Director Shareholding

STOCK EXCHANGE ANNOUNCEMENT

The Company announces the purchase on 7th September 2004 of 46,025 ordinary
shares in the Company by Computershare Trustees Limited (the Trustee) at a
price of 238.25 pence per share for the purpose of satisfying the purchase of
ordinary shares by eligible employees (including executive directors) under the
Rolls-Royce SharePurchase Plan (the Plan) for the current month. The Plan has
been approved by the Inland Revenue as a share incentive plan under Schedule 8
to the Finance Act 2000.

Following the transaction the Trustee will hold 4,943,648 ordinary shares, all
of which are held on behalf of eligible employees pursuant to the terms of the
Plan.

The number of ordinary shares purchased on this date on behalf of the executive
directors were as follows:

Sir John Rose    53

C H Green        53

A B Shilston     53

Company notified 8 September 2004

Dated 8 September 2004

For further information please contact John Warren, Deputy Company Secretary,
Rolls-Royce Group plc, tel. no. 01332 245878