Rolls-Royce has warned that its future could be at risk if the Covid downturn becomes even more severe, after plunging to a record £5.4bn half-year loss.
The pre-tax loss for the six months to June included an almost £1.5bn hit from currency movements as markets swung violently when the pandemic struck.
Revenues sank by a quarter to £5.6bn following a collapse in air travel which crushed demand for the firm's engines, and Rolls also announced its finance chief has got a new job.
Bosses are now fighting to raise £2bn by selling assets including their ITP Aero division, which makes parts for the Eurofighter Typhoon.
Analysts at JP Morgan said: "Only a very major capital raise would put [Rolls] on a sound footing."
Rolls warned that if the economy fails to recover from Covid, its future could be at risk. The business said that in a "severe but plausible downside scenario", uncertainties over the severity and duration of the disruption caused by the pandemic "represent material uncertainties that may cast significant doubt on the group’s ability to continue as a going concern".
Chief executive Warren East said: "While our actions have helped to secure the group's immediate future, we recognise the material uncertainties resulting from Covid-19 and the need to rebuild our balance sheet for the longer term.
"Our view is that we’re exploring a range of options. We’re not in a great hurry because we have the liquidity and won’t be forced to do anything too quickly."
On a grim day for the FTSE 100 firm, chief financial officer Stephen Daintith also announced he was leaving to join online grocer Ocado - piling further pressure on Mr East as he fights to push through the biggest turnaround plan in Rolls' history. Mr Daintith was previously finance director at Daily Mail owner DMGT.
Mr East said: "Obviously I can’t possibly pretend that I wasn’t disappointed [about Mr Daintith's departure] because Stephen has given us three years of absolute dedication.
"As an individual, and as a human being, he’s entitled to make these decisions and there’s no doubt about it, the opportunity he’s got is a good one."
The company has been hammered by a near-total halt to global air traffic, sending its shares to their lowest levels in a decade and valuing the company at just £5bn – a third of the level it was at one year ago.
Shares slumped more than 7pc on Thursday, before reversing their losses to close up 1.4pc at 256.5p.
Rolls also said that underlying free cash flow – a measure of how much money the company has after expenses and one of its key metrics – came in at negative £2.8bn, down from negative £429m for the same period last year.
Engine flying hours, another key marker of performance, were down by 75pc in the second quarter.
Rolls builds engines for widebody aircraft such as the Airbus A350 and A330 and Boeing’s 787 Dreamliner. The firm has been seeking looked to shore up its finances by cutting its foreign exchange trading book and axing 9,000 jobs.
On Thursday, it said that 4,000 people have already left the business, with at least 5,000 more expected to go before the end of the year.
The firm said the revaluation of its foreign exchange trading book led to a £2.6bn hit during the period.
Sources said last month that Rolls is in talks with private equity houses about a potential sale of ITP, its engine parts business based in Spain, while the company has hinted it is also looking at other options including a fundraising.
The Government has a "golden share" in Rolls that gives it the ultimate say in the event of a takeover, a legacy from when the company was nationalised in 1971 after running into financial trouble developing an advanced new engine.
It prevents a foreign power gaining control over the firm's sensitive work on jet engines for military aircraft and nuclear power plants for submarines.
Analysts at Jefferies said much depends on how engine flying hours unfold for Rolls, adding that the firm will do whatever it takes to protect shareholder value.