Gripen Propels Saab’s Strong 2011 Earnings
Swedish weapons and aeronautics manufacturer Saab reported on Feb. 10 a five-fold increase in its 2011 earnings after clinching several major contracts, and said it hoped to increase sales this year.
“2011 was an important year for us, and we secured several key orders, such as further development and maintenance orders for Gripen to the Swedish Defence Material Administration and for our multi-mission radar system Giraffe to the U.S. Department of State,” chief executive Haakan Buskhe said in a statement.
“I am also proud of the strong recognition Gripen received when the Swiss government down-selected it for negotiations as a future multirole fighter aircraft,” he said.
The Swiss government is to formally approve the choice of Gripen in February. If approved, the order would only go into Saab’s books in 2012.
In November, Bern announced that it had chosen 22 Gripen fighter planes to replace its ageing F-5 fighter fleet for an estimated 3.1 billion francs ($3.38 billion).
But amid pressure from other rival suppliers still eager to win the deal, Saab, according to unconfirmed press reports, is ready to review its price and the contract is now said to be worth between 2.5 billion and 2.8 billion francs.
In 2011, Saab posted a net profit of 2.23 billion kronor ($333.8 million), compared to 433 million kronor in 2010. In the fourth quarter alone, the profit rose 52-fold to 413 million kroner from 8 million kroner.
Sales fell by 4 percent in 2011 from the level the previous year to 23.5 billion kronor and slid by 9 percent in the fourth quarter to 7.35 billion kroner.
“For 2012, we estimate that sales will increase slightly compared to 2011,” Buskhe said.
Order intake was lower in the second half of the year, as “a consequence of continuous delays in customers’ decision-making processes,” Saab said.
Order intake fell by 28 percent to 18.91 billion kroner in 2011 compared to the previous year. As of the end of the year, Saab’s order book totaled 37.17 billion kroner, down by 10 percent from 2010.
That news worried investors, and Saab’s share price was down by 9.3 percent in afternoon trading on a Stockholm market down just 1.25 percent.
Saab AB, whose star product is the JAS Gripen fighter, has for more than 30 years been a separate company from the now-bankrupt carmaker Saab Automobile.
Source: By AGENCE FRANCE-PRESSE, STOCKHOLM, 10 February 2012 - Gannett Government Media / DefenceNews (www.defensenews.com)
Photo: The Swedish Air Force Saab JAS-39C Gripen in Kecskemét Airshow (Photo by Laszlo Petenyi)