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TheCountOfNowhere

Rolls-Royce reports record loss of £4.6bn

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Worth noting that the old CEO (or was it the Chairman? I heard it on R4 this morning) apparently retired on a pension of £450,000 a year.

Nice work if you can get it!

Edited by Errol

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6 hours ago, 999house said:

Most of it is one off costs, fines and accounting treatments. Nothing to see here...next!

Yep, 700m or so in fines, and a 4.6billion write down on the value of 35bn in currency hedges. 

Good clear analysis here http://www.forbes.com/sites/timworstall/2017/02/14/rolls-royces-record-corporate-loss-isnt-actually-a-loss-its-an-accounting-charge/#125a49845177

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6 hours ago, TheCountOfNowhere said:

Actual economic news just seems to be getting ignored now.

http://www.bbc.co.uk/news/business-38966165


That's a MASSIVE loss.

 

 

I'm not even sure it is a massive loss any more. Money is fast losing the plot for me, what is the value of £1million? When it can be magicked into existence one hundred times a day

 

Its really ironic that the true value of money is found in some pocket change, the lowest common denominator, you know the value of what that change can buy you, a loaf of bread or whatever, pint of milk if that's your poison.

 

Then you get up to the millions billions and trillions and they're spunking that shit all over the place with not a care in the world, is it even real?

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And its like the way people talk about footballers wages or transfer fees or whatever: "yeah, they should just pay him what he's worth, 300 grand a week is the going rate, stop being a tight **** and pay it" or "if you want the best players you're going to have to get your wallet out and spend that £100million like the other top clubs are prepared to do"

 

then the same genius goes and balances armfuls of shopping away from tescos so as to avoid the 5p bag charge like a proper savvy businessman.

 

Its really mental when you think about it how we view money, and what money actually is.

 

 

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7 hours ago, 999house said:

Most of it is one off costs, fines and accounting treatments. Nothing to see here...next!

The underlying numbers don't look too good.

RR's earnings are mostly in dollars (albeit hedged) - the pound has been falling against the dollar for almost ten years but RR's profits are still falling - avoid.

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53 minutes ago, Foreverblowingbubbles said:

Yep, 700m or so in fines, and a 4.6billion write down on the value of 35bn in currency hedges. 

Good clear analysis here http://www.forbes.com/sites/timworstall/2017/02/14/rolls-royces-record-corporate-loss-isnt-actually-a-loss-its-an-accounting-charge/#125a49845177

35bn in currency hedges... How much do they sell per year? Isn't a hedge meant to nullify the risk?

Has RR moved into finance? they should consider opening a bank and do finance properly. 

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55 minutes ago, sPinwheel said:

Money gives you more options. A lot of money gives you a lot of options.

I'm sure Big Phil and Mother Theresa are thinking the exact same thing...

0.66627300-1451810223-pm-modi-lays-found

Edited by zugzwang

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Probably because it's a loss of potential profit rather than actual profit. What you never had you don't miss.

As I understand that forbes article, you hedge to fix your exchange rate, if the exchange rate goes against you , things are ok, but if it moves in your favour you don't reap the benefits.

Presumably a company would agree all these hedges quite a while ago and be unable to predict brexit or anything much else. In a way the company is just being honest.

It makes sense to hedge now as it locks in a favorable exchange rate, except the risk is a matter of judgment.

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Hedging, if you buy in dollar imports and hold for 6 months before you sell as you manufacture, you hedge the risk by selling he dollar to the value of the import. Its not rocket science. Simple.

If they are speculating then you are hoping you have a crystal ball.

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