saab half-year report 2010 · their fokker 50 fleet successful support and maintenance of the sk60...

HALF-YEAR REPORTJANUARY - JUNE 2010

CEO ÅKE SVENSSON, CFO LARS GRANLÖF23 JULY, 2010INTERIM REPORT, PRESS AND ANALYST MEETING

JANUARY – JUNE 2010Increased order bookings, but still delays in customer decision making processesSales at expected levelStrong operating cash flow as a result of business activities being delivered according to planProfitability negatively impacted by a terminated contract and lower capacity utilization pending larger ordersAs a consequence, we change our outlook for 2010

STRENGTHENING THE COMPANY

Efficiency improvements• Billion+ programme according to plan• Programme reaches its final phase, continuous

improvements will follow

Strategy• Stronger market focus• More focused business portfolio• Further increased efficiency

1,500

250

600

650

2009 2010 201120082007

Billion+ programme,cost reduction plan (MSEK)

AERONAUTICS

Order from FMV for delivery of tactical unmannedaerial vehicle system Order from FMV for further development of Gripen’sreconnaissance system and continuous support of Gripen’s operational capacity

Shadow 200 from AAI Corporation

Saabs first aircraft B17 turns 70 and Swedish aviation celebrates 100 years

GRIPEN EXPORT OPPORTUNITIES

COMMERCIAL AERONAUTICS

DYNAMICS

Two separate component orders for Carl-GustafLuxembourg new customernation for NLAW – fourth nation to choose NLAWLargest multispectral camouflage order so far (MSEK 670) receivedin July

RAPID 3D MAPPING ORDER FROM FMV

ELECTRONIC DEFENCE SYSTEMS

Order from Australian defencemateriel organisation for the Giraffe AMB radar system and related servicesDelivery of Giraffe AMB to UK Order from FMV for development of future avionics systems for Gripen

SECURITY AND DEFENCE SOLUTIONS

Order for combat management system for next generation Swedish submarinesOrder for combat management and fire control systems for the Finnish Navy’s Rauma class missile boatsCivil security order, significant breakthrough on the central European marketTermination of OKG contract, additional reservation of MSEK 150 in Q2

PROGRESS IN AEW PROGRAMMES

SUPPORT AND SERVICES

Component maintenance agreement with Avia Express for their Fokker 50 fleetSuccessful support and maintenance of the SK60 trainingaircraft for the Swedish Armed Forces

CHANGED OUTLOOK 2010

We remain cautious regarding order intake and foresee sales and profitability at about the same level as 2009. Our long-term financial targets remain.

NEW CEO FOR SAAB

Saab’s new President and CEO Håkan Buskhetakes office 1 September

JANUARY - JUNE 2010FINANCIALS

LARS GRANLÖF23 JULY, 2010FINANCIALS, JANUARY - JUNE 2010

ORDER BOOKINGS AND ORDER BACKLOG

Jan-June Jan-June 30 JuneMSEK 2010 2009 2010

Aeronautics 3,529 1,468 15,603Dynamics 1,760 1,789 6,597Electronic Defence Systems 1,849 1,002 6,906Security and Defence Solutions 1,708 2,742 7,109Support and Services 1,887 1,469 4,339Corporate/Internal -217 -374 -1,695Saab Group 10,516 8,096 38,859

Order Order Orderbookings bookings backlog

ORDER BACKLOG

NLAW

RBS70

AT4/Carl-Gustaf

Tornado

ANZAC

Civil security

solutions

Airborne surveillance

system

Order backlog duration(SEK billion):

2010: 10.6 2011: 12.5 2012: 6.32013: 3.5After 2013: 6.0

Total: 38.9

SALES

AeronauticsDynamicsElectronic Defence SystemsSecurity and Defence SolutionsSupport and Services Corporate/InternalSaab Group

