ANNUAL REPORT 2017 Director-General's Statement DI
RECTOR-GENERAL'S STATEMENT 2017 WAS A RECORD YEAR FOR AVIATION The traffic year 2017 was a record year for aviation in Sweden. The number of aircraft movements in the Swedish airspace was 762,000. This is an increase of almost five per cent compared to 2016. A strong Swedish economy and an increased attractiveness as a tourist country contributes to the increase in aviation. Capacity and delivery In 2017 LFV delivered a very good capacity. With high flexibility, responsibility, and competent employees, LFV has managed the large increase in air traffic with maintained quality and punctuality. We are to treat the environment carefully in our daily work. We do this through training and developing our air traffic controllers in eco-driving in the air, and offering our customers support when they apply for environment certificates. We collaborate with scientists, authorities, and others to develop models to use the airspace in the most optimal way, from a sustainability perspective. In May, the area was expanded with straight flight routes, Free Route Airspace (FRA), when Norway joined the previously established FRA in Northern Europe, where Sweden already is a member. Aviation safety Aviation safety is always our first priority. In 2017 all aviation safety objectives were achieved. Globally as well, 2017 was the safest year in aviation so far. It is the results of the systematic, insistent, longterm, and global work conducted to make aviation the safest mode of transport. Finances The loss for the year was minus SEK 78 million. The result is burdened with a net of around SEK 70 million, regarding increased pension costs, due to the low interest rate. The increase in traffic has entailed more revenue, even if LFV cannot keep the full revenue increase in accordance with the current charging model. LFV is a state-owned enterprise and our LFV ANNUAL REPORT 2017 will commence 1 January 2020. LFV has, in cooperation with our Danish equivalent Navair, proposed a simplified mode which, to a higher degree take different providers' individual prerequisites into consideration. Overly ambitious targets regarding cost efficiency risk to affect the ability to achieve other objectives, e.g. the capacity target, in a negative way. revenue comes from air traffic services and other services, which we sell to airlines and airports. LFV do not achieve the owner's requirement of 4 per cent return on equity. Neither the equity/assets ratio of 15 per cent is achieved, and is not assessed as possible to achieve with the current model of financing the pension liability in the balance sheet. Since 2014 LFV has conducted an efficiency programme, which so far has rendered savings of slightly more than SEK 200 million. We assess the scope for further efficiency measures within the programme as limited. Performance plan and efficiency programme The air traffic service is governed by fiveyear performance plans, with stipulated targets from EU, regarding aviation safety, capacity, environment and cost efficiency. The present plan is in force during the period 2015–2019. In 2017 LFV has achieved the targets regarding aviation safety, capacity, and environment. The objective regarding cost efficiency is also achieved, excluding the increased pension costs following changes in the interest rate. From an international perspective, the Swedish targets for capacity and environment are very ambitious. At present, discussions are held before the upcoming third reference period, which Systems and development In November 2017 we signed an agreement with Swedavia regarding air navigation control from a common control center at Arlanda for the airports in Kiruna, Umeå, Östersund and Malmö. With remote air traffic control at four more airports, Sweden and LFV consolidate the strong position when it comes to digitalisation of the air navigation service. The commercial market, both nationally and internationally, is important for LFV. The objectives set for the international business are not yet achieved. Therefore, LFV has made the decision regarding a revised direction. We have decided to invest in a new system for flight inspection to become more attractive. We continue to develop digital services in air traffic services, where we work together with Saab through our joint company Saab Digital Air Traffic Solutions. A jubilee pointing forward We are facing enormous challenges with increased requirement of total defense ability, retirements, and efficiency requirements from airlines and EU, just to mention a few. We will keep on delivering capacity and aviation safety to our customers. In 2018 it is 40 years since Sweden integrated civil and military air traffic services. That made us a forerunner in Europe. And that will LFV continue to be. Ann Persson Grivas Director General, LFV 3
ANNUAL REPORT 2017 LFV is with you on the travel
ANNUAL REPORT 2017 This is LFV
ANNUAL REPORT 2017 The Year in Brief
ANNUAL REPORT 2017 Operating Environment and Marke
t
ANNUAL REPORT 2017 Strategy and Objectives
ANNUAL REPORT 2017 Customer Focus
ANNUAL REPORT 2017 Environment
ANNUAL REPORT 2017 Aviation Safety
ANNUAL REPORT 2017 Innovation
ANNUAL REPORT 2017 Cooperation and Partnerships
ANNUAL REPORT 2017 Employees
ANNUAL REPORT 2017 Board of Director's Report
ANNUAL REPORT 2017 Income Statement, Comments on t
he Income Statement
ANNUAL REPORT 2017 Balance Sheet
ANNUAL REPORT 2017 Comments on the balance sheet a
nd funds statements
ANNUAL REPORT 2017 Financing
ANNUAL REPORT 2017 Accounting and Valuation Princi
ples
ANNUAL REPORT 2017 Notes
ANNUAL REPORT 2017 Investments
ANNUAL REPORT 2017 Reporting in Accordance with Pe
rformance Plan
ANNUAL REPORT 2017 Reporting in Accordance with Ap
propriation Directions
ANNUAL REPORT 2017 Risk Management
ANNUAL REPORT 2017 Dividend Proposal
ANNUAL REPORT 2017 Audit Report
ANNUAL REPORT 2017 Board of Directors
ANNUAL REPORT 2017 Group Management
ANNUAL REPORT 2017 Five Years at a Glance
ANNUAL REPORT 2017 Abbreviations and Explanations