Sweden’s Hexagon said weakness in European and Chinese construction markets constrained sales and earnings in the first quarter of 2024.
The software and hardware company reported a 1% rise in net sales to €1.3 billion, compared with the same period last year, while EBIT and operating margin were also about the same at €376.5 million and 29%, respectively.
Total mining-related Q1 sales across Hexagon’s asset lifecycle intelligence, geosystems and autonomous solutions divisions were €121.52 million, or US$130.36m.
“Growth in Hexagon Mining was held back by timing issues and macro uncertainty in South America,” the company said.
The bulk of the group’s mining-related business is generated through its autonomous solutions division (52% of autonomous solutions sales in Q1, 2024), which saw good growth in the period (plus-8%) “offset by a slowdown in mining that was partly driven by timing issues”.
Mining also accounts for about 11% of the sales of Hexagon’s largest division, geosystems, which reported €376.8 million revenue for the latest quarter versus €389.8 million in Q1 last year.
“The first quarter of 2024 demonstrated the strength of Hexagon’s business model,” Hexagon CEO Paolo Guglielmini said.
“We delivered 3% organic growth in revenues, despite a mixed demand backdrop, reflecting weaker demand in the construction sector in both Europe and China and a gradual continuation of the broader economic slowdown seen throughout 2023.
“Despite this backdrop we maintained margins, with a higher contribution from software products mitigating weakness in the high-margin Geosystems division.”
