Saab 2014 Annual Report Download - page 9

LONG-TERM GROWTH
e order backlog is strong and there is every
reason to be optimistic about the future. We have
already signed important contracts and see good
business opportunities, especially aer our new
product launches. In 2015, the Gripen order from
Brazil is expected to become ocial, provided that
certain benchmarks unrelated to Saab are met.
Since the level of activity from major orders can
uctuate between years and the deals take so long,
it is also important for us to have a stable backlog
of smaller orders.
Sales were in line with the previous year at
MSEK 23,527, but organic sales growth was nega-
tive. It was mainly in business area Dynamics that
sales fell, due to a challenging market in recent
years. At the same time, the business area Security
and Defence Solutions increased its sales, partly
through the acquisition of Saab Kockums.
Our long-term goal is to grow organically,
which makes it important to ensure that the order
backlog increases and, with it, future sales.
MONITORING AND TRANSPARENCY
Operating income in 2014 amounted to MSEK
1,659, with an operating margin of 7.1 per cent.
During the year, we continued to reassess our com-
pany portfolio. We have acquired Saab Kockums
and sold our minority interest in Hawker Pacic
Airservices.
In 2013, we introduced a clearer governance
model and the increased internal transparency
has been valuable. Better monitoring helps us to
navigate in increasingly complex markets.
Eorts to further improve operations and e-
ciencies are continuing. e eciency measures
announced in 2013 have been implemented and
the goal of improving eciency by MSEK 500 was
reached in 2014. is was primarily achieved
through capacity adjustments and by reducing the
total number of FTE’s and external consultants by
about 950 from the beginning of 2013, excluding
the acquisition of Saab Kockums and deconsoli-
dation of Saab Grintek Technologies (Pty) Ltd in
South Africa. e eciencies le more room
for investments primarily in development and
marketing activities during the year. Adjusting
capacity, the portfolio and the way we work is a
natural part of our business and will continue.
We had a strong operating cash ow in the
fourth quarter and came close to reaching our goal
of positive cash ow for the second half of the year.
Continued focus on improved processes through-
out the chain, from negotiations to project imple-
mentation, is essential in order to improve cash
ow.
TRUST IS ONE OF OUR CORE VALUES
We continued to work on a number of activities in
2014 to strengthen our compliance work, includ-
ing the launch of a program to audit our marketing
consultants. We also began updating our Code of
Conduct with the intent of launching a special
code for our suppliers and partners in 2015.
No company is isolated from its environment.
We are all dependent on a well-functioning society
in order to grow over time. By acting responsibly
and sustainably in everything we do, we can gain
the trust of customers, employees and our commu-
nities, which creates opportunities for increased
growth and long-term development.
A long-term approach is of great importance to
Saab and can be seen in everything we do. Many of
our commitments extend over decades, and Saab
has been creating value-added for nearly eighty
years. Some of the development projects we are
working on today will create jobs and growth for
many decades to come.
Stockholm, February 2015
Håkan Buskhe
President and CEO
The order backlog is
strong and there is every
reason to be optimistic
about the future.
SAAB ANNUAL REPORT 2014 – 5