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Hexagon Report 2020 Financial Results

“We recorded our highest quarterly earnings and cash flow ever, returning to positive organic growth, with a record operating margin despite a significant currency headwind. We closed several acquisitions in the quarter to further our autonomous solutions strategy within construction, manufacturing and industrial facilities. As in the previous quarter, China and our Geospatial Enterprise Solutions segment were the growth engines recording 25 per cent and 7 per cent organic growth, respectively. Within the Industrial Solutions segment, the Manufacturing Intelligence division improved sequentially, recording -2 per cent organic growth but with a positive book-to-bill. This improvement was supported by a broad-based recovery in China and growth in software solutions but hampered by continued demand weakness in the automotive and aerospace markets throughout Europe and Americas. The PPM division declined organically by -12 per cent on the back of tough comparisons and a challenging oil and gas market.

Although market conditions remain challenging in some regions, we enter 2021 with confidence. We expect demand to accelerate with a sequential improvement in Industrial Enterprise Solutions, and continuing favourable development in Geospatial Enterprise Solutions.” commented Ola Rollén, President and CEO, Hexagon AB.

Hexagon’s Industrial Enterprise Solutions division includes metrology systems that incorporate the latest in sensor technology for fast and accurate measurements, as well as CAD (computer-aided design), CAM (computer-aided manufacturing) and CAE (computer-aided engineering) software. These solutions optimise design, processes and throughput in manufacturing facilities and create and leverage asset management information critical to the planning, construction and operation of plants and process facilities in a number of industries, such as automotive, aerospace and oil and gas. Industrial Enterprise Solutions consists of Manufacturing Intelligence and PPM.

Net Sales

Hexagon’s Industrial Enterprise Solutions (IES) operating net sales amounted to 508.8 MEUR ($652.8M). Using fixed exchange rates and a comparable group structure (organic growth), net sales decreased by -5 per cent. Regionally, organic growth was 9% in Asia, -11% in EMEA and -13% in Americas. In Asia, China recorded 25% organic growth, mainly driven by a strong broad based recovery in manufacturing. Japan and South Korea declined in the quarter. In EMEA, Western Europe recorded -14% organic growth, driven by weakness in the automotive and aerospace segments in Germany and France and high year-on-year comparisons in the power and energy segment. Eastern Europe, the Middle East and Africa recorded solid growth. In Americas, North America recorded -13% organic growth, mainly driven by a weak development in the aerospace and oil and gas markets. South America recorded a double-digit decline.

Regarding the divisions within IES, Manufacturing Intelligence recorded -2% organic growth, supported by a broad-based recovery in China and software growth but hampered by weak demand in the automotive and aerospace segments in Europe and Americas. The PPM division recorded -12% organic growth, on the back of high year-on-year comparisons and a challenging oil and gas market. However, the AEC (architecture, engineering and construction) design software portfolio recorded strong growth in the quarter.

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