Jan-June Jan-JuneMSEK 2010 2009 Change

3,4012,1532,0992,6271,577-480

11,377

3,9562,1552,0872,3991,780-682

11,695

-14%0%1%

10%-11%

-3%

OPERATING INCOME, EBIT

Aeronautics 71 2.1% 4.6% -41 -1.0% 1.5% Dynamics 259 12.0% 11.5% 169 7.8% 7.8% Electronic Defence Systems 151 7.2% 7.2% 75 3.6% 3.6%Security and Defence Solutions -202 -7.7% -7.1% 105 4.4% 4.4%Support and Services 175 11.1% 11.1% 215 12.1% 12.1%Corporate -52 99

Saab Group 402 3.5% 4.5% 622 5.3% 4.9%

Jan-June adj. Jan-June adj.MSEK 2010 margin margin 2009 margin margin

INCOME STATEMENT

Sales 11,377 11,695Cost of goods sold -8,665 -8,658Gross income 2,712 3,037Gross margin 23.8% 26.0%Other operating income 81 73Marketing expenses -868 -890Administrative expenses -587 -664Research and development costs -851 -841Other operating expenses -76 -40Share of income inassociated companies -9 -53Operating income 402 622Operating margin 3.5% 5.3%Share of income inassociated companies 24 1Result from financial investments -116 -260Income before taxes 310 363Taxes -64 -98Net income 246 265

Jan-June Jan-JuneMSEK 2010 2009

Earnings per share after dilution, SEK 2.25 2.46Tax rate 21% 27%

STATEMENT OF FINANCIAL POSITION

30 June 31 Dec ChangeMSEK 2010 2009

AssetsFixed assets 13,714 14,110 -396Current assets 15,267 16,320 -1,053 Total assets 28,981 30,430 -1,449

Shareholders’ equity and liabilitiesShareholders’ equity 10,930 10,682 248Long-term liabilities 4,522 4,468 54Short-term liabilities 13,529 15,280 -1,751Total liabilities 18,051 19,748 -1,697Total shareholders’ equity & liabilities 28,981 30,430 -1,449

Equity/assets ratio 37.7% 35.1%

Total net liquidity/debt(-) 1,359 -634 1,993

SUMMARISED CASH FLOW JANUARY-JUNE 2010

Cash flow from operations 1,186 89 1,275 959

Inventories -213 45 -168 -584Receivables 1,184 -50 1,134 575Advances 111 - 111 -51Liabilities 149 -183 -34 -764Provisions -173 32 -141 -178Change in working capital 1,058 -156 902 -1,002

Intangible assets -30 - -30 -58Tangible assets -96 - -96 -105Lease assets -1 42 41 48Acquisitions - - - -66Divestments - 133 133 9Acq/sales of financial assets 1 7 8 -28Cash flow from investments -126 182 56 -200

Operating cash flow 2,118 115 2,233 -243

ActualMSEK Saab SAL/M&A 2010 2009

APPENDIX

AERONAUTICS – HIGHLIGHTS

Jan-Jun Jan-Jun Jan-DecMSEK 2010 2009 %-change 2009

Order bookings 3,529 1,468 140 3,417Split between larger orders > MSEK 100 and smaller orders 91/9 72/28 - 79/21

Order backlog 15,603 17,179 -9 15,476Sales 3,401 3,956 -14 7,571Operating income/loss 71 -41 - 6Operating margin, % 2.1 -1.0 0.1

Operating cash flow 262 -475 - -434Number of employees 2,941 3,065 -4 3,015


Order bookings 3,529 1,468 140 3,417Split between larger orders > MSEK 100 and smaller orders 91/9 72/28 - 79/21

Order backlog 15,603 17,179 -9 15,476Sales 3,401 3,956 -14 7,571Operating income/loss 71 -41 - 6Operating margin, % 2.1 -1.0 0.1

