Hexagon estimates the full year 2008 growth in earnings per share to be between 6 and 8 per cent. This is below the earlier outlook for the year of 15 per cent growth in earnings per share.
December usually displays strong sales and represents approximately 25 per cent of Hexagon's earnings in a year. The final weeks of 2008 were significantly weaker than expected. Customers closed down their entire operations rather than, as under normal circumstances, place late orders with deliveries before the year end.
Due to the deteriorating demand situation, Hexagon has accelerated its cost reduction programme. Lay offs of personnel in combination with furlough (temporary leave of absence) during the first half of 2009 are expected to bring annualised savings of approximately 500 MSEK. These measures result in restructuring charges of approximately 100 MSEK in total in the fourth quarter 2008.
Hexagon's sales are estimated to be 13 billion SEK and earnings per share to be between 6.4 and 6.5 SEK for the full year 2008. The numbers are excluding Hexpol AB, the polymers business that was de-consolidated from Hexagon as of 1 June 2008.
"The first half of the year 2009 will be challenging. Hexagon is responding to the demand drop by cutting cost, laying off and furloughing of personnel as well as delaying investments. As governmental stimuli packages around the world start to have an impact on infrastructural investments, Hexagon's growth is expected to resume", says Ola Rollén, President and CEO of Hexagon AB.