Saab interim report January-MarchQ1 2016 Q1 2017 Q1 2018 Q1 2019 Sales 294 539 447 591 0 100 200 300 400 500 600 700 Q1 2016 Q1 2017 Q1 2018 Q1 2019 Operating income EBIT margin,%

Saab interim reportJanuary-March

Håkan Buskhe, President and CEOMagnus Örnberg, EVP and CFO

26 April, 2019

Highlights January-March 2019

• xxxxxxx

2

• Increase of working capital due to ongoing preparation of deliveries of

Gripen to Sweden and Brazil

• Saab estimates that the operational cash flow will be negative for the

full year, but on a better level than 2018

Strong organic growth

Improved operating income

Cash flow

• Organic growth of 8 per cent

• Dynamics strong growth driven by more deliveries

• IPS*, growth in several business units

• Aeronautics growth driven by production for deliveries to Sweden

and Brazil

• Execution of major projects progressing according to plan

• Productivity improvement in several business areas

• Dynamics improved operating margin due to higher utilisation

*Business Area Industrial Products and Services

Swedish submarine HMS Gotland during sea trials

Market opportunities

3

Gripen E

A26 Submarine

GlobalEye

Carl-Gustaf M4

C2S*

• In April, Saab was shortlisted as Combat System Provider for Finnish Squadron 2020 program

• Saab handed in proposal to Switzerland consisting of options for 30, and 40, Gripen E

• Saab handed in proposal to Finland in January, comprising of 64 Gripenaircraft

• Tender process for fighter aircraft in Canada and India on-going

• Tender process to replace the Walrus-class submarines in the Netherlands ongoing

*C2S = Command and Control Systems

0

2

4

6

8

Order bookings

Jan-Mar 2018 Jan-Mar 2019

Financial highlights, January-March 2019

4

0

2

4

6

8

10

Sales


447

591

0

200

400

600

800

Operating income


-2,211-2500

-2000

-1500

-1000

-500

0Operational cash flow


-1,923

BS

EK

BS

EK

MS

EK

MS

EK

7.88.56.1

4.5

EBIT-

margin,%7.05.8

First quarter development

5

MS

EK

MS

EK

Giraffe 1X

6,7907,586 7,766

8,496

0

2000

4000

6000

8000

10000

Q1 2016 Q1 2017 Q1 2018 Q1 2019

Sales

294

539

447

591

0

100

200

300

400

500

600

700

Q1 2016 Q1 2017 Q1 2018 Q1 2019

Operating income

EBIT

margin,% 7.1% 5.8%7.0%

5.8%4.3%

12%2.4% 9.4%

Cash flow development, Jan-Mar 2019

6

MSEK

2,603

1,388

-2,424

-1,923

-3000

-2000

-1000

0

1000

2000

3000

4000

2016 2017 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019

Operational cashflow

Estimated range for cash flow in period

Strategic focus areas 2019

Market

• Pursue focused market strategy and utilize

installed base to strengthen market position

• Technology investments imperative for creating

stronger market position

7

Re-sizing & Re-shaping

DirectionUpdate April 2019

• All re-sizing plans

implemented

• Focus portfolio

• More focused market

approach

• Higher degree of

digitalisation and

simplification of

functional processes

Performance

• Execution of major projects

• Continue implementation of re-sizing and re-

shaping initiatives

Innovation

• Forward thinking leadership enabler for

technology development

• Employee reduction

implemented;

consultancy reduction

on-going

• Portfolio analysis on-

going; civil business

in South Africa

divested

• Current review of

market org.

• New global HR-IT

environment

launched

Outlook 2019

Sales growth in 2019 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 2019, excluding

material non-recurring items, is expected to

improve compared to 2018, bringing Saab a

further step closer to its financial goal: an

operating margin of 10 per cent.

8

9

Financial summary

Magnus Örnberg, EVP and CFO

Financial summary, January-March 2019

• Increase of small-sized order bookings by

33 per cent

• Sales increase by 9 per cent; organic growth 8

per cent

• Improved operating margin 7.0 (5,8) per cent

• Operational cash flow negative with Aeronautics

preparing for deliveries of Gripen to Sweden

and Brazil

• Net debt impacted by IFRS16 adjustment of

BSEK 2.2

10

MSEKJan-Mar

2019

Jan-Mar

2018Change,

%

Order Bookings 4,482 6,135 -26.9

Order Backlog* 97,401 105,712 -7.9

Sales 8,496 7,766 9.4

Operating Income 591 447 32.2

Operating margin, % 7,0 5,8

Net Income 397 251 58.2

Operational Cash Flow -1,923 -2,211

Free Cash Flow -2,137 -2,411

*Not including order bookings related to serial production of the TX trainer aircraft developed by Boeing and Saab for the U.S. Air Force. The

U.S. Airforce has ordered the first phase, the EMD = Engineering and Manufacturing Design, to be followed by production orders.

