Hexpol earnings down in ‘stable quarter’

Malmo, Sweden – Hexpol AB has reported a “stable second quarter with strong margins” despite lower year-on-year earnings and sales.

For the three months to end of June, sales fell 4.7% year-on-year to SEK5.4 billion (€470 million), while earnings (Ebit) dropped 3.5% to SEK911 million, Hexpol reported 17 July.

For the first six months of the year earnings dropped marginally to SEK1.8 billion on 8% lower sales of SEK10.7 billion.

Margins remained strong in the second quarter, improving to 16.7% from 16.5% last year. For the half-year, earnings margin fell from 16.9% in 2023 to 16.1% this year.

Commenting on the results, new Hexpol CEO Klas Dahlberg said improved margins were driven by “good product and price mix.”

Demand from customers remained on the same level as the second half of 2023 and first quarter of the year, with sales prices also remaining stable.

Hexpol Compounding, the primary contributor to the group’s sales, reported a 9% year-on-year decline in first-half revenue, totalling SEK10 billion.

The figure includes a SEK50 million boost from positive currency effects and a 1% contribution from the newly acquired Star Thermoplastics.

Sales to automotive-related customers were down compared to the first half of 2023, affected by lower automotive production in the markets where Hexpol is active.

Furthermore, the compounding unit noted lower sales to customers within building and construction, in “virtually all markets.”

Sales were also impacted by lower demand in consumer-related end customer segments as well as decreased selling prices, amid stable raw material prices.

Hexpol Engineered Products, on the other hand, reported a 2.5% increase in first half revenue to SEK765 million, driven by positive developments in Asia and America.

Overall, the group reported an 8% year-on-year increase in first-half sales in Asia, while America and Europe reported declines of 10% and 8% respectively.