Rolls-Royce's Trent XWB engine will power the 31 Airbus A350 XWB aircraft ordered by Japan Airlines

Defence aerospace securing Rolls-Royce profit growth

Work on the Type 26 Royal Navy warships and new Japan Airlines planes will keep Rolls-Royce on track for strong profits growth.

Shares in the British engineering company surged more than 3 per cent pushing them close to their record high in July, as Rolls said stronger trading in defence aerospace has helped offset weaker trading in marine, which should mean "good" underlying profits growth for 2013, plus "modest" sales growth.

Rolls recently won a deal to design a propulsion system for the Navy's Type 26 global combat ship, which are due to go into service from 2021 onwards. Rolls said 5,400-tonne vessels will feature the "world's most powerful marine gas turbine", its MT30.

The firm will work with main contractor BAE Systems and Tognum, its joint venture collaboration with Daimler, to design the system.

The warships are due to be built in Glasgow after BAE's controversial decision to end shipbuilding at Portsmouth, which will cost about 1,800 jobs at BAE. A final decision on the Type 26 contracts is thought to hinge on the outcome of the Scottish referendum over independence.

Rolls said it will also be boosted by Japan Airlines' order for 31 Airbus A350 XWB aircraft, which are powered by its Trent XWB engines. It also struck a recent $1.5bn (£933m) deal with Lufthansa to supply Trent XWB engines to power 25 Airbus A350-900 aircraft, including a support package.

The company added it has signed multiple contracts worth more than $600m with various American government departments, despite delays in spending by the administration.

The group said it now expects its defence aerospace arm to show modest growth, up from broadly flat, but downgraded earnings in its marine division to broadly flat from previous expectations for an increase.

Underlying pre-tax profits leapt 34 per cent to £840m during the first six months of the year, lifted by more work and restructuring. It reported 24 per cent profits growth to £1.4bn in 2012. The group has major sites at Derby and Bristol and employs around 45,000 people worldwide.

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