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INTERIM REPORT Q3 2011

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					INTERIM REPORT Q3 2011
27 OCTOBER 2011
AGENDA


01    Net sales and earnings


02    Market development


03    Segment information


04    Orders and product releases


05    Going forward




2    HEXAGON INTERIM REPORT Q3 2011
                                     NET SALES
                                     AND EARNINGS




3   HEXAGON INTERIM REPORT Q3 2011
Overview Q3 2011

                                     • Solid organic growth of 13%
                                        •   Growth primarily driven by recovery in
                                            western markets and strong demand from
                                            customers in engineering and energy
                                            related segments
                                        •   Excluding the weak activity in high-speed
                                            rail in China – Geosystems grew by
                                            approximately 6%
                                        •   Negative F/X impact of -3%: reduces top
                                            line but almost no impact on margins

                                     • Strong Gross and EBIT margin in MT
                                        •   In spite of negative currency effects of -8.0
                                            MEUR, gross margin was 54% and EBIT
                                            margin 20%
                                        •   First time Hexagon reports 20 per cent
                                            EBIT in a third quarter
                                            (normally seasonally weak)
                                        •   Strong cash flow




4   HEXAGON INTERIM REPORT Q3 2011
Seasonality in profit

• Seasonal pattern still valid
• Although less accentuated with Intergraph in the Group




          Q1                     Q2      Q3                Q4


5    HEXAGON INTERIM REPORT Q3 2011
Key figures Q3 2011

MEUR                                                                                     Q3 2011   Q3 2010   Change %
Net sales                                                                                  521.2     337.0        13 1)
Operating earnings (EBIT1)                                                                  98.9      58.0          71
Operating margin, %                                                                         19.0      17.2         1.8
Earnings before taxes                                                                       84.3      53.5          58
Net earnings                                                                                67.4      46.5          45
Earnings per share, EUR                                                                     0.19      0.15          27




1) Adjusted to fixed exchange rates and a comparable Group structure (organic growth).



6          HEXAGON INTERIM REPORT Q3 2011
Key figures first nine months 2011

MEUR                                                                                       Q1-3    Q1-3    Change %
                                                                                           2011    2010
Operating net sales                                                                      1,586.0   980.2        15 1)
Revenue adjustments 2)                                                                      -8.5      –         n.a.
Net sales                                                                                1,577.5   980.2        15 1)
Operating earnings (EBIT1)                                                                318.0    169.4          88
Operating margin, %                                                                        20.1     17.3         2.8
Earnings before taxes excl. non-recurring items                                           274.0    157.6          74
Non-recurring items                                                                         -8.5      –         n.a.
Earnings before taxes                                                                     265.5    157.6          68
Net earnings                                                                              212.2    136.0          56
Earnings per share, EUR                                                                    0.60     0.45          33
Earnings per share excl. non-recurring items, EUR                                          0.61     0.45          36
1) Adjusted to fixed exchange rates and a comparable Group structure (organic growth).
2) Non-recurring items related to the acquisition of Intergraph.
7          HEXAGON INTERIM REPORT Q3 2011
Cash flow

MEUR                                         Q3      Q3    Q1-3    Q1-3      FY
                                           2011    2010    2011    2010    2010
Cash flow from operations before changes
in working capital excluding taxes and
interest                                   121.7   78.5    375.4   220.6   371.3
Tax paid                                    -3.6    -4.1   -50.8   -14.7   -22.1
Interest received and paid, net            -14.4    -3.8   -41.9   -11.4   -55.1
Cash flow from operations before
changes in working capital                 103.7   70.6    282.7   194.5   294.1
Changes in working capital                  23.3    -1.5   -27.0   -15.0   -33.7
Cash flow from operations                  127.0   69.1    255.7   179.5   260.4
Ordinary investment activities             -36.4   -20.5   -93.2   -62.2   -87.2
Operating cash flow                         90.6   48.6    162.5   117.3   173.2
Non-recurring cash flow                       –     -1.1   -16.0    -5.7   -47.8
Operating cash flow after non-recurring
items                                       90.6   47.5    146.5   111.6   125.4

8     HEXAGON INTERIM REPORT Q3 2011
Currency effects as compared to EUR



                                          Movement     Income - cost Profit impact
    CHF                                 Strengthened       Negative       Negative
    USD                                   Weakened          Positive      Negative
    CNY                                   Weakened          Positive      Negative
    EBIT, Q3                                                            -8.0 MEUR
    EBIT, Q1-Q3                                                        -15.5 MEUR




9      HEXAGON INTERIM REPORT Q3 2011
                                      MARKET
                                      DEVELOPMENT




