JANUARY-MARCH
2017
26 April, 2017
Håkan Buskhe, President and CEO
Magnus Örnberg, EVP and CFO
2
HIGHLIGHTS JANUARY – MARCH 2017
Market demand high for defence and security
Leading technology and cost-efficient solutions
Overall performance in line with expectation
Strengthened order backlog compared to yearend 2016
Improved gross margin, operating margin and
positive cash flow generation
Additional order for GlobalEye in first quarter
Order for next generation anti-ship missile
Saab and Aalto University research agreement
Increased attractiveness among female
engineering student in Swedish ranking
3
ORDERS RECEIVED JAN-MAR 2017
4
FINANCIAL HIGHLIGHTS, JAN-MAR 2017
Order backlog
12
120
10
100
8
80
BSEK
BSEK
Order bookings
6
4
60
40
2
20
0
0
Q1 2016
Q1 2017
Q1 2016
Sales
Operating income
12
600
500
+9%
6
4
2
MSEK
BSEK
10
8
Q1 2017
400
300
200
EBIT- 100
margin 0
0
Q1 2016
Q1 2017
4.3%
Q1 2016
6.6%
Q1 2017
• Orders received after the closing of the period include a
contract with the Swedish Defence Material Administration
(FMV) for delivery of a Special Purpose Ship for Signal
Intelligence (SIGINT).
5
BACKLOG DEVELOPMENT
Saab Group
Aeronautics
BSEK
120
100
2012*
2013*
2014
2015
2016
Q1
2017
2016
Q1
2017
60
Dynamics
12
40
10
8
BSEK
BSEK
80
70
60
50
40
30
20
10
0
20
6
4
2
0
2012
2013
2014
* Figures not restated for organisational change in 2016
2015
2016
Q1 2017
0
2012*
2013*
2014
2015
6
PRODUCTIVITY IMPROVEMENT
Sales per FTE
1,9
1,85
1,8
1,75
1,7
1,65
1,6
1,55
1,5
1,45
2013
Q1 2017 sales rolling 12-months
2014
2015
2016
Q1 2017
7
FOCUS ON COST BASE
Admin and Marketing expenses / Sales
14,5%
14,0%
13,5%
13,0%
12,5%
12,0%
11,5%
11,0%
2012
2013
2014
2015
2016
Q1 2017
8
OUTLOOK STATEMENT 2017
• We estimate that sales growth in 2017 will be higher
than Saab’s long-term financial goal:
annual organic sales growth of 5 per cent.
• We expect the operating margin, excluding material
non-recurring items, to improve compared to 2016 and
thus the company will take a step towards its financial
goal: an operating margin of 10 per cent.
9
FINANCIAL UPDATE
10
SUMMARY JAN-MAR 2017
• Solid order backlog with strong increase in
business area Dynamics
• Sales growth of 9 per cent:
‒ Growth in Airborne Early Warning area
‒ Execution of larger projects
• Gross margin and operating margin improved – in
line with management expectations
• Operating cash flow positive
• Balance sheet continued strong with equity/asset
ratio >33 per cent
11
FINANCIAL KEY DATA
MSEK
Order bookings
Jan-Mar
2017
Jan-Mar
2016
Change
FY 2016
9,701
4,614
110
21,828
109,381
111,649
-2
107,606
7,430
6,790
9
28,631
Operating income
492
294
67
1,797
Operating margin
6.6%
4.3%
Net income
360
223
Operational
cash flow
986
3,056
2,603
Free cash flow
897
2,955
2,359
Order backlog
Sales
*Adjusted for non-recurring items
6.3%
61
1,175
12
ORDER BACKLOG
Order backlog duration, SEK bn
31 March 2016
31 Dec 2016
120
2017:
20.1
2016:
18.2
2017:
24.5
2018:
19.7
2017:
17.2
2018:
17.0
2019:
15.2
2018:
12.4
2019:
13.5
2020:
15.5
2019:
11.9
2020:
15.8
After 2020:
38.9
After 2019:
51.9
After 2020:
36.8
Total:
109.4
Total:
111.6
Total:
100
BSEK
31 March 2017
Order backlog
80
60
40
20
0
'12
107.6
'13
'14
'15
'16
Order backlog distribution
36%
• Strong order backlog in all business areas
64%
Sweden
RoW
Q1 '17
13
ORDER SIZE DISTRIBUTION
50 000
3,5
45 000
3
40 000
2,5
35 000
MSEK
30 000
2
25 000
1,5
20 000
15 000
1
10 000
0,5
5 000
0
0
Q1
'12
Q2
'12
Q3
'12
Q4
'12
Q1
'13
Q2
'13
Q3
'13
Q4
'13
Small orders*
Q1
'14
Q2
'14
Q3
'14
Q4
'14
Large orders
Q1
'15
Q2
'15
Q3
'15
Q4
'15
Q1
'16
Q2
'16
Q3
'16
Q4
'16
Q1
'17
Book-to-bill ratio
*Small orders = <MSEK 100
Book-to-bill ratio calculated as 12 months rolling
14
ORDER BOOKINGS AND ORDER BACKLOG
Major order in Airborne Early Warning
segment received in January 2017
Dynamics received order for next
generation anti-ship missile
MSEK
Order bookings
4 500
4 000
3 500
3 000
2 500
2 000
1 500
1 000
500
0
Aeron.
