Quarterly Report • May 9, 2012
Quarterly Report
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| MEUR | Q1 2012 | Q1 2011 ∆% | ||
|---|---|---|---|---|
| Operating net sales | 565.8 | 521.3 | 6 1) | |
| Revenue adjustment 2) | - | -4.4 | n.a. | |
| Net sales | 565.8 | 516.9 | 6 1) | |
| Operating earnings (EBIT1) | 111.0 | 104.8 | 6 | |
| Operating margin, % | 19.6 | 20.1 -0.5 | ||
| Earnings before taxes excl. non-recurring items | 97.5 | 90.2 | 8 | |
| Non-recurring items | - | -4.4 | n.a. | |
| Earnings before taxes | 97.5 | 85.8 | 14 | |
| Net earnings | 79.0 | 68.6 | 15 | |
| Earnings per share, EUR | 0.22 | 0.19 | 16 | |
| Earnings per share, excl. non-recurring items, EUR | 0.22 | 0.20 | 10 |
1) Adjusted to fixed exchange rates and a comparable group structure, i.e. organic growth.
2) Non-recurring reduction of acquired deferred revenue in H1 2011 related to the acquisition of
Intergraph.
COMMENTS FROM OLA ROLLÉN, PRESIDENT AND CEO, HEXAGON AB
"The year has started well for Hexagon. Net sales of 566 MEUR marks an all-time high for a first quarter. Regionally, it's a mixed message with double digit growth in North and South America, and slower, single digit growth in EMEA and Asia. We are happy with the profitability performance in the quarter. An operating margin of 20 per cent is a sign of strength bearing in mind that it includes -4.9 MEUR of costs stemming from the restructuring of the Intergraph SG&I business unit. The revenue synergy initiatives involving Intergraph continue to progress at full speed. Further details and insight into these developments will be shared at our upcoming event, "Hexagon 2012", held in the first week of June."
Ola Rollén, President and CEO, Hexagon AB
9%
6%
Organic growth
20%
Operating Margin
Q1
Sales growth
Organic growth in operating net sales was 6 per cent in the first quarter and the operating earnings (EBIT1) increased by 6 per cent to 111.0 MEUR.
Geosystems, which represented 33 per cent of Group sales in Q1, recorded an organic growth of -1 per cent in net sales. Geosystems' growth was adversely affected by the lack of investment in the high-speed rail network in China. Q1 is the last quarter in which the comparative growth figures of Geosystems will be hampered by these investment delays and our belief is that growth will resume in the second quarter.
Metrology, which represented 30 per cent of Group sales, displayed 19 per cent organic growth in net sales.
Technology, which represented 34 per cent of Group sales, displayed 3 per cent organic growth in net sales. The Intergraph PP&M division reported strong double digit growth whereas SG&I reported slightly negative growth. Technology is expected to report stronger growth once the restructuring of the SG&I division is concluded.
| Operating net sales | ||
|---|---|---|
| Q1 2011, MEUR | 521.3 | |
| Structure, % | 0 | |
| Currency, % | 3 | |
| Organic grow th, % | 6 | |
| Total, % | 9 | |
| Q1 2012, MEUR | 565.8 |
Growth in the quarter primarily comes from the ongoing recovery in North America and northern parts of Western Europe and strong demand in the automotive, aerospace, power and energy markets.
The demand for Hexagon's products and services in EMEA grew slightly in the first quarter. The organic growth in net sales was 1 per cent in the Group's core business, Measurement Technologies (MT), and -5 per cent in Other Operations.
The major markets in Western Europe experienced increased activity levels in the first quarter primarily driven by improved demand for measurement solutions used in automotive, aerospace and manufacturing. Demand was also driven by customer investments in enterprise engineering, construction and data management software used in power and process industries. Construction related activities and governmental businesses remained weak.
Demand in Southern Europe remains weak whilst Eastern Europe, Russia and the Middle East continue to grow.
Americas recorded 17 per cent organic growth in net sales in the first quarter. Apart from defense and security related markets, all of Hexagon's market segments
are growing in NAFTA, including automotive, aerospace and engineering, as well as infrastructure projects related to the Hexagon Geosystems application area.
Canada showed strong growth for Hexagon due to high demand in the natural resources sector.
Activity levels in all of Hexagon's end markets continue to be strong in South America. Hexagon anticipates many opportunities related to the exploration and production of Brazil's massive offshore oil reserves and has many interesting business opportunities and projects involving the 2014 World Cup and the 2016 Olympics.
Asia recorded organic growth in net sales of 2 per cent in the first quarter.
