Times of Oman
Dec 01, 2015 LAST UPDATED AT 11:51 AM GMT
Rolls-Royce warns over marine division
May 1, 2014 | 12:00 AM

Britain's Rolls-Royce warned Thursday over profits at its marine unit, sending its share price sliding, and repeated that the engine maker's earnings and revenues would flatten this year.

The firm said in a trading update that production problems at the division would spark an exceptional charge of £30 million ($51 million, 36 million euros).

Profit and sales at the group's marine arm will be down 10 percent this year, hit by the one-off charge and lower services volume, it added, without providing further details of the "product quality issue".

The group had previously forecast modest profit growth for the unit.

Rolls also maintained its guidance that the overall group would not experience revenue or profits growth in 2014.

"We remain confident that the group will resume growth in 2015," it added.

Rolls had already flagged in February that the group would not experience growth this year, as government cutbacks on defence spending ends the company's decade of rampant growth.

Thursday's news sent the group's shares down 2.86 percent to 1,020 pence in morning deals on London's FTSE 100 index, which rose 0.36 percent to 6,804.24 points.

The gloomy warning came a day after Rolls-Royce said it was in talks over the possible sale of its energy production arm to German engineering giant Siemens.

Rolls added on Thursday: "These talks have not concluded and we will make a further announcement in due course."

Siemens had revealed Tuesday that it had decided to make an offer for French firm Alstom's energy division, in an attempt to thwart a rival bid from US giant General Electric.

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