10   HEXAGON INTERIM REPORT Q3 2011
 Sales mix Hexagon MT Q3 2011 (Q3 2010)


                                                 Eastern Europe,
                                                 Middle East, Russia, Africa
North America                  EU
                                                 7% (7)
28% (22)                       34% (36)
                                                              China
                                                              14% (21)
      South America
      4% (3)                              Rest of Asia
                                          13% (11)




 Q3 2010 does not include Intergraph.
 11    HEXAGON INTERIM REPORT Q3 2011
 Hexagon’s growth per customer segment in Q3


  Q3 2011
                                                        >8%                     0-8%                     Negative
                                      Share of        W EU            MEA             NA             SA         CN   APAC
                                      sales 1)        34%             7%             28%             4%        14%    13%
 Surveying                               24%
 Power & Energy                          18%
 Aerospace & Defence                     13%
 Public Safety & Security                11%
 Construction                            10%
 Automotive                               9%
 Manufacturing                            7%
 Other                                    8%

 TOTAL

1) Sales per customer segment is per December 31, 2010 pro forma and sales by region is as of Q3 2011.

 12        HEXAGON INTERIM REPORT Q3 2011
EMEA market trends, Q3

Increased activity in Western Europe
• Growth comes primarily from
   North-western Europe
• Improved demand for systems used
   in industrial segments such as
   automotive and aerospace
• Slow recovery for
   infrastructure/construction
   although growing
• Weak sales, but strong order
   intake in public safety             Q3 Share of Group sales 43 %
• High demand for CAD software used
                                       Growth, %     Group      MT
   in power and process industries
• Southern Europe remained weak        Net sales         13      13


Eastern Europe and the Middle East
continue to grow
13   HEXAGON INTERIM REPORT Q3 2011
Americas market trends, Q3

Improved demand in NAFTA
• Automotive, aerospace, general
  engineering and infrastructure
  projects improving further
• Strong demand for CAD software in
  Canada
• Flat sales in public safety but backlog at
  record level
• Residential housing still weak
South America - strong demand for
PP&M, Geosystems and Metrology                 Q3 Share of Group sales 31 %
• Activity increasing in basically all         Growth, %     Group       MT
  segments
                                               Net sales         27      27
• Sisgraph opens up many opportunities in
  South America


14   HEXAGON INTERIM REPORT Q3 2011
Asia market trends, Q3

Sales at peak levels in Asia
• Excluding high-speed rail, organic growth
  was 10 per cent
China
• Growth driven by:
  automotive, aerospace, power & process
• Growth in China in the quarter excluding
  high-speed rail was more than 20 per cent
• Chinese construction slowing down due to
  cooling off measures by government
                                              Q3 Share of Group sales 26 %
Australia, Japan and Korea continue to        Growth, %     Group       MT
grow, but negative growth in Southeast
                                              Net sales          1           1
Asia and Central Asia



15   HEXAGON INTERIM REPORT Q3 2011
Organic growth1) per geographic region (MT)


 %                                                                           Share of sales Q3
                                                                             Asia        26%
                                                                             Americas    32%
                                                                             Total      100 %
                                                                             EMEA        41%




       Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
     1) Adjusted to fixed exchange rates and a comparable Group structure.




16        HEXAGON INTERIM REPORT Q3 2011
                                      SEGMENT
                                      INFORMATION




17   HEXAGON INTERIM REPORT Q3 2011
Measurement Technologies (MT)



MEUR                                                      Q3            Q3 Change                  Q1-3    Q1-3 Change
                                                        2011          2010 %                       2011    2010 %
Net sales                                              507.9         326.0               13 1)   1,537.7   944.1   14 1)
Operating earnings (EBIT1)                             101.5           60.7                67     325.6    176.5     84
Operating margin, %                                      20.0          18.6               1.4      21.2     18.7    2.5

1) Adjusted to fixed exchange rates and a comparable group structure (organic growth).




18        HEXAGON INTERIM REPORT Q3 2011
Net sales - organic growth1) by application area



  %




                                                                                                         Metrology
                                                                                                         Total
                                                                                                         Geosystems




       Q1      Q2      Q3      Q4 Q1         Q2      Q3      Q4 Q1         Q2      Q3    Q4 Q1   Q2 Q3


1) Adjusted to fixed exchange rates and a comparable group structure (organic growth).


19        HEXAGON INTERIM REPORT Q3 2011
Gross margin (MT) – yearly data



  %                                        Q1-3 2011 55% (52)
                                                                Trend line
  60
                                                                Gross margin
  50

  40

  30

  20

  10

     0
      2002 2003 2004 2005 2006 2007 2008 2009 2010 20111)

1) Q1-3 2011.


