Rolls-Royce crashes after losing $7 billion in first half
Rolls-Royce Holdings Plc (#RR) shares fell in the first hours of the London Stock Exchange session by more than 7% after announcing that in the first half of 2020 it registered a loss of 5,400 million pounds (7 Billion dollars).
The company has explained in a press release that these losses are a consequence of the collapse in demand in the airline sector due to the coronavirus pandemic, which has also led to the cancellation of currency hedging contracts that will no longer be necessary as sales decline.
To mitigate the effect of these losses, the company, whose main business is the jet engines division, has announced several measures to cut expenses and capture revenue.
- Raising at least 2 billion pounds with the sale of assets, including ITP Aero, a world leader in the aeronautical and industrial engines market.
- Cutting 4,000 jobs from the 9,000 planned to deal with Covid-19.
The company announced its results on the same day that its CFO Stephen Daintith was known to leave to take the same position at the food company Ocado.
Source: Admiral Markets MetaTrader 5. Daily Rolls-Royce chart. Data range: from December 30, 2019, to August 27, 2020. Prepared on August 27, 2020, at 10 am. Keep in mind that past results do not guarantee future returns.
Rolls-Royce shares have accumulated a loss on the stock market this year of more than 63% and are currently supported around the support of 240 GBX, a minimum that has not been touched since the previous financial crisis, in 2008. In the last five years it has lost 64%. In 2015, it fell by 33%; in 2016, it managed to recover 16%; in 2017, it was up 27%; in 2018, it fell slightly, 2%, and in 2019 it lost almost 18%.
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