FTSE 100 movers: Rolls-Royce fires on all cylinders; Mondi disappoints

(Sharecast News) - Rolls-Royce was firing on all cylinders during the front half of 2023. "There is much more to do to deliver better performance and to transform Rolls-Royce into a high performing, competitive, resilient, and growing business," chief executive officer Turfan Erginbilgic said.

"We will share the outcome of our strategy review along with medium-term goals for the Group in November.

"We have a strong portfolio of products and technologies in growing end markets and have secured key contract wins that will create future value and profitable growth. Our continued transformation will grow our business and allow us to play a stronger role in the energy transition."

For the six months ending on 30 June, Rolls Royce delivered a 31% jump in underlying revenues to reach £6.95bn.

Underlying operating profits more than quintupled to £673m and Rolls Royce turned cash flow positive to the tune of £356m after an outflow of -£68m in the year earlier period.

Management attributed the improvement to continued growth in its end markets, commercial optimisation and cost efficiencies.

Its performance was driven by the Civil and Defence sectors. Net debt reduced £3.25bn to £2.85bn.

Paper and packaging group Mondi reported a sharp fall in interim earnings due to weaker demand, customer destocking and higher input costs.

Pre-tax profit for the six months to June 30 more than halved to €418m from €933m a year ago.

"So far in 2023, demand and prices have declined sequentially with the exception of containerboard prices which stabilised in the later part of the half year. We saw some benefit from lower input costs which continue to ease as we progress into the third quarter of the year," said chief executive Andrew King.

Medical products maker Smith+Nephew on Thursday lifted its full-year revenue outlook as first-half results were boosted by outperformance in its sports medicine and advanced wound management divisions.

The company said it now expected full-year underlying revenue growth of 6-7%, compared with previous forecast range of 5-6%.

It added that chief financial officer Anne-Françoise Nesmes would step down in the second quarter of 2024.

First-half revenue rose to $2.7bn from $2.6bn. Operating profit rose to $275m compared with $242m a year earlier.

Trading profit of rose to $417m from $440m with margins down to 15.3%, compared with 16.9%, reflecting expected seasonality and higher input inflation, transactional foreign exchange and increased sales and marketing to drive growth, the company said.

"Margin development in the first half was in line with our expectations. In the second half, we expect a clear step up in both trading margin and cash generation as we begin to see the benefit of productivity gains and start bringing down inventory levels," said chief executive Deepak Nath.

Market Movers

FTSE 100 (UKX) 7,516.29 -0.60%

FTSE 100 - Risers

Admiral Group (ADM) 2,133.00p 3.64% Rolls-Royce Holdings (RR.) 190.50p 3.59% Entain (ENT) 1,382.00p 2.37% JD Sports Fashion (JD.) 151.55p 2.05% Barclays (BARC) 149.10p 1.80% Taylor Wimpey (TW.) 118.95p 1.36% NATWEST GROUP (NWG) 236.10p 1.29% Unite Group (UTG) 961.50p 1.16% Convatec Group (CTEC) 221.20p 1.10% B&M European Value Retail S.A. (DI) (BME) 540.80p 0.97%

FTSE 100 - Fallers

Mondi (MNDI) 1,249.00p -6.48% BT Group (BT.A) 114.25p -3.95% Fresnillo (FRES) 560.20p -3.75% Ocado Group (OCDO) 860.40p -2.78% St James's Place (STJ) 879.80p -2.24% National Grid (NG.) 976.00p -1.99% Smith & Nephew (SN.) 1,131.00p -1.78% Vodafone Group (VOD) 72.59p -1.77% Unilever (ULVR) 4,110.00p -1.71% Experian (EXPN) 2,875.00p -1.68%