|H1 12|| H1 11|| Change|
|Order book (£bn)||1.3||1.4*||-7%|
|Underlying revenue (£m)||445||541 ||-18%|
|Underlying OE revenue (£m)||179||312||-43%|
|Underlying services revenue (£m)||266||229||+16%|
|Underlying profit before financing (£m)||(5)||(7)||+29%|
* 2011 year-end data
N.B. H1 2011 restated to take into account the transfer of Bergen to Engine Holding on January 2nd as per Note 2 on p.19
- A seven per cent reduction in the order book included an order intake of £0.3bn (£0.4bn in H1 2011). In the Oil & Gas market, high oil prices continue to sustain bid activity around the world, albeit with pricing pressures and order deferrals by some customers. The traditional power generation market remains suppressed and industrial demand has not yet fully recovered to pre-2008 levels, with few new projects being tendered in the developed world. However we continue to see opportunities in the developing economies. We continue to invest for future growth in Civil Nuclear. Significant orders in the period included:
- A Power Generation contract to supply two industrial Trent 60 WLE gas turbines to power LUKOIL's plant in Russia.
- A Power Generation contract to supply a Trent 60 WLE gas turbine for the El Alto plant in the Kenko Zone that will power over 100,000 homes in and around La Paz, Bolivia.
- An Oil & Gas contract to supply an RB211 to operate PTT’s Ethane Separation Plant in Thailand.
- Revenue fell by 18 per cent due to a significant reduction in OE revenue and adverse revenue mix in Oil & Gas and in Power Generation. The OE reduction was partially offset by a 16 per cent increase in services revenue. Services revenue, particularly in Oil & Gas, benefited from a better penetration of the aftermarket services market for the installed base across all markets.
- The reduced loss in H1 is due to the increased aftermarket volume partly offset by higher R&D spend, lower OE volumes and also increased investment in Civil Nuclear.
- An agreement was signed with Areva to collaborate further on civil nuclear new build projects for which we will manufacture complex components and provide engineering and technical services.
- LG has invested $45m to acquire a 51% share holding in Rolls-Royce Fuel Systems (US) Inc. that will enable the business to further the research, development, testing and commercialisation of solid oxide fuel cell technology.
- Ground has been broken for a new purpose-built gas turbine package, assembly and test facility in Santa Cruz in the state of Rio de Janeiro. The facility is expected to start production from the first quarter of 2013, including equipment for Petrobras for the Lula (Tupi) and Guará oilfields.
- As in our Marine business, Tognum will add complementary products and scale to our existing portfolio and systems integration capabilities.