Hexatronic Group AB (publ) Year-end report January – December 2022
February 09 2023 - 1:00AM
Hexatronic Group AB (publ) Year-end report January – December 2022
Hexatronic Group AB
(publ)Year-end report
January – December 2022
Events during the quarter
- Hexatronic completed the acquisition of Impact Data Solutions
Ltd.
- Hexatronic has signed a binding asset purchase agreement to
acquire all business activities of Rochester Cable, from TE
Connectivity, for an enterprise value of MUSD 55.
- Hexatronic acquires leading micro duct business KNET for an
expected enterprise value of MUSD 63.
- Hexatronic has signed a three-year strategic supply agreement
with Eltel for the Finnish market, to a value of approximately MEUR
20.
- Hexatronic has signed a four-year Strategic Partner agreement
with Grizzly Broadband in Montana, USA, to a value of over MUSD
15.
- Hexatronic syndicated credit facilities have increased by MSEK
1500 to finance published acquisitions and increase unutilized
credit facilities.
Events since the end of the quarter
- Hexatronic adjusted the profitability target to an EBITA-margin
of 15% to 17% over a business cycle. The previously set
profitability target was at least 12% EBITA-margin over a business
cycle
- The Board of Directors will propose
a divided of 0.10 SEK (0.10) per share for the financial year 2022
to the Annual General meeting
Comments from the CEO
A great finish to the year
The year was another record year in terms of both sales and
profitability. We continued to grow very strongly, particularly in
the US and UK, but also in Germany. Sales grew by 88% in 2022 with
53% organic growth compared to 2021. Profitability (EBITA)
increased 177% to a margin of 16.6% for the full year 2022. The
profitability target of 12% was significantly exceeded and given
the trends we see ahead, we have decided to increase the target to
15-17% EBITA over a business cycle.
The fourth quarter followed the trend we have seen throughout
the year, with solid sales growth. We achieved sales growth of 54%,
of which 36% organic growth, compared to the same quarter last
year. Profitability (EBITA) increased by 153%, resulting in a
margin of 17.3%. We continue to see a positive impact on
profitability due to a favorable geographic sales mix and positive
scale effects with high-capacity utilization in our factories.
Sales in our largest market, North America, continued to develop
very strongly in the fourth quarter, with a growth of 100% compared
to the same quarter last year. Both duct sales and our FTTH systems
developed strongly. During the quarter, a 4-year contract of MUSD
15 was signed with Grizzly Fiber for our FTTH system. Our new duct
plant in Clinton, South Carolina, began small-scale production
during the quarter. We expect full-scale production to be achieved
by the end of the second quarter of 2023.
Sales in Europe, excluding Sweden, continued to develop strongly
in the last quarter of the year, mainly thanks to the UK and
Germany. Sales in the region increased by 56% compared to the
corresponding quarter last year. During the quarter, a three-year
contract of MEUR 20 was signed with Eltel Finland for our FTTH
system.
Sales in Sweden remained strong and increased by 11% compared to
the same quarter last year. Sales in the rest of the
world grew by 9% in the fourth quarter compared to the
corresponding quarter last year, mainly due to the acquisition of
KNET, which was consolidated as of December 1, 2022.
With the acquisition of the micro duct manufacturer KNET in
South Korea, we enhance our position in our strategic growth
markets in the US and Europe, as well as opening up new selected
markets in Asia. Further we secure capacity and strengthen the
groups competence in plastics and production processes.
The acquisitions, during the year, of homeway in Germany,
strengthened our indoor offering and the acquisition of IDS in the
UK strengthened our data center offering. We have also signed an
agreement to acquire Rochester in the US, which strengthens our
Harsh Environment business offering (fiber optic solutions in
demanding environments) and we expect closing in the first quarter
of 2023.
Our acquisition efforts in 2023 will primarily focus on building
the Harsh Environment, Wireless, and Data Center businesses. We
continue to have an attractive pipeline for further acquisitions in
2023.
Order intake has continued to develop strongly. At the end of
the year, we have an order book that is organically 67 percent
higher than the corresponding time last year. We have yet to see
any signs of a slowdown in order intake. During the last month, we
have noticed that a few smaller and relatively new players have had
difficulties to finance planned FTTH-projects. We assess that it
will not negatively affect the rollout pace on the market as the
limited factor is still expected to be trained installers. In the
event of a potential recession, we expect to see some negative
impact.
Welcome to join us on our growth journey.Henrik Larsson
LyonPresident and CEO Hexatronic Group AB (publ)
Please direct any questions
to:Henrik Larsson Lyon, CEO Hexatronic
Group, +46 706 50 34 00Pernilla Lindén, CFO Hexatronic Group,
+46 708 77 58 32
This information comprises disclosures that Hexatronic Group AB
(publ) must publish according to the Swedish Securities Market Act
The information was submitted for publication, through the agency
of the contact person set out above, at 07:00 CET on February 9,
2023. This is a translation of the Swedish version of the interim
report. When in doubt, the Swedish wording prevails.
Hexatronic creates sustainable networks all over the world. We
partner with customers on four continents – from telecom operators
to network owners – and offer leading, high-quality fiber
technology for every conceivable application. Hexatronic Group
(publ.) was founded in Sweden in 1993 and the Group is listed on
Nasdaq OMX Stockholm. Our global brands include Viper, Stingray,
Raptor, InOne, and Wistom®.
- Hexatronic Group - Year-end report 2022
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