The chief executive of Rolls-Royce has announced plans to stand down after nearly eight years at the helm as the business returned to profit.
Warren East, who will leave the firm at the end of 2022, said he was committed to a “smooth leadership transition”. Rolls-Royce's share price plummeted nearly 14% on the news.
The news comes as the engineering giant posted full-year profits of £124m - up from a £3.1bn loss a year earlier, after delivering its restructuring programme a year ahead of schedule.
Rolls-Royce, which has UK bases in Derby and Filton, near Bristol, has cut nearly 9,000 jobs from its global workforce since the pandemic hit. It has also already announced plans to sell off four of its ancillary businesses - two of which were sold in 2021. The sales are expected to generate around £2bn for the company.
Mr East said: "The positive momentum we are generating gives us confidence both in our expectations for 2022 and our future growth.
“We have also made significant progress with our new businesses in electrical power and small modular reactors, both of which have the potential to create very significant long-term value.”
The company said it was continuing to make major investments to develop new and existing technologies in its drive towards net zero. The shift towards green technologies, Rolls-Royce said, was the biggest since the arrival of the jet engine.
Mr East said it had been a “privilege” to lead Rolls-Royce, but it was the “right moment” to look to the future.
"It's a job which I thoroughly enjoy. There have been challenges, but we have built on the cultural and organisational improvements we have made to work through them, deliver on our commitments and create a better business."
He added: “Rolls-Royce is a dramatically different business today: a leading industrial technology company that is not only addressing the energy transition but embracing the opportunity it presents to generate substantial business growth.”
As well as Mr East, Rolls-Royce announced two further departures from the board for 2022.
Lee Hsien Yang will have completed his nine-year term at the end of the year and Irene Dorner, chair of the remuneration committee and employee champion, will not be standing for re-election at the Annual General Meeting (AGM) in May.
Rolls-Royce said Jitesh Gadhia, a non-executive director of Taylor Wimpey and Compare the Market, would be joining the board on April 1. He will become a member of the nominations and governance, and remuneration committees.
Sir Kevin Smith, senior independent director and chair of the science and technology committee, will also be stepping down after seven years. After the AGM, George Culmer will be appointed senior independent director and Paul Adams will be appointed chair of the science and technology committee, Rolls-Royce said.
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