Saab shares crash on lower forecast

Swedish aerospace giant Saab announced on Thursday that it was lowering its sales outlook for 2008, sending its shares tumbling 20 percent on the Stockholm stock exchange.

The company cut organic sales expectations from 5 percent down to 3- 4 percent, and also shaved a percentage point or two off forecasts for its operating margins.

The company now projects 2008 operating margins of 8-9 percent, rather than the 10 percent growth forecasted earlier.

“Different factors have had and continue to have an adverse impact on Saab, mainly through delays in order intake for major international projects and uncertainties in respect of Swedish defence material spending,” the company said in a statement.

Saab also cited higher than expected marketing costs for its Gripen aircraft, as well as delays in commercial aircraft orders and weaker development for its technology business in South Africa as reasons for the reduced outlook.

Saab shares finished the day down 19.5 percent, closing at 128.75 kronor ($19.51).