Despite posting a record loss in 2016, the investment fundamentals of British engineering stalwart Rolls Royce PLC (LON:RR.) are really unchanged, reckons City Index market analyst Ken Odeluga today.
Odelugo also added that on an underlying basis, the 49% drop was better than expected, and should signal that the company was on a "surer" footing than it had been this time a year ago and during the last 18 months.
The firm was recently hit with a £671m fine agreed with authorities in the UK, US and Brazil that will see it escape corruption charges. Rolls-Royce's order book increased by £3.3bn to £79.8bn during the year, led by its civil aerospace arm - and on an underlying basis, pre-tax profits were actually ahead of expectations.
The Derby-based group, which employs about half of its 50,000-strong workforce in the United Kingdom has been axing thousands of jobs over the last couple of years as part of a cost-cutting overhaul.
"While we have made good progress in our cost cutting and efficiency programs, more needs to be done to ensure we drive sustainable margin improvements within the business", Chief Executive Warren East said. "The addition of new management and a renewed focus within the business leadership teams, with clear goals and stronger accountabilities, should provide a strong platform for further progress in 2017". "The pace of technology change in the sector is accelerating, and we continue to invest in pioneering research into Ship Intelligence technologies focused on data-driven value-added services that facilitate full ship automation in the long term", it said.
As Google, Tesla and Uber push the boundaries of self-driving vehicle technology, Rolls-Royce is pioneering crewless ships.