ANNUAL REPORT 2009 - Saab

ADMINISTRATION REPORT > FINANCIAL REVIEW 2009FINANCIAL REVIEW 2009Saab AB (publ.), corporate identity no. 556036-0793, with its registeredaddress in Linköping, Sweden. The address of the company’shead office is Kungsbron 1, Stockholm, with the mailing address Box70 363, SE-107 24 Stockholm, Sweden, and the telephone number+46 8 463 00 00. Saab has been listed on NASDAQ OMX Stockholmsince 1998 and on the Large Cap list since October 2006. The principalowners are Investor AB, with 20 per cent of the shares, correspondingto 39 per cent of the votes, and BAE Systems with 21 percent of the shares, corresponding to 21 per cent of the votes. Theremaining 59 per cent of the shares are traded on NASDAQ OMXStockholm.The total number of shares in the company is 109,150,344, distributedbetween 5,254,303 Series A shares with ten votes each and103,896,041 Series B shares with the one vote. At year-end, a total of3,639,220 Series B shares had been repurchased to guarantee theGroup’s share matching plan. The repurchased shares are held astreasury shares.OPERATIONSOne of the world’s leading high technology companies, Saab offersproducts, solutions and services for military defence and civil security.In 2009, we had customers in over 60 countries, but research, developmentand production are principally carried out in Sweden. Despiteour growing global presence, we are primarily active in Europe, SouthAfrica, Australia and the US. Saab was organised in three businesssegments in 2009: Defence and Security Solutions, Systems and Products,and Aeronautics, which in turn consisted of 15 business units andaround 13,200 employees who stand behind the deliveries to customers.On 9 September 2009, Saab announced that a new organizationalstructure would take effect on 1 January 2010. Since that date, the Grouphas five business areas: Aeronautics, Dynamics, Electronic DefenceSystems, Security and Defence Solutions and Support and Services.In addition to the business segments and since 1 January 2010 thebusiness areas, Corporate comprises Group staff and departmentsand secondary operations. It also includes the leasing fleet of Saab340 and Saab 2000 aircraft. As of 1 January, 2010, Combitech isreported as part of Corporate.lOng-tERM FinanCIAL OBJECTIVES ANDACCOMPLISHMENTSGROWTHSaab’s organic growth shall average 5 per cent per year over a businesscycle. In 2009, organic growth was 4 per cent (6).OPERATING MARGINSaab has two operating margin objectives, both of which are formulatedas an average over a business cycle. The operating margin afterdepreciation/amortisation shall amount to at least 10 per cent andthe operating margin before depreciation/amortisation shall be atleast 15 per cent. The operating margin after depreciation/ amortisationwas 5.6 per cent (0.7) in 2009. Adjusted for nonrecurring items,operating income amounted to MSEK 1,324 (1,994) and the adjustedoperating margin was 5.4 per cent (8.4). The operating margin beforedepreciation/amortisation (EBITDA)was 10.5 per cent (6.4).RETURN ON EQUITYThe return shall average 15 per cent. In 2009, Saab reported a returnon equity of 7.0 per cent (-2.4).EQUITY/ASSETS RATIOSaab’s equity/assets ratio shall exceed 30 per cent. At year-end 2009,the equity/assets ratio was 35.1 per cent (28.4).DIVIDEND POLICYSaab’s long-term dividend objective is to distribute 20–40 per cent ofnet income over a business cycle to shareholders. For 2009, theBoard of Directors proposes a dividend of SEK 2.25 per share (1.75).Comment on net incomeSaab’s order bookings decreased by 21 per cent to MSEK 18,428(23,212) in 2009. The international share of order bookings was 62per cent (66). The order backlog amounted to SEK 39.4 billion (45.3).Sales rose by 4 per cent (3) to MSEK 24,647 (23,796). Adjusted for thesale of Saab Space on 1 September 2008 and exchange rate effects,sales increased by 4 per cent. Sales during the period were positivelyaffected by approximately 2 percentage points by changes inexchange rates. The effects relate to the translation of foreign subsidiariesfrom their local currency to SEK, primarily relating to South34 saab ANNUAL REPORT 2009