Rolls-Royce is set to reward all its employees with shares worth approximately £700 each, marking the company’s first such initiative. In a recent internal announcement, the engineering firm revealed it will distribute 150 shares to each of its 42,000 workers globally. This move follows a remarkable turnaround for the Derby-based company, which specializes in jet engines.
The company reported a substantial profit of £1.1 billion for the first half of the year, nearly doubling its earnings from the same period in 2023. This upturn comes after Rolls-Royce, which employs 21,000 people in the UK, faced significant challenges due to the COVID-19 pandemic that severely impacted its commercial aerospace business.
This shares distribution, which will be implemented in September, is expected to cost Rolls-Royce about £30 million. For UK employees, there will be a three-year lock-in period before they can sell the shares, with potential tax implications unless the shares are held for five years.
Chief Executive Tufan Erginbilgic emphasized that the success of the company is a result of the employees’ dedication and efforts. “These results are thanks to your hard work and collective actions,” Erginbilgic stated in the internal memo. “It is important that you share in our success, which is why we are giving you the opportunity to own a part of Rolls-Royce.”
Since Erginbilgic’s appointment, Rolls-Royce has undergone a major transformation, reversing a period of struggle and leading to an all-time high share price of 501p. The company has also reinstated its dividend for the first time since the pandemic and is noted for its significant turnaround, described as one of the most impressive in recent memory by investment director Russ Mould.
Erginbilgic, who will not benefit from the share distribution, reiterated that this gesture is a recognition of the employees’ contributions to the company’s renewed success.
