Slide 1: Q1 2024 report
iby HEXAGON Q1 2024 report
Slide 2: Paolo Guglielmini, President and CEO
Paolo Guglielmini President and Chief Executive Officer
Slide 3: Strong cash flows, resilient growth and margins
Strong cash flows, resilient growth and margins • Good performance despite mixed market environment Total revenue 1,299.9 MEUR (1,286.6) • Resilient gross and operating margins • Higher contribution from software 3% organic growth • Benefits of rationalisation program • Divestments 1% reported growt
Slide 4: Key geographic trends
Key geographic trends Growth centered on North America & Asia Americas EMEA APAC 38% of revenues 34% of revenues 27% of revenues 4% Organic growth 0% Organic growth 4% Organic growth • Infrastructure investment continues, • Demand from residential construction • China grew by 5% despite difficult ma
Slide 5: Divisional performance
Divisional performance Growth despite mixed markets and tough comparators Manufacturing Asset Lifecycle Autonomous Safety, Infrastructure Intelligence Intelligence Geosystems Solutions & Geospatial Hexagon Q1 2024, MEUR Revenue 478.1 192.2 376.8 135.5 116.9 1,299.9* Organic Growth 5% (10%) 2% (16%)
Slide 6: Divisional performance
Divisional performance Division Category (MEUR) Q1 2023 Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2024 Revenue 1,286.6 1,366.0 1,352.1 1,435.3 5,440.0 1,299.9 Organic growth in revenue 8% 8% 8% 5% 7% 3% Hexagon* EBIT1 371.2 394.1 393.0 438.4 1,596.7 376.5 EBIT1 margin % 28.9% 28.9% 29.1% 30.5% 29.4% 29.0%
Slide 7: Manufacturing Intelligence
Manufacturing Intelligence Revenue by industry (FY 2023) General manufacturing 3% 13% Automotive 4% 32% Aerospace & Q1 2024, MEUR (Q1 2023) Business update Defence 10% Electronics Good demand in aerospace and medical 14% Energy & Power 24% Revenue 478.1 (476.8) Steady demand in electronics Healthcar
Slide 8: Asset Lifecycle Intelligence
Asset Lifecycle Intelligence Revenue by industry (FY 2023) Oil & Gas Chemicals 24% 27% Heavy construction - Q1 2024, MEUR (Q1 2023) Business update industrial facilities 5% Energy & Power Lower perpetual sales following unusually 9% 18% strong performance in prior period Mining Revenue 192.2 (190.6)
Slide 9: Geosystems
Geosystems Revenue by industry (FY 2023) Heavy construction - infrastructure 8% 6% Buildings 29% 11% Surveying Q1 2024, MEUR (Q1 2023) Business update Mining Construction markets remain challenged, 19% 27% particularly in EMEA and China Mapping Revenue 376.8 (389.9) North America construction suppor
Slide 10: Autonomous Solutions (AS)
Autonomous Solutions (AS) Revenue by industry (FY 2023) 5% 9% Mining Agriculture Q1 2024, MEUR (Q1 2023) Business update 17% 52% Aerospace & Defense Strong growth in positioning solutions, Marine particularly in A&D and precision agriculture 17% Revenue 135.5 (124.7) Other Mining growth slowed due t
Slide 11: Safety, Infrastructure & Geospatial
Safety, Infrastructure & Geospatial Revenue by industry (FY 2023) 5% Public safety 7% Aerospace & 10% Defense Q1 2024, MEUR (Q1 2023) Business update 44% Utilities 12% Transportation No drag from exit of low margin defence services contracts, which completed in 2023 Revenue 116.9 (102.5) 22% Consume
Slide 12: David Mills, Chief Financial Officer
David Mills Chief Financial Officer
Slide 13: Income statement
Income statement Growth and stable margins Adjusted income statement MEUR Q1 2024 Q1 2023 % Change Sales bridge 2023, MEUR 1,286.6 Net Sales 1,299.9 1286.6 3* COGS -435.4 -430.5 1 Structure, %* 0% Gross earnings 864.5 856.1 1 Currency, % -2% Gross margin 66.5% 66.5% 0.0 Organic growth, %** 3% Operat
Slide 14: Revenue & profitability bridge
Revenue & profitability bridge Stable margins despite currency headwinds Growth - 2% 0% 3% 1% MEUR Q1 2023 Currency Structure Organic Q1 2024 Operating Net Sales 1,286.6 -23 4 33 1,299.9 Adjusted Operating Earnings (EBIT1) 371.2 -8 2 11 376.5 Adjusted Operating Margin 28.9% 34% 63% 33% 29.0% Accreti
Slide 15: Gross margin
Gross margin Favorable mix offsetting seasonality Rolling 12-months gross margin Gross margin by quarter 67% 67% 67% 70% 66% • Richer software mix in portfolio through innovation 66% 65% 65% 65% and M&A 65% 65% • Innovation drives higher GM% for next generation 60% devices 55% • Q1 adjusted gross ma
Slide 16: Cash flow
Cash flow Strong cash conversion, despite seasonality Cash Flow Statement Q1 24 Q1 23 Change % MEUR Adjusted operating earnings (EBIT1) 376.5 371.2 1 D&A (Excluding adjustments) 107.1 91.0 18 • Improved operational cash generation Adjusted EBITDA 483.6 462.2 5 Non-cash items -16.8 -9.8 71 • Investme
Slide 17: Working capital to sales
Working capital to sales Returning to trend WC/Sales, % 25% WC Bridge Q1 2024 Receivables & 20% -45.4 Prepaid expenses Q1 2024 Inventories 7.4 7.3% 15% Liabilities 10.9 10% Deferred revenue -60.0 Accrued expenses 74.4 5% Change in WC -12.7 0% Working capital to net sales (on a rolling basis) 17 | he
Slide 18: Ben Maslen, Chief Strategy Officer
Ben Maslen Chief Strategy Officer
Slide 19: Progressing our strategy for value creation
Progressing our strategy for value creation Unlocking the full potential of the opportunity ahead Technology leadership • Cloud and automation Innovate to drive growth and customer • Adoption and resources expansion Commercial execution • Sales strategy Align sales with strategy, optimise market • P
Slide 20: Rationalisation programme update
