Hexagon AB

Hexagon reported net sales of EUR 1.05 billion, up about EUR 40 million reported; management said the underlying top-line increase was about EUR 110 million including FX, translating to about 12% organic growth. Gross margin was around 62%, or 62.3% excluding the sold D&E business, and EBITAC was 24.3% versus 21% in the comparison period. Adjusted EPS was about EUR 0.078 per share, lower than the EUR 0.092 reported due to a EUR 71.5 million gain on Cadence share sales affecting financial net. Cash conversion was 149%, operating cash flow pretax was EUR 364 million, and net debt leverage declined to 0.3x. For the full year, Robotics cost is expected to be approximately EUR 50 million; the restructuring program had reached a EUR 73.5 million run rate against the EUR 74 million target. Management did not give formal quarterly or full-year sales/profit guidance, but said Q3 entered with strong momentum, strong order intake, and continued solid end-market trends.

CEO Anders Svensson characterized Q2 as an excellent quarter with the highest organic growth Hexagon has recorded in five years, and said momentum strengthened rather than faded during the period. He emphasized portfolio reshaping through the Octave separation, the Waygate acquisition, and completion of the cost restructuring program ahead of schedule. He also pointed to strong demand in aerospace & defense, electronics, and general manufacturing, while noting weakness in automotive in China, agriculture, and construction in parts of Europe and China.

New CFO Enrique Patrickson focused on the financial bridge, saying the business added about EUR 40 million to reach EUR 1.05 billion in net sales, but the underlying increase was about EUR 110 million after the D&E divestment and FX effects. He highlighted EBITAC expansion, with operational leverage, currency, and roughly EUR 14 million of restructuring savings supporting margins, and noted the restructuring program has reached a EUR 73.5 million run rate, essentially the full EUR 74 million target, with completion expected by the end of Q3. He also pointed to strong working-capital performance behind the 149% cash conversion, EUR 364 million in operating cash flow pretax, and leverage down to 0.3x, while saying group holding costs were somewhat elevated in the quarter and should be thought of as around EUR 5 million rather than extrapolating the quarter’s level.

Analysts pressed management on whether tariff refunds, defense demand, semiconductor strength, and robotics partnerships were creating any one-off boosts. Anders said tariffs contributed a net positive EUR 2.4 million versus last year, but that was offset by higher freight and other costs from the Middle East, making the net effect zero when combined; he also said he did not see meaningful one-off distortions in MI demand and that market trends remained stable. On Robotics, management reiterated that Schaeffler’s deployment spans at least 1,000 humanoids over the coming years, but said other customer discussions vary widely in size and that commercialization by year-end could require more spending and possible partner arrangements. On Waygate, management said the deal is expected to close in the second half, likely Q4, with the USD 630 million business generating about 10% EBIT margin overall and the two focus businesses at about USD 330 million revenue and 16% margin.