Hexatronic Group (HTRO) Investor Update summary

Strategic Direction and Business Area Focus

• The updated strategy emphasizes diversification across Fiber Solutions, Data Center, and Harsh Environment, each with tailored strategies and financial targets for 2028.

• Data Center and Harsh Environment are expected to represent half of global sales and profits by 2028, while Fiber Solutions undergoes a turnaround.

• The company is transitioning from a European fiber cable provider to a global connectivity solutions provider.

Fiber Solutions: Turnaround and Growth Plan

• SEK 110 million EBITA/EBITDA improvements targeted via cost savings, including closure of the Weterings plant in the Netherlands and 120 FTE reductions, with full run-rate impact by Q1 2026.

• One-time restructuring costs are estimated at 230 MSEK, with 125 MSEK in cash impact, mostly in Q3 2025.

• 2028 targets: SEK 6 billion in sales and 10% EBITA/EBITDA margin.

• U.S. market is the main growth driver, with Europe expected to remain flat; focus areas include submarine cables, transport networks, and adjacent segments.

• Renewed focus on innovation, including the launch of a first-to-world dry microcable, to accelerate time-to-market and enhance customer productivity.

Data Center: Growth and Profitability Outlook

• Data Center achieved a 46% sales CAGR and a 17.3% EBITA/EBITDA margin in the last 12 months.

• 2028 targets: SEK 3 billion in sales and 15% EBITA/EBITDA margin, with growth driven by organic initiatives and M&A.

• Services account for nearly half of revenue, with a strong presence in both the US and Europe, focusing on hyperscale leased and colocation segments.

• M&A pipeline is robust, with acquisition multiples expected at 5–7x EBITDA.