Saab Year-End Report 2017
Saab presents the results for 2017.
Statement by the President and CEO Håkan Buskhe:
Strong order intake, continued growth
In 2017 geopolitical tensions were evident, and defence and security spending increased in much of the world. At the same time, it has become even more important to deliver effective systems in a short time.
Demand for and interest in Saab’s world-leading products and solutions are strong. In 2017, Saab strengthened its market position, at the same time that operating efficiency was improved.
Several important international collaborations were established that strengthen the local position in several countries. In Poland, for example, Saab selected the Nauta Shiprepair Yard to build the special purpose Signal Intelligence vessel for the Swedish Navy. In Australia, targeted market efforts led to the announcement that Saab has been identified by the government to provide the tactical interface to the Royal Australian Navy’s fleet of nine Future Frigates.
Order bookings
2017 was a strong year for Saab. Major orders were received in several areas and order bookings rose by 41 per cent to SEK 30.8 billion (21.8). Orders were received from among other areas Airborne Early Warning and Control and support and maintenance for Gripen C/D. We also received important orders for the development of next-generation products, including Sweden’s order for the development and production of the next generation of anti-ship missiles and a new signals intelligence vessel. Medium-sized orders increased as well, which is gratifying, since we have maintained a local focus for some time in our various markets to grow the base where we are active.
The order backlog amounted to SEK 106.8 billion (107.6) at the end of the year.
Sales growth and operating income
All business areas saw sales growth during the year and organic sales growth was 10 per cent.
Operating income amounted to MSEK 2,155 (1,797) with an operating margin of 6.9 per cent (6.3). In 2017 a number of efficiency improvement projects has been implemented within the company, where we for example focus on streamlining functional processes. Mainly the business area Dynamics and operations related to Airborne Early Warning and Control systems and support operations improved profitability in 2017.
In 2018, the focus on efficiency improvements will continue. This is an important factor for Saab to reach its long-term goal of a 10 per cent operating margin.
Operational cash flow amounted MSEK 1,388 (2,603) and during the year Saab received larger milestone payments related to large projects.
Earnings per share after dilution amounted to SEK 13.10 (10.60).
Outlook statement for 2018
Sales growth in 2018 is expected to be in line with Saab’s long-term goal: annual organic growth of 5 per cent.
The operating margin in 2018, excluding material non-recurring items, is expected to improve compared to 2017, bringing Saab a further step closer to its financial goal: an operating margin of 10 per cent over a business cycle.
Financial highlights
| MSEK | Full year 2017 | Full year 2016 | Change, % | Q4 2017 | Q4 2016 |
| Order bookings | 30,841 | 21,828 | 41 | 6,586 | 6,868 |
| Order backlog | 106,849 | 107,606 | -1 | ||
| Sales | 31,394 | 28,631 | 10 | 9,819 | 9,016 |
| Gross income | 7,448 | 6,883 | 8 | 2,405 | 2,451 |
| Gross margin, % | 23.7 | 24.0 | 24.5 | 27.2 | |
| EBITDA | 2,994 | 2,743 | 9 | 1,084 | 1,206 |
| EBITDA margin, % | 9.5 | 9.6 | 11.0 | 13.4 | |
| Operating income (EBIT) | 2,155 | 1,797 | 20 | 882 | 960 |
| Operating margin, % | 6.9 | 6.3 | 9.0 | 10.6 | |
| Net income | 1,438 | 1,175 | 22 | 519 | 639 |
| of which Parent Company’s shareholders’ interest | 1,407 | 1,133 | 24 | 517 | 624 |
| Earnings per share after dilution, SEK 1) | 13.10 | 10.60 | 4.81 | 5.82 | |
| Return on equity, % 2) | 10.4 | 9.0 | |||
| Operational cash flow | 1,388 | 2,603 | 2,146 | 681 | |
| Free cash flow | 852 | 2,359 | 1,772 | 619 | |
| Free cash flow per share after dilution, SEK | 7.93 | 22.07 | 16.47 | 5.78 | |
| 1) Average number of share after dilution | 107,400,920 | 106,906,726 | 107,590,836 | 107,167,229 |
2) Return on equity is measured over a rolling 12-month period.
For more information and explanations regarding the usage of these key ratios, please see http://saabgroup.com/investor-relations/financial-data/key-ratios/
Press and analyst meeting
Saab is pleased to invite to a press and analyst meeting, where CEO Håkan Buskhe and CFO Magnus Örnberg present the Saab Group 2017 year-end result.
Date: Friday, 16 February at 10:00 (CET)
Address: Grand Hôtel, Blasieholmshamnen 8, Stockholm, Sweden
Venue: New York
The report is published at 7.30 a.m. (CET) the same day.
You are welcome to participate on site at Grand Hôtel, watch the live webcast or dial in to the conference call. It is possible to post questions also over the web and conference call.
Live webcast:
http://saab-interimreport.creo.se/180216
Conference call:
Please dial in using one of the numbers below.
UK: +442030089814
US: +18557532237
SE: +46856642697
The interim report, the presentation material and the webcast will be available on http://www.saabgroup.com/en/InvestorRelations.
R.S.V.P
E-mail: marie.bergstrom@saabgroup.com
Tel: +46 8 463 02 45
For further information, please contact:
Saab Press Centre,
Ann Wolgers, Press Officer
+46 (0)734 18 70 52
presscentre@saabgroup.com
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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 16 February 2018 at 07.30 (CET).