Rolls-Royce reports $5.7bn loss following corruption cases in Nigeria & South Africa

Following Rolls-Royce’ passionate apology last month for the corruption case that centered around allegations that the group hired middlemen to broker lucrative deals in a number of countries including, Nigeria, South Africa and Angola the Engine-maker Rolls-Royce, today, has reported a record £4.6bn ($5.7bn) annual loss largely due to its pay of $808 million fine to affected countries authorities and currency depreciation.

Last year, Rolls-Royce and its agents company in Nigeria, PSL Engineering & Control tasked to supply gas turbines to power plants in the oil states of Bayelsa and Delta, were accused of various projects, especially to Oghareki power plant  in Delta that cost $100m but was never completed.

An investigation by the Guardian and the BBC had uncovered leaked documents and testimony from insiders that suggest that Rolls-Royce may have benefited from the use of illicit payments to key officials and politicians boost profits for years.

The Guardian/BBC investigation  called Panorama: revealed that Nigeria, Angola and South Africa were part of the 11 countries the company had hired middlemen.

The investigation also revealed Rolls-Royce  hired Fana Hlongwane, who is close to South Africa’s ANC government and in 2008 to help broker deals in the country.

Although,  Nigeria or South Africa are yet to get any amount from the agreement, the company revealed last month it has agreed to pay £671m  to settle corruption cases with UK, US and Brazilian authorities.

Rolls-Royce corrupt case in Nigeria, South Africa
FILE PHOTO – Warren East, CEO of Rolls-Royce, poses for a portrait at the company’s aerospace engineering and development site in Bristol, Britain, December 17, 2015. REUTERS/Toby Melville/File Photo

Chief executive Warren East took the helm in 2015 and has been tasked with turning round the struggling company.

East said: “While we have made a steady start, more remains to be done. The addition of new management and a renewed focus within the business leadership teams, with clear goals and stronger accountabilities, should provide a strong platform for further progress in 2017.”

He added he would reveal further plans about the firm’s direction later this year.

The business added that it must continue to make cost savings and “cultural and behavioural changes” in 2017.

East said: “These are essential if we are to become a more trusted, resilient company.”

Rolls-Royce is a luxury automobile driven by very influential Africans, politicians, businessmen and religious leaders, notably from Nigeria and South Africa.