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Saab shares dive despite strong 2011 report

AFP/The Local · 10 Feb 2012, 15:29

Published: 10 Feb 2012 15:29 GMT+01:00

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"2011 was an important year for us and we secured several key orders, such as further development and maintenance orders for the Gripen (fighter) from (Sweden) ... and for our multi-mission radar system Giraffe from the US," chief executive Håkan Buskhe said in a statement.

"I am also proud of the strong recognition Gripen received when the Swiss government ... selected it" as the preferred bidder, he said.

The Swiss government is expected to formally approve the choice of the Gripen multi-role fighter in February.

In November, Bern announced it would buy 22 Gripen fighters to replace its ageing F5 fighter fleet for an estimated 3.1 billion francs ($3.38 billion).

But amid pressure from other rival suppliers still eager to win the deal, Saab, according to unconfirmed press reports, is ready to review its price down to perhaps 2.5-2.8 billion francs.

In 2011, Saab posted a net profit of 2.23 billion kronor ($333.8 million), up from 433 million in 2010. In the fourth quarter alone, profit rose 52-fold to 413 million kronor from 8.0 million kronor.

Sales fell 4.0 percent in 2011 to 23.50 billion kronor and were down 9.0 percent in the fourth quarter to 7.35 billion kronor.

"For 2012, we estimate that sales will increase slightly compared to 2011," Buskhe said.

Orders however were lower in the second half of the year as "a consequence of continuous delays in customers' decision making processes."

Orders fell 28 percent in 2011 to 18.91 billion kronor giving an order book at the end of the year worth 37.17 billion kronor, down 10 percent from 2010.

Story continues below…

That news worried investors and Saab's share price slumped 9.3 percent in afternoon trade on a Stockholm market down just 1.25 percent.

Saab AB, whose star product is the JAS Gripen fighter, has for more than 30 years been a separate company from the now-bankrupt carmaker Saab Automobile.

AFP/The Local (news@thelocal.se)

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Your comments about this article

08:12 February 12, 2012 by sunnchilde
The Gripen fighter needs to have some combat experience. If you want to convince other countries to buy your fighter to protect their airspace, you need to show them how "excellent" the Gripen is. For lack of a nicer way to say this, Gripen needs to kick some butt. The next time there is a multi-country military intervention like Lybia, you need to send your fighters right away and tell your pilots to go out there and make a name for themselves. Then the orders will come. Right now, nobody is afraid of the Gripen. You need to change that.
12:26 February 12, 2012 by JohnnyEnglish
Yes, they need to demonstrate Gripen's arab-killing-capability or no one in the west will be interested.
05:52 February 13, 2012 by sunnchilde
More correctly you're killing arabs flying Russian (or French) hardware. I really doubt you'd be killing Russians flying Russian hardware, because if that were to happen, we have much bigger problems.
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