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Thursday, August 27, 2020 

First-half financial results at Rolls-Royce's Power Systems division have been significantly impacted by the global Covid-19 pandemic, and although revenue is down the division remains in the black.

Looking to the future, Power Systems has been continuing to work on reinventing itself as a provider of sustainable, integrated total solutions for drive-power and energy needs, and is increasingly developing net-zero-carbon products.

Andreas Schell, CEO, said: “Despite the unprecedented scenario in which the global economy finds itself due to Covid-19, we have actively managed the economic impact on Power Systems in the first six months of 2020. We identified this problem at an early stage and took a number of countermeasures. The challenge of focusing effort on shielding our employees from infection while continuing to serve customers to the best of our abilities has been met despite the prevailing headwinds.” s

CFO Louise Öfverström referred to a "noticeable reluctance on the part of customers to invest in new equipment." She continued: "Our diversified positioning across a range of applications covering 13 markets has once again proven to be the right one and has had a stabilizing effect on our business.”

Equipment destined for sectors including marine propulsion systems were all hit by declining sales. As a great many assets were halted during lockdown, service revenues fell, as was expected. In order to mitigate the financial impact of the pandemic, Power Systems has taken measures aimed at preserving cash.

Signs of recovery are now emerging in some applications and markets, for example in China. “State rescue programs and the easing of Covid restrictions, where feasible, will help bring about recovery. That said, whether and to what extent a recovery will occur also depends on what happens to the infection rate, and how that impacts the economy,” said Schell. “We want to emerge from this crisis stronger, so we're using the time to press ahead with our transformation even more keenly than before."

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