Saab profit soars in second quarter

Swedish aviation and defence group Saab said Friday its second-quarter profit soared by 45 percent, exceeding analysts' expectations, owing to strong sales despite a plunge in orders.

For the period April-June, the group posted a net profit of 438 million kronor (47.85 million euros, 65.9 billion dollars), up from 301 million a year earlier, a Saab statement said.

Sales totalled 5.935 billion during the period, up by 15.35 percent from a year ago.

In the first six months of the year, sales reached 10.852 billion, exceeding analysts’ forecasts of 10.629 billion.

In the second quarter, the group’s operating profit rose by 55.9 percent to 630 million kronor, while operating margin climbed from 7.9 percent to 10.6 percent.

However, orders in the second quarter plunged by 74 percent to 2.954 billion from 11.431 billion a year ago, and were almost halved during the six-month period to 8.345 billion.

The group attributed the drop to Pakistan’s decision to reduce by 1.35 billion kronor an order for an airborne surveillance system.

“The first half of 2007 was a stable, forward-looking period for Saab,” group chief executive Aake Svensson said.

“Order bookings remained satisfactory, sales increased and income was stable. During the second quarter, important acquisitions were complemented by future-oriented partnerships of major significance,” he added.

For the rest of the year, the group said it expected growth in line with 2006 levels when the group posted a 12 percent rise in net profit to 1.347 billion kronor.