Hexagon Report First Quarter Financial Results
Hexagon Group has reported operating net sales increased by 19 per cent to 1,163.4 MEUR (977.9). Using fixed exchange rates and a comparable group structure (organic growth), net sales increased by 10 per cent compared with 1st quarter 2021.
The Hexagon Industrial Enterprise Solutions division (IES), which includes metrology systems, CAD, CAM and CAE software, reported operating net sales amounted to 580.7 MEUR (475.3). Using fixed exchange rates and a comparable group structure (organic growth), net sales increased by 10 per cent over the same period in 2021.
Regionally, organic growth was 12 per cent in Asia, 10 per cent in EMEA and 9 per cent in the Americas.
In Asia, China recorded 14 per cent organic growth, fuelled by strong growth in aerospace, automotive and in the software portfolios but hampered by a challenging oil and gas market. The rest of Asia recorded solid growth due to strong demand for design and production software.
In EMEA, Western Europe recorded 13 per cent organic growth, driven by a recovery in aerospace and strong demand in automotive, manufacturing, power and energy. Russia declined substantially, reflecting the impact from the sanctions imposed by the European Union and the U.S. as well as actions taken to freeze the business operations in Russia in March. Africa and the Middle East recorded double-digit growth.
In the Americas, North America recorded 8 per cent organic growth, driven by a recovery in aerospace and solid demand in general manufacturing, automotive, power and energy segments. South America recorded strong double-digit growth, driven by continued growth in the power and energy segment.
Manufacturing Intelligence recorded 13 per cent organic growth, driven by strong, broad-based demand across key industries, regions, and for software solutions. The PPM division recorded 2 per cent organic growth, fuelled by growth in design and asset information management software, leading to a continued recovery in EMEA and Americas. Both divisions were negatively impacted by Russia.
“Hexagon delivered yet another record quarter, recording 19 per cent sales growth of which 10 per cent was organic, a gross margin of 65 per cent and an operating margin of 29 per cent. All divisions improved their results. The supply situation for critical electronic components remained strained and had an adverse impact on organic sales growth of approximately -6 per cent in the quarter, which also impacted profitability and cash flow. Hexagon also decided to freeze its operations in Russia which reduced organic growth by approximately -1 per cent organic growth in the quarter. Russia previously represented around 2 per cent of Hexagons sales annually.
“Looking into the global macro environment, we are following the main themes closely: labor market, inflation, and overall demand. Despite political and Covid-19 related challenges across parts of the world our growth is a testament to the very strong demand situation that prevails in the global economy.” stated Ola Rollén, President and CEO, Hexagon AB.
For more information: www.hexagon.com