Hexatronic Presents Interim Report Q2 2022
Q2 from Hexatronic Group - Continued strong performance!
“The strong start to the year intensified during the second quarter. We achieved sales growth of 112 percent compared with the same quarter last year, of which 60 percent was organic growth. Profitability (EBITA) increased 174 percent equating to a margin of 16,8 percent, which exceeds our target of at least 12 percent by a good margin. The increase in profitability is primarily a result of strong performances in the USA and UK, a good product mix, as well as scale effects with most of our factories operating at high capacity,” says Henrik Larsson Lyon, CEO Hexatronic Group.
Read the full report here.
Events during the quarter
Events since the end of the period
Hexatronic CEO Henrik Larsson Lyon in interview about Q2, 2022
Comments from CEO
Continued strong performance!
The strong start to the year intensified during the second quarter. We achieved sales growth of 112 percent compared with the same quarter last year, of which 60 percent was organic growth. Profitability (EBITA) increased 174 percent equating to a margin of 16,8 percent, which exceeds our target of at least 12 percent by a good margin. The increase in profitability is primarily a result of strong performances in the USA and UK, a good product mix, as well as scale effects with most of our factories operating at high capacity.
The uncertainty regarding the development of raw material prices remains. After the end of the second quarter, further substantial price increases within certain product categories were announced. Efforts to pass on these price increases to customers are a high priority, but we estimate that the gross margin will continue to be negatively affected during the coming quarters.
Sales in our largest market, the USA, continued to develop well, at a growth rate of 129 percent. The growth is led by sales of our ducts, as well as sales of Fiber To The Home (FTTH) systems. Since the end of the quarter, we have signed a comprehensive agreement with Open Fiber USA for our FTTH system, another sign that our FTTH system is highly appreciated among our customers. We expect our new duct factory in Clinton, South Carolina, to begin production during the fourth quarter of this year. The factory will be a major contribution to continued organic sales growth.
Sales in Europe excluding Sweden also continue to develop strongly, primarily driven by strong performances in the UK and Germany. Sales in the region increased by 122 percent compared with the corresponding quarter last year. In Germany, the acquisition of REHAU’s telecom business is contributing strongly to the increase in sales.
Sales in Sweden were very strong and increased by 64 percent compared with the corresponding quarter last year, primarily driven by a positive trend in sales of submarine cable.
Sales in the rest of the world grew by 115 percent, attributable to our two acquisitions in Australia in 2021.
The order book has continued to develop very positively. We ended the quarter with an order book that was 154 percent higher organically than at the same point in the previous year. The strong order book is well distributed across most of our companies, with those in the USA accounting for the largest increase.
Welcome to join us on our growth journey.
Henrik Larsson Lyon
President and CEO
Hexatronic Group AB (publ)
Publication
This information comprises disclosures that Hexatronic Group AB (publ) must publish according to the EU Market Abuse Regulation and the Swedish Securities Market Act. The information was submitted for publication, under responsibility of the contact persons named below, on 11 August 2022 at 07:00 CET.
