Hexatronic Group (HTRO) Q4 2024 earnings summary

Executive summary

• Q4 2024 net sales decreased by 2% year-over-year to SEK 1,824 million, mainly due to a record Harsh Environment quarter last year; organic sales declined 4%.

• EBITDA/EBITA margin improved to 10% (up from 9.1% in Q4 2023), with strong operating cash flow and leverage ratio reduced to 1.9.

• Fiber Solutions returned to 2% growth in Q4, while Harsh Environment declined 20% and Data Center grew 1%.

• CEO transition announced: Rikard Fröberg to succeed Henrik Larsson Lyon in March 2025.

• Board proposed no dividend for 2024.

Financial highlights

• Full-year 2024 net sales were SEK 7,581 million, down 7% year-over-year; Q4 organic sales declined 4%.

• Q4 EBITDA/EBITA was SEK 182 million (10% margin), up from SEK 170 million (9.1%) last year.

• Gross margin improved to 41.4% in Q4, mainly due to higher manufacturing efficiency.

• Operating cash flow was SEK 286 million in Q4, with a cash conversion of 150%.

• CapEx for Q4 was SEK 85 million (4.7% of sales); full-year CapEx SEK 308 million (4.3% of sales).

Outlook and guidance

• Cautiously optimistic for 2025, with signs of increased activity but ongoing price pressure, especially in Fiber Solutions.

• BEAD program in the US expected to impact results in H2 2025.

• Seasonal softness anticipated in Q1 and Q4 for Fiber Solutions.

• Long-term growth expected in Harsh Environment and Data Center, driven by defense, energy, and AI investments.

• Positive structural trends in global fiber optic infrastructure.