Combitech’s interim report for January-September 2016

Combitech, the Nordic technology consulting firm that forms part of the Saab AB defence and security group, increased its sales and saw its earnings improve over the first nine months of the year.

Events during the third quarter:

  • It was announced in August that Combitech signed an agreement with Ericsson, for a transfer of parts of Ericsson’s radio software development in Linköping and Gothenburg. Through this agreement, Combitech will secure in-house competence in this area, and be able to further build on its strong engineering base, making this expertise available to a broader group of customers. Around 300 Ericsson engineers transferred to Combitech on October 1.
  • Combitech sees a continued and substantial need amongst customers for services in Cyber Security and, with 190 consultants, the company is at the forefront of the field in the Nordic countries. A major campaign got under way recently geared towards increasing awareness regarding security both within industry and among private citizens in Sweden.
  • Sales in the first nine months of the year amounted to SEK 1,243 million, which is an increase on the same period the previous year. The number of employees was 1,464 by the close of the period.

"We are experiencing a positive development in terms of sales and profitability, and see considerable demand from the market. Customers are predominantly requesting services to keep up with digital transformation, as well as for support within Cyber Security.  By acquiring 300 engineers from Ericsson, we have gained an invaluable boost to our skills base within the area of digitalisation," says CEO of Combitech, Hans Torin.

KEY FIGURES, JANUARY-SEPTEMBER 2016:

Order situation

Order intake during the period was SEK 1,593 million, an increase of 33 % percent on the same period in 2015 (SEK 1,199 million). The increase in order intake is mainly due to multi-year orders from FMV and from orders in the telecom sector.

Sales

Sales revenues amounted to SEK 1,243 million, an increase of 3.3 % on the same period in 2015.

Profit and Margin

The operating profit (EBIT) increased by 24 percent to SEK 84 million (SEK 68 million in 2015). Operating margin increased to 6.8 percent (5.7 percent in 2015). The improved operating margin is chiefly due to an increased utilization and a reduction in costs.

Operating Cash Flow

The operating cash flow increased to SEK 84 million during the nine-month period, compared with SEK 71 million during the same period in 2015. This increase is predominantly due to improved earnings.

Events After Close of Period

On 1 October, approximately 300 engineers from Ericsson transferred to Combitech. The impact of this deal will first be seen during Q4.