Support and Services signed global
framework agreement with Loomis Group
regarding secure transport logistic system
Dyn
Surveillance
Q1 '16
Order backlog
40
60
S&S
IPS
Kockums
Q1 '17
Regional distribution, Order backlog
1%
BSEK
30
1%
13%
36%
20
Sweden
RoE
Americas
10
Asia
Africa
0
Aeron.
Dyn
Surveillance
Q1 '16
S&S
Q1 '17
IPS
Kockums
Australia etc
40%
9%
15
SALES
2 000
1 800
Regional distribution
-1%
2% 3%
37%
3%
Sweden
24%
1 600
41%
1 400
Americas
Asia
1 200
MSEK
RoE
Africa
16%
-8%
Australia etc
16%
1 000
14%
800
7%
Sales growth mainly driven by the Gripen
programmes, GlobalEye and the
submarine A26
600
400
Second order for GlobalEye received in
January
200
0
Aeron.
Dyn
Surveillance
Q1 '16
Q1 '17
S&S
IPS
Kockums
Sales in Combitech strong
16
OPERATING INCOME
180
156
160
140
MSEK
120
98
100
90
88
80
80
70
67
55
60
53
40
40
34 35
20
EBIT-margin
4.1 4.8
3.7
9.2
3.1 4.9
7.6 8.9
6.1 6.9
5.4 5.2
Surveillance
S&S
IPS
Kockums
0
Aeron.
Dyn
Q1 '16
Q1 '17
Dynamics strong margin recovery on the
back of strong order intake
Operating income affected by
investments in T-X-program
Orders for GlobalEye positive impact on
margin in Support and Services
17
CASH FLOW
1 600
Jan-Mar 2017
Cash flow from operating
activities before changes in
working capital
786
1 400
Change in working capital
671
1 200
1 000
800
600
400
Cash flow
from operating
activities
before
changes in
working capital
Investing activities
Investing
activities
Change in
working
capital
Tax and other
financial items
Acquisitions
and sale of
subsidiaries
and other
financial assets
0
-471
Operational cash flow
986
Tax and other financial items
-84
Acquisitions and sale of
subsidiaries and other financial
assets
Free cash flow
200
MSEK
-5
897
18
FINANCIAL POSITION
31 March, 2017 MSEK
Net liquidity (+) / Net debt (-), 31 December 2016
Cash flow from operating activities
Change in net pension obligation
Net investments
Currency impact and unrealised results from financial investment
Net liquidity (+) / Net debt (-), 31 March 2017
Net pension obligation, 31 March 2017
Total interest-bearing assets, 31 March 2017
-1,836
1,373
49
-471
12
-873
2,375
-580
Liquidity
922
Equity/assets ratio, 31 March 2017
33.3
19
FOCUS 2017
• Focus on execution of large projects – project
management
• Build order backlog in selected areas
• Drive efficiency improvements throughout the
organisation
‒ Functional and operational excellence
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