The British manufacturer of engines for the aerospace industry Rolls-Royce will undertake a restructuring of its activity during the next 24 months that will result in the cut of 4,600 jobs, most in the United Kingdom, with an estimated cost of 500 million pounds (567 million euros) and the expectation of achieving savings of 400 million pounds per year (454 million euros) by the end of 2020, according to the company.
“Rolls-Royce announces the next stage of our effort to gain pace and simplicity with a restructuring proposal that will offer improved yields, higher margins and an increase in cash flow,” the company said.
About a third of the announced job adjustment, slightly more than 1,500 jobs, will be carried out by the end of 2018 and its impact will be increased as it advances 2019 with the aim of having completed the restructuring program in the middle of 2020
The company calculates a negative impact of this restructuring of some 500 million pounds sterling (567 million euros), including the cost of severance payments and the investments necessary to carry out the program.
For its part, Rolls-Royce estimates that the restructuring measures will save 400 million pounds (454 million euros) by the end of 2020.
“The creation of a more rational organization with rhythm and simplicity at its core will allow us to generate returns and be able to invest for the future,” said Warren East, CEO of Rolls-Royce, noting that the company aims to reduce its complexity to gain agility in making decisions and eliminate duplication.
Rolls-Royce shares have started the session on the London Stock Exchange with a rise of more than 2% after the announcement of the company’s restructuring plan.