Skip to content Go to main navigation Go to language selector

Saab's Results January - September 2020

Saab presents the results for January-September 2020 earlier than previously announced.

mj_pressrelease.jpg

Statement by the President and CEO Micael Johansson:

The corona pandemic has continued to impact the world negatively and not least the global aviation industry. For Saab, the uncertainty surrounding Covid-19 has mainly been associated with supply chain disruptions within the company’s business areas and the market conditions for the civil business. Due to the ongoing pandemic and drawn-out global recovery, Saab now sees an increased risk related to the effects of Covid-19.

In recent assessments, the future risks have increased foremost for business area Aeronautics. The prolonged pandemic and slow recovery is primarily affecting subcontractors and material supply for the Gripen E/F programme, with consequences for development, verification and production work.

The Gripen-programme is characterized by long lead times and small series where components must be certified for airworthiness, which means the assessment of future possible economic impact within Aeronautics has become increasingly uncertain. Saab has managed the increased risks by adjusting the project estimates, which affected the operating income negatively by SEK 1.1 billion in the quarter. Our view is that the risks in the supply chain for other business areas have also increased, but to a lesser extent, why an additional SEK 0.4 billion has been allocated for adjustments in other project estimates. Our assessments assumes that the effects of the pandemic will continue during 2021.

In connection with the interim report for the first quarter 2020, the outlook for organic sales growth and operating margin for the full-year could not be confirmed due to the great uncertainty caused by Covid-19. This still applies. The projection of a high delivery rate in the fourth quarter, including important milestone payments, have not changed, nor has our projection that operational cash flow for the full-year 2020 will be positive, excluding the state support package. Saab remains committed to its long-term financial goals in terms of growth and profitability.

Strong order bookings and continued internationalisation

In challenging times, Saab has continued to win important contracts. Order bookings increased by 8% in the quarter and by 27% in the first nine months of the year and amounted to SEK 24.2 billion (19.1). Small orders grew by 7% in the same period. During the first nine months, the work of developing the business in a more international direction has continued. In the United States of America, the establishment of local production capacity for the T-7 aircraft is progressing, and in connection with Australia’s order for Saab’s solution for deployable health modules, a global development centre is being established in the country.

Stable sales and profitability affected by Covid-19

Sales in the first nine months of 2020 amounted to SEK 22.9 billion (24.9). The lower volumes in the quarter were mainly due to Covid-19 related adjustments to project estimates and weak demand in civil aviation operations. Excluding adjustments to project estimates, sales were down 2% in the year’s first nine months. Operating income for the first nine months amounted to SEK 549 million (1,739). Items affecting comparability for the quarter includes capital gain from the divestment of Vricon SEK 1,0 billion, Covid-19 related adjustments to project estimates SEK 1,5 billion and provisions and write-downs SEK 0,6 billion. Excluding items affecting comparability, operating income amounted to SEK 1,657 million, equivalent to an operating margin of 6.8% (7.0).

Cash flow improvement in the quarter

Operational cash flow showed an improvement compared to the first nine months of 2019 and amounted to SEK -128 million (-4,356), thanks to several important deliveries during the year, including GlobalEye to the United Arab Emirates and Gripen E to Brazil.

Outlook statement for 2020

Due to uncertainty related to the scope and duration of COVID-19, it was stated in the first quarter interim report of 2020 that the previous forecast for the full-year 2020 could not be confirmed. Saab reiterates this assessment.

Financial highlights

MSEK Jan-Sep 2020 Jan-Sep 2019  Change, % Q3 2020 Q3 2019  Change, % Full Year 2019 
               
Order bookings 24,222 19,093 27 10,152 9,383 8 27,216
Order backlog 94,652 96,004 -1       93,293
Sales 22,940 24,855 -8 6,064 7,914 -23 35,433
Gross income 3,537 5,466 -35 -174 1,678 -110 8,035
Gross margin, % 15.4 22.0   -2.9 21.2   22.7
EBITDA 1,604 2,742 -42 -314 849 -137 4,305
EBITDA margin, % 7.0 11.0   -5.2 10.7   12.1
Operating income (EBIT) 549 1,739 -68 -663 518 -228 2,937
Operating margin, % 2.4 7.0   -10.9 6.5   8.3
Adjusted operating income ¹⁾ 1,657 1,739 -5 445 518 -14 2,937
Adjusted operating margin, % ¹⁾ 6.8 7.0   5.9 6.5   8.3
Net income 489 1,121 -56 -371 295 -226 2,025
of which Parent Company’s shareholders’ interest 475 1,100 -57 -380 269 -241 1,983
Earnings per share after dilution, SEK ²⁾ 3.55 8.21   -2.83 2.01   14.81
Return on equity, % ³⁾ 7.0 13.1         10.0
Operational cash flow -128 -4,356   -363 -1,654   -1,300
Free cash flow 698 -4,991   676 -1,865   -2,036
Free cash flow per share after dilution, SEK 5.21 -37.25   5.04 -13.95   -15.20
               
¹⁾ See note 5 for additional information regarding items affecting comparability              
²⁾ Average number of shares after dilution 133,861,996 133,994,725   134,048,466 133,702,351   133,929,292
³⁾ Return on equity is measured over a rolling 12-month period.              

Presentation of Saab’s results January – September 2020

The interim report, the presentation material and the webcast will be available on https://www.saab.com/investors

For further information, please contact:

Ann Wolgers, Press Officer
+46 (0)734 18 70 52
presscentre@saabgroup.com

Merton Kaplan, Head of Investor Relations
+46 (0)73 418 20 71

www.saabgroup.com
www.saabgroup.com/YouTube
Follow us on twitter: @saab

Saab serves the global market with world-leading products, services and solutions within military defence and civil security. Saab has operations and employees on all continents around the world. Through innovative, collaborative and pragmatic thinking, Saab develops, adopts and improves new technology to meet customers’ changing needs. 

The information is such that Saab AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, on 19 October 2020 at 08.10 (CET).