Delays and cutbacks behind Saab profit slump

Swedish aviation and defence group Saab has reported a 25 percent drop in net profit in the first half of 2005, due in part to project delays and declining orders, and confirmed that further job cuts will be needed.

Net profit for the first six months of this year fell to 386 million kronor compared with 519 million kronor during the same period of 2004, the company said in a statement.

Orders fell to 6.96 billion kronor, about 20 percent less than orders in the first six months of last year.

Revenue for the period showed a slight increase to 8.43 billion kronor versus 8.37 billion kronor in 2004.

“The first half of the year did not unfold as we had expected, except for the necessary provision for one of our projects in development,” said the group’s chief executive Åke Svensson.

He was referring to the delay in the delivery of command and control systems for 18 helicopters produced by the European consortium NH Industries, which Saab had previously announced.

Saab also suffered from a reduction of work on the Gripen JAS 39 fighter plane, a project with British defence contractor BAE Systems in their joint enterprise Gripen International.

Saab confirmed that due to cutbacks in Swedish defence spending the group would have to lay off between 1,000 and 1,500 employees during this year and next.

The group laid off 350 workers last month, bringing the total so far this year to 760 people.

Saab is now counting more on its exports which represented 62 percent of orders in the first half of the year.



Former Swedish Saab bosses appear in court

Swedish car maker Saab's former CEO Jan Åke Jonsson and the firm's former head lawyer Kristina Geers have appeared in court in Vänersborg in west Sweden, accused of falsifying financial documents shortly before the company went bankrupt in 2011.

Former Swedish Saab bosses appear in court
Saab's former CEO Jan Åke Jonsson. Photo: Karin Olander/TT
The pair are accused of falsifying the paperwork at the height of the Swedish company's financial difficulties at the start of the decade.
A third person – who has not been named in the Swedish media – is accused of assisting them by issuing false invoices adding up to a total of 30 million kronor ($3.55m).
According to court documents, the charges relate to the firm's business in Ukraine and the paperwork in question was signed just before former CEO Jan Åke Jonsson resigned.
Both Jonsson and Saab's former head lawyer Kristina Geers have admitted signing the papers but denied knowledge of the Ukranian firm implicated in the case.
All three suspects deny all the charges against them.

Saab's former head lawyer Kristina Geers. Photo:  Björn Larsson Rosvall/TT
Saab filed for bankruptcy at the end of 2011, after teetering on the edge of collapse for nearly two years.
Chief prosecutor Olof Sahlgren told the court in Vänersborg on Wednesday that the alleged crimes took place in March 2011, when Saab was briefly owned by the Dutch company Spyker Cars.
It was eventually bought by National Electric Vehicle Sweden (Nevs), a Chinese-owned company after hundreds of staff lost their jobs.
The car maker, which is based in west Sweden, has struggled to resolve serious financial difficulties by attracting new investors since the takeover.
In October 2014 it announced it had axed 155 workers, close to a third of its workforce.
Since 2000, Saab automobile has had no connection with the defence and aeronautics firm with the same name. It only produces one model today, the electric 9-3 Aero Sedan, mainly targeting the Chinese market.