Read Rolls Royce's One-Of-Its-Kind Attempt To Beat Inflation

·2 min read
  • Rolls Royce Holdings plc (OTC: RYCEY) doled out £2,000 ($2,458) to ~70% of its U.K. staff to beat the inflation in a first-of-its-kind move, Reuters reports.

  • The economy battled inflation and has aggravated by the labor crisis, supply chain disruptions, post-Brexit, and Ukraine crisis after an initial rebound from the pandemic.

  • Rolls Royce looked to offer the sum to 11,000 shopfloor workers and 3,000 junior managers mainly based at its Derby and Bristol sites, BBC reports.

  • Rolls-Royce also offered a 4% pay hike dated to March to 11,000 U.K. shopfloor workers.

  • Three thousand workers would receive the cash in August. The other 11,000 would get the sum when the union approved the deal.

  • Last May, regulators had warned against another 40% increase in household energy bills in Britain in October.

  • Rolls-Royce returned to profit in 2021 post-pandemic after cutting 9,000 jobs. It earned $152.20 million profit in 2021 and looked to be “modestly” cash positive for the year ahead.

  • The proposed 4% salary hike and bonus will cost Rolls-Royce ~$55 million in 2022.

  • Recently, British Prime Minister Boris Johnson warned against a sharp wage hike fueling further inflation.

  • U.K. gas prices rose 53.5%, and electricity prices were up 95.5% in April versus a year earlier, Fortune reports.

  • High oil prices also triggered consumer prices while the average British salary dropped 1.2%.

  • Companies worldwide have started trimming their workforce and scaling down to reduce their capital expenditure amid the global macro uncertainties.

  • Price Action: RYCEY shares closed at $1.12 on Friday.

  • Photo via Wikimedia Commons

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