British jet-engine maker Rolls-Royce plunged into the red last year with a loss of £4 billion ($5.6bn) as the company suffered a “severe” blow from the Covid-19 pandemic when airlines stopped flying.
The underlying pre-tax loss, which compares with a profit of £583 million ($814m) in 2019, was driven by the company’s “power by the hour” model of charging some airlines for the amount of time its engines fly.
It meant Rolls-Royce’s income was instantly affected when airlines across the globe grounded their planes at the start of the pandemic, with flying hours on wide-body airliners – such as the A380 – at just 43 per cent of the usual time last year.
Warren East, chief executive at Rolls-Royce, called 2020 “an unprecedented year” and said the effects of the pandemic were felt “most acutely” by its civil aerospace business.
“In response, we took immediate actions to address our cost base, launching the largest restructuring in our recent history, consolidating our global manufacturing footprint and delivering significant cost-reduction measures,” he said.
“We have taken decisive actions to enhance our financial resilience and permanently improve our operational efficiency, resulting in a regrettable, but unfortunately very necessary, reduction in the size of our workforce.”
Britain's best-known engineering company, which also makes engines for ships and powers the UK's nuclear submarines, successfully completed taxiing trials of the company's all-electric plane earlier this month ahead of its first test flight in spring.
Powered along the runway by a 400-kilowatt electric engine and the latest battery technology, the tests form “part of an exciting new chapter in aviation”, according to the UK’s Minister for Business Paul Scully.
However, the company was hit particularly hard by the downturn in travel because it focuses on producing engines for the largest long-haul planes, such as the A380, a sector of travel expected to take longer to recover.
The company was forced to cut 7,000 permanent and contractor roles by the end of last year, with at least 2,000 more to go by the end of 2022.
Senior managers and executives were also hit with a 10 per cent pay cut, with the company warning in January that its 2021 cash outflow would be worse than expected.
After taking on approximately £5bn ($7bn) of debt last year – through a £2bn ($2.8bn) rights issues and £3bn ($4.2bn) in bonds and loans – Rolls-Royce is planning to repair its balance sheet by selling assets worth £2bn ($2.8bn), the major part of which will be Spain-based ITP Aero.
"Our planned sale of ITP Aero is progressing well with ongoing conversations with a number of potential buyers," Rolls-Royce said.
Adam Vettese, analyst at multi-asset investment platform eToro, said the pandemic continues to be "excruciatingly painful for Rolls-Royce, despite efforts to overhaul its finances".
“In the past year, the engine-maker has seen its revenue slump, pre-tax losses treble and it has piled on the debt. There are hopes that short-term flights will increase in number in the coming months, which would provide relief for Rolls-Royce, but long-haul flight demand will take considerably longer to recover – as will its own recovery," Mr Vettese said.
Mr East said the company had “made a good start on our programme of disposals and will continue with this in 2021”.
In a separate interview with the BBC, Mr East said 2020 “was a year like none other, but we do think the worst is behind us”.
He said the global vaccination drive should result in a pick-up in air travel in the second half of the year, although much will depend on an international agreement on how passenger health is checked.
The company’s loss was much higher than the £3.1bn ($4.35bn) expected by analysts, while revenue tumbled by 30 per cent to £11.8bn ($16.5bn).
Its cash outflow of £4.2bn ($5.9bn) was in line with consensus, and the company said it would improve this year to an outflow of £2bn ($2.8bn), with the figure turning positive during the second half.
That improvement is dependent on flying hours of its wide-body engines reaching 55 per cent of 2019 levels this year, a downgrade from its October forecast of 70 per cent.
Looking ahead to 2022, Rolls-Royce expects flying hours to be at 80 per cent of normal levels, down from an earlier forecast of 90 per cent.
"The near-term outlook remains uncertain and highly sensitive to the developments of the Covid-19 virus and the related measures taken by governments around the world," Rolls-Royce said.
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TO A LAND UNKNOWN
Director: Mahdi Fleifel
Starring: Mahmoud Bakri, Aram Sabbah, Mohammad Alsurafa
Rating: 4.5/5
Nancy 9 (Hassa Beek)
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More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
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Super Bowl LIII schedule
What Super Bowl LIII
Who is playing New England Patriots v Los Angeles Rams
Where Mercedes-Benz Stadium in Atlanta, United States
When Sunday (start time is 3.30am on Monday UAE time)
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How to apply for a drone permit
- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
Where to donate in the UAE
The Emirates Charity Portal
You can donate to several registered charities through a “donation catalogue”. The use of the donation is quite specific, such as buying a fan for a poor family in Niger for Dh130.
The General Authority of Islamic Affairs & Endowments
The site has an e-donation service accepting debit card, credit card or e-Dirham, an electronic payment tool developed by the Ministry of Finance and First Abu Dhabi Bank.
Al Noor Special Needs Centre
You can donate online or order Smiles n’ Stuff products handcrafted by Al Noor students. The centre publishes a wish list of extras needed, starting at Dh500.
Beit Al Khair Society
Beit Al Khair Society has the motto “From – and to – the UAE,” with donations going towards the neediest in the country. Its website has a list of physical donation sites, but people can also contribute money by SMS, bank transfer and through the hotline 800-22554.
Dar Al Ber Society
Dar Al Ber Society, which has charity projects in 39 countries, accept cash payments, money transfers or SMS donations. Its donation hotline is 800-79.
Dubai Cares
Dubai Cares provides several options for individuals and companies to donate, including online, through banks, at retail outlets, via phone and by purchasing Dubai Cares branded merchandise. It is currently running a campaign called Bookings 2030, which allows people to help change the future of six underprivileged children and young people.
