Engineering firms putting recession woes behind them

Engineering giants Rolls-Royce and BAE say they are starting to emerge from the depths of recession and have both seen an increase in profits.

Both companies are major employers in the West Country and have struggled over the last three years as a result of the global downturn.

But yesterday the firms, which both have bases in Filton on the outskirts of Bristol, announced that there are signs of better times ahead even though governments are looking at cutting back on defence spending.

Rolls-Royce saw a four per cent rise in profits over the last six months to £465 million and announced £5.9 billion worth of new orders,

The marine division of the company, which is partly based in Bristol, did particularly well and saw a 55 per cent increase in profits.

The West part of the business is working on £6.5bn worth of orders for the coming year and made profits of £158m last year, an increase of 16 per cent.

Dan Korte, who is president of the defence division, said: "Once again the defence business has made a significant contribution to a strong set of results which demonstrate the continued resilience of Rolls-Royce in a difficult economic climate.

"I would personally like to thank all of the employees within the team for their tremendous contribution to another half-year of great achievement.

"We are confident of growing our defence business significantly over the next decade and programmes like the F-35 Joint Strike Fighter and the A400M, in which Bristol plays a significant role, will make a major contribution to this growth.

"The investment that Rolls-Royce has made in new facilities across the world, such as the £75m in the Bristol site, will stand us in good stead for the long-term growth that is achievable if we continue to be competitive and innovative in our chosen markets."

BAE, a major regional employer, also enjoyed a good year. Sales were up nine per cent to £10.6bn and profits were up 14 per cent to £1.1bn.

Chief executive Ian King said: "This is another good set of results demonstrating that BAE Systems continues to perform well. We see good opportunities for sustainable growth including building on our home markets and our substantial presence in customer support and services.

"We have a proven track record of delivering reduced costs and enhanced capability for our customers and expect to continue to drive performance from our order book."