Rolls-Royce is set to cut another 600 jobs from its workforce after falling oil prices hit its Scandinavia-focused marine business.
The 131-year-old engineering group, which axed 2,600 jobs last year, said that fewer than 5 per cent of the cuts will be in the UK, with the bulk of the redundancies taking place in Norway.
“While we are making good progress on cost, the effect of low oil prices means we have to continue to look for further efficiencies,” said Mikael Makinen, who runs the division.
Rolls said the proposals would have a “broadly neutral impact on profits” and result in £25m of benefits. Last year’s job cuts will affect its aerospace division and head office, with most of those cuts happening in the UK and US.
In contrast, falling oil prices – and the prospect of further defence cuts under the Conservatives – failed to knock the Royal Navy contractor Babcock International off course last year.
The support services giant has seen its shares spike since the general election on expectations the Tory victory will safeguard the future of the Trident nuclear programme on which Babcock works.
The company spent about £200m on acquisitions last year and has integrated the helicopters operator Avincis into its operations, having spent about £1.7bn buying the business in early 2014. However, the renamed Mission Critical Services (MCS) arm counts as clients oil and gas companies that have been forced to cut back because of the fall in the price of oil over the past few months.
Pre-tax profits rose 43 per cent to £313.1m in the year ending 31 March, and its order book now stands at a record £20bn.Reuse content