By Niklas Pollard
STOCKHOLM (Reuters) -Swedish defence group Saab on Friday reported first-quarter operating profit just above market expectations and stood by guidance for sharply higher sales and earnings this year even as global trade tensions have stoked uncertainty.
The company said in a statement its operating earnings rose to 1.45 billion Swedish crowns ($150.6 million) from a year-ago 1.19 billion crowns, narrowly topping a mean forecast of 1.42 billion crowns seen in an LSEG compilation of analyst forecasts.
The maker of military equipment ranging from missiles and advanced electronics to submarines and the Gripen fighter jet repeated its full-year outlook for sales to grow 12%-16% organically with operating profit to rise even more.
Saab is riding a defence spending boom brought on by Russia’s invasion of Ukraine and related worries over security in Europe, its main market and home to well over half its sales.
Shares in the company, which competes with giants such as U.S. Lockheed Martin, France’s Dassault Aviation and Britain’s BAE Systems, have risen nearly 80% since the start of the year, adding to gains in previous years.
But the tariff turmoil triggered by U.S. President Donald Trump has raised uncertainty about supply chains and broader economic activity, a concern also for Saab, though it only generates roughly a tenth of its sales in North America.
CEO Micael Johansson told Reuters its partly regionalised supply chains with no single big hub, large inventories and contracts covering compensation for factors like inflation and currencies provided resilience amid the tariff turmoil.
“Many countries, including Sweden, also have reciprocal defence agreements specifically with the U.S. and whether these would override tariffs is a bit unclear right now,” he said.
Asked whether he was paying particular attention to any specific supply chain given the tariffs, Johansson said: “That would probably be raw material supplies, even if we of course have inventories there too.”
Saab, which also sells civilian products to customers such as Airbus and Boeing, said order bookings rose 4% in the quarter with its backlog of orders growing to 189 billion crowns from 158 billion a year ago.
($1 = 9.6264 Swedish crowns)
(Reporting by Niklas Pollard, editing by Essi Lehto, Mrigank Dhaniwala and Shri Navaratnam)