20        HEXAGON INTERIM REPORT Q3 2011
EBIT margin (MT) – quarterly data



 %
                                      Trend line

                                      EBIT MT




21   HEXAGON INTERIM REPORT Q3 2011
                                      ACQUISITIONS,
                                      ORDERS AND
                                      PRODUCT
                                      RELEASES




22   HEXAGON INTERIM REPORT Q3 2011
Acquisitions completed Q1-3 2011


     Denali Solutions – records management
     software for public safety and security
     (Technology)




     7 Ocean – vision technology company in
     China (Metrology)




23
Acquisitions completed Q1-3 2011


     Augusta Systems – software to enable
     detailed, real-time information from cameras,
     sensor systems, and networks (Technology)




     SISGRAPH – software and services provider
     in Latin America (Technology)




24
First installation using Hexagon and Intergraph Technology


“La Grande Frana di Ancona”, Ancona, Italy

Monitoring system to predict landslide




25   HEXAGON INTERIM REPORT Q3 2011
Customer Wins: Process, Power & Marine Market


                    INPEX – worldwide oil and gas exploration and production owner
                    operator (based in Australia)

                    Wison Chemical – supplier of high-quality chemical raw materials
                    (based in China)

                    Engevix – leading engineering company (based in Brazil)

                    Tecnomare – engineering company of Italian oil and gas company ENI


                    Siemens Energy – world leading energy technology provider (based in
                    Germany)

                    Samsung – leading shipbuilding company (based in Korea)

                    Toyo - Thai – leading EPC (based in Thailand)


26   HEXAGON INTERIM REPORT Q3 2011
Customer Order: Ecovix


Hexagon aids platform construction for
deep-sea oilfields prospection in Brazil

• Ecovix (a Petrobras supplier) selects
  Hexagon’s 2D and 3D software for the
  construction of FPSO hulls to support one
  of the largest oil discovers off the Brazilian
  coast (made by Petrobras)




27    HEXAGON INTERIM REPORT Q3 2011
Customer Order: Danish Ambulance, Denmark


Regions of Denmark join forces to replace
old systems with new, state-of-the-art
emergency dispatch from Hexagon

• More efficient collaboration and utilization of
  ambulance and helicopter dispatch
• Quicker response to daily emergency needs
  and major events (e.g. natural disasters)




28    HEXAGON INTERIM REPORT Q3 2011
Customer Order: “9-1-1” Expansion in the State of Rio Grande do Norte


Hexagon selected to implement “9-1-1”
expansion in the emergency operation
center of Natal – the capital of the state of
Rio Grande do Norte
• Natal is one of the host cities for the 2014
  FIFA World Cup in Brazil
     • Together with the Olympic Games in
       2016
       (Rio de Janeiro), this event will trigger
       huge investments in infrastructure




             Half of all host-cities for the
             2014 FIFA World Cup are Hexagon customers

29     HEXAGON INTERIM REPORT Q3 2011
Customer Order: Westar Energy, Kansas, USA


Largest electric energy provider in Kansas,
USA relies on Hexagon’s outage and
mobile workforce management solutions

• Better coordination between dispatcher and
  mobile crews for increased operational
  efficiency and improved asset utilization
  and performance




30    HEXAGON INTERIM REPORT Q3 2011
Customer: Colombian Army, Columbia


Hexagon aides mission-planning in the
Colombian Amazon with the Intelligence
Operations Department of Colombian
Army

• Quicker decisions when lives are at
  stake
     • Rapid management and delivery of
       the multiple sources of massive
       data and imagery that inundate the
       defense and intelligence community
       everyday (satellite, aerial, UAVs)




31     HEXAGON INTERIM REPORT Q3 2011
Customer: City of Richmond, Virginia, USA


EdgeFrontier® software from Augusta
Systems (now a part of Hexagon) offers
coordinated information sharing critical to
incident response
• First computer-aided dispatch provider to
  implement a pilot interface for the
  Department of Homeland Security’s Unified
  Incident Command and Decision Support
  (UICDS) platform
• Standards-based interface enables two-way
  information sharing between Richmond’s
  UICDS platform and the Virginia Emergency
  Management Association




32    HEXAGON INTERIM REPORT Q3 2011
Customer Order: State of Steiermark, Austria


State of Steiermark underlines its pioneering
role in disaster control

• Hexagon to deliver command information
  system for all public safety and security
  agencies in the federal state of Steiermark
• All areas of governmental crisis management
  and rescue organizations involved in disaster
  control networked within one command
  information system




33    HEXAGON INTERIM REPORT Q3 2011
Customer Order: Department of Microbiology, Russia


Russia’s Department of Microbiology
preventing the spread of diseases and
promoting better healthcare

• Hexagon’s ERDAS APOLLO Professional is
  mapping infectious diseases to establish a
  correlation between rural and urban areas
• Synergistic sales – Hexagon product through
  Intergraph channel




