Re Contract

15 July 2008

    ROLLS-ROYCE SIGNS $900M EXCLUSIVE POWER SYSTEMS AGREEMENT WITH ALENIA     
               AERONAUTICA FOR C-27J MILITARY TRANSPORT AIRCRAFT               

Rolls-Royce today signed a nine-year, $900 million agreement with Alenia
Aeronautica to be the exclusive propulsion system provider for the C-27J
Spartan medium-lift transport aircraft.

The twin-engined C-27J is powered by AE 2100D2 turboprop engines with
Rolls-Royce having responsibility as the propulsion system provider of both the
engine and the Dowty six-blade propeller assemblies.

This agreement builds upon a 2006 contract with Alenia Aeronautica for 42
propulsion systems, bringing the total guaranteed volume to 155. In addition,
78 C-27J aircraft and up to 180 engines were placed under contract by the US
Armed forces's Joint Cargo Aircraft programme in 2007 with potential volumes of
up to 145 aircraft to be delivered.

Dennis Jarvi, President of Defense North America for Rolls-Royce, said: "This
agreement further strengthens the partnership that has been forged with Alenia
Aeronautica to ensure the success of the C-27J Spartan programme globally. It
also confirms the company's position as the world leader in the supply of
propulsion systems for military transport aircraft."

Antonio Perfetti, Alenia Aeronautica Chief Operating Officer said: "The
Rolls-Royce engines, together with the state-of-the-art avionics and systems,
contributes to the outstanding performance, operational flexibility and cost
effectiveness of the C-27J.  The Spartan is the only medium-lift military
aircraft available in its class that is interoperable with heavier airlifters
and can also deliver the speed, range, payload and load compartment volume
capabilities our customers require."

The C-27J is a mid-range, multifunctional and interoperable aircraft, able to
perform logistical re-supply, MEDEVAC, troop movement, airdrop operations,
humanitarian assistance and homeland security missions.

In addition to the United States, the C-27J is also in service in Italy,
Greece, Bulgaria and Lithuania and has been ordered by Romania.

NOTE TO EDITORS

 1. The AE 2100D2 engine is part of the "common core" AE engine line produced
    by Rolls-Royce, and provides up to 6,000 shaft horsepower. The reliable and
    proven AE engine line has accumulated more than 33 million flight hours in
    military and civil applications.
   
 2. As the world leading propulsion system provider for military transport
    aircraft, Rolls-Royce provides the engine for the new C-130J and V-22
    Osprey and powers more than 2,800 fixed and rotary-wing aircraft currently
    in service with the United States and other international armed forces.
    These include such mission-critical aircraft as: the Global Hawk; the AV-8B
    Harrier and V-22 Osprey; the T-45 Goshawk and P-3 Orion; the OH-58 Kiowa
    and Kiowa Warrior and MH-6 Little Bird helicopters; and C-130 Hercules
    transports.
   
 3. Rolls-Royce is also a member of Europrop International, the consortium
    which is producing the TP400-D6 engine to power the A400M military
    transport aircraft.
   
 4. Rolls-Royce, a world-leading provider of power systems and services for use
    on land, at sea and in the air, has established a strong position in global
    markets - civil aerospace, defence aerospace, marine and energy.
   
 5. Rolls-Royce continues to invest in core technologies, products, people and
    capabilities with the objective of broadening and strengthening the product
    and service portfolio, improving efficiency and enhancing the environmental
    performance of its products. These investments create high barriers to
    entry.
   
 6. Rolls-Royce is working hard to improve the environmental impact of its
    products. Each year, in collaboration with its partners, it invests over £
    800 million on research and development, two thirds of which has the
    objective of reducing the environmental impact of its products. The primary
    technology investment area is aimed at reducing noise and emissions.
   
 7. Annual sales were £7.4 billion in 2007, of which 55 per cent came from
    services revenues. The firm and announced order book at the end of 2007
    stood at £45.9 billion, of which aftermarket services represent 30 per
    cent, providing visibility of future levels of activity.
   
For visual material:
Please visit the Rolls-Royce Media Room for images and The Newsmarket for
broadcast-standard video. If you are a first-time user of The Newsmarket, we
encourage you to take a moment to register. If you have any questions about
using The Newsmarket, please email Journalist Help.

For further information, please contact:

Mark Alflatt
Director of Financial Communications
Rolls-Royce plc
Phone: [phone]
E-mail: [e-mail]

Nicky Louth-Davies
Director Corporate Communications
Rolls-Royce plc
Phone: [phone]
E-mail: [e-mail]