Re Contract

Tuesday 2 October 2007

                 US NAVY RENEWS ROLLS-ROYCE POWER BY THE HOUR                  
             T-45 TRAINER ENGINE SUPPORT WITH $66 MILLION CONTRACT             

The US Navy has renewed its engine services contract with Rolls-Royce to
provide support for the F405 engines which power T-45 training aircraft. The
contract is worth $66 million to Rolls-Royce and is the fifth year of a
five-year agreement.

Rolls-Royce, the sole provider of logistics support for the F405 (Adour) engine
within the US Navy inventory, has exceeded engine availability targets since
the programme began, supporting the US Navy's intermediate and advanced
training mission.

The US Navy has praised the effectiveness of this innovative services
programme, which has also met all performance metrics since its inception. The
contract has been developed in line with commercial Power By The Hour
agreements under a fixed price per engine flight hours.

Rolls-Royce provides all engine maintenance, support, trouble-shooting, parts
supply and logistics coverage for more than 185 aircraft operating at Naval Air
Stations in Meridian, Miss., and Kingsville, Texas.

The contract is administered by the Naval Air Systems Command (NAVAIR) at NATC
Patuxent River and the work is split between Meridian and Kingsville, Texas,
along with some functions at Patuxent River, Md. Rolls-Royce employs 110 
maintenance, supply and management personnel across five locations in support 
of this programme.

David Waggoner, President - Rolls-Royce Defense Services, said: "Rolls-Royce is
proud of its partnership with the US Navy in support of their training mission.
Under our commercial performance-based logistics arrangement, we work together
with the Navy and their airframe CLS provider to ensure availability objectives
are achieved. I'm proud to say we've exceeded this objective since day one, and
we're looking forward to another successful year."


NOTE TO EDITORS

 1. The T-45 is used for intermediate and advanced portions of the Navy-Marine
    Corps pilot training programme for jet carrier aviation and tactical strike
    missions. It is scheduled to remain in service with the Navy until 2035. As
    the primary jet trainer for the Chief of Naval Air Training (CNATRA), the
    T-45 is used to produce approximately 350 strike aviators per year for the
    F/A-18, EA-6B, E-2C, and S-3B pipelines.
   
 2. The T-45 F405 contract is distinguished from other military services
    contracts in that it is truly Power By The Hour - a single contract line
    item number is used to pay a fixed price per aircraft flight hours.
    Contract performance is measured almost exclusively against the
    fleet-driven performance metric of ready for issue engine availability.
   
 3. The F405 is the US designation of the Adour engine which powers the trainer
    fleet. Over 2,800 Adours have been delivered to date, clocking up well over
    seven million flying hours. Rolls-Royce manufactures the engines in
    partnership with Turbomeca.
   
 4. Rolls-Royce, the world-leading provider of power systems and services for
    use on land, at sea and in the air, operates in four global markets - civil
    aerospace, defence aerospace, marine and energy.
   
 5. Rolls-Royce has a broad customer base comprising nearly 600 airlines, 4,000
    corporate and utility aircraft and helicopter operators, 160 armed forces
    and more than 2,000 marine customers, including 70 navies. The company has
    energy customers in nearly 120 countries. Rolls-Royce employs around 36,000 
    people, of which 22,000 are in the UK. Forty per cent of its employees are 
    based outside the UK - including nearly 5,000 in the rest of Europe and 
    nearly 8,000 in North America.

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Mark Alflatt
Director - Financial Communications
Tel: [phone]