34    HEXAGON INTERIM REPORT Q3 2011
African Orders for Hexagon’s Photogrammetric Solutions


Ministry of Lands Housing and Urban
Development (Malawi, Africa) using Hexagon to
support African Union initiative involving border
remapping between neighboring territories




National Mapping Agency in Kenya using Hexagon
to update and create maps for the coastal areas of
Malindi and Lamu under the Rapid Results
Initiative of the Government of Kenya




35    HEXAGON INTERIM REPORT Q3 2011
Large Customer Order: LENS – Supplier to Apple


 Hexagon’s video measurement
 machines (7 Ocean technology)
 support Apple product

 • Record purchase order from
   LENS – glass panel supplier for
   Apple IPhone 4S




36    HEXAGON INTERIM REPORT Q3 2011
Customer Order: Leica Absolute Tracker AT401


Leica Absolute Tracker AT401: Diamond Light
Source Alignment

• Alignment of Partial Accelerator
• Diamond Light source replaces unreliable and
  time consuming solution




37    HEXAGON INTERIM REPORT Q3 2011
Large order for assembly guidance systems


Large Customer Order with American
Company Sub-supplier of Airbus:

• Supplier setting up new plant in
  France to receive, assemble and ship
  centre fuselage frame sections for the
  Airbus A350XWB
• Multiple Leica Absolute Trackers
  AT901 to be used to improve the
  assemble process of the fuselage




38    HEXAGON INTERIM REPORT Q3 2011
Customer Demand: Large Orders for Laser Scanning


High demand for Hexagon’s high-definition
scanning solutions

• Georgia Bureau of Investigation (GBI) selects
  Hexagon solutions to provide high quality
  investigative, scientific, and information services
• University of Miami selects Hexagon’s solutions to
  aid the BMW Accident Research Mapping Team in
  the development of a safer vehicle in near fatal
  collisions
• United States Air Force selects Hexagon’s solutions
  for a variety of applications, including the exterior
  and interior mapping of both domestic and foreign
  fixed wing aircraft




39     HEXAGON INTERIM REPORT Q3 2011
Product Release: Smart 3D 2011 SP1


Feature-rich, high-quality release with
nearly 1,200 enhancements


• Includes SmartPlant® 3D, SmartMarine
  3D, and SmartPlant 3D Materials Handling
  Edition design solutions for plant, offshore,
  bulk material sectors




            New functionality vital to oil and gas, power,
            offshore, and shipbuilding markets.

40    HEXAGON INTERIM REPORT Q3 2011
Product Release: Video Analyst® now Removes Fog, Smog, & Haze


Comprehensive, effective, affordable, and
user-friendly solution for forensic video
enhancement and analysis

• Unique, newly patented technology removes
  fog, smog, and haze from videos
• Displays progressive video in motion stereo
  in a manner similar to that of interlaced video




            Unique, newly patented technology

41    HEXAGON INTERIM REPORT Q3 2011
Product Release: SPAN MEMS IMU (GPS/INS product)


Compact, light-weight GPS/INS product
targeted at unmanned vehicle integrators

• Great for new applications and markets
  where size, power, and width are key
  critical attributes
• Weighing only 100 grams




42    HEXAGON INTERIM REPORT Q3 2011
Product Release: GPStation-6™ “STORM” Receiver


Next-generation GNSS Ionospheric Scintillation
and Total Electron Content Monitor receiver

• Monitor local space weather effects on GNSS
  signals for real-time high-integrity high-value
  applications (“storm” detection)
• Solar storms happen every 13 years
• Next solar storm is expected 2013




43    HEXAGON INTERIM REPORT Q3 2011
Product Releases: New Software for Laser Scanning


Leica Cyclone 7.2

• Up to 10x improvement in rendering
  speeds
• Greater CPU availability for
  converting point clouds into models



Leica CloudWorx for AutoCAD & µStation 4.2
• Efficient management, viewing and processing
  of as-built laser scan data for 2D & 3D projects
• Architectural projects & plant projects
• Familiar CAD environment to extract
  valuable information from point cloud



44     HEXAGON INTERIM REPORT Q3 2011
                                      GOING
                                      FORWARD




45   HEXAGON INTERIM REPORT Q3 2011
Expected market conditions 2011


EMEA
• Hexagon expects continued
  increased demand in EMEA in         Hexagon will continue
  2011
                                      to grow in 2011 due to
Americas                              growth in emerging
• Hexagon expects continued
  increased demand in NAFTA and
                                      markets and further
  South America in 2011               demand recovery in
Asia                                  Western Europe and
• Hexagon expects continued           NAFTA
  