Shares in Rolls-Royce Holdings PLC (LSE:RR.) climbed 9% on Thursday after the engineering giant raised its full-year guidance, buoyed by a 50% surge in underlying operating profit for the first half.
While expectations were high, the engine-maker bested them as it reported an operating profit of £1.73 billion, up from £1.15 billion a year earlier, with revenue rising nearly 11% to £9.06 billion and margins expanding to 19.1%.
Free cash flow improved to £1.58 billion, helping net cash rise to £1.08 billion by the end of June. Rolls-Royce declared an interim dividend of 4.5p per share and said it had already completed £0.4 billion of a planned £1 billion share buyback.
Full-year operating profit is now expected in the range of £3.1-3.2 billion, up from previous guidance of £2.7-2.9 billion, with free cash flow also upgraded.
Chief executive Tufan Erginbilgic credited ongoing transformation efforts for the strong results, despite supply chain and tariff challenges.
The stock rose 88.5p to 1,076.5p.