The growth in the region has been negatively affected by the lack of activity in the Chinese high-speed rail sector and the slowdown in the construction sector driven by government actions. Hexagon's business in India reported negative growth in the quarter due to tough comparison figures related to a large mining order recognized in the corresponding quarter last year.
Organic growth in China in the quarter, excluding high-speed rail, was 7 per cent. In addition to China, several other markets and industries in the region, such as Korea and Japan, reported growth. Hexagon foresees a gradual growth recovery for the business in China as new initiatives start to contribute during 2012
2 HEXAGON INTERIM REPORT 1 JANUARY – 31 MARCH 2012
NORTH AMERICA
30% (27)
SOUTH AMERICA
3%
(3)
| Net sales | Earnings | |||||
|---|---|---|---|---|---|---|
| MEUR | Q1 2012 | Q1 2011 ∆ % 1) | Q1 2012 | Q1 2011 ∆ % | ||
| Hexagon MT | 548.5 | 503.1 | 6 | 113.4 | 106.9 | 6 |
| Other Operations | 17.3 | 18.2 | -5 | 0.8 | 0.9 | -11 |
| Operating net sales | 565.8 | 521.3 | 6 | |||
| Group cost and eliminations | -3.2 | -3.0 | -7 | |||
| Operating earnings (EBIT1) | 111.0 | 104.8 | 6 | |||
| Operating margin, % | 19.6 | 20.1 | -0.5 | |||
| Interest income and expenses, net | -13.5 | -14.6 | 8 | |||
| Earnings before non-recurring items | 97.5 | 90.2 | 8 | |||
| Non-recurring items | - | -4.4 | n.a. | - | -4.4 | n.a. |
| Net sales | 565.8 | 516.9 | 6 | |||
| Earnings before taxes | 97.5 | 85.8 | 14 | |||
| Tax | -18.5 | -17.2 | n.a. | |||
| Net earnings | 79.0 | 68.6 | 15 |
1) Adjusted to fixed exchange rates and a comparable group structure, i.e. organic growth.
| Movement 1) | Income less cost | Profit impact | |
|---|---|---|---|
| CHF | Strengthened | Negative | Negative |
| USD | Strengthened | Positive | Positive |
| CNY | Strengthened | Positive | Positive |
| EBIT1, MEUR | -1.8 |
1) Compared to Q1 2011.
EMEA sales grew 1% organically in the first quarter, whilst Americas reported strong organic growth of 17%. The growth rate in Asia was negatively impacted by the lack of investments in the high-speed rail network in China.
Operating net sales increased by 9 per cent to 565.8 MEUR (521.3) in the first quarter. Using fixed exchange rates and a comparable group structure, net sales increased by 6 per cent.
Operating earnings (EBIT1) increased by 6 per cent to 111.0 MEUR (104.8), which corresponds to an operating margin of 19.6 per cent (20.1).
In the quarter, Hexagon conducted a restructuring programme in the Intergraph SG&I division. In an effort to reduce cost and better balance the global distribution of headcount, around 190 employees considered redundant were let go. The restructuring charge amounts to -4.9 MEUR and is included in EBIT1. Hexagon expects full payback from the programme as of the third quarter 2012 which is why the charge is not reported as a non-recurring item.
Operating earnings (EBIT1) were negatively affected by exchange rate movements of -1.8 MEUR.
The financial net amounted to -13.5 MEUR (-14.6) in the first quarter.
Earnings before taxes amounted to 97.5 MEUR (85.8). Earnings were negatively affected by exchange rate movements of -1.6 MEUR. Earnings before taxes in Q1 2011 include non-recurring items of -4.4 MEUR related to reduction of acquired deferred revenue stemming from the acquisition of Intergraph.
Net earnings amounted to 79.0 MEUR (68.6), or 0.22 EUR (0.19) per share.
Hexagon's core business Measurement Technologies has consistently improved its profitability. In 2007 and in 2008, the EBIT margin was 20 per cent. In 2009, the margin decreased to approximately 17 per cent due to reduced volumes caused by the global economic downturn. In 2010, the margin was back to 20 per cent, and in 2011 it reached a record level of 21 per cent. In the first quarter of 2012, the margin was 20.7 per cent (21.2).
1) Organic growth in net sales stemming from Intergraph has been included in the graph above per the date of consolidation (November 2010).
Hexagon Metrology is the largest global provider of metrology products and value-added services, serving the needs of motor sports teams and industries worldwide. Hexagon Metrology is a significant contributor to the performance, and consistency of the United Kingdom Formula One racing industry. UK based Force India F1 investments include Absolute trackers, arms, and scanners, as well as CMMs.
