interim report q2 2020 - saab.com · q2 2016 q2 2017 q2 2018 q2 2019 q2 2020 sales 5% 317 347 458...

19
Saab interim report January-June 2020 Micael Johansson, President and CEO Thomas Hendel, Acting CFO 17 July, 2020

Upload: others

Post on 30-Sep-2020

15 views

Category:

Documents


0 download

TRANSCRIPT

Page 1: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

Saab interim reportJanuary-June 2020

Micael Johansson, President and CEOThomas Hendel, Acting CFO

17 July, 2020

Page 2: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

• Strong order growth of 45% in the first half

• Continued growth in small orders of 9%

• Organic growth of 5% in the second quarter

• Sales growth in 5 out of 6 business areas

Highlights, January-June 2020

2

Strong order growth

Solid performance

Execution highlights

• Earnings development in line with last year, strong performance in defence

• Cost reduction contributed positively

• Execution of major projects progressing according to plan

• Delivery of the first GlobalEye to UAE in April

• Saab’s new fighter AESA radar successfully completed air trials

• Successful tests with the Saab Lightweight Torpedo

• Start of production of Gripen E/F fighter at the new plant in Brazil

• Divestment of Vricon JV completed

• FCAS-UK partnership intensified in the quarter Saab Gripen C

Page 3: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

COVID-19 update

COVID-19 impact

• Limited impact on the defence related business

• Major programs progressing according to plan

• Tangible impact on civil business from the significant decline in

demand in the aviation industry

• Difficult to predict effect on future orders and supply chain

recovery

Actions being taken

• Capacity adjustments in operations impacted by lower volumes

due the downturn in the civil related business

• Implementation of shorter working hours, particularly in IPS

• Tight monitoring of the supply chain and secondary source

analysis to preserve operations

• Strengthened financial flexibility

• Withdrawal of dividend proposal at the AGM 2020

3

Page 4: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

Market highlights, Q2 2020

Market development

• Unchanged procurement programs with most customers

• Good market activity despite Covid-19 situation

• Decline in the commercial market affecting industry

Saab key orders Q2

• Contract signed for Saab’s airborne Erieye AEW&C radar

• Carl-Gustaf orders from the U.S., Latvia and Estonia

• Gripen support and maintenance orders from Sweden

• Support agreement for trainer aircraft SK60 for Sweden

• First order of life extension of the heavyweight torpedo

system to Sweden

• G/ATOR radar order from U.S.

