Re Contract

7 September, 2006

               ROLLS-ROYCE WINS £40 MILLION GEM SUPPORT CONTRACT               

Rolls-Royce has won a £40 million contract to support Gem engines powering the
UK Ministry of Defence's (MoD) fleet of Lynx helicopters, marking a further
success for the company's Mission Ready Management Solutions (MRMS®) services
activity.

Rolls-Royce will overhaul engine modules at the company's facility at Ansty,
supported by Rolls-Royce personnel at Yeovilton and Bristol, and also provide
spare parts.

This initial contract, which also includes an incentive for Rolls-Royce to
reduce costs for support activity, will run for two years and is seen as the
first step towards an agreement from 2008 which will provide a guaranteed level
of engine availability at all times.

Nick Durham, Director of Services at Rolls-Royce Defence Aerospace said:

"This new partnership agreement, together with the intention to progress to
full engine availability-based support in 2008, highlights that our customer at
the MoD has embraced the mutual benefits of this new way of working."

Hagen Helm, Senior Vice President of Helicopters at Rolls-Royce Defence
Aerospace said: "This is a win:win agreement which benefits both the MoD and
Rolls-Royce and most importantly, will improve the service to the helicopter
operators in the UK Armed Forces."

Captain John Stratton (RN), Helicopter Engine IPT Leader said: "The contract
will enable improved support to the front line, mutual cost benefits and is a
huge step forward to establishing a fully partnered approach to supporting all
Rolls-Royce helicopter engines."

Rolls-Royce operates a number of MRMS contracts with the MoD already, under
which there is an incentive to provide a guaranteed level of engine
availability for aircraft such as the Typhoon, Tornado and the Nimrod, and an
engine spares inclusive contract for the Gnome engine in the Sea King
helicopter fleet.

With the experience of managing over 2350 engines and 3350 modules under MRMS®
-style contracts, Rolls-Royce is a pioneer in partnered support and
availability contracting.

NOTE TO EDITORS

 1. Services account for 55 per cent of the revenues of the Defence Aerospace
    business of Rolls-Royce.
   
 2. Over the last 12 months, Rolls-Royce has won MRMS contracts worth more than
    £400 million from the UK MoD.
   
 3. The Lynx helicopter is in service in the UK with the Army and the Royal
    Navy. It is powered by two Rolls-Royce Gem engines.
   
 4. In June, the Light Helicopter Turbine Engine Company (LHTEC), in which
    Rolls-Royce is a 50 per cent partner, announced that it had won a £75
    million contract from AgustaWestland to supply the CTS800-4 turboshaft
    engine for the British Armed Forces' Future Lynx helicopter.
   
For further information please contact:

Justine Steele
Head of Communications - Defence Aerospace
Rolls-Royce plc
Tel: [phone]
Email: [e-mail]