Swedish aerospace and defence company Saab has reported a 13.6% increase in operating income, amounting to $51.68m (Skr568m), in the third quarter (Q3) of 2022.

With an operating margin of 6.5%, the company said that the growth was the result of strong sales of 9.5% in Q3, of which 6.9% was organic growth.

Primarily driven by small and medium-sized orders growth, the order bookings for this quarter amounted to $706.47m (Skr7.772bn) and the backlog was $10.19bn (Skr112bn).

According to Saab, major orders in Q3 2022 included a $73.90m (Skr813m) deal of Carl-Gustaf ammunition and AT4 with the US, and the $68.17m (Skr750m) contract for advanced training aircraft fuselage systems with Boeing.

The company has reported a gross margin of 21.5% this quarter, compared to 21.8% in Q3 of 2021.

The earnings before interest, taxes, depreciation, and amortisation (EBITDA) margin was 12.7%.

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Operational cash flow for the third quarter was $50.81m (Skr559m) and $82.80m (Skr911m) for nine months.

Saab president and CEO Micael Johansson said: “We continued to see strong interest for Saab’s portfolio in the quarter.

“The increased defence spending in many countries, in combination with Sweden’s Nato application, has created significant market opportunities for Saab.

“Whilst procurement processes take time before being translated into orders, we are preparing our operations for future demand and have taken initiatives to invest in increased capacity and to recruit the right competences.

“We reconfirm our full year estimate of the operating income to improve at the upper end of our outlook range of 8% to 12%.”