Capital employed, defined as total assets less non-interest bearing liabilities, increased to 4,396.0 MEUR (4,045.2). Return on average capital employed, excluding non-recurring items, for the last twelve months was 10.5 per cent (10.5). Return on average shareholders' equity for the last twelve months was 13.0 per cent (7.0). The capital turnover rate was 0.5 times (0.5).
Total shareholders' equity increased to 2,564.1 MEUR (2,132.5). The equity ratio was 49 per cent (45). Hexagon's total assets increased to 5,278.0 MEUR (4,786.6).
Hexagon's primary source of financing is a 900 MUSD and a 1,000 MEUR Term and Revolving Credit Facilities Agreement that expires in July 2015. In the fourth quarter of 2009, Hexagon issued a 2,000 MSEK five year bond. To diversify the debt structure Hexagon, in the first quarter of 2012, established a Swedish Commercial Paper Program. The program enables Hexagon to issue commercial paper up to a total amount of SEK 5 billion. Commercial paper can be issued up to 12 months under the program. On 31 March 2012, Hexagon had issued commercial paper of a total amount of SEK 2.5 billion. The Bridge Term Loan of 375 MUSD, that should have matured in July 2012, has been refinanced through the commercial paper program and been repaid in full. An additional back-up facility of 2.5
billion SEK has been established to support the commercial paper programme.
On 31 March 2012, cash and unutilised credit limits totalled 437.3 MEUR (457.0). Hexagon's net debt was 1,722.5 MEUR. The net indebtedness was 0.62 times (0.79). Interest coverage ratio was 7.6 times (6.7).
During the first quarter, cash flow from operations before changes in working capital increased to 112.5 MEUR (98.7), corresponding to 0.32 EUR (0.28) per share. Cash flow from operations in the first quarter increased to 87.5 MEUR (74.2), corresponding to 0.25 EUR (0.21) per share. The operating cash flow in the first quarter 2012 including non-recurring items amounted to 52.5 MEUR (29.8).
Hexagon's net investments, excluding acquisitions and divestitures, amounted to -35.0 MEUR (-28.4) in the first quarter.
Depreciation and amortisation amounted to -28.8 MEUR (-25.3) in the first quarter. There were no impairment charges recorded in the quarter.
The Group's tax expense for the first quarter totalled -18.5 MEUR (-17.2), corresponding to an effective tax rate of 19 per cent (20).
The average number of employees in Hexagon during the first quarter was 12,940 (11,712). The number of employees at the end of the quarter was 13,138 (11,979).
Earnings per share for the first quarter amounted to 0.22 EUR (0.19).
On 31 March 2012, equity per share was 7.25 EUR (6.03), and the share price was 128 SEK (151).
Hexagon's share capital amounts to 78,471,187 EUR, represented by 353,642,177 shares, of which 15,750,000 are of series A with 10 votes each and 337,892,177 are of series B with one vote each. Hexagon AB treasury shares amounted to 1,152,547 shares of series B.
Associated companies affected Hexagon's earnings during the first quarter by 0.0 MEUR (0.0).
The parent company's earnings after financial items in the first quarter amounted to -21.1 MEUR (-42.4). The equity was 1,457.9 MEUR (1,222.6). The solvency ratio of the parent company was 38 per cent (33). Liquid funds including unutilised credit limits were 291.1 MEUR (300.0).
| MEUR | Q1 2012 | Q1 2011 | ∆% |
|---|---|---|---|
| Net sales | 548.5 | 503.1 | 6 1) |
| Operating earnings (EBIT1) | 113.4 | 106.9 | 6 |
| Operating margin,% | 20.7 | 21.2 | -0.5 |
1) Adjusted to fixed exchange rates and a comparable group structure, i.e. organic growth.
| MEUR | Q1 2012 | Q1 2011 | ∆% |
|---|---|---|---|
| Net sales | 17.3 | 18.2 | -5 1) |
| Operating earnings (EBIT1) | 0.8 | 0.9 | -11 |
| Operating margin,% | 4.6 | 4.9 | -0.3 |
1) Adjusted to fixed exchange rates and a comparable group structure, i.e. organic growth.
| Net sales | |||||
|---|---|---|---|---|---|
| MEUR | Q1 2012 | Q1 2011 | ∆ % 1) | ||
| Geosystems | 188.2 | 185.1 | -1 | ||
| Metrology | 167.4 | 136.9 | 19 | ||
| Technology | 192.9 | 181.1 | 3 | ||
| Total Hexagon MT | 548.5 | 503.1 | 6 |
1) Adjusted to fixed exchange rates and a comparable group structure, i.e. organic growth.