Operating cash flow 262 -475 - -434Number of employees 2,941 3,065 -4 3,015

30%

Order bookingsSales Backlog

46%

8%

63%

Sales, % of total

Markets outsideSweden

89%

Split Defence/Civil

% of sales

DYNAMICS - HIGHLIGHTS

Jan-Jun Jan-Jun Jan-DecMSEK 2010 2009 %-change 2009Order bookings 1,760 1,789 -2 3,133Split between larger orders 68/32 28/72 - 20/80> MSEK 100 and smaller orders

Order backlog 6,597 8,103 -19 6,980Sales 2,153 2,155 - 4,580Operating income 259 169 53 269Operating margin, % 12.0 7.8 5.9

Operating cash flow 590 -75 - 369Number of employees 1,614 1,781 -9 1,739

Jan-Jun Jan-Jun Jan-DecMSEK 2010 2009 %-change 2009Order bookings 1,760 1,789 -2 3,133Split between larger orders 68/32 28/72 - 20/80> MSEK 100 and smaller orders

Order backlog 6,597 8,103 -19 6,980Sales 2,153 2,155 - 4,580Operating income 259 169 53 269Operating margin, % 12.0 7.8 5.9

Operating cash flow 590 -75 - 369Number of employees 1,614 1,781 -9 1,739

19%


74% 84% 91%

Sales, % of total


94%

Split Defence/Civil

% of sales

ELECTRONIC DEFENCE SYSTEMS


Order bookings 1,849 1,002 85 2,625Split between larger orders 36/64 18/82 - 49/51> MSEK 100 and smaller orders

Order backlog 6,906 8,374 -18 7,159Sales 2,099 2,087 1 4,670Operating income 151 75 101 24Operating margin, % 7.2 3.6 0.5

Operating cash flow 327 168 95 506Number of employees 2,527 2,632 -4 2,601



Order backlog 6,906 8,374 -18 7,159Sales 2,099 2,087 1 4,670Operating income 151 75 101 24Operating margin, % 7.2 3.6 0.5

Operating cash flow 327 168 95 506Number of employees 2,527 2,632 -4 2,601

15%


62% 52% 72%

Sales, % of total


Split Defence/Civil

% of sales 99%

SECURITY AND DEFENCE SOLUTIONS HIGHLIGHTS


Order bookings 1,708 2,742 -38 6,045Split between larger orders 33/67 47/53 - 41/59

> MSEK 100 and smaller orders

Order backlog 7,109 7,944 -11 7,746Sales 2,627 2,399 10 5,800Operating income -202 105 - 278Operating margin, % -7.7 4.4 4.8

Operating cash flow 688 370 - -217Number of employees 2,564 2,518 2 2,568


Order bookings 1,708 2,742 -38 6,045Split between larger orders 33/67 47/53 - 41/59

> MSEK 100 and smaller orders

Order backlog 7,109 7,944 -11 7,746Sales 2,627 2,399 10 5,800Operating income -202 105 - 278Operating margin, % -7.7 4.4 4.8

Operating cash flow 688 370 - -217Number of employees 2,564 2,518 2 2,568

23%


75% 84%80%

Markets outside Sweden

Sales, % of totalSplit Defence / Civil

% of sales

70%

SUPPORT AND SERVICES - HIGHLIGHTS



Order backlog 4,339 3,143 38 4,011Sales 1,577 1,780 -11 3,564Operating income 175 215 -19 410Operating margin, % 11.1 12.1 11.5

Operating cash flow 406 -88 - 81Number of employees 1,763 1,765 - 1,749



Order backlog 4,339 3,143 38 4,011Sales 1,577 1,780 -11 3,564Operating income 175 215 -19 410Operating margin, % 11.1 12.1 11.5

