Hexpol to add mixing line in Qingdao as sales, profits double

ERJ staff report (DS)

Stockholm -- Sales and operating profits at Hexpol AB almost doubled in the three months to September 2011, in comparison with the same period a year ago. Most of the sales increase was due to the addition of new Elasto businesses, but like-for-like sales increased by 21 pecent in the period. The company said sales in Asia were up by 68 percent and China was particularly strong. It is adding a new mixing line, due on stream in late 2012, at its Hexpol Compounding unit in Qingdao. The new line will double existing capacity there.

In the third quarter, net sales amounted to SEK 1,843 million (euro 203 million), up by 94 percent from the figure of SEK 950 million a year earlier. Operating profit rose 96 percent to SEK 235 million, up from SEK 120 million.

Results for the first none months were almost as good. Net sales increased to SEK 5,405 million from SEK 2,666 million. Operating profit more than doubled, to SEK 675 million from SEK 323 million.

Georg Brunstam, President and CEO, said, "The third quarter of 2011 was the best quarter to date for the Hexpol Group in terms of both sales and earnings. Our sharp growth continued in the third quarter, with strong sales in all units. Sales were strong in all geographic regions, with particularly strong growth in NAFTA and Asia."

he added, "We continued our forceful growth in China, and proceeded to expand in all product areas. Our sales in Asia rose 68 per cent. We have decided to invest in a new production line in Hexpol Compounding in Qingdao, in addition to the earlier decision to expand Elasto in the Guangdong province. We are also increasing our moulding capacity for gaskets to plate heat exchangers in Hexpol Gaskets and launching polyurethane wheel manufacturing in Hexpol Wheels."

The new mixing line is in addition to the earlier decision to expand Elasto in the Guangdong province.

The comapny said, "The acquired Excel Polymers Group developed significantly better than expected during the third quarter. The entire acquired group is integrated geographically in the Hexpol Compounding business area and its operating margin was in line with the Hexpol Group.

Hexpol said, "Raw material prices continued to rise during the third quarter, albeit at a slower pace than in previous quarters in 2011. However, shortages continue to prevail for a number of raw materials. The Group's operating margin continues to remain largely unaffected by the higher raw material prices. "

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Q3 results statement from Hexpol