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Rolls-Royce flies into profit
by Staff Writers
London (AFP) July 28, 2011

Rolls-Royce, the British maker of aircraft engines, rebounded into profit during the first half of 2011, aided by a record order book despite defence spending cutbacks in Britain, it said on Thursday.

Net profit hit 842 million pounds ($1.4 billion, 960 million euros) in the six months to the end of June, after a post tax loss of 334 million pounds in the same period of last year, Rolls-Royce announced in a results statement.

Revenue eased one percent to 5.36 billion pounds, but the group's order book climbed four percent to a record 61.4 billion pounds in the reporting period.

Underlying pretax profit meanwhile jumped to 595 million pounds from 465 million pounds last time around.

Rolls-Royce added that underlying earnings were given a 60 million pound boost from contract termination settlements in the wake of the British government's strategic defense and security review (SDSR).

The group meanwhile announced that it would hike its shareholder dividend by eight percent to 6.9 pence per share.

"Performance in the first half of the year was strong with our order book and underlying profit showing solid growth, enabling an increased payment to shareholders," chief executive John Rishton said in the earnings release.

"This demonstrates the resilience of our strategy that is based on a diverse portfolio and access to global markets," added Rishton, who became chief executive in April with John Rose stepping down after 14 years in charge.

In late morning trade, Rolls-Royce shares gained 0.16 percent to 642.50 pence on London's FTSE 100 index of leading companies, which was 0.70 percent lower.

Rolls-Royce is the world's second-largest maker of commercial and military jet engines after US giant General Electric Co.

But it has been hit by the British government's decision last October to shrink the armed forces and scrap key assets as part of a major defence review that formed part of stinging public sector cuts to slash a record deficit.

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IATA says June air traffic up but warns of rising fuel price
Geneva (AFP) July 28, 2011 - Air passenger traffic rose 4.4 percent in June compared to a year ago, but rising fuel costs hit earnings, industry association IATA said Thursday.

"What is clear is that the rising jet fuel price is putting pressure on the bottom line," said Tony Tyler, incoming director general of the International Air Transport Association.

"The average price for the second quarter was $133 per barrel which is an increase of $10 over the first quarter," he said in a statement.

"Slower economic growth makes these challenges all the more difficult.

"It is certainly not the time to burden the industry with increases in other costs, including taxation," added Tyler, the former chief executive of Cathay Pacific.

Latin American airlines were the month's star for the second time running, with passenger demand increasing 14.3 percent year-on-year.

But it was lower than the 21.3 percent recorded in May due to the disruptions caused by Chile's Puyehe volcano eruption.

European carriers reported an 8.9 percent increase compared to June 2010, as travellers took advantage of the weak euro to visit the region.

Asian Pacific airlines saw demand rise 3.3 percent, with the effects of March's earthquake and tsunami in Japan knocking an estimated 0.5 percentage points off the region's growth.

Passenger demand for the Japanese domestic market continued to suffer from the effects of the disaster, falling 24.6 percent compared to June 2010.

IATA held its industry profit forecast of $4 billion for 2011, 78 percent lower than 2010.

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Embraer plans military transport jet
Rio De Janeiro (UPI) Jul 26, 2011
Brazilian aircraft manufacturer Embraer plans to have its first major military cargo aircraft airborne by 2015, competing in markets currently dominated by U.S., European and Russian manufacturers. The KC-390 transport aircraft will be fitted with engines supplied by International Aero Engines, a consortium that includes Rolls-Royce, United Technologies unit Pratt and Whitney and the Ja ... read more

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