Geosystems reported -1 per cent organic growth in net sales in the first quarter. The strong recovery in Metrology continued in the first quarter and the application area displayed organic sales growth of 19 per cent compared to the corresponding period in 2011. Technology including Intergraph and NovAtel reported strong growth in the PP&M division but negative growth in SG&I.
In the first quarter, operating net sales amounted to 548.5 MEUR (503.1). Using fixed exchange rates and a comparable group structure, net sales increased by 6 per cent.
Operating earnings (EBIT1) amounted to 113.4 MEUR (106.9) including the restructuring charge for Intergraph SG&I of -4.9 MEUR which corresponds to an operating margin of 20.7 per cent (21.2).
The number of employees by the end of the OTHER OPERATIONS – SALES AND EARNINGS quarter was 12,803 (11,650).
In the first quarter, net sales amounted to 17.3 MEUR (18.2). Using fixed exchange rates and a comparable group structure, net sales decreased by -5 per cent.
Operating earnings (EBIT1) amounted to 0.8 MEUR (0.9), which corresponds to an operating margin of 4.6 per cent (4.9).
The number of employees by the end of the quarter was 318 (317).
Product innovations including new technology, lower manufacturing costs and increasing software content enables Hexagon to continously improve the gross margin. In the first quarter, the gross margin reached an all-time high of 55 per cent.
SmartPlant FreeView enables customers and their suppliers to increase productivity and competiveness without increasing costs. Engineering companies can provide 3D models to potential subcontractors who can use SmartPlant FreeView for preliminary reviews. Once work is awarded, subcontractors can upgrade to SmartPlant Review for more in-depth review and analysis capabilities.
The Board of Directors and the President and CEO declare that this interim report provides a true and fair overview of the company´s and the Group´s operations, their financial position and performance, and describes material risks and uncertainties facing the company and companies within the Group.
Stockholm, Sweden, 9 May 2012 Hexagon AB (publ)
Melker Schörling Chairman of the Board
Mario Fontana Ulrika Francke Board Member Board Member
Ulf Henriksson Gun Nilsson
Board Member Board Member
Ulrik Svensson Ola Rollén
Board Member President and CEO Board Member
This Interim Report has not been reviewed by the company's auditors.
Hexagon applies International Financial Reporting Standards (IFRS) as adopted by the European Union. Hexagon's report for the Group is prepared in accordance with IAS 34, "Interim Financial Reporting" and the Annual Accounts Act. Parent company accounts are prepared in accordance with the Annual Accounts Act. Accounting principles and calculation methods are unchanged from those applied in the Annual Report for 2011. New and amended IFRS Standards effective 2012 had no significant impact on the financial statements.
As an international group, Hexagon is exposed to a number of business and financial risks. The business risks can be divided into strategic, operational and legal risks. The financial risks are related to such factors as exchange rates, interest rates, liquidity and the giving of credit. Risk management in Hexagon aims to identify, control and reduce risks. This work begins with an assessment of the probability of risks occurring and their potential effect on the Group. There has been no change in the risks facing the Group compared to what was reported in the 2011 Annual Report.
No significant related party transactions have been incurred during the quarter.
No significant events have occurred during the period between quarter-end and date of issuance of this report.
| MEUR | Q1 2012 | Q1 2011 | 2011 |
|---|---|---|---|
| Net sales | 565.8 | 516.9 | 2,169.1 |
| Cost of goods sold | -259.9 | -243.5 | -1,025.6 |
| Gross earnings | 305.9 | 273.4 | 1,143.5 |
| Sales and administration costs, etc. | -194.9 | -173.0 | -712.2 |
| Earnings from shares in associated companies | 0.0 | 0.0 | 0.0 |
| Operating earnings 1) | 111.0 | 100.4 | 431.3 |
| Interest income and expenses, net | -13.5 | -14.6 | -58.9 |
| Earnings before taxes | 97.5 | 85.8 | 372.4 |
| Taxes | -18.5 | -17.2 | -75.0 |
| Net earnings | 79.0 | 68.6 | 297.4 |
| Attributable to: | |||
| Parent company shareholders | 78.4 | 68.1 | 295.2 |
