Investors in British engineering giant Rolls-Royce look to be in for a bumpy ride in the weeks ahead after the new boss described the group as a "burning platform" and said the company's performance is "unsustainable".
The shares closed down 3.61% on Friday at 109.38p, compared with a 2014 high of 436p.
Stock market watchers hoping for a quick turnaround in the firm's fortunes in the days ahead will be disappointed - shares were still below the 110p mark shortly after opening this morning.
Tufan Erginbilgic, a former executive at oil giant BP, had told staff last week that they faced a "last chance" to change.
"Every investment we make, we destroy value," he told employee.
Rolls-Royce told the BBC on Friday that Mr Erginbilgic had been "honest about our financial underperformance" compared to others.
Rolls-Royce is one of the UK's flagship companies. Its engines and systems are on planes such as the Airbus A350 and Boeing 787.
Air travel woes
It was one of many firms hit hard by the Covid pandemic when air travel was grounded for months and it axed 9,000 jobs.
But, in a broadcast to staff, Mr Erginbilgic said Rolls-Royce had "not been performing for a long, long time".
The ex-oil executive added that the company was a "burning platform"- meaning it is imperative to get out of the situation it finds itself in.
"It has nothing to do with Covid, let's be very clear. Covid created a crisis, but the issue in hand has nothing to do with it," Mr Erginbilgic said. "Given everything I know talking to investors, this is our last chance."
Mr Erginbilgic took over as chief executive of Rolls-Royce from Warren East, who led the firm for eight years, earlier this month.
He is charged with significantly improving the performance of the company, which analysts have said is often less profitable than US rival General Electric in the aircraft sector.
Huge losses
Mr East had said in 2021 that company was "set it on track for growth in the future" and that the worst times were behind, after huge losses of £4billion in 2020. led to thousands of job cuts.
The new boss stressed to staff he was convinced he could improve the company, but warned employees needed to "think differently, act differently, make a difference so this business corrects itself and we don't have much time".
A spokesman for Rolls-Royce said Mr Erginbilgic "laid out his priorities for all of us and stressed the need for everyone within the business to work together in order for Rolls-Royce to succeed".
One analyst said: "People might start to think what have you seen that we don't know."
Mr Erginbilgic looks to have a tough task ahead.
"The challenge is that there may not be easy solutions," said George Zhao, an analyst at Bernstein.
"Many rounds of restructuring and asset sales were already undertaken under prior chief executive Warren East, putting to question just how much more can be implemented."
Britain owns a golden share in Rolls-Royce, meaning the government can block a takeover. The arrangement reflects the importance of the company to the UK's military capability.
FTSE 100
The UK's top share index, the FTSE 100, was down 40 points at 7,724 shortly after opening this morning, following Friday's four-point gain.
Brent crude futures were down 0.68% at $86.07.
Companies reporting today
- Trading update: Computacenter