INTERIM REPORT JANUARY – MARCH 2012 PRESIDENT AND CEO HÅKAN BUSKHE, INTERIM CFO GÖRGEN JOHANSSON 19 APRIL, 2012 Q1 REPORT
SUMMARY JAN-MARCH 2012 (I) High interest in cost-efficient products and solutions Local market expansion continues, increased order intake in North America and high activity level in Asia Stable level of medium and small orders Sales growth in rather weak market conditions Efficiency improvement activities contributed to increased profitability Focus on cash-flow generation is a priority
SUMMARY JAN – MARCH 2012 (II) Important orders secured • FMV (the Swedish Defence Materiel Administration) placed an order for system maintenance regarding Gripen. • The U.S. Federal Aviation Administration (FAA) selected Saab Sensis Corporation for the Airport Surface Surveillance Capability (ASSC) program • A two-year extension contract was signed for the Deployable Tactical Engagement Simulation training system (DTES) with the UK Ministry of Defence • After the closing of the period, extension for the life of the programme for deliveries of Ailerons to Airbus 320 In Sweden, Armed Forces presented intention to upgrade the fighter aircraft fleet to Gripen E/F and gave a clear commitment to Gripen as the backbone of the Swedish Air Force Switzerland reconfirmed the commitment to their 2011 down selection of Gripen for further negotiations for a potential order PAGE 3
CHALLENGING MARKET CONDITIONS The Market place Continued challenging market conditions even though the situation Defending borders is now better than during the second half of 2011 Government budgets in Europe and the US under pressure Political interest in Europe to co- operate in the field of research and Securing functions development and defence material in the society PAGE 4
HIGHLIGHTS JAN – MAR 2012, I (II) ELECTRONIC DEFENCE SYSTEMS DYNAMICS AERONAUTICS Hungary extended their Gripen Several important export Order on naval radar contract with FXM for another orders received in the Ground system Sea Giraffe for ten years Combat Systems area US Navy's Littoral Combat Ship The Supreme Commander Growing global market interest announced that the fighter and good order intake in Order for support of ground aircraft fleet in Sweden needs Signature Management area based surveillance radar at least 60-80 upgraded system Giraffe for British For the first time ever in Gripen to Gripen E/F Army Sweden, possibly in the Neuron ready to start ground world, an autonomous Successful test of new high testing underwater vehicle (AUV) speed directed launcher – docked with a submarine important milestone in the The biggest Gripen exercise with the help of a remotely development of LEDS ever, Lion Effort, with aircraft operated underwater from four countries took place in vehicle, SUBROV Sweden PAGE 5
HIGHLIGHTS JAN – MAR 2012, II (II) SECURITY AND DEFENCE SUPPORT AND SERVICES COMBITECH SOLUTIONS Order from the Dutch authority Major support agreement Acquisition of Sörman Rijkswaterstaat regarding with Sikorsky Aerospace Information, to widen delivery of the AIS automatic Services regarding Combitech’s service offering identification system which will technical maintenance and within the information supply increase safety on the Dutch support for Sweden's chain waterways Black Hawk helicopters . Build-up of a development One of the main sponsors of A long term contract with centre in Trollhättan with 90 the 2nd edition Border American aircraft operator new employees so far Surveillance Conference in Silver Airlines Framework agreement to Brasilia and participating assist in the development of with speakers on common the Norwegian emergency operating picture for Border communications network, safeguarding Nødnett PAGE 6
JANUARY - MARCH Jan-Mar 2012 IN BRIEF 2012 Sweden International Jan-Mar Jan-Mar MSEK 2012 2011 Order bookings 4,000 5,215 Order backlog (BSEK) 35.7 41.0 62% Sales 5,573 5,452 Sales Operating income 398 368 Operating margin, % 7.1 6.7 Net income 265 277 Net cash position 5,260 3,833 64% 66% Order intake Operating cash flow -48 559 EPS, after dilution 2.56 2.56 PAGE 7
ORDERS PER MARKET REGION Africa Austr, etc JAN-MARCH 2012 7% 5% In percentage of total orders MSEK SE Asia 35% 3% 1,903 1,828 Americas 30% -25% RoE EU excl SE 1% 1,431 19% 465% 1,181 Jan - March 2012 -1% Jan - March 2011 756 749 -94% -17% 353 - 294 27% 207% 209 192 151 111 42 14 SE EU excl SE RoE Americas Asia Africa Austr., etc PAGE 8
