Saab 2012 Annual Report Download - page 117

Liquidity and nancing risks are minimised by diversifying nancing
sources and maturities.
Saab’s policy is to insure on-demand guarantees for major projects against
unauthorised use. is applies to contracts where the counterparty is classi-
ed as a developing country according to the denition of the Export Credits
Guarantee Board (). Insurance can be obtained from state guarantee
institutions or the private insurance market.
Saab has access to the following credit facilities:
Loan facilities
MSEK Facility Utilised Available
Club loan (matures 2016) 4,000 - 4,000
Total confirmed credit facilities 4,000 - 4,000
Commercial paper 5,000 - 5,000
Medium Term Notes (MTN) 3,000 1,100 1,900
Receivables financing 1,515 852 663
Total loan programmes 9,515 1,952 7,563
Total loan facilities 13,515 1,952 11,563
e club loan is a credit facility with an equivalent value of  , evenly
divided between eight banks and expiring in . No nancial covenants are
attached to the club loan or the other credit facilities.
A commercial paper programme with a limit of  , is available as
well. Neither the commercial paper programme nor the club loan was used in
.
In , Saab established a Medium Term Note () programme with a
limit of  , or an equivalent value in . e  programme pro-
vides access to nancing for up to  years, which is an element in diversifying
loan maturities.
Net liquidity
Net liquidity excluding interest-bearing receivables and provisions for pen-
sions amounted to  , (,) on  December . Liquidity varied
during the year, and surplus liquidity was placed as per the Group Treasury
Policy. At year-end, placements in interest-bearing securities and bank
deposits amounted to  , (,).
Net liquidity
MSEK Note 31-12-2012 31-12-2011
Assets
Liquid assets 31 1,616 1,918
Short-term investments 25 3,963 4,555
Total liquid investments 5,579 6,473
Short-term interest-bearing receivables 27 326 368
Long-term interest-bearing receivables 27 109 99
Long-term interest-bearing financial investments 25 144 143
Total interest-bearing assets 6,158 7,083
Liabilities
Short-term interest-bearing liabilities 35 1,637 520
Long-term interest-bearing liabilities 35 105 1,218
Provisions for pensions 37 11 12
Total interest-bearing liabilities 1,753 1,750
Net liquidity 4,405 5,333
As of  December , net liquidity amounted to  , (,) with an
average during the year of  , (,). e net of interest income
received and interest expenses paid amounted to   (-). Of the liquid
investments of  , (,),   () was pledged as trading secu-
rity to . e sensitivity analysis below shows the eect on income of an
increase in market interest rates and the credit margin of  basis point for
Saab’s investments.
Placements in interest-bearing securities and bank deposits
Sensitivity analysis of financial risk
MSEK
Maturities
Fixed
interest
Effect of
market in-
terest rate,
1%
Tied-up
capital
Effect of
credit
spread,
1%
Effect on
financial
costs
1 year 2,788 28 2,485 25 53
2 years -203 -2 100 1 -1
3 years 880 9 880 9 18
4 years 1,170 11 1,170 11 22
5 years and
forward - - - - -
Total 4,635 46 4,635 46 92
Adjustment 1) 190 - - - -
Total 4,825 - - - -
1) Adjustment of nominal value compared to book value due to market valuation at a premium or discount.
Current interest-bearing liabilities mainly consist of  in issue of
, that was reported as a long-term interest-bearing liability in 
and liabilities to joint ventures of   (). Long-term interest-bearing
liabilities amount to   (,). Of the long-term interest-bearing lia-
bilities,   (,) matures within -years and   () in more
than  years.
e maturity structure of liabilities to credit institutions is indicated in
the tied-up capital column of the “Sensitivity analysis of nancial risk” table.
e volume of tied-up capital includes interest rate swaps. e interest rate
risk in the loans given a  basis point parallel shi in the yield curve was
 () as of  December . e sensitivity analysis below shows the
impact on results of an increase in market interest rates and an equally large
increase in the credit margin of  basis point for Saab’s renancing of credits.
Financing (refers to utilised credit facilities)
Sensitivity analysis of financial risk
MSEK
Maturities
Fixed
interest
Effect of
market in-
terest rate,
1%
Tied-up
capital
Effect of
credit
spread,
1%
Effect on
financial
costs
1 year 1,702 17 1,952 20 37
2 years 150 2 - - 2
3 years 100 1 - - 1
4 years - - - - -
5 years and
forward - - - - -
Total 1,952 20 1,952 20 40
Commodity risks
Price risks are divided into two parts:
t Commodity price risk refers to the risk that purchasing costs for ma-
terial will rise.
t Electricity price risk refers to the risk that Saab could be negatively af-
fected by changes in electricity prices.
According to the Group’s policy, commodity risk is minimised and managed
primarily through contract clauses with customers/suppliers. To minimise
the risk to Saab’s operating margin, future electricity consumption is hedged.
is is done by hedging projected consumption according to a model where
 per cent of the next quarter’s consumption is hedged. e hedging level
then drops on a straight-line basis to  per cent in quarter . Swedish units
consume around  () h per year with a spot price risk of  .
(.) per every time the price of electricity changes by  .. Electricity
NOTE 41, CONT.
FINANCIAL INFORMATION > NOTES
SAAB ANNUAL REPORT 2012 113