give or take £100m. But yesterday Rolls guided investors to expect full- year results at the higher end of this range. Shares rose by 4.5pc, or 35.2p, to 816p. The engineer helped the FTSE

100 climb 1.1pc, or 73.25 points, to 6880.19 points.

Brexit-sensitive builders including Berkeley Group (up 5.7pc, or 189p, to 3500p), Barratt Developments ( up 4.7pc, or 20.9p, to 468.1p) and Persimmon (up 4.3pc, or 80.5p, to 1971p) also added to the blue- chip index’s gains, as investors expected Prime Minister Theresa May to survive a noconfidence vote in Parliament.

However Wood Group, which provides engineering services to the oil and gas sector, sank as it said it was unsure what recent volatility in the price of oil would mean for customers’ spending.

Wood depends on oil and gas firms building and maintaining new drilling structures, but companies are likely to hold back on this spending when oil prices are lower. Its shares dropped 10.2pc, or 65.6p, to 578.6p.

Thomas Cook was also trying to get back onto the front foot, as its shares climbed 16.4pc, or 4.14p, to 29.44p after sliding dramatically following its third profit warning of the year.

Traders appeared to be hunting a bargain with the travel agent’s shares, which have lost almost 80pc of their value this year. Now, the drastic sell- off seems to be drawing to a close. Landscaping company Marshalls, which makes items from paving slabs to road bollards, shot up as it bought brick maker Edenhall for up to £17.2m.

The deal should start adding to Marshalls’ earnings within the first year. Shares rocketed 10.8pc, or 45.2p, to 462p. Shares in stockbroker AJ Bell were on the rise, as they became freely available for all investors to trade following their market debut last week.

When it floated on Friday, only investors who had bought shares through the initial public offering could trade. Still, the price shot up more than 30pc and added £ 62m to founder Andy Bell’s 25.5pc stake.

As new investors piled in yesterday, shares climbed another 9.6pc, or 21.5p, to 245p, increasing Bell’s paper wealth a further £22m. Addiction treatment company

Indivior received a temporary reprieve from a US court, which denied an application from competitor Dr Reddy’s Laboratories to immediately restart selling its cheaper copycat drug in the US.

Indivior was granted an injunction to stop Dr Reddy’s selling the drug, which was overturned last month. Now it is filing to have its case reheard to ban Dr Reddy’s permanently, and the ruling gives it breathing space. Shares rose 7.7pc, or 6.54p, to 91.34p.