4

Page 5: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

-2,702-3 000

-2 000

-1 000

0

1 000

Operational cash flow

Jan-Jun 2019 Jan-Jun 2020

235

0

5

10

15

Order bookings

Jan-Jun 2019 Jan-Jun 2020

Financial highlights, January-June 2020

5

0

5

10

15

20

Sales

Jan-Jun 2019 Jan-Jun 2020

1,221 1,212

1000

1100

1200

1300

1400Operating income

Jan-Jun 2019 Jan-Jun 2020

BS

EK

MS

EK

16.9 16.9

9.7

14.1

EBIT-

margin,% 7.27.2

BS

EK

MS

EK

Page 6: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

Quarterly development

6

MS

EK

MS

EK

7,0647,772 7,953

8,445 8,836

0

2000

4000

6000

8000

10000

Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020

Sales5%

317 347

458

630 652

0

100

200

300

400

500

600

700

Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020

Operating income

7.4%

EBIT

margin,% 4.5% 7.5%5.8%4.5%

10% 2%6%

6,848

10,853

6,5295,228

9,247

0

2000

4000

6000

8000

10000

12000

Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020

Order bookings

1,137

-1,429

-539-779

1,817

-2000-1500-1000-500

0500

100015002000

Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020

Operational cash flow

Page 7: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

Strategy and long term financial targets remain

7

• Innovation labs in prioritized technology areas

• Increased focus on cybersecurity

• Strategic workforce planning

• AI and 3D research projects

• Continuous cost efficiency measures

• Automation & digitalisation for increased productivity

• Reduced greenhouse gas emissions

• International expansion

• Strategic partnerships

• Local footprint in strategic markets

• Focus on optimizing the product portfolio

• Significantly increase R&D efficiency

• Resource efficiency through product life-cycle

Page 8: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

Financial SummaryThomas Hendel, Acting CFO

8

Page 9: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

MSEKJan-Jun

2020

Jan-Jun

2019

Change,

%

Order bookings 14,070 9,710 45

Order backlog 90,458 94,236 -4

Sales 16,876 16,941 0

Operating income 1,212 1,221 -1

Operating margin, % 7.2 7.2

Net income 860 826 4

Operational cash flow 235 -2,702

Free cash flow 22 -3,126

Financial summary, Jan-Jun 2020

• Solid performance in the defence related business

• Increased order intake of 45%, small orders up 9%

• Sales in the first six months at a stable level

• Organic growth of 5% in Q2

• Stable earnings with an operating margin of 7.2%

• Positive volume effect in defence

• Impact from cost reduction actions

• Improved cash flow in Q2

• Strong financial position and liquidity maintained

9

Page 10: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

Order backlog duration

10

End of June 2020 Year End 2019 End of June 2019

2020: 15,6 2020: 28.9 2019: 14.9

2021: 25.7 2021: 22.3 2020: 22.7

2022: 18.6 2022: 16.1 2021: 18.8

2023: 14.7 2023: 13.2 2022: 14.8

After 2023: 15.9 After 2023: 12.8 After 2022: 23.0

Total: 90.5 Total: 93.3 Total: 94.2

Aeronautics43%

Dynamics17%

Surveillance17%

S&S10%

IPS9%

Kockums4%

Order backlog per business area

Sweden30%

Rest of Europe

17%North America8%

Latin America

33%

Asia8%

Africa>1%

Australia etc3%

Order backlog per region

BSEK

Page 11: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

Order size distribution

0

0,5

1

1,5

2

2,5

3

3,5

0

5 000

10 000

15 000

20 000

25 000

30 000

35 000

40 000

45 000

50 000January-June 2020

MS

EK

Small orders = <MSEK 100, Large orders = >MSEK 100

Book-to-bill ratio calculated as 12 months rolling11

50% (67)

39% (33)

11% (0)

Small orders MSEK < 100

Medium-sized orders MSEK 100-1,000

Large orders > 1,000

Large orders

Medium sized orders

Small orders

Small orders Large orders

Small orders = <MSEK 100, Medium sized orders = MSEK 100-1,000,

Large orders = >MSEK 1,000

Page 12: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

• Strong order growth of 45%

• Both small and large orders contributed

• Growth driven by BA Dynamics,

Surveillance and Support & Services

0 500

1 0001 5002 0002 5003 0003 5004 0004 500

Aeronautics Dynamics Surveillance S&S IPS Kockums

Order bookings

Jan-June 2019 Jan-June 2020

Order bookings per business areaM

SE

K

0

10

20

30

40

50

60

Aeronautics Dynamics Surveillance S&S IPS Kockums

Order backlog

30 June 2019 30 June 2020

BS

EK

12 *Not including order bookings related to serial production of the TX trainer aircraft developed by Boeing and Saab for the U.S. Air Force. The U.S. Air Force has ordered the first

phase from Boeing, the EMD = Engineering and Manufacturing Development, intended to be followed by production orders.

*

Page 13: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

• Stable sales volumes y-o-y but stronger

Q2 in 5 out of 6 business areas

• High activity level across business areas

• Dynamics deliveries started to pick up

in the second quarter

• IPS downturn related to civil aviation,

slight increase in Combitech y-o-y

0

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

Aeronautics Dynamics Surveillance S&S IPS Kockums

Jan-Jun 2019 Jan-Jun 2020

Sales per business area

13

-2%

-2%

8%

1%

-8%

4%

MS

EK

Page 14: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

Operating income per business area

14

MS

EK

• Operating income affected by the

downturn in IPS

• Strong improvement in Dynamics and

Surveillance due to continued high

activity level and positive mix

• Aeronautics and Support & Services at

a high stable level, according to plan

• Productivity measures in Kockums

continue

363

273

303322

140

31

330 329

381

295

-54

51

- 100

- 50

0

50

100

150

200

250

300

350

400

450

500

Aeronautics Dynamics Surveillance S&S IPS Kockums

Jan-Jun 2019 Jan-Jun 2020

Operating

margin,%

8.28.9 11.59.3 10.0 11.112.2

-1.8

3.32.1

8.6 4.3

Page 15: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

MS

EK

15

Operational cash flow, Jan-Jun 2020

Cash flow from

operations

Change in

working capitalInvestments

• Improved cash generation, good

collection in the quarter

• Lower levels of working capital build up,

POC receivables starting to decrease

• Positive effect from deferral related to

tax and social fees

• Continued investments in fixed assets

and capitalized R&D expenses

• Further deliveries planned for 2020

• Continued ambition to generate positive

operational cash flow for 2020

+1,999

-210

-1,554

January – June 2020

Cash flow from

operationsChange in

working capitalInvestments

+1,168

+1,405

-756

April – June 2020

MS

EK

Page 16: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

MSEK

Net debt, 31 December 2019 -7,069

Cash flow from operating activities 1,776

Change in net pension obligation -112

Net investments -1,554

Other -401

Net debt, 30 June 2020 -7,360

Net pension obligation 4,834

Total interest-bearing receivables -463

Lease liabilities 2,526

Net debt excl. net provisions for pensions, lease

liabilities and interest-bearing receivables

-463

16

Financial position and maturity profile

• The cash buffer as of June 30: ~ 16 300 MSEK

• Liquidity: ~ 6 300 MSEK

• Committed unutilized credit facility: 10 000 MSEK 36.2%

Equity/Assets ratio

Page 17: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

Focus going forward

17

Execution and delivery of projects

Continue productivity

Secure targeted orders

Cash flow generation

Page 18: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

This presentation may contain forward-looking statements which reflect Saab AB’s current view on

future events and financial and operational development. Words such as “intend”, “expect”,

“anticipate”, “may”, “believe”, “plan”, “estimate” and other expressions which imply indications or

predictions of future development or trends, and which are not based on historical facts, are

intended to identify forward-looking statements. Forward-looking statements inherently involve both

known and unknown risks and uncertainties as they depend on future events and circumstances.

Forward-looking statements do not guarantee future results or development and the actual outcome

could differ materially from the forward-looking statements.

Important information

Page 19: Interim report Q2 2020 - saab.com · Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Sales 5% 317 347 458 630 652 0 100 200 300 400 500 600 700 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Operating

19

Q&A