May 7, 2019 / 6:55 AM / 2 months ago

UPDATE 1-Weak public safety business holds back Hexagon

(Adds shares, background, detail, CEO comment)

STOCKHOLM, May 7 (Reuters) - Swedish industrial technology group Hexagon increased quarterly sales and core earnings slightly less than forecast held back by continued weakness in its public safety business.

The maker of measurement and positioning systems and software described the first quarter as robust overall.

Adjusted operating earnings grew to 221 million euros ($247.7 million) from 198 million a year earlier, just short of the 225 million mean forecast seen in a poll of analysts.

Organic sales growth for the group was 4 percent, compared to analysts’ expectations for 5 percent growth.

Hexagon said growth and margins had been hampered by a weak Safety & Infrastructure division with a 17 percent organic sales drop in the quarter. Public Safety accounts for roughly 5 percent of Hexagon’s sales.

“If we exclude the public safety related business the Hexagon organic growth was above 6 percent,” Chief Executive Ola Rollen said in a statement.

“As previously communicated, actions have been taken to ensure improved performance in this division throughout the remainder of 2019,” he added.

Hexagon’s sensors and software are used for measurement and quality inspection in manufacturing processes and in engineering plant design. Its products are also used in areas such as infrastructure planning, construction, mining, agriculture and energy.

Shares of Hexagon, which competes to an extent with companies such as Trimble, Autodesk and Dassault Systemes are up 20 percent so far in 2019. ($1 = 0.8922 euros) (Reporting by Johannes Hellstrom Editing by Helena Soderpalm/Keith Weir)

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