Financial Performance and Guidance
TRANSACTIONAL FOREIGN EXCHANGE
ROLLS
R
ROYCE
% cover of forecast net US$ income
% £/$ exchange rate
Rolls-Royce hedges transactional FX
Transactional exposure arises when revenue currencies differ from cost
currencies
100%
Achieved rate is not typically affected by short-term spot rate
movements unless new cover is taken; this impact is usually diluted
80%
.
$15 billion GBP:USD hedge book (average rate £/$1.52)
•
$3 billion EUR:USD hedge book (average rate €/$1.14)
60%
Each 1 $ cent change in the £/US$ hedge rate impacts pre-tax cash by
c£20-30m
USD hedge book cash costs of closing out over-hedge positions
Costs are included in Group FCF definition
2024-2026 are future cash outflows
£m
Cash cost
2020-2022 2023 2024 2025 2026 Total
40%
20%
0%
964
389
146
148
27 1,674
2023
1% Hedged
2024
2025
1% Unhedged
2026
Blended rate (RHS)
2027
2028
Market rate (RHS)
1.60
1.50
1.40
1.30
1.20
1.10
©2024 Rolls-Royce
Not Subject to Export Control
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