| Non-controlling interest | 0.6 | 0.5 | 2.2 |
| 1) of w hich non-recurring items | - | -4.4 | -8.5 |
| Earnings include depreciation, amortisation and impairments of | -28.8 | -25.3 | -102.6 |
| Basic earnings per share, EUR | 0.22 | 0.19 | 0.84 |
| Earnings per share after dilution, EUR | 0.22 | 0.19 | 0.84 |
| Total shareholder's equity per share, EUR | 7.25 | 6.03 | 7.15 |
| Closing number of shares, thousands | 352,490 | 352,490 | 352,490 |
| Average number of shares, thousands | 352,490 | 352,467 | 352,484 |
| Average number of shares after dilution, thousands | 352,749 | 352,706 | 352,546 |
| MEUR | Q1 2012 | Q1 2011 | 2011 |
|---|---|---|---|
| Net earnings | 79.0 | 68.6 | 297.4 |
| Other comprehensive income: | |||
| Exchange rate differences | -19.1 | -128.2 | 77.1 |
| Effect of hedging of net investments in foreign operations | -29.9 | 23.6 | 38.9 |
| Cash flow hedges, net | 0.6 | -0.4 | -0.8 |
| Tax attributable to Other comprehensive income | 7.7 | -6.2 | -10.0 |
| Other comprehensive income, net of tax | -40.7 | -111.2 | 105.2 |
| Total comprehensive income for the period | 38.3 | -42.6 | 402.6 |
| Attributable to: | |||
| Parent company shareholders | 37.9 | -42.9 | 399.9 |
| Non-controlling interest | 0.4 | 0.3 | 2.7 |
| MEUR | 31/3 2012 | 31/3 2011 | 31/12 2011 |
|---|---|---|---|
| Intangible fixed assets | 3,828.0 | 3,428.5 | 3,872.3 |
| Tangible fixed assets | 227.7 | 260.4 | 229.3 |
| Financial fixed assets | 30.8 | 19.6 | 28.6 |
| Deferred tax assets | 102.1 | 77.8 | 88.5 |
| Total fixed assets | 4,188.6 | 3,786.3 | 4,218.7 |
| Inventories | 370.3 | 327.0 | 358.9 |
| Accounts receivable | 495.2 | 444.8 | 509.8 |
| Other receivables | 52.1 | 41.3 | 83.6 |
| Prepaid expenses and accrued income | 62.4 | 53.7 | 56.3 |
| Total current receivables | 609.7 | 539.8 | 649.7 |
| Cash and cash equivalents | 109.4 | 133.5 | 116.4 |
| Total current assets | 1,089.4 | 1,000.3 | 1,125.0 |
| Total assets | 5,278.0 | 4,786.6 | 5,343.7 |
| Equity attributable to parent company shareholders | 2,556.6 | 2,126.0 | 2,518.7 |
| Equity attributable to non-controlling interest | 7.5 | 6.5 | 7.1 |
| Total shareholders' equity | 2,564.1 | 2,132.5 | 2,525.8 |
| Interest bearing liabilities | 1,607.9 | 1,700.7 | 1,407.5 |
| Other liabilities | 23.4 | 19.6 | 29.9 |
| Pension liabilities | 37.9 | 38.1 | 38.6 |
| Deferred tax liabilities | 250.1 | 218.9 | 245.7 |
| Other provisions | 58.6 | 37.5 | 81.3 |
| Total long-term liabilities | 1,977.9 | 2,014.8 | 1,803.0 |
| Interest bearing liabilities | 185.9 | 138.3 | 456.9 |
| Accounts payable | 126.3 | 120.6 | 144.8 |
| Other liabilities | 79.2 | 59.6 | 79.0 |
| Other provisions | 8.1 | 29.6 | 8.2 |
| Accrued expenses and deferred income | 336.5 | 291.2 | 326.0 |
| Total short-term liabilities | 736.0 | 639.3 | 1,014.9 |
| Total equity and liabilities | 5,278.0 | 4,786.6 | 5,343.7 |
| MEUR | Q1 2012 | Q1 2011 | 2011 |
|---|---|---|---|
| Opening shareholders' equity | 2,525.8 | 2,172.3 | 2,172.3 |
| Total comprehensive income for the period 1) | 38.3 | -42.6 | 402.6 |
| Rights issue, net of issuance cost | - | 2.8 | 2.8 |
| Dividend | - | - | -57.3 |
| Repurchase of stock options | - | - | -2.8 |
| Sale of stock options | - | - | 8.2 |
| Closing shareholders' equity 2) | 2,564.1 | 2,132.5 | 2,525.8 |
| 1) of w hich: Parent company shareholders | 37.9 | -42.9 | 399.9 |
| Non-controlling interest | 0.4 | 0.3 | 2.7 |
| 2) of w hich: Parent company shareholders | 2,556.6 | 2,126.0 | 2,518.7 |
| Non-controlling interest | 7.5 | 6.5 | 7.1 |
| series A | series B | Total | |
|---|---|---|---|
| 2009-12-31 Total issued and outstanding | 11,812,500 | 252,534,653 | 264,347,153 |
| Sale of repurchased shares | - | 20,070 | 20,070 |
| Rights issue | 3,937,500 | 83,845,572 | 87,783,072 |
| 2010-12-31 Total issued and outstanding | 15,750,000 | 336,400,295 | 352,150,295 |
| Rights issue | - | 339,335 | 339,335 |
| 2011-12-31 Total issued and outstanding | 15,750,000 | 336,739,630 | 352,489,630 |
| 2012-03-31 Total issued and outstanding 1) | 15,750,000 | 336,739,630 | 352,489,630 |
1) As per 31 March 2012, there were in total 353,642,177 shares in the company, of which 15,750,000 are of series A with ten votes each and 337,892,177 are of series B with one vote each. Hexagon AB Treasury shares amounted to 1,152,547 shares of series B.
