Hexpol reports double-digit growth in third quarter

Malmo, Sweden – Hexpol AB has reported double-digit sales growth in the third quarter of 2026, supported by increased volumes across most end-customer segments and higher raw material prices.

For the three months to end of September, the Swedish group reported adjusted earnings (EBIT) of SEK723 million (€64 million), up 5.1% year-on-year, on 13% higher sales of SEK5.3 billion, said Hexpol 23 Oct.

Third-quarter adjusted earnings margin, however, fell to 13.6%, from 14.7% reported last year, mainly due to increased overhead costs.

Adjusted profit after tax improved 8.0% year-on-year to SEK502 million.

For the first nine months of the year, Hexpol reported a 3.8% decline in adjusted earnings to SEK2.2 billion, despite a 1.8% increase in sales to SEK15.3 billion.

Nine-month adjusted earnings margin stood at 14.3%, compared to 15.1% the year before, while adjusted profit after tax declined 2.7% to SEK1.56 billion.

"During my first quarter as President and CEO of Hexpol it is very pleasing to see a double-digit organic growth of 12%," said Henrik Elmin, who took over as CEO at the beginning of August.

The performance, he added, marked "a continuation of the strong growth we delivered during the second quarter."

According to Elmin, Hexpol increased volumes within most of its largest end-customer segments, despite a "continued uncertain environment."

The group also "successfully adjusted the prices to compensate for increasing raw material prices," he added.

Hexpol reported sales growth across all three business areas and all geographical regions during the quarter.

In particular, Elmin reported increased volumes in general industry, the cable industry, automotive and consumer products.

"Given that the overall market has been relatively cautious, this means we have gained market shares," he said.

At the same time, Hexpol continued to face "volatile raw material prices" during the period.

The group said it managed to compensate for increased material costs through price adjustments.

Margins were negatively affected by higher overhead costs, which Elmin said were "necessary to enable growth."

"Going forward, the focus is on converting growth into higher margins," Elmin added.

Hexpol also reported continued growth in North America, Europe and Asia, with sales increasing 15%, 10% and 16% respectively during the quarter.

Breaking up segment performance, Hexpol Rubber Compounding reported a 10.2% year-on-year increase in third-quarter sales to SEK3.3 billion.

The business recorded higher volumes across most end markets, particularly the cable industry, consumer products and general industry, while automotive volumes remained unchanged.

North America reported increased organic volumes, while Europe saw a decline.

Segment adjusted earnings during the quarter fell 4.2% year-on-year to SEK483 million, with the margin narrowing to 14.5% from 16.6%, mainly due to higher overhead costs.

For the first nine months, segment sales declined 1.1% to SEK9.79 billion, while earnings fell 11.1% to SEK1.52 billion.

Within Thermoplastic Compounding, third-quarter sales increased 19.5% year-on-year to SEK1.57 billion, while earnings rose 30.8% to SEK157 million.

The business reported increased volumes across most end markets, with particularly strong demand from building and construction.

General industry, cable and automotive also recorded volume growth, while consumer products demand remained unchanged.

For the first nine months, sales increased 10.6% to SEK4.42 billion, while earnings grew 28.4% to SEK461 million.

Hexpol’s Engineered Products reported a 30% year-on-year jump in earnings to SEK83 million on a 12.5% higherin third-quarter sales to SEK397 million.

Hexpol linked the higher revenue to a “double-digit growth” within its wheels product area, with positive development across all markets. Other product areas also reported higher sales.

For the first nine months, sales declined 3.3% to SEK1.15 billion, as earnings edged up 0.5% to SEK218 million.

Elsewhere, the group highlighted its expansion in thermoplastic compounding through two recent acquisitions.

Hexpol completed its acquisition of Italian cable compounds manufacturer Vipa Group 1 Oct, while announcing the acquisition of an 80% stake in Turkish thermoplastic elastomers compounder Symplast 21 Oct.

Hexpol also continued to invest in product development at its Rubber Compounding development centre in Gorlago, Italy.

The group is meanwhile working to streamline production through its Mixing 5.0 project, which aims to achieve "a significantly higher level of automation."