Engine maker Rolls-Royce reaffirmed its FY21 guidance last week but Deutsche Bank said on Monday that achieving the guidance “looks a bit daunting”.
“In the first four months of 2021, large engine flying hours (EFH) were around 40% of 2019 levels, lower than the 43% for full-year 2020 and below the 55% target for 2021,” the bank noted.
It said this implies that in the next eight months, the company will need to see EFH improve to 63% of 2019, with the fourth quarter practically at more than 70%.
“While we believe that the run-rate at the end of April was probably better (more than 40%) than the troughs of Feb, it is still unclear whether traffic is improving as swiftly as desired, considering its engine portfolio,” it said.
At 1055 BST, the shares were down 3% at 104.38p.
