Rolls-Royce, a British aircraft engine manufacturer, reported that its net losses more than doubled to £3.2 billion last year, owing to the coronavirus pandemic, which caused thousands of company layoffs. According to the group, the loss after tax was $4.4 billion, or 3.7 billion euros, compared to a loss of £1.3 billion in 2019. Coronavirus struck civil aviation the hardest, causing revenue to plummet by nearly 29% to about £11.8 billion.
Rolls-Royce said in a result release that the deadly Covid-19 pandemic had a “strong effect” on the company’s 2020 success and near-term outlook. Last year, the aviation industry took a hit when the contagion grounded planes all over the world, triggering a transportation crisis. Last year, the group saved more than £1.0 billion in expenses, including 7,000 jobs lost as part of a turnaround effort that aims to eliminate “at least” 9,000 positions by the end of 2022.
Rolls-Royce, which works in the aerospace, defence, and energy industries, has cut jobs and expenses as it attempts to escape the negative effects of the health-care crisis. “2020 was a once-in-a-lifetime year,” said Warren East, the company’s CEO. “Our civil aerospace company felt the brunt of the Covid-19 pandemic’s effects the most”, he added.
The company says that in response, they have launched the largest restructuring in their recent history, consolidating their global manufacturing footprint, and delivering substantial cost reduction initiatives. East went on to state that the company had taken “decisive steps” to boost its finances and operating performance.
This resulted in a “regrettable, but sadly inevitable” reduction in the size of the company’s workforce, East said. Last year, the company raised additional funds through a rights issue, shares, and new credit lines, as well as divesting key assets. East said, “We have made a decent start on their disposals program, and we’ll keep it going in 2021.”
