Saab: year-end report 2016
Linkoping, Sweden - Order bookings, development projects, cash flow and future growth
Defence and security company Saab presents the results for 2016. Order bookings They were lower in 2016 than in 2015, when the company received orders for the new version of Gripen airplane to Brazil, a new generation of its airborne surveillance system, GlobalEye, and development of the A26 submarine. The order intake of smaller orders below MSEK 100 in 2016 was good with an increase of 3 per cent compared to 2015. The business area Dynamics strengthened its order backlog in 2016 in part through orders for the latest version of the Carl-Gustaf man-portable weapon system and the RBS 70 air defence system. In the fourth quarter, order bookings were somewhat lower than anticipated, as a major order in airborne surveillance systems was delayed until January 2017. Progress in development projects Important steps were taken in 2016 in several of the company’s major projects. In February, Saab presented GlobalEye. In May, Saab revealed the new version of Gripen and in September, Boeing and Saab presented the first two aircraft for the US Air Force’s T-X competition. The new trainer’s first flight was in December. Together with LFV, the Swedish air navigation service provider, Saab established a joint company during the year to develop market and operate remote air traffic control systems. There is great interest in these solutions around the world. Strong cash flow Operating income amounted to MSEK 1,797 (1,900) with an operating margin of 6.3 per cent (7.0). Adjusted for non-recurring items, operating income amounted to MSEK 1,782 in 2015 and the operating margin was 6.6 per cent. Today several major projects are in an early stage where they in most cases generate lower profits. Development of a new jet trainer together with Boeing has also affected operating income. The business areas Dynamics and Surveillance saw improvements in operating income thanks to increased deliveries and a change in product mix. A high priority in 2016 was the completion of the big development projects in the order backlog, which will continue in 2017. Operational cash flow was strong and amounted to MSEK 2,603 (-500), despite the fact that no receivables had been sold at the year-end 2016. Cash flow was bolstered by payments related to major projects during the year, as well as by a high level of activity in the business area Dynamics. Earnings per share after dilution amounted to SEK 10.60 (12.79). The Board of Directors proposes a dividend for 2016 of SEK 5.25 per share (5.00). Further growth The order backlog strengthened in the business area Dynamics in 2016. At year-end, all business areas had a strong order backlog, which puts us in a good position for a continued journey of growth in 2017.
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