| MEUR | Q1 2012 | Q1 2011 | 2011 |
|---|---|---|---|
| Cash flow from operations before change in w orking capital | |||
| excluding taxes and interest | 132.8 | 122.4 | 523.9 |
| Tax paid | -6.7 | -10.0 | -71.1 |
| Interest received and paid, net | -13.6 | -13.7 | -55.6 |
| Cash flow from operations before change in w orking capital | 112.5 | 98.7 | 397.2 |
| Cash flow from change in w orking capital | -25.0 | -24.5 | -28.2 |
| Cash flow from operations | 87.5 | 74.2 | 369.0 |
| Cash flow from ordinary investing activities | -35.0 | -28.4 | -135.9 |
| Operating cash flow | 52.5 | 45.8 | 233.1 |
| Non-recurring cash flow | - | -16.0 | -16.0 |
| Operating cash flow after non-recurring items | 52.5 | 29.8 | 217.1 |
| Cash flow from other investing activities 1) | -4.0 | -0.7 | -99.2 |
| Cash flow after other investing activities | 48.5 | 29.1 | 117.9 |
| Dividends paid | - | - | -57.3 |
| Rights issue net of expenses | - | 2.8 | -5.7 |
| Repurchase of stock options | - | - | -2.8 |
| Sale of stock options | 8.2 | - | - |
| Cash flow from other financing activities | -63.5 | -61.3 | -97.8 |
| Cash flow for the period | -6.8 | -29.4 | -45.7 |
| Cash and cash equivalents, beginning of period | 116.4 | 160.4 | 160.4 |
| Effect of translation differences on cash and cash equivalents | -0.2 | 2.5 | 1.7 |
| Cash flow for the period | -6.8 | -29.4 | -45.7 |
| Cash and cash equivalents, end of period | 109.4 | 133.5 | 116.4 |
1)Acquisitions totalled -4.0 MEUR (-0.5) and other was 0.0 MEUR (-0.2) in the first quarter 2012.
| Q1 2012 | Q1 2011 | 2011 | |
|---|---|---|---|
| Operating margin, % | 19.6 | 20.1 | 20.2 |
| Profit margin before taxes, % | 17.2 | 16.6 | 17.2 |
| Return on shareholders' equity 12 month average, % | 13.0 | 7.0 | 13.1 |
| Return on capital employed, % | 10.5 | 10.5 | 10.5 |
| Equity ratio, % | 48.6 | 44.6 | 47.3 |
| Net indebtedness | 0.62 | 0.79 | 0.66 |
| Interest coverage ratio | 7.6 | 6.7 | 7.0 |
| Average number of shares, thousands | 352,490 | 352,467 | 352,484 |
| Basic earnings per share excl. non-recurring items, EUR | 0.22 | 0.20 | 0.85 |
| Basic earnings per share, EUR | 0.22 | 0.19 | 0.84 |
| Cash flow per share, EUR | 0.25 | 0.21 | 1.05 |
| Cash flow per share before change in w orking cap, EUR | 0.32 | 0.28 | 1.13 |
| Share price, SEK | 128 | 151 | 103 |
| Share price translated to EUR | 14.5 | 16.9 | 11.6 |
In connection with the acquisition of Intergraph, a business unit in Geosystems (ERDAS) has been transferred to Intergraph (Technology) and a business unit in Intergraph (Z/I) has been transferred to Geosystems. Historic numbers have not been restated.