Operating cash flow 406 -88 - 81Number of employees 1,763 1,765 - 1,749

13%


28%

14%

29%

Markets outside Sweden

Sales, % of totalSplit Defence / Civil

% of sales

75%

SALES BY MARKET

45%

30%

9%

6%

6%4%

Air Land

Naval Civil Security

Commercial Aeronautics Others

Jan-June 2010

OPERATING INCOME, EBIT/EBITDA

Aeronautics EBIT 71 2.1% -41 -1.0%EBITDA 194 5.7% 82 2.1%

Dynamics EBIT 259 12.0% 169 7.8%EBITDA 337 15.7% 259 12.0%

Electronic Defence Systems EBIT 151 7.2% 75 3.6%EBITDA 413 19.7% 342 16.4%

Security & Defence Solutions EBIT -202 -7.7% 105 4.4%EBITDA -137 -5.2% 155 6.5%

Support & Services EBIT 175 11.1% 215 12.1%EBIDA 183 11.6% 223 12.5%

Corporate EBIT -52 99EBITDA 8 152

Saab Group EBIT 402 3.5% 622 5.3%EBITDA 998 8.8% 1,213 10.4%

Jan-Jun Jan-JunMSEK 2010 margin 2009 margin

COMPREHENSIVE INCOME

Net income for the period 246 265

Other comprehensive income:Translation differences for the period 97 292Net gain/loss on cash flow hedges 147 313Share of other comprehensive income in associated companies 1 21Tax attributable to comprehensive income -39 -85

Other comprehensive income for the period 206 541

Net comprehensive income for the period 452 806

Jan-Jun Jan-JunMSEK 2010 2009

OPERATING CASH FLOW VS STATEMENT OF CASH FLOW

Operating cash flow 2,233 -243

Cash flow from financing:Loans amortized/raised -1,932 604Dividend -237 -187Share repurchase - -

Cash flow from investments –interest bearing:Short-term investments 111 -Other financial investments 14 190

Statement of Cash flow 189 364

Jan-Jun Jan-JunMSEK 2010 2009

30 Jun 31 DecMSEK 2010 2009 Change

AssetsIntangible fixed assets 6,742 7,108 -366Tangible fixed assets 3,130 3,174 -44Lease assets 1,422 1,464 -42Biological assets 255 256 -1Investment properties 236 25 211Shares in associated companies 360 356 4Financial investments 93 116 -23Long-term receivables 1,357 1,327 30Deferred tax assets 119 284 -165Total fixed assets 13,714 14,110 -396

Inventories 4,942 4,698 244Derivatives 1,041 1,002 39Tax receivables 33 43 -10Accounts receivable 2,393 2,837 -444Prepaid expenses and accrued income 1,030 705 325Other receivables 3,694 4,696 -1,002Liquid assets and short-term investments 2,134 2,014 120Total current assets 15,267 15,995 -728Assets held for sale - 325 -325Total assets 28,981 30,430 -1,449


30 Jun 31 DecMSEK 2010 2009 Change

Shareholders’ equity and liabilitiesParent Company´s shareholders’ interest 10,766 10,542 224Non-controlling interest 164 140 24Total shareholders´ equity 10,930 10,682 248Long-term interest-bearing liabilities 1,114 1,126 -12Other liabilities 318 287 31Provision for pensions 4 4 0Other provisions 2,278 2,146 132Deferred tax liabilities 808 905 -97Total long-term liabilities 4,522 4,468 54

Short-term interest-bearing liabilities 631 2,519 -1,888Advance payments from customers 564 442 122Accounts payable 1,266 1,730 -464Derivatives 1,407 1,181 226Tax liabilities 253 212 41Other liabilities 700 746 -46Accrued expenses and deferred income 8,037 7,668 369Provisions 671 753 -82Total current liabilities 13,529 15,251 -1,722Liabilities related to assets held for sale - 29 -29Total shareholders’ equity and liabilities 28,981 30,430 -1,449

