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Rolls-Royce scraps dividend; to cut global worker salaries by 10%

By BFN News | 07:35 AM | Monday 06 April, 2020


Engineering group Rolls-Royce scrapped its final dividend and said it would cut staff costs by around 10% as it buffers its balance sheet from the Covid-19 crisis. The company had been planning to pay a 2019 final dividend of 7.1p per share. Rolls-Royce said new cost mitigation measures would provide a cash flow benefit of at least £750m in 2020, in addition the company's ongoing transformation plans. These included postponing external recruitment and reducing salary costs across the global workforce by at least 10% in 2020, subject to local legal requirements. Salaries for senior managers and executives would be reduced by 20% for the rest of 2020, comprising a reduction of 10% and a deferral of 10%, with an additional bonus deferral for the chief executive and chief financial officer. There would also be a corresponding reduction in fees for non-executive directors for the remainder of the year. Rolls-Royce also withdrew its previous financial guidance. The company make engines for the commercial aviation sector, which has been one of the worst hammered by the Covid-19 crisis. It also confirmed that it was part of the VentilatorChallengeUK Consortium working to increase the UK's supply of ventilators. Story provided by StockMarketWire.com

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