| MEUR | Q1 2012 | Q4 2011 | Q3 2011 | Q2 2011 | Q1 2011 | 2011 |
|---|---|---|---|---|---|---|
| Hexagon MT | 548.5 | 574.6 | 507.9 | 526.7 | 503.1 | 2,112.3 |
| - Of w hich Geosystems | 188.2 | 196.1 | 179.2 | 196.6 | 185.1 | 757.0 |
| Metrology | 167.4 | 183.5 | 157.5 | 155.6 | 136.9 | 633.5 |
| Technology | 192.9 | 195.0 | 171.2 | 174.5 1) | 181.1 1) | 721.8 1) |
| Other operations | 17.3 | 17.0 | 13.3 | 16.8 | 18.2 | 65.3 |
| Group | 565.8 | 591.6 | 521.2 | 543.5 | 521.3 | 2,177.6 |
| MEUR | Q1 2012 | Q4 2011 | Q3 2011 | Q2 2011 | Q1 2011 | 2011 |
|---|---|---|---|---|---|---|
| Hexagon MT | 113.4 | 124.5 | 101.5 | 117.2 | 106.9 | 450.1 |
| Other operations | 0.8 | 0.8 | 0.0 | 0.4 | 0.9 | 2.1 |
| Group costs | -3.2 | -3.5 | -2.6 | -3.3 | -3.0 | -12.4 |
| Group | 111.0 | 121.8 | 98.9 | 114.3 | 104.8 | 439.8 |
| Margin,% | 19.6 | 20.6 | 19.0 | 21.0 | 20.1 | 20.2 |
| MEUR | Q1 2012 | Q4 2011 | Q3 2011 | Q2 2011 | Q1 2011 | 2011 |
|---|---|---|---|---|---|---|
| EMEA | 237.2 | 258.5 | 223.2 | 242.6 | 231.3 | 955.6 |
| Americas | 183.5 | 190.7 | 163.6 | 158.4 | 153.7 | 666.4 |
| Asia | 145.1 | 142.4 | 134.4 | 142.5 | 136.3 | 555.6 |
| Group | 565.8 | 591.6 | 521.2 | 543.5 1) | 521.3 1) | 2,177.6 1) |
1) Excluding non-recurring effect from revaluation of acquired deferred revenue of -4.4 MEUR in Q1 2011 and -4.1 MEUR in Q2 2011, in total -8.5 MEUR for 2011.
| Q1 2012 | Q1 2011 | |||
|---|---|---|---|---|
| MEUR | Acquisitions | Divestments | Acquisitions | Divestments |
| Intangible fixed assets | 6.4 | - | - | - |
| Other fixed assets | 0.1 | - | - | - |
| Total fixed assets | 6.5 | - | - | - |
| Total current assets | 1.3 | - | - | - |
| Total assets | 7.8 | - | - | - |
| Total long-term liabilities, etc | 2.6 | - | -0.5 | - |
| Total short-term liabilities | 1.0 | - | - | - |
| Total liabilities | 3.6 | - | -0.5 | - |
| Total net assets | 4.2 | - | 0.5 | - |
| Total acquisition cost/divestment income | -7.2 | - | - | - |
| Adjustment for non-paid part of acquisition cost/ | ||||
| divestment income incl. payment of items from prior years | 3.0 | - | -0.5 | - |
| Adjustment for cash and bank balances in aquired entities | 0.2 | - | - | - |
| Cash flow from acquisitions | -4.0 | - | -0.5 | - |
During the quarter, Hexagon acquired the following companies or businesses: Lasertopo in Belgium and MicroSurvey Software in Canada. Since the total size of the acqusitions is insignificant, Hexagon does not present any further information regarding these acquisitions.
Hexagon has also paid to Sellers of Intergraph, with no net cash flow effect, part of the tax benefit that arose according to the merger agreement from 2010. The payment to sellers has been reported net of the tax payment to the company in the cash flow statement.
There were no divestments in the first quarter 2012 or in the first quarter 2011.
