Statement by the president and CEO of Saab, Håkan Buskhe:
Strong growth 2015
During the past few years, Saab has invested significant resources in developing the company’s world-leading technologies, on coming closer to key markets with a new global sales organisation, and also implemented efficiency measures throughout the company. This has resulted in an improved organisational structure, a strong product portfolio and a record high order backlog. Sales growth 2015 shows the strength in these efforts.
During the year, the security and defence market was influenced by major geopolitical shifts, political events and the world economic situation. The market continues to be challenging; meanwhile, interest in Saab’s products and services increases as they offer demanded functionality and cost efficiency.
Order backlog at historical level
At year-end, the order backlog amounted to MSEK 113 834 (2014: MSEK 60 128), which is more than four times annual sales. During 2015, Saab received several large orders, including Gripen for Brazil, the submarine A26 for Sweden and an airborne surveillance system for the United Arab Emirates (UAE). In addition, the volume of small and medium-sized orders increased by more than 30%.
During 2015, sales amounted to MSEK 27 186 (2014: MSEK 23 527), an increase of 16%. The organic sales growth amounted to 11%. All business areas report growth. The increase is mainly attributable to business area Aeronautics following the order for Gripen to Brazil, and the order for an airborne surveillance system that was received in November 2015. This order had a positive impact on sales in business areas Electronic Defence Systems and Support and Services during the fourth quarter, as preparation work was recognised as sales on signing of the contract.
Operating income amounted to MSEK 1 900 (2014: MSEK 1 659) during the year and the operating margin was 7% (2014: 7.1%). The operating income in the fourth quarter was positively impacted by sales recognition in the large projects mentioned above, and by large deliveries in business area Dynamics.
The operational cash flow amounted to MSEK -500 (2014: MSEK -1 197) for the full year and MSEK 653 (2014: MSEK 753) for the fourth quarter. Cash flow was positively impacted by milestone payments related to Gripen for Brazil and the submarine A26 for Sweden.
At the beginning of 2016, liquidity is strengthened by significant advance and milestone payments. This will lead to a strengthened balance sheet and that the net debt moves towards zero, depending on activity level, during the first quarter of 2016.
Strong foundation for future development
In an uncertain world, high efficiency and reduced lead times is a precondition to meet customer requirements. Saab focuses on execution of the large deliveries that it has ahead of it in the coming years. In addition, Saab strengthens the efforts to make the company more efficient. As part of this work, a re-organisation was implemented on 1 January, whereby business area Security and Defence Solutions was dissolved and its business units moved to other business areas.
At the same time, Saab continues to increase sales efforts in selected markets and to grow the volume of small and medium-sized orders.
Saab has, during 2015, continued to invest in product renewal, mainly within the radar and sensor area and in the important T-X program, where the trainer aircraft of the future is developed together with Boeing. This work will continue during 2016.
Earnings per share after dilution amounted to SEK 12.79 (SEK 10.78).
The board of directors proposes a dividend for 2015 of SEK 5.00 per share (SEK 4.75).
Outlook statement 2016:
* In 2016, the company estimates sales to be in line with Saab’s long-term financial goal: Annual organic sales growth of 5%.
* The operating margin 2016, excluding material non-recurring items, is expected to be in line with 2015.
Press and analyst meeting
Saab hosted a press and analyst meeting, where CEO Håkan Buskhe and CFO Magnus Örnberg presented the 2015 year-end results.
Date: Wednesday, 10 February 2016 at 10:00 (CET)
Address: Grand Hôtel, Blasieholmshamnen 8, Stockholm, Sweden
Venue: New York
The interim report, the presentation material and the Webcast will be available on http://www.saabgroup.com/en/InvestorRelations.
E-mail: [email protected]
Tel: +46 8 463 02 45