Sweden's Hexagon posts surprise jump in Q4 operating profit

By Marta Frackowiak

(Reuters) -Industrial technology group Hexagon posted a surprise 3% rise in its fourth quarter operating profit on Friday, aided by a return to slight organic growth and despite a challenging environment in the key automotive and construction end markets.

The maker of measurement and positioning systems said its adjusted earnings before interest and taxes grew to 450.3 million euros ($468.2 million) in the quarter, while analysts' consensus was expecting them to fall by 2.6%.

Hexagon's shares were trading 7% higher by 1017 GMT, among top performers on Europe's benchmark STOXX 600 index.

The Swedish group said growth was driven by its Asset Lifecycle Intelligence unit, whose software is used in building and operating industrial facilities, and the Safety, Infrastructure & Geospatial unit which provides public safety solutions.

Hexagon in October said it was investigating the possibility of separating the Asset Lifecycle Intelligence business from the group. It plans to provide an update on the topic during the first quarter, it said on Friday.

"In the fourth quarter we recorded a return to positive organic growth, while maintaining EBIT margins and generating a very strong cash conversion, despite difficult macroeconomic conditions," interim CEO Norbert Hanke said in a statement.

Hexagon added it saw no changes in the market environment in the first quarter of 2025.

Asked about some manufacturing firms starting to see green shoots within construction and infrastructure, especially in the United States, Hanke told analysts it would take a few more months to see whether the trend was changing in the U.S.

The group is banking on its decentralized business model to help it react quickly to any U.S. policy changes, Hanke added in an emailed comment to Reuters, though he refused to speculate on those potential changes. Hexagon made some 30% of its revenue in the U.S. last year.

The company proposed a dividend of 0.14 euros per share for 2024, up 8% from last year.

($1 = 0.9617 euros)

(Reporting by Marta Frąckowiak in Gdansk; Editing by Milla Nissi)

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