Hexpol reports weak first quarter despite volume growth

Malmo, Sweden — Hexpol AB has reported lower sales and earnings for the first quarter of 2026, as negative currency effects and weaker price and product mix offset higher volumes across key end markets.

Group sales for the three months to end of March fell 11% year-on-year to SEK4.8 billion (€440 million), while earnings (EBIT) declined 16% to SEK701 million, with earnings margin down at 14.7% from 15.6% reported the year before.

The decline was mainly affected by negative currency effects of 10%, while organic sales were down 3%, partially offset by acquisitions contributing 2%, Hexpol reported 4 May.

The quarter showed “a continuation of the growing volumes” seen at the end of 2025, said CEO Klas Dahlberg, noting that Hexpol increased volumes within its "largest end customer segments.”

However, Dahlberg said, “the result continues to be weighed down primarily by a strong Swedish currency and by the price and product mix development.”

Group-wide, Hexpol reported “overall increased volumes in most end customer segments,” with the largest gains in cable industry, building and construction and general industry.

Meanwhile, the automotive sector showed increased volumes.

However, the sales value was negatively affected by the price- and mix development, the Hexpol leader said.

Regionally, North America sales fell 18% year-on-year, reflecting a 13% negative currency impact.

Europe showed “stable sales despite negative currency effects,” while Asia declined 21%.

Hexpol’s Rubber Compounding, which accounts for 69% of group sales, reported revenue of SEK3.3 billion, down 11% year-over-year.

Organic sales were positively affected by increased volumes to most of the end customer segments.

However, Hexpol said, sales value was “affected more negatively by the price- and mix development, which gave a net negative organic sales development of 3%.”

Segment earnings fell 18% year-on-year to SEK520 million, with margin down at 15.8% from 17.0% last year.

Negative currency effects affected earnings with SEK60 million or 10%, the group said.

The Thermoplastic Compounding unit, which is primarily focus on thermoplastics but also includes Hexpol’s thermoplastic elastomer (TPE) operations, posted a 10% decrease in sales to SEK1.1 billion.

Volumes increased in “building and construction and general industry,” as well as in automotive and medical technology, but “demand for consumer products was lower.”

Engineered Products, which includes gaskets for plate heat exchangers and wheels of polymer materials for forklifts and material handling, reported sales of SEK362 million, down 10%.

Sales were hit by both currency and weaker demand, with a negative organic sales development of 8%.

The decline in organic sales, Hexpol said, was mainly visible in Sweden for both wheels and gaskets.

This, it noted, was “driven by generally weaker demand in the beginning of 2026, while sales at the beginning of 2025 were at record levels.”

Despite the weaker earnings, Hexpol pointed to continued recovery in volumes and market share gains.

“It is gratifying that our focus on maintaining market share has resulted in a continued recovery in several of our end customer segments,” Dahlberg said.

He added, however, that “geopolitical unrest continues to characterise our world,” and that the he currently sees “no general market improvement in the near future.”