Engine maker Rolls-Royce Group said it was raising its dividend by a third after posting a 13 per cent rise in underlying annual profit today.
But its shares reversed gains made in recent sessions on disappointment the cash return was not greater. The stock was down 4.5 per cent at 458 and a half pence by 8.55 am.
Rolls-Royce made an underlying pretax profit of £800 million in 2007, on sales up 6 per cent to £7.82 billion despite the weakening of the dollar and increased costs for materials such as cobalt, nickel and titanium.
Analysts' median forecast was for £809.4 million profit based on a range from £767 million to £884 million. The median forecast for 2008 was for a profit of nearly £900 million.