Rationalisation programme update Synergies Performance Footprint Automation • Simplification of the • Completion of the divestment of • 6 facilities closed in Q1 • Investment in automation for organisational structure and hand-tools business in MI (47.3 assembly and calibration to related savings tr
Slide 21: Good progress integrating sustainability into our business
Good progress integrating sustainability into our business Published Hexagon’s Integrated Report, increasing transparency around our ESG performance and outlining our sustainability implementation roadmap Launched Green Cubes, using Hexagon technology to provide precise volume measurements, health a
Slide 22: Product suite in action
Product suite in action Safety Manufacturing Asset Lifecycle Infrastructure Autonomous Intelligence Intelligence Geosystems & Geospatial Solutions Core market/ Discrete Process industries Buildings & Networks & Public Autonomy & Relevant TAM manufacturing Infrastructure Safety Positioning Reality Ca
Slide 23: Product suite in action
Product suite in action Safety Manufacturing Asset Lifecycle Infrastructure Autonomous Intelligence Intelligence Geosystems & Geospatial Solutions Core market/ Discrete Process industries Buildings & Networks & Public Autonomy & Relevant TAM manufacturing Infrastructure Safety Positioning Reality Ca
Slide 24: AGC Chemicals Company: How Hexagon is helping
Asset Lifecycle Intelligence Operations & maintenance software AGC Chemicals Company Customer background Customer Challenge AGC is a global leader in the Data was stored in silos and managed chemical industry, offering a diverse independently by each department. This range of products including glas
Slide 25: Gnant: How Hexagon is helping
Geosystems Machine control Gnant Customer background Customer Challenge Gnant is an Austrian construction Modernising infrastructure on the Westbahn company specialising in civil railway line while managing complex planning, engineering projects, infrastructure construction, and safety consideration
Slide 26: Port Houston: How Hexagon is helping
Geosystems Project management Port Houston Customer background Customer Challenge A major player in supply chain processes Outdated construction management handling 70% of container traffic for the methods weren't keeping up with the Gulf Coast region and contributing over needs of construction proj
Slide 27: Codelco: How Hexagon is helping
Autonomous Solutions Mine operations technology Codelco Customer background Customer Challenge Codelco, Chile’s state-owned mining With multiple mine sites across Chile’s varied company, is one of the largest landscapes and high altitudes, Codelco is producers of copper in the world. continuously ch
Slide 28: Guilford Metro 911: How Hexagon is helping
Safety, Infrastructure & Geospatial Computer aided dispatch Guilford Metro 911 Customer background Customer Challenge 911 call-takers and dispatchers from The agency sought to replace its current Guilford Metro in North Carolina, USA computer-aided dispatch (CAD) solution to manage more than 700,000
Slide 29: Automotive OEM: How Hexagon is helping
Manufacturing Intelligence Automated inspection Automotive OEM Customer background Customer Challenge A global automotive company, The customer is very technologically advanced renowned for a wide range of and wanted to improve their quality inspection to vehicles, emphasising quality, have a faster
Slide 30: PRESTO System automated inspection
PRESTO M PRESTO L PRESTO XL (Launched April 2023) (New) (New) Parts of ∅ 1-3m, 360° scanning Parts of up to 6m long, 180° scanning Parts of up to 6m long, 360° scanning Manufacturing Intelligence Automated inspection Advanced PRESTO System Manufacturing Speed, quality and accuracy. The launchpad for
Slide 31: New product: SmartScan VR800
Manufacturing Intelligence Metrology hardware and software New product: SmartScan VR800 SmartScan VR800 A patented dual stereo camera with mechanical optical zoom projection unit setup. Removes the need for multiple base lengths, complex lens changing and frequent recalibration Resolution Four separ
Slide 32: New product: Aura
New product: Aura Focused on healthcare/facial aesthetics Complete skin Generates a photo- analysis and 3D realistic 3D digital modelling with a twin of the face and single capture neck • Utilises new and existing photogrammetry and 3D meshing and texturing technology • Uses technology also utilised
Slide 33: Paolo Guglielmini, President and CEO
Paolo Guglielmini President and Chief Executive Officer
Slide 34: Conclusions
Conclusions Resilient Strong Cash Future growth margins Focused conversion ready Despite mixed Benefitting from Rationalisation 88% cash Innovation and market conditions software sales and programme improving conversion, despite execution focus position efficiencies efficiency seasonality us well in
Slide 35: Cautionary statement
Cautionary statement 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,
Slide 36: For the calendar
for the calendar 24-26 Sept Minexpo 24-26 Sept Intergeo
Slide 37: Appendix
Appendix
Slide 38: Our key targets
Our key targets Organic growth Average annual growth of 5-7% Conviction in our existing Growth via M&A Average annual growth of 3-5% 2022-2026 targets Operating margin More than 30% by the end of 2026 (EBIT1 incl. PPA) Cash conversion Annual target range of 80-90% Additional targets 95% reduction of
Slide 39: R&D breakdown
R&D breakdown Research & Development Q1 2024 MEUR Gross R&D cost 211 Capitalised R&D 118 Amortisation of previously capitalized R&D 55 Adjusted net R&D cost (impact on EBIT1) 148 39 | hexagon.com