Annual and sustainability report 2021 Hexatronic Group

The future belongs to everyone.

Creating a lasting link to the future

Hexatronic enables non-stop connectivity for commu-nities worldwide. We partner with customers across four continents - from telecom operators to network owners - offering leading-edge fiber technology and solutions for any and all conditions.

1,289

Key Markets:

Employees

50

North America Germany United Kingdom Nordics

Companies

Focus Areas:

Fiber Solutions Custom Wireless

Headquarters in Gothenburg

Every care has been taken in the translation of this Annual Report. In the event of discrepancies, the Swedish original will supersede the English translation.

2

Annual Report and Sustainability Report 2021 | Hexatronic

The year in brief

4

Risks and risk management

60

Comments from the CEO

6

Board of Directors and Executive Management

64

Business model and value chain

8

Corporate Governance Report

66

The offer and strategy

13

Group - Financial Reports

74

The market

18

Parent Company - Financial Reports

79

Organization and acquisitions

26

Notes

85

The Hexatronic share and shareholders

34

Reconciliation between IFRS and terms for key figures

127

Sustainability Report

36

Auditor's report

130

Board of Directors' Report

54

The year in brief

A year of very strong development

In 2021 we have seen high profitability and very strong growth, both organically and through acquisitions. Our efforts have laid a good foundation for continued positive development.

Pernilla Lindén, CFO, Hexatronic Group AB

Annual Report and Sustainability Report 2021 |

Financial summary

2021

2020

2019

2018

2017

Net sales, MSEK

3,491.6

2,080.8

1,842.3

1,597.8

1,299.4

Earnings before amortisation of intangible assets (EBITA), MSEK

393.8

204.8

135.9

114.9

133.4

EBITA margin, %

11.3,

9.8

7.4

7.2

10.3

Operating result (EBIT), MSEK

355.1

177.3

106.4

92.5

122.3

Net earnings, MSEK

252.4

126.5

67.1

59.3

90.4

Total assets, MSEK

4,715.2

1,953.3

1,497.9

1,303.1

777.1

Cash flow from operating activities, MSEK

104.7

249.8

173.9

15.6

133.4

Earnings per share after dilution, SEK

6.47

3.37

1.80

1.62

2.38

4

Hexatronic

The year in brief

3 492

SALES MSEK

11.3 %

EBITA MARGIN

2021 has been a year of very strong growth both in terms of sales and profitability. The year marked a breakthrough for our system sales in the USA and Germany, as well as an intense acquisition activity with seven new companies being added to the Group.

The year in brief

Hexatronic has signed strategically important orders and agreements during the year.

  • • Agreement with Ting Internet in USA to a value over MUSD 50.

  • • Agreement with Centric Fiber in Texas, USA, to a value of MUSD 10.

  • • Three contracts in Germany to a value of MSEK 70, MEUR 12 and MEUR 9.

  • • Marine cable order to a value of approx. MSEK 60.

  • • Strategic supplier agreement with Vocus in Australia.

Other

  • • Decision to invest MUSD 18 in a new production plant for microducts in south-east USA, via the wholly owned subsidiary Blue Diamond Industries.

  • • Hexatronic conducted a directed share issue, injecting MSEK 550.

Acquisitions

  • • TK-KONTOR-FREITAG GmbH, German competence center for FTTH .

  • • Mpirical Ltd., UK-based training company.

  • • Optical Solutions Australia Group Pty Ltd, distributor of telecom products in Australia.

Hexatronic | Annual Report and Sustainability Report 2021

  • • The Fibre Optic Shop Pty Ltd, manufacturer and distributor of fiber optic products in Australia.

  • • H. Weterings Galgeweg BV, Dutch manufacturer of ducts and hoses for the telecom and agricultural markets.

  • • Data Center Systems, supplier of complete fiber optic solutions for the American data center market.

  • • REHAU Group's business operations in telecom - a major player in microducts on the German market.

Events since the end of the period

  • • The Board chooses to adjust Hexatronic's profita-bility target to 12% EBITA margin (earnings before amortization of intangible assets) over a business cycle. The previously set profitability target was at least 10% on a rolling 12-month basis.

  • • Hexatronic's growth target has been adjusted to annual growth of at least 20% over a business cycle. The previous growth target was to grow more than the market organically and with annual growth of at least 20%.

  • • The Board will propose to the AGM a dividend of SEK 0.50 (0.50) per share for the 2021 financial year.

  • • The Russian invasion of Ukraine has a minor direct impact on Hexatronic's operations but it is expected to result in secondary effects such as increased material prices, cargo prices and, to some extent, a shortage of raw materials and transport.

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Hexatronic Group AB published this content on 12 April 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 12 April 2022 16:11:28 UTC.