SALES PER MARKET REGION Africa Austr, etc JAN-MARCH 2012 7% 5% In percentage of total orders MSEK SE 38% Asia 2,367 23% -10% Americas 2,122 9% EU excl SE RoE 17% 1% 11% 1,303 Jan - March 2012 1,172 Jan - March 2011 940 21% 780 66% -32% 545 527 23% - 371 318 254 208 -10% 56 62 SE EU excl SE RoE Americas Asia Africa Austr., etc PAGE 9
SALES PER MARKET SEGMENT JAN-MARCH 2012 Sales split per market January - March 2012 Comm. Others Sales Aeron. 4% MSEK -8% 5% 2,410 Civil 2,225 Security 22% Air 7% 1,938 40% Naval 9% 1,584 Land 35% Jan-March 2012 1% Jan-March 2011 522 515 52% -32% -22% 385 357 332 254 243 260 Air Land Naval Civil Security Comm. Aer. Others PAGE 10
PEOPLE ARE KEY FOR GROWTH Combitech opened development center in Trollhättan, with competence and skills to handle Strategic priorities complete construction commitments. 90 people recruited so far Group-wide trainee program started Saab acclaimed for active and succesful work with equality by Swedish business magazine ”Veckans Affärer” Continued work with competence development and performance management for current employees PAGE 11
OUTLOOK 2012 In 2012, we estimate that sales will increase slightly compared to 2011 The operating margin in 2012, excluding net material capital gains, is expected to be in line with the operating margin in 2011, excluding net material capital gains, of 7.5 per cent Strategic priorities PAGE 12
JANUARY - MARCH 2012 FINANCIALS Görgen Johansson, Interim CFO 19 APRIL, 2012 FINANCIALS, JANUARY - MARCH 2012
ORDERS RECEIVED Book-to-bill ratio (12 months rolling) 1,2 11,900 Large orders Small orders 1 Book-to-Bill ratio 0,8 MSEK 72% 0,6 5,478 5,215 5,431 5,114 5,038 0,4 4,000 3,862 46% 58% 43% 3,147 57% 57% 19% 18% 40% 0,2 81% 43% 43% 82% 28% 42% 54% 60% 57% 0 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
ORDER BOOKINGS AND ORDER BACKLOG Order Order Order backlog bookings bookings Jan-Mar Jan-Mar 31 Mar MSEK 2012 2011 2012 Aeronautics 817 963 12,489 Dynamics 554 1,528 4,977 Electronic Defence Systems 520 1,234 6,204 Security and Defence Solutions 1,247 777 7,609 Support and Services 955 923 4,634 Combitech 246 242 358 Corporate/Internal -339 -452 -614 Saab Group 4,000 5,215 35,657
ORDER BACKLOG Order backlog duration (SEK billion): NLAW Mar. 2012 Mar. 2011 Dec. 2011 Airborne 2012: 14.3 2011: 14.2 2012: 17.7 Aero- surveillance structures system 2013: 9.3 2012: 11.5 2013: 8.4 2014: 5.2 2013: 6.1 2014: 4.8 2015: 3.1 2014: 4.4 2015: 2.7 RBS70 ANZAC After 2015: 3.8 After 2014: 4.8 After 2015: 3.6 AT4/ Civil Carl- security Total: 35.7 Total: 41.0 Total: 37.2 Gustaf solutions
SALES Jan-Mar Jan-Mar MSEK 2012 2011 Change Aeronautics 1,419 1,508 -6% Dynamics 1,035 962 8% Electronic Defence Systems 1,181 1,035 14% Security and Defence Solutions 1,323 1,303 2% Support and Services 779 907 -14% Combitech 311 239 30% Corporate/Internal -475 -502 Saab Group 5,573 5,452 2%
OPERATING INCOME, EBIT Jan-Mar Jan-Mar MSEK 2012 margin 2011 margin Aeronautics 78 79 5.5% 5.2% Dynamics 108 10.4% 89 9.3% Electronic Defence Systems 91 36 7.7% 3.5% Security and Defence Solutions 60 71 5.4 % 4.5% Support and Services 67 75 8.6% 8.3% Combitech 39 12.5% 28 11.7% Corporate -45 -10 Saab Group 398 368 7.1% 6.7%
INCOME STATEMENT Jan-Mar Jan-Mar MSEK 2012 2011 Sales 5,573 5,452 Cost of goods sold -3,999 -4,025 Gross income 1,574 1,427 Gross margin 28.2% 26.2% Other operating income 41 73 Marketing expenses -457 -398 Administrative expenses -275 -310 Research and development costs -479 -406 Other operating expenses -3 -12 Share of income in associated companies -3 -6 Operating income 398 368 Operating margin 7.1% 6.7% Share of income in associated companies 1 1 Result from financial investments -31 15 Income before taxes 368 384 Taxes -103 -107 Net income 265 277 Earnings per share after dilution, SEK 2.56 2.56 Tax rate 28% 28%
RESEARCH AND DEVELOPMENT MSEK Amortisation and write-down of 2-3 %-points capitalised development costs impact from Self funded R&D expenditures (not 588 changed view on including capitalised costs) application of 664 686 accounting principles 728 515 1,340 1 156 1 127 804 152 738 191 144 157 78 327 268 250 262 167 2007 2008 2009 2010 2011 Q1 2008 Q1 2009 Q1 2010 Q1 2011 Q1 2012 * Amortisation and write-down of capitalised development costs included write-downs of MSEK 250 in 2008 and MSEK 20 in the first quarter of 2010
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