Equity/assets ratio,% 37.7 35.1


STATEMENT OF FINANCIAL POSITION, JUNE 30, 2010 SUBDIVIDED

Saab Aircraft Elimi- SaabMSEK Saab Leasing nations GroupIntangible assets 6,742 - - 6,742Tangible assets 3,621 - - 3,621Lease assets 5 1,417 - 1,422Long-term interest-bearing receivables 544 - - 544Shares, etc 1,919 - -1,500 419Other long-term receivables 832 15 - 847Deferred tax assets - 229 -110 119Inventories 4,924 18 - 4,942Short-term interest-bearing receivables 430 1,541 -1,541 430Other current assets 6,621 99 - 6,720Derivatives 1,041 - - 1,041Liquid assets and short-term investments 2,119 15 - 2,134Total assets 28,798 3,334 -3,151 28,981Shareholders’ equity 10,859 1,571 -1,500 10,930Provision for pensions 4 - - 4Other provisions 2,050 899 - 2,949Deferred tax liabilities 918 - -110 808Interest-bearing liabilities 3,286 - -1,541 1,745Advance payments from customers 564 - - 564Derivatives 1,407 - - 1,407Other liabilities 9,710 864 - 10,574Total shareholders’ equity & liabilities 28,798 3,334 -3,151 28,981

CHANGES IN SHAREHOLDERS EQUITY

Capital Other Net res. Translation Revaluation Retained Total excl.stock capital on cash f. reserve reserve earnings non-.

contr. Hedges controlling intr.

Opening balance, 1 January, 2010 1,746 543 84 -21 51 8,139 10,542

Net comprehensive income for the period 100 91 246 437

Transactions with shareholders:

Dividend -237 -237

Repurchase of shares - -

Share matching plan 23 23

Purchase and sale of non-controlling interest 1 1

Closing balance, 30 June, 2010 1,746 543 184 70 51 8,172 10,766

NET LIQUIDITY / NET DEBT

AssetsShort-term investments 440 551Liquid assets 1,694 1,463Interest-bearing receivables 974 1,001Total liquid investments 3,108 3,015

LiabilitiesLong-term interest-bearing liabilities -1,114 -1,126Short-term interest-bearing liabilities -631 -2,519Provisions for pensions -4 -4Total interest-bearing liabilities -1,749 -3,649

Total net liquidity/debt (-) 1,359 -634

30 Jun Year-EndMSEK 2010 2009

LIQUIDITY

Liquid investments at the beginning of the year 1,463

Operating cash flow 2,233Financial investments 125Loans raised/amortised -1,932Share repurchase -Dividend to shareholders -237Other changes, translation differencies etc 42

Liquid investments June 30 1,694

MSEK 2010

NUMBER OF EMPLOYEES

Jun 30 Dec 31MSEK 2010 2009 Change

Aeronautics 2,941 3,015 -74Dynamics 1,614 1,739 -125Electronic Defence Systems 2,527 2,601 -74Security & Defence Solutions 2,564 2,568 -4Support & Services 1,763 1,749 14Corporate 1,435 1,487 -52Saab Group 12,844 13,159 -315

APPENDIX

Quarterly information Q1 and Q2 2010 and 2009

Jan-Mar Jan-Mar April-Jun April-JunSales 2010 2009 2010 2009Aeronautics 1,703 1,843 1,698 2,113Dynamics 986 1,005 1,167 1,150Electronic Defence Systems 940 988 1,159 1,099Security and Defence Solutions 1,200 1,060 1,427 1,339Support and Services 743 814 834 966Corporate 219 226 233 304Internal sales -407 -524 -525 -688Total 5,384 5,412 5,993 6,283

Operating incomeAeronautics 53 3.1% 3 0.2% 18 1.1% -44 -2.1%Dynamics 85 8.6% 75 7.5% 174 14.9% 94 8.2% Electronic Defence Systems 37 3.9% 27 2.7% 114 9.8% 48 4.4% Security and Defence Solutions -96 -8.0% 11 1.0% -106 -7.4% 94 7.0%Support and Services 56 7.5% 103 12.7% 119 14.3% 112 11.6%Corporate -9 -69 -43 168Total 126 2.3% 150 2.8% 276 4.6% 472 7.5%

saab half-year report 2010 · their fokker 50 fleet successful support and maintenance of the sk60...

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