saab q1 2017 interim report presentation · 31 march, 2017 msek net liquidity (+) / net debt (-),...
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26 April, 2017
JANUARY-MARCH2017
Håkan Buskhe, President and CEOMagnus Örnberg, EVP and CFO
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HIGHLIGHTS JANUARY – MARCH 2017
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Market demand high for defence and security
Leading technology and cost-efficient solutions
Overall performance in line with expectation
Strengthened order backlog compared to year-end 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 femaleengineering student in Swedish ranking
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ORDERS RECEIVED JAN-MAR 2017
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FINANCIAL HIGHLIGHTS, JAN-MAR 2017
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• 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).
02468
1012
Order bookings
Q1 2016 Q1 2017
020406080
100120
Order backlog
Q1 2016 Q1 2017
0100200300400500600
Operating income
Q1 2016 Q1 2017
02468
1012
Sales
Q1 2016 Q1 2017
+9%
4.3% 6.6%
BSEK
BSEK
BSEK
MSE
K
EBIT-margin
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BACKLOG DEVELOPMENT
5
02468
1012
2012 2013 2014 2015 2016 Q12017
Dynamics
010203040506070
2012 2013 2014 2015 2016 Q12017
Aeronautics
0
20
40
60
80
100
120
2012 2013 2014 2015 2016 Q1 2017
Saab Group
BS
EK
BS
EK
BSEK
* *
* *
* Figures not restated for organisational change in 2016
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PRODUCTIVITY IMPROVEMENT
1,45
1,5
1,55
1,6
1,65
1,7
1,75
1,8
1,85
1,9
2013 2014 2015 2016 Q1 2017
Sales per FTE
6
Q1 2017 sales rolling 12-months
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FOCUS ON COST BASE
11,0%
11,5%
12,0%
12,5%
13,0%
13,5%
14,0%
14,5%
2012 2013 2014 2015 2016 Q1 2017
Admin and Marketing expenses / Sales
7
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OUTLOOK STATEMENT 2017
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• We estimate that sales growth in 2017 will be higherthan 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.
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FINANCIAL UPDATE
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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
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FINANCIAL KEY DATA
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*Adjusted for non-recurring items
MSEKJan-Mar
2017Jan-Mar
2016Change FY 2016
Order bookings 9,701 4,614 110 21,828
Order backlog 109,381 111,649 -2 107,606Sales 7,430 6,790 9 28,631Operating income 492 294 67 1,797Operating margin 6.6% 4.3% 6.3%Net income 360 223 61 1,175Operationalcash flow
986 3,056 2,603
Free cash flow 897 2,955 2,359
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ORDER BACKLOGOrder backlog duration, SEK bn
31 March 2017 31 March 2016 31 Dec 2016
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: 107.6
12
0
20
40
60
80
100
120
'12 '13 '14 '15 '16 Q1 '17
BS
EK
Order backlog
36%
64%
Order backlog distribution
SwedenRoW• Strong order backlog in all business areas
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ORDER SIZE DISTRIBUTION
0
0,5
1
1,5
2
2,5
3
3,5
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
45 000
50 000
Q1'12
Q2'12
Q3'12
Q4'12
Q1'13
Q2'13
Q3'13
Q4'13
Q1'14
Q2'14
Q3'14
Q4'14
Q1'15
Q2'15
Q3'15
Q4'15
Q1'16
Q2'16
Q3'16
Q4'16
Q1'17
MS
EK
Small orders* Large orders Book-to-bill ratio
13
*Small orders = <MSEK 100Book-to-bill ratio calculated as 12 months rolling
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ORDER BOOKINGS AND ORDER BACKLOG
0500
1 0001 5002 0002 5003 0003 5004 0004 500
Aeron. Dyn Surveillance S&S IPS Kockums
MS
EK
Q1 '16 Q1 '17
14
36%
9%
40%
13%
1% 1%
Regional distribution, Order backlog
SwedenRoEAmericasAsiaAfricaAustralia etc
Major order in Airborne Early Warningsegment received in January 2017
Dynamics received order for nextgeneration anti-ship missile
Support and Services signed global framework agreement with Loomis Group regarding secure transport logistic system
0
10
20
30
40
Aeron. Dyn Surveillance S&S IPS Kockums
BSEK
Q1 '16 Q1 '17
Order bookings
Order backlog60
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SALES
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
2 000
Aeron. Dyn Surveillance S&S IPS Kockums
MS
EK
Q1 '16 Q1 '17
15
41%
14%
16%
24%
2% 3%Regional distribution
SwedenRoEAmericasAsiaAfricaAustralia etc
Sales growth mainly driven by the Gripen programmes, GlobalEye and the submarine A26
Second order for GlobalEye received in January
Sales in Combitech strong
3%
-8%
-1%37%
16%
7%
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OPERATING INCOME
67
40
98
53
34
8090 88
156
70
35
0
20
40
60
80
100
120
140
160
180
Aeron. Dyn Surveillance S&S IPS Kockums
MS
EK
Q1 '16 Q1 '17
55
16
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
4.1 4.8 3.7 9.2 4.9 7.6 8.9 6.1 6.9 5.4 5.23.1EBIT-margin
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CASH FLOWJan-Mar 2017 MSEKCash flow from operating activities before changes in working capital
786
Change in working capital 671Investing activities -471Operational cash flow 986
Tax and other financial items -84Acquisitions and sale ofsubsidiaries and other financialassets
-5
Free cash flow 897
17
0
200
400
600
800
1 000
1 200
1 400
1 600
Cash flowfrom operating activitiesbeforechanges in working capital
Change in workingcapital
Investingactivities
Tax and otherfinancial items
Acquisitionsand sale ofsubsidiariesand otherfinancial assets
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FINANCIAL POSITION31 March, 2017 MSEK
Net liquidity (+) / Net debt (-), 31 December 2016 -1,836
Cash flow from operating activities 1,373
Change in net pension obligation 49
Net investments -471
Currency impact and unrealised results from financial investment 12
Net liquidity (+) / Net debt (-), 31 March 2017 -873
Net pension obligation, 31 March 2017 2,375
Total interest-bearing assets, 31 March 2017 -580
Liquidity 922
Equity/assets ratio, 31 March 2017 33.3
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FOCUS 2017
• Focus on execution of large projects – projectmanagement
• Build order backlog in selected areas
• Drive efficiency improvements throughout the organisation‒ Functional and operational excellence
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