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STOCKHOLM, Feb 7 (Reuters) - Swedish industrial technology firm Hexagon on Wednesday reported fourth-quarter core earnings ahead of analyst forecasts and said like-for-like sales growth had picked up sharply from the previous quarter.
Hexagon said growth had been strong in most of its businesses, and that its high-margin power, process and marine division (PPM), which has been hit by a slow oil and gas market, had returned to growth in the quarter.
Like-for-like sales growth was 10 percent in the quarter, a marked acceleration from the 6 percent growth seen in the third quarter, and far ahead of the mean forecast for a 5 percent rise.
Growth was powered by a 23 percent like-for-like sales rise in its China business, but its Americas business also showed double-digit growth.
“This is our best quarter ever,” Chief Executive Ola Rollen said in a statement. “The result shows that our strategy is paying off and we are on the right track towards our 2021 targets”.
The firm has faced unwanted attention over the past 15 months due to insider trading charges against Rollen over his 2015 purchase of shares in Norway’s Next Biometrics, a company not connected to Hexagon.
Rollen was cleared of all accusations in an unanimous verdict by an Oslo court on January 10, but the prosecutors are appealing the ruling.
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.
Hexagon is targeting sales of 4.6-5.1 billion euros and an operating margin of 27-28 percent by the end of 2021. That compares with sales of 3.5 billion euros and operating margin of 24.1 percent in 2017.
Adjusted quarterly operating earnings at Stockholm-listed Hexagon rose to 247 million euros ($306 million) from 209 million in the year-ago quarter, beating a 231 million forecast in a poll of analysts.
The firm partly competes with companies such as Trimble Navigation, Autodesk and Dassault Systemes . Its stock has been strong over the past year, rising 26 percent compared with a 14 percent rise in the STOXX Europe 600 Technology Index ($1 = 0.8069 euros) (Reporting by Johannes Hellstrom; Editing by Simon Johnson)