HEXPOL reported Q2 net sales of SEK 11.4B, up 18%, and EBIT up 49% to SEK 1.59B, beating expectations. Acquisitions and organic growth drove the results.
Alpha Score of 40 reflects weak overall profile with moderate momentum, poor value, moderate quality, moderate sentiment.
HEXPOL AB reported Q2 net sales of SEK 11.4 billion, up 18% from SEK 9.68 billion a year earlier. EBIT rose 49% to SEK 1.59 billion, HEXPOL said in a statement. The results surpassed analyst expectations.
Both business segments contributed to the growth. Compounding & Solutions posted organic sales growth of 3.5% and Engineered Products added 1.5% organically. Acquisitions, including the purchases of Kexin and Elastocon, added to the top line.
Cash flow from operations improved and HEXPOL used the proceeds to reduce debt. Acting CEO and CFO Peter Rosén said HEXPOL is focused on finding acquisition targets and managing raw material costs. He added that demand growth is expected to persist across end markets.
HEXPOL reported a stronger margin in the quarter. EBIT margin rose to 13.9% from 11.0% a year earlier. Rosén attributed the improvement to volume growth and cost control.
Rosén said HEXPOL remains cautious on the macroeconomic environment. He expects demand to hold up. HEXPOL will continue to evaluate bolt-on acquisitions that fit its portfolio.
HEXPOL's shares trade on the Stockholm Stock Exchange under the ticker HEXA B. HEXPOL also has an ADR listing in the US under HXXPY. HEXPOL's results reflect trends in the broader polymers market, which is covered in more detail in our commodities analysis.
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