Rolls Royce issued trading statement for the third quarter on Thursday which highlighted the struggles the company are facing in the current environment.
Despite strong demand in the defence unit, the Civil Aerospace business recorded flight hours at just 65% of 2019 levels.
The economic environment and rising costs were the main focus and are set to threaten margins through the rest of 2022.
“Rolls Royce is doing all it can within its control. Costs are being managed by inflation-linked clauses in its customer contracts, debt’s being repaid, and crucial Engine Flying Hours are edging upwards,” said Sophie Lund-Yates, Lead Equity Analyst at Hargreaves Lansdown.
“The trouble is, and which has been the case since the pandemic struck, the group’s grappling against a multitude of headwinds from external forces.”
Having completed disposals in the quarter, Rolls Royce paid down £2bn debt but still had £4bn of drawn debt outstanding.
Rolls Royce shares were trading down 5% to 79p at the time of writing.