Emirates Airline Foundation
Those who travel on Emirates have undoubtedly seen the little donation envelopes in the seat pockets. But the foundation also accepts donations online and in the form of Skywards Miles. Donated miles are used to sponsor travel for doctors, surgeons, engineers and other professionals volunteering on humanitarian missions around the world.
Emirates Red Crescent
On the Emirates Red Crescent website you can choose between 35 different purposes for your donation, such as providing food for fasters, supporting debtors and contributing to a refugee women fund. It also has a list of bank accounts for each donation type.
Gulf for Good
Gulf for Good raises funds for partner charity projects through challenges, like climbing Kilimanjaro and cycling through Thailand. This year’s projects are in partnership with Street Child Nepal, Larchfield Kids, the Foundation for African Empowerment and SOS Children's Villages. Since 2001, the organisation has raised more than $3.5 million (Dh12.8m) in support of over 50 children’s charities.
Noor Dubai Foundation
Sheikh Mohammed bin Rashid Al Maktoum launched the Noor Dubai Foundation a decade ago with the aim of eliminating all forms of preventable blindness globally. You can donate Dh50 to support mobile eye camps by texting the word “Noor” to 4565 (Etisalat) or 4849 (du).
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October 3: v Wuhan Jiangda Women’s FC
October 6: v Hyundai Steel Red Angels Women’s FC
October 9: v Sabah FA
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Centre Court
Starting at 2pm:
Elina Svitolina (UKR) [3] v Jennifer Brady (USA)
Anastasia Pavlyuchenkova (RUS) v Belinda Bencic (SUI [4]
Not before 7pm:
Sofia Kenin (USA) [5] v Elena Rybakina (KAZ)
Maria Sakkari (GRE) v Aryna Sabalenka (BLR) [7]
Court One
Starting at midday:
Karolina Muchova (CZE) v Katerina Siniakova (CZE)
Kristina Mladenovic (FRA) v Aliaksandra Sasnovich (BLR)
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hall of shame
SUNDERLAND 2002-03
No one has ended a Premier League season quite like Sunderland. They lost each of their final 15 games, taking no points after January. They ended up with 19 in total, sacking managers Peter Reid and Howard Wilkinson and losing 3-1 to Charlton when they scored three own goals in eight minutes.
SUNDERLAND 2005-06
Until Derby came along, Sunderland’s total of 15 points was the Premier League’s record low. They made it until May and their final home game before winning at the Stadium of Light while they lost a joint record 29 of their 38 league games.
HUDDERSFIELD 2018-19
Joined Derby as the only team to be relegated in March. No striker scored until January, while only two players got more assists than goalkeeper Jonas Lossl. The mid-season appointment Jan Siewert was to end his time as Huddersfield manager with a 5.3 per cent win rate.
ASTON VILLA 2015-16
Perhaps the most inexplicably bad season, considering they signed Idrissa Gueye and Adama Traore and still only got 17 points. Villa won their first league game, but none of the next 19. They ended an abominable campaign by taking one point from the last 39 available.
FULHAM 2018-19
Terrible in different ways. Fulham’s total of 26 points is not among the lowest ever but they contrived to get relegated after spending over £100 million (Dh457m) in the transfer market. Much of it went on defenders but they only kept two clean sheets in their first 33 games.
LA LIGA: Sporting Gijon, 13 points in 1997-98.
BUNDESLIGA: Tasmania Berlin, 10 points in 1965-66
Emergency phone numbers in the UAE
Estijaba – 8001717 – number to call to request coronavirus testing
Ministry of Health and Prevention – 80011111
Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre
Emirates airline – 600555555
Etihad Airways – 600555666
Ambulance – 998
Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries
UAE currency: the story behind the money in your pockets
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One in four Americans don't plan to retire
Nearly a quarter of Americans say they never plan to retire, according to a poll that suggests a disconnection between individuals' retirement plans and the realities of ageing in the workforce.
Experts say illness, injury, layoffs and caregiving responsibilities often force older workers to leave their jobs sooner than they'd like.
According to the poll from The Associated Press-NORC Centre for Public Affairs Research, 23 per cent of workers, including nearly two in 10 of those over 50, don't expect to stop working. Roughly another quarter of Americans say they will continue working beyond their 65th birthday.
According to government data, about one in five people 65 and older was working or actively looking for a job in June. The study surveyed 1,423 adults in February this year.
For many, money has a lot to do with the decision to keep working.
"The average retirement age that we see in the data has gone up a little bit, but it hasn't gone up that much," says Anqi Chen, assistant director of savings research at the Centre for Retirement Research at Boston College. "So people have to live in retirement much longer, and they may not have enough assets to support themselves in retirement."
When asked how financially comfortable they feel about retirement, 14 per cent of Americans under the age of 50 and 29 per cent over 50 say they feel extremely or very prepared, according to the poll. About another four in 10 older adults say they do feel somewhat prepared, while just about one-third feel unprepared.
"One of the things about thinking about never retiring is that you didn't save a whole lot of money," says Ronni Bennett, 78, who was pushed out of her job as a New York City-based website editor at 63.
She searched for work in the immediate aftermath of her layoff, a process she describes as akin to "banging my head against a wall." Finding Manhattan too expensive without a steady stream of income, she eventually moved to Portland, Maine. A few years later, she moved again, to Lake Oswego, Oregon. "Sometimes I fantasise that if I win the lottery, I'd go back to New York," says Ms Bennett.
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