In This Article:
-
Revenue: SEK4.7 billion, down 4% versus Q4 last year.
-
Organic Sales: Down 6% in the quarter.
-
Adjusted EBIT: SEK631 million with a margin of 13.4%.
-
Operating Cash Flow: SEK1.2 billion.
-
Net Debt: SEK2.2 billion with a net debt to EBITDA ratio of 0.59.
-
Equity Asset Ratio: 64%.
-
Return on Capital Employed: Approximately 17%.
-
Hexpol Compounding Revenue: SEK4.3 billion, 5% below Q4 last year.
-
Engineered Products Revenue: SEK386 million, above last year's SEK357 million.
-
Engineered Products Operating Profit: Increased 18% to SEK65 million with an EBIT margin of 16.8%.
-
Ordinary Dividend: Proposed at SEK4.26 per share, a 5% increase.
Release Date: January 28, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Hexpol AB (HXPLF) reported a strong operating cash flow of SEK1.2 billion, driven by efficient working capital management.
-
The company raised its ordinary dividend to SEK4.26 per share, reflecting confidence in its financial stability.
-
Hexpol AB achieved a significant milestone in sustainability, reaching a 65% reduction in CO2 emissions, with a target of 75% by 2025.
-
The acquisition of Piedmont Resin Supply strengthens Hexpol's position in nylon compounding, a growing market with applications in electric vehicles and other industries.
-
Hexpol's Engineered Products segment reported strong sales and a new sales record for wheels, with an 18% increase in operating profit and a higher EBIT margin of 16.8%.
Negative Points
-
Overall sales for the quarter were down 4% compared to the previous year, with organic sales declining by 6%.
-
The company experienced lower demand from the automotive sector, particularly in North America, impacting sales and margins.
-
Hexpol's adjusted EBIT margin decreased to 13.4%, below the previous year's level, due to lower volumes and a less profitable product mix.
-
The early shutdowns by North American customers in December led to a short sales month, affecting overall quarterly performance.
-
The integration of Piedmont Resin Supply had a negative impact on Q4 margins due to the timing of the acquisition and seasonal sales patterns.
Q & A Highlights
Q: Could you provide more details on the significant drop in margins year-over-year? A: The key drivers for the margin drop include lower volumes due to early customer shutdowns in December, which we couldn't offset with cost savings as we needed resources for January's expected high volumes. Additionally, the product mix was less profitable during this period. - Peter Rosen, Deputy CEO & CFO