Hexatronic Group (HTRO) Q2 2025 earnings summary

Executive summary

• Q2 net sales declined 6% year-over-year to SEK 1,906 million, mainly due to currency headwinds and weak Fiber Solutions performance, while Data Center and Harsh Environment achieved record results.

• EBITDA/EBITA margin dropped to 8.9% from 11% last year, primarily due to Fiber Solutions underperformance, while Data Center posted a 20.8% margin and Harsh Environment reached all-time highs.

• Cash flow from operating activities was SEK 131 million with a 74% cash conversion rate; net debt leverage remained stable at 1.9x.

• A performance improvement program was launched in Fiber Solutions to address declining demand and margins, with details to be presented in September.

• Data Center and Harsh Environment contributed over 50% of group EBITA.

Financial highlights

• Q2 net sales: SEK 1,906 million, down 6% year-over-year; organic sales down 1%, currency effects -6%.

• Gross margin decreased to 40.1% from 42% last year, mainly due to lower demand and price pressure in Fiber Solutions.

• EBITDA/EBITA: SEK 169 million (8.9% margin), down 24% from last year.

• Earnings per share after dilution: SEK 0.38, down from SEK 0.44 last year.

• Net financial items: -SEK 31 million, mainly interest expense; tax rate at 30.3%.

Outlook and guidance

• Fiber Solutions expected to see continued subdued demand and price pressure in Europe, with Q3 EBITA margin expected in line with Q2.

• Data Center anticipated to maintain strong growth, with seasonality expected in H2.

• Harsh Environment Q3 sales expected to be flat year-over-year due to project-based volatility; efficiency improvements ongoing.

• M&A pipeline focused on Data Center and Harsh Environment, with ambitions to close deals before year-end.

• Performance improvement program for Fiber Solutions to be detailed September 11.