Forecast boosts SAS

The board of the airline SAS gained authorisation to implement a new issue of a maximum of 66 million ordinary shares during an extraordinary shareholders’ meeting on Friday. This corresponds to almost 20% of the number of common shares outstanding. It remains unclear whether the board is going to use the mandate, and if so, when.

On Friday the airline’s shares climbed after SAS presented new forecasts for the 2017/2018 financial year. SAS expects profits before tax and one-off posts to be between SEK 1.5 and 2 billion. This would constitute steady progress from the recent financial year.

The forecast indicates the company is in a significantly stronger position than several years ago, says Jacob Pederson, aviation analyst at Sydbank.

Margin lower than expected

At a first glance, the Volvo group’s interim report looked set to ignite a stock market rally; the group posted a 22% per cent increase in orders and an operating profit of SKr 8,540 million in the second quarter and raised its forecast for the North American truck market and the all-important Chinese construction equipment market.

But, when the Stockholm stock exchange opened the group’s share price fell and at close was down 3.4%. The main reason for this was that the Trucks division, which is Volvo’s largest business area, reported an operating margin of 9.6% for the quarter, which was 1.1 percentage points lower than expected. The margin was weighed down by delivery disturbances, mainly in Europe, and problems in the supplier chain.

Volvo hopes to resolve the problem over the summer and expects the impact of the disturbances to be lower in the third quarter.

Vattenfall’s threat: we will close all reactors

Yesterday’s quarterly report from energy giant Vattenfall presented a rise in operating profits and profits after tax of SKr 6 billion, thereby granting CEO Magnus Hall some breathing space.

However write-downs for German brown coal, if the government approves Vattenfall’s sale, are expected in the next report and the company must make a decision to make new investments into nuclear power or decommission.

“Without investment… we will not be allowed to run the reactors after 2020. We are not going to make investments if the government does not remove the tax on nuclear power completely. That is a definite decision from us,” says Magnus Hall.

Meanwhile DN reports Vattenfall has no plans to scrap emission rights, as MEP Jytte Guteland has demanded. Magnus Hall says the rights are part of the deal with the buyer of the lignite operations in Germany.