Rolls Royce agrees contract with MoD worth 800m pounds

Rolls-Royce, the FTSE 100 global power systems company, has shaken hands with the Ministry of Defence (MoD) on a new 10-year enabling contract that will sustain as many as 2,000 jobs in the UK.

Rolls-Royce, the FTSE 100 global power systems company, has shaken hands with the Ministry of Defence (MoD) on a new 10-year enabling contract that will sustain as many as 2,000 jobs in the UK.

The contact, which is valued at around £800m, will deliver costs savings of £200m to the MoD in the provision of nuclear propulsion systems for the UK's existing and future submarine flotilla.

The cost-savings will be brought about by the delivery of a step-change in operational efficiency, the group said.

Jason Smith, Rolls-Royce President of Submarines, continued: "I am pleased that we have agreed this enabling contract with the MoD, which delivers significant savings to them over the next ten years and provides us with the stability to deliver these activities efficiently. It further reinforces the commitment to the submarine programme."

Back in 2010, Rolls-Royce, as part of an industry-wide move, committed to the delivery of cost savings of in excess of £900m over a ten-year period by the creation of a Submarines Enterprise Performance Programme (SEPP). The company said the savings enabled by the contract "represent a significant step forward" in meeting that commitment.

The share price climbed 1.54% to 986p by 14:14.

Recommended

The top funds to invest in
Funds

The top funds to invest in

As market volatility and recessionary fears continue, here are the most popular funds, stocks and trusts investors are putting their money into
2 Mar 2023
The ten highest dividend yields in the FTSE 100
Income investing

The ten highest dividend yields in the FTSE 100

Rupert Hargreaves takes a look at the companies with the highest dividend yields in the UK’s blue-chip index
27 Feb 2023
The outlook for Shell shares is mixed, despite bumper profits
Energy stocks

The outlook for Shell shares is mixed, despite bumper profits

With profits surging, it looks as if Shell is on a roll, but the company’s growth from here is hard to see as Rupert Hargreaves explains.
6 Feb 2023
The top ten dividend stocks in the FTSE 250
Share tips

The top ten dividend stocks in the FTSE 250

The average FTSE 250 dividend yield is around 4%, but many stocks yield much more. Rupert Hargreaves picks the best FTSE 250 stocks for income investo…
17 Jan 2023

Most Popular

Government plans could see NS&I boost interest rates
Savings

Government plans could see NS&I boost interest rates

The government-backed bank has a new funding target, which could prompt it to boost the rates on its Premium Bonds, ISAs and bonds.
16 Mar 2023
Share tips of the week – 17 March
Investments

Share tips of the week – 17 March

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages
10 Mar 2023
How to make your child a tax-free millionaire by age 37
Investments

How to make your child a tax-free millionaire by age 37

Exclusive research for MoneyWeek reveals how funding an ISA and a pension for your child until age 18 could build up a seven-figure sum by the time th…
14 Mar 2023