Saab interim report January-September 2018

Transcription

1 Saab interim report January-September October, 218 Håkan Buskhe, President and CEO Magnus Örnberg, EVP and CFO

2 Q3 218 highlights Saab and Boeing T-X trainer aircraft selected by U.S. Air Force Order bookings of mid-sized orders strong, 2 per cent organic sales growth Efficiency measures initiated during Q3; non-recurring cost of MSEK 298 Major projects running according to plan To support Saab s continued growth journey, Saab is planning a rights issue during the fourth quarter

3 T-X new era for Saab Selection of Saab Boeing solution strengthen Saab s position in the U.S. Order for Engineering Manufacturing & Development (EMD), MUSD 118 EMD phase of 3.5 years followed by serial production phase Saab T-X EMD-phase activities: Detailed design and parts manufacturing Manufacturing and delivery of 7 various test aircraft aft s Flight test support Verification and certification Pre-operational support Industrialization (preparation for serial production) 3

4 Financial highlights, Jan-Sept 218 BSEK Order bookings BSEK Order backlog Jan-Sep 217 Jan-Sep 218 Jan-Sep 217 Jan-Sep 218 Operating income Operational cash flow MSEK ,255 1,142 Adjusted EBITmargin,% EBITmargin,% Adjusted operating income MSEK ,197 Jan-Sep 217 Jan-Sep 218 Jan-Sep 217 Jan-Sep 218 4

5 Third quarter sales 24 2 MSEK Jan-Sep 214 Jan-Sep 215 Jan-Sep 216 Jan-Sep 217 Jan-Sep MSEK 4 2 Gripen E Q3 214 Q3 215 Q3 216 Q3 217 Q

6 Efficiency measures initiated in Q3 Reshaping Resizing Measures to reduce workforce Overall measures to reduce consultants Adjustment of product portfolio Market efficiency Digitalisation of internal processes Non-recurring cost in Q3 of MSEK 298; Actions initiated: Dynamics Surveillance Support & Services 6 Improve efficiency to: 1) support long-term operating margin target of 1 per cent; and 2) create room for investments in research and development

7 Efficiency measures going foward Actions in Q3 218 Ambition going forward Reshaping Resizing All Business areas and corporate functions has defined plans in place On-going analysis to reduce product portfolio; areas closed & divested in Q3 Future growth requires more focused market approach Several initiatives for higher degree of digitalisation of internal processes Reduced employees with approximately 3 and 55 consultants; Employees across the company and consultants mainly in development area Reduce product portfolio by integration internally, close-down, divestment More focused market approach Higher degree of digitalisation and simplification of functional processes 7 Improve efficiency to: 1) support long-term operating margin target of 1 per cent; and 2) create room for investments in research and development

8 Project execution in focus Status major projects: Gripen E to Sweden - Flight trials, flying with external stores and system verification ongoing Gripen NG to Brazil - Production in Sweden ongoing, production site in Brazil inaugurated GlobalEye to the United Arab Emirates - Flight test and verification 218 Kockums - Submarine A26 initial customer system verification review - Submarine HSwMS Gotland sea trials after mid-life upgrade T-X - Project start up, ramp up T-X Gripen E Gripen NG HSwMS Gotland GlobalEye 8

9 Rights issue approximately SEK 6 bn To support Saab s continued growth journey as well as give Saab an increased opportunity to successfully compete for new large orders, Saab is planning a new share issue of approximately SEK 6 billion Strong demand for Saab s products and systems has resulted in a record high order backlog, strong sales combined with opportunities for future growth Shareholders representing 52.3 per cent of capital, are supportive of the rights issue EGM to authorize the Board of Directors to decide on rights issue during fourth quarter 9

10 Outlook Sales growth in 218 is expected to be in line with Saab s long-term financial goal: annual organic sales growth of 5 per cent. The operating margin in 218, excluding material non-recurring items, is expected to improve compared to 217, bringing Saab a further step closer to its financial goal: an operating margin of 1 per cent. 1

11 Financial summary Magnus Örnberg, EVP and CFO 11

12 Financial summary, January-September 218 MSEK Jan-Sep 218 Jan-Sep 217 Change, % Strong medium-sized order intake Sales increased organically by 2 per cent Operating margin 3.8 per cent; adjusted for nonrecurring items of MSEK 298, 5.2 per cent Operational cash flow impacted by timing differences of milestone payments and working capital build-up in large projects Financial net impacted by changes in market values of derivatives related to hedged tenders in USD Operational cash flow expected to be positive to strongly positive in fourth quarter Order Bookings 17,183 24, Order Backlog 12,4 11,12-7 Sales 22,138 21,516 3 Operating Income 844 1, Operating margin, % Adjusted op. Income 1,142 1,255-9 Adjusted op. margin, % Net Income Operational Cash Flow -5, Free Cash Flow -5,