| MEUR | Q1 2012 | Q1 2011 | 2011 |
|---|---|---|---|
| Net sales Administration cost |
2.5 -3.3 |
1.8 -2.9 |
8.6 -13.1 |
| Operating earnings | -0.8 | -1.1 | -4.5 |
| Earnings from shares in Group companies | - | - | 149.0 |
| Interest income and expenses, net | -20.3 | -41.3 | 150.6 |
| Earnings after financial items | -21.1 | -42.4 | 295.1 |
| Tax | 5.6 | 11.1 | -20.3 |
| Net earnings | -15.5 | -31.3 | 274.8 |
| MEUR | 31/3 2012 | 31/3 2011 | 31/12 2011 |
|---|---|---|---|
| Total fixed assets | 3,726.3 | 3,570.4 | 3,772.5 |
| Total current receivables | 125.2 | 114.5 | 207.5 |
| Cash and cash equivalents | 0.0 | 4.7 | 0.2 |
| Total current assets | 125.2 | 119.2 | 207.7 |
| Total assets | 3,851.5 | 3,689.6 | 3,980.2 |
| Total shareholders' equity | 1,457.9 | 1,222.6 | 1,473.3 |
| Total long-term liabilities | 1,576.1 | 1,751.2 | 1,371.0 |
| Total short-term liabilities | 817.5 | 715.8 | 1,135.9 |
| Total equity and liabilities | 3,851.5 | 3,689.6 | 3,980.2 |
| Capital employed | Total assets less non-interest bearing liabilities |
|---|---|
| Capital turnover rate | Net sales divided by average capital employed |
| Cash flow | Cash flow from operations, after change in working capital, excluding non-recurring items |
| Cash flow per share | Cash flow from operations, after change in working capital, excluding non-recurring items divided by average number of shares |
| Earnings per share | Net earnings excluding non-controlling interest divided by average number of shares |
| Equity ratio | Shareholders' equity including non-controlling interests as a percentage of total assets |
| Interest cover ratio | Earnings after financial items plus financial expenses divided by financial expenses |
| Investments | Purchases less sales of tangible and intangible fixed assets, excluding those included in acquisitions and divestitures of subsidiaries |
| Net indebtedness | Interest-bearing liabilities less interest-bearing current receivables and liquid assets divided by shareholders' equity excluding non-controlling interests |
| Non-recurring items | Income and expenses that are not expected to appear on a regular basis |
| Operating earnings (EBIT1) | Operating earnings excluding capital gains on shares in group companies and other non-recurring items |
| Operating margin | Operating earnings (EBIT1) as a percentage of operating net sales |
| Operating net sales | Net sales adjusted by the difference between fair value and book-value of deferred revenue regarding acquired businesses |
| Profit margin before tax | Earnings after financial items as a percentage of net sales |
| Return on capital employed (12 month average) |
Twelve months to end of period earnings after financial items, excluding non-recurring items, plus financial expenses as a percentage of twelve months to end of period average capital employed |
| Return on equity (12 month average) | Twelve months to end of period net earnings excluding non-controlling interests as a percentage of twelve months to end of period average shareholders' equity excluding non-controlling interests last twelve months. |
| Shareholders' equity per share | Shareholders' equity excluding non-controlling interests divided by the number of shares at year-end |
| Share price | Last settled transaction on NASDAQ OMX Nordic Exchange on the last business day for the period |
| BUSINESS DEFINITIONS | |
| Americas | North, South and Central America |
| Asia | Asia, Australia and New Zealand |
| EMEA | Europe, Middle East and Africa |
MT Hexagon's core business, Measurement Technologies
Hexagon is a leading global provider of design, measurement and visualisation technologies. Our customers can design, measure and position objects, and process and present data, to stay one step ahead of a changing world. Hexagon's solutions increase productivity, enhance quality and allow for faster, better operational decisions, saving time, money and resources. Hexagon has over 13 000 employees in more than 40 countries and net sales of about 2 200 MEUR. Our products are used in a broad range of industries including surveying, power and energy, aerospace and defence, safety and security, construction and manufacturing. Learn more at www.hexagon.com.
Hexagon gives financial information at the following occasions:
| Interim Report Q2 2012 | 9 August 2012 |
|---|---|
| Interim Report Q3 2012 | 26 October 2012 |
| Year-End Report 2012 | February 2013 |
Financial information is available in Swedish and English at the Hexagon website and can be ordered via phone +46 8 601 26 20 or e-mail [email protected]
The interim report for the first quarter 2012 will be presented on 9 May at 15:00 CET at a telephone conference. Please view instructions at Hexagon's website on how to participate.
Mattias Stenberg, VP Strategy and Communications, Hexagon AB +46 8 601 26 27, [email protected]
This interim report is a type of information that Hexagon AB (publ) is obliged to disclose in accordance with the Swedish Securities Market Act and /or the Financial Instruments Trading Act. The information was submitted for publication on 9 May 2012 at 12:30 CET.
This communication may contain forward-looking statements. When used in this communication, words such as "anticipate", "believe", "estimate", "expect", "intend", "plan" and "project" are intended to identify forward-looking statements. They may involve risks and uncertainties, including technological advances in the measurement field, product demand and market acceptance, the effect of economic conditions, the impact of competitive products and pricing, foreign currency exchange rates and other risks. These forward-looking statements reflect the views of Hexagon's management as of the date made with respect to future events and are subject to risks and uncertainties. All of these forward-looking statements are based on estimates and assumptions made by Hexagon's management and are believed to be reasonable, though are inherently uncertain and difficult to predict. Actual results or experience could differ materially from the forward-looking statements. Hexagon disclaims any intention or obligation to update these forwardlooking statements.
Hexagon AB [publ] P.O. Box 3692 SE- 103 59 Stockholm Fax: +46 8 601 26 21 Phone: +46 8 601 26 20 Registration number: 556190-4771 Registred Office: Stockholm Sweden www.hexagon.com
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