The Hexagon year-end report for 2011 just came out, and there is a recorded webinar with slides and an overview from Ola Rollen, president and CEO, that is available online. Rollen’s commentary highlighted many different areas of performance and business change, including:
- The blended Intergraph (software) and Hexagon (hardware) business has a favorable effect on cash flow, where the traditional hardware business involves building an inventory, invoicing and then getting paid, with software the licenses are essentially pre-payments.
- Investment activities were higher than normal for the quarter (with the purchase of MicroSurvey and a Brazilian software company SISGRAPH)
- Currency impacts show that Western Europe was down 3% with the European debt crisis.
- The strongest growth was in South America
- Asia saw great advances, particularly for Intergraph where software sales increased 70% for the quarter via the sales channels that other business units have established.
The call also highlighted some interesting applications of Hexagon technologies, including:
- Use of Leica measurement technologies to monitor the Costa Concordia cruise ship wreck, with automatic total stations used, and monitoring prisms mounted on the vessel
- They have developed a Metro Inspection System for the Chinese Market with the ability to survey coordinates of buildings, pipe lines and tracks.
- They are involved in a large-scale landslide monitoring project with partner Hydrochina Huadong Engineering to monitor landslide of Kala Hydropower Station
- Novatel and Stara have partnered to deliver precision agriculture solutions for Brazilian farmers
Overall for 2011, the company saw sales growth of 46% with 12 % organic growth and margins at 20% and operating cash flow increases of 35%. There is a focus within the company on increasing the margins of the SG&I business where Intergraph resides (which is in the teens). Going forward, the company sees a strong benefit from the Intergraph integration, particularly in R&D projects. Rollén indicated that the company is ahead of their target on this integration.