Order backlog duration

11

31 March 2019 Year End 2018 31 March 2018

2019: 22.2 2019: 28.0 2018: 20.7

2020: 21.6 2020: 20.6 2019: 21.8

2021: 17.2 2021: 18.1 2020: 17.7

2022: 14.8 2022: 13.3 2021: 17.1

After 2022: 21.6 After 2022: 22.2 After 2021: 28.4

Total: 97.4 Total: 102.2 Total: 105.7

Aeronautics46%

Dynamics14%

Surveillance15%

S&S10%

IPS9%

Kockums6%

Order backlog per Business Area

Sweden33%

Rest of Europe

12%North America7%

Latin America

35%

Asia9%

Africa1%

Australia etc3%

Order backlog per Region

BSEK

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 000January-March 2019

MS

EK

Small orders = <MSEK 100, Large orders = >MSEK 100

Book-to-bill ratio calculated as 12 months rolling12

73%

27%

Small order MSEK < 100

Medium-sized order MSEK 100-1,000

Large orders

Medium sized orders

Small orders

Small orders Large orders

Small orders = <MSEK 100, Medium sized orders = MSEK 100-1,000,

Large orders = >MSEK 1,000

• Small orders grew 33 per cent

• Adjustment of backlog with IPS, due to order

order cancellation related to Airbus A380

program* and currency adjustment

• One large order booked in first quarter 2018

in Aeronautics

0

500

1 000

1 500

2 000

Aeronautics Dynamics Surveillance S&S IPS Kockums

Order bookings

Jan-March 2018 Jan-March 2019

Order bookings per business areaM

SE

K

0

10

20

30

40

50

60


Order backlog

31 March 2018 31 March 2019

BS

EK

13 *Saab delivers the wingframe for the A380 aircraft. Airbus recently announced that the A380 program will be ceased in 2021, earlier than previously planned.

**Not including order bookings related to serial production of the TX trainer aircraft developed by Boeing and Saab for the U.S. Air Force. The U.S. Airforce has ordered the first

phase, the EMD = Engineering and Manufacturing Design, to be followed by production orders.

**

• 9 per cent sales growth;

8 per cent organic growth

• Dynamics increased level of deliveries

• IPS saw increased sales within business

unit Aerostructures, which saw a high

delivery rate in the quarter

• Growth also driven by strong activity

level in major programs in business area

Aeronautics and Kockums

0

500

1 000

1 500

2 000

2 500



Sales per business area

14

+4%

+32%

-3%

+1%

+13%

+7%

MS

EK

Operating income per business area

15

MS

EK

• Operating margin improvement as

productivity levels in several business

areas improved

• Higher level of deliveries in Dynamics –

higher utilization

• IPS operating margin strengthened due

to higher activity level in several areas

• Aeronautics saw increased activities in

the Gripen projects and lower T-X-spend

163

46

69

174

27

42

197

113

90

182

69

34

0

50

100

150

200



Operating

margin,% 9.38.0 8.14.4 5.2 13.513.0 4.41.0 4.35.63.9 1.9

Cash flow development large project

16

Time

Development phase

Illustrative cashflow and working capital development in a large project

Cash in flow

Cash out flow (working capital build-up)

Delivery phase

-2 500

-2 000

-1 500

-1 000

-500

0

500

1 000

1 500

MS

EK

17

Operational Cash flowCash flow from operating activities before

changes in working capital: 1,127

Change in working capital:

Contract assets and liabilities -2,333

Inventories -230

Other current receivables 760

Other current liabilities -567

Provisions -50

-2,420

Cash flow from investing activities:

Intangible assets -358

Tangible assets -272

-630

Operational cash flow : -1,923

Cash flow

from

operations

Change in workingcapital

Investing activities

MSEK

Net debt, 31 December 2018 -1,460

Effects related to implementation of IFRS 16 (opening balance) -2,190

Cash flow from operating activities -1,366

Change in net pension obligation 300

Net investments -630

Other -36

Net debt, 31 March 2019 -5,382

Net pension obligation, 31 March 2019 3,799

Total interest-bearing assets, 31 March 2019 -524

Net debt excluding interest-bearing receivables and net pension

obligation

-2,107

35.4%Equity/Assets

ratio

152.1Equity per share

(SEK)

18

Financial position

19

IFRS 16 effects

MSEK

Jan-Mar

2019 incl.

IFRS16 Change

Jan-Mar

2019 excl.

IFRS16

Sales and other

operating income 8,514 - 8,514

COGS and OPEX* -7,595 107 -7,702

Depreciation and

amortisation -328 -96 -232

Operating income 591 11 580

Net financial items -81 -22 -59

Income before taxes 510 -11 521

Taxes -113 2 -115

Net income for the

period 397 -9 406

Total assets 57,986 2,200 55,786

Total equity 20,544 -9 20,553

Total liabilities 37,442 2,209 35,233

Giraffe AMB UK*COGS = Cost of goods sold, OPEX = Operating expenses

Focus 2019

Order intake

Project execution

Productivity improvement

Cash generation

Important information

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.

Saab interim report January-MarchQ1 2016 Q1 2017 Q1 2018 Q1 2019 Sales 294 539 447 591 0 100 200 300 400 500 600 700 Q1 2016 Q1 2017 Q1 2018 Q1 2019 Operating income EBIT margin,%

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