DERBY aero engine-maker Rolls-Royce has warned investors it will not grow profits next year largely because of the impact of Russian trade sanctions.
The firm, which has its civil aerospace division in Sinfin, had previously predicted a profits rise for 2015.
But, this morning, the company - which also has its nuclear and energy division in Raynesway - issued guidance to the London Stock Exchange, saying that it now estimated that profits for the group next year would be flat, or at worst 3% lower than its performance this year.
Rolls-Royce has downgraded profit forecasts for its power systems division, as well as its nuclear and energy division.
But it is still predicting that profits will continue to grow in its civil aerospace division.
In a statement, Rolls-Royce said: "In the last few months economic conditions have deteriorated and Russian trade sanctions have tightened, leading a number of customers to delay or cancel orders, particularly in our nuclear and energy and power systems businesses.
"At the same time we have made good progress on cost, which has limited the impact of these adverse trading conditions on the group."
Rolls-Royce has also updated its sales forecast for its current financial year, saying that its performance would be 3.5% to 4% lower than 2013. Previously, it had predicted flat sales of 0%.
Despite this, Rolls-Royce continues to be optimistic about the prospects of its civil aerospace division, which in Derby makes the Trent family engines.
The firm said: "In the medium term, our business remains well positioned in growth markets. In civil aerospace, the market will strengthen, driven by increasing demand for travel in emerging economies and the need to replace older aircraft with new fuel-efficient models."
Rolls-Royce chief executive John Rishton said: "While the short term is clearly challenging, reflecting the economic environment, the prospects for the group remain strong, driven by the growing global requirement for cleaner, better power.
"The operational efficiencies already achieved and the cost programmes we will now accelerate will put us in a better position to benefit from these growth drivers."