13 Rights issue To support Saab s continued growth journey as well as give Saab an increased opportunity to successfully compete for new large orders, Saab is planning a new share issue of approximately SEK 6 billion Strong demand for Saab s products and systems has resulted in a record high order backlog, strong sales combined with opportunities for future growth Saabs aim is to stregthen the balance sheet and enhance financial capacity 13

14 Order backlog duration BSEK 3 Sep 218 Year End Sep : : : : : : : : : : : : 16.1 After 221: 32.9 After 221: 27.8 After 22: 43. Total: 12.4 Total: 17.2 Total: 11.1 Order backlog per Business Area S&S 11% Surveillance 15% Kockums IPS 7% 9% Dynamics 12% Order backlog per Region Asia 11% Africa 1% Australia etc 3% Aeronautics 46% Sweden 35% Latin America 34% North America 5% Rest of Europe 11% 14

15 Order size distribution ,5 3 2,5 January-September 218 8% MSEK % 2 1,5 46% ,5 Small order MSEK < 1 Medium-sized order 1-1 Big order > 1 15 Small orders* Large orders Medium-sized order Book-to-bill ratio** *Small orders = <MSEK 1 **Book-to-bill ratio calculated as 12 months rolling

16 Order bookings per business area MSEK Order bookings Aeronautics Dynamics Surveillance S&S IPS Kockums Jan-Sep 217 Jan-Sep 218 Good increase in order bookings of medium-sized orders Order bookings for small orders stable (below MSEK 1 in size) Major order received for operational support for Gripen from Sweden BSEK Order backlog Saab to supply CMS*, FCS*, RWS* and the New Lightweight Torpedo to the Finnish Navy s Squadron 2 Mid-Life Upgrade programme Australian Army ordered Carl-Gustaf M4 Aeronautics Dynamics Surveillance S&S IPS Kockums 3-sep-17 3-sep *CMS=Combat Management System, FCS=Fire Control System, RWS=Remote Weapon Station

17 Sales per business area % +8% % Sales, 2 per cent organic growth % -8% Growth driven by strong growth in Gripen operations, Kockums as well as Airborne Surveillance operations MSEK % Dynamics strong sales growth in third quarter 218 vs same period Kockums saw strong sales increase in major submarine project 5 Aeronautics Dynamics Surveillance S&S IPS Kockums Jan-Sep 217 Jan-Sep

18 Operating income per business area 5 45 MSEK EBIT-margin,% Aeronautics Dynamics Surveillance S&S IPS Kockums Adjusted operating margin at 5.2 per cent, non-recurring item of MSEK 298 Efficiency improvement measures initiated in third quarter Aeronautics saw increased activities in the Gripen projects and lower T-X-spend Fewer deliveries in Dynamics compared to 217 Jan-Sep 217 Jan-Sep

19 Non-recurring items MSEK Jan-Sep 218 Cost of goods sold -41 Administrative expenses -3 Research and development costs -54 Other operating expenses -2 Total -298 Main part of cost related to workforce reductions Actions initiated during third quarter Corporate, Dynamics, Surveillance and Support and Services non-recurring items in Q3 19

20 Operational Cash flow Cash flow from operations Cash flow from operating activities before changes in working capital: 2,166 Change in working capital: Contract assets and liabilities -4,145 Inventories -1,312 MSEK -1-2 Change in working capital Other current receivables 543 Other current liabilities -134 Provisions ,24 Cash flow from investing activities: -3 Intangible assets Investing activities Tangible assets -1,73 Operational cash flow : -5,

21 MSEK Net debt, 31 December 217-1,834 Cash flow from operating activities -3,764 Change in net pension obligation -818 Net investment -1,993 Acquisitions and sale of operations 8 Repurchase of shares -23 Dividend -588 Dividend to and transactions with non-controlling interest -38 Currency impact and unrealised results from financial investments -2 Net debt, 3 September 218-9,25 Net pension obligation, 3 September 218 3,464 Total interest-bearing assets, 3 September Net debt excluding interest-bearing receivables and net pension -6,279 obligation 21 Financial position 29.% Equity/Assets ratio Equity per share (SEK)

22 Focus 218 Continued focus on execution of large projects project management Drive efficiency to improve margins Build order backlog in selected areas and markets

23 Important information The information in this presentation does not contain or constitute an offer to acquire, subscribe or otherwise trade in shares, subscription rights or other securities in Saab Aktiebolag ( Saab AB ) in any jurisdiction. All offers and sales of securities in connection with any rights offer by Saab AB will be made for certain eligible shareholders, subject to certain limited exceptions, outside of the United States and in reliance on, and in compliance with, Regulation S under the U.S. Securities Act of 1933, as amended. This presentation may contain forward-looking statements which reflect Saab AB s current view on future events and financial and operational development. Words such as intend, expect, anticipate, may, believe, plan, estimate and other expressions which imply indications or predictions of future development or trends, and which are not based on historical facts, are intended to identify forward-looking statements. Forward-looking statements inherently involve both known and unknown risks and uncertainties as they depend on future events and circumstances. Forward-looking statements do not guarantee future results or development and the actual outcome could differ materially from the forward-looking statements.

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