Hexagon to generate 160-170 MEUR in annual operational efficiency savings

“Hexagon has a significant market opportunity, driven by long-term and cross-industry megatrends.”

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Global customers are demanding more productive, sustainable, high-quality products and operations for their businesses. And Hexagon, which is continuously building its reality capture, measurement, and positioning foundation for software-centric, business-critical and high-value solutions for its customers, believe it’s perfectly placed to meet these demands.

Key information:

  • Hexagon is set to make cost-saving efficiency cuts to optimise the company’s ability to meet industry demands.
  • Reductions in the company’s office and facility footprint, a push towards increased automation, and overall overhead cost reductions are expected.
  • The Swedish company hopes these efficiency changes will help the company reach its target of having an operating margin of more than 30% by the end of 2026.

However, for Hexagon to take advantage of these opportunities, and to also build a strong financial profile for its stakeholders, the Swedish company are looking into ways to make efficiency savings. Additionally, Hexagon is also looking into investment opportunities which can strengthen the company’s skills in these pre-determined growth areas.

"Hexagon has a significant market opportunity, driven by long-term and cross-industry megatrends. Over the last few quarters, we have assessed our operations through the lens of this potential and this efficiency program will provide a solid foundation for delivery," said Paolo Guglielmini, President and CEO of Hexagon.

The digital reality solutions provider is set to take a one-off charge of approximately 200 MEUR in Q3 2023 (with a similar cash impact). Over the next six quarters, Hexagon will implement its program which is expected to generate 160-170 MEUR in annual cost savings, which will reach the full run-rate impact in early 2025.

Hexagon’s efficiency program will focus on these four key areas:

  • Hexagon’s office and facilities footprint will be reduced by around 25%.
  • Extraction of cross-divisional efficiencies, with the aim to reduce overall overhead costs.
  • Development, manufacturing, and digital processes will be optimised through automation.
  • All non-core business areas and activities will be rationalised.

The Swedish company has set the target to reach an operating margin of more than 30% by the end of 2026. Hexagon hopes to use these cost-efficiency savings to underpin this target, while also countering inflationary pressures and allowing for continued investments and growth.