Swedish defence contractor Saab has revised its financial projections for full year 2025 upward following a 31.5% surge in organic sales during the second quarter.
Sales in the quarter climbed to Skr19.79bn ($1.9bn), marking a 30.4% increase from the previous year.
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This growth was consistent across all business areas, including Combitech, with Dynamics making notable sales contribution.
Saab’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the quarter stood at Skr2.83bn, translating to an EBITDA margin of 14.3%.
The company’s operating income (EBIT) saw a substantial rise of 49%, reaching Skr1.98bn and achieving a margin of 10.0%, largely propelled by robust results in the Dynamics and Surveillance business areas.
Net income for Q2 FY25 also experienced a significant boost, increasing by 52% to Skr1.54bn compared to Skr1.01bn in the same quarter of the previous year. Its diluted earnings per share followed suit, jumping by 53% to Skr2.83.
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By GlobalDataDuring the second quarter, the company secured new orders totalling Skr28.403bn, a figure primarily fuelled by a significant number of small and medium-sized contracts.
In the first half of the fiscal year, Saab reported sales totalling Skr35.58bn, a year-over-year increase of 21.2%.
Both EBITDA and EBIT showed strong growth of 31% and 36%, respectively, with EBIT reaching Skr3.43bn and maintaining an operating margin of 9.6%.
The company raised its anticipated organic sales growth to the range of 16-20%, up from the previously forecasted range of 12-16%.
The company also expects EBIT growth to outpace organic sales growth and maintains its forecast for positive operational cash flow for the entire year.
Saab president and CEO Micael Johansson said: “Following the Nato summit in June, alliance members have now committed to increase defence expenditures to 5% of GDP by 2035, of which 1.5% of GDP is dedicated for broader defence and security infrastructure investments. In Europe, there is a growing call for unity and cooperation to create deterrence, and in Sweden, a decision has been made to expand defence spending by Skr300bn to meet the new Nato targets.
“While this will enable significant growth for our industry, the shift from defence planning and policy alignment to procurement takes time. Saab’s broad portfolio and ability to deliver leading technologies uniquely positions us to support countries in their capability needs. We are continuing to invest in capacity increases and are proactively working in close cooperation with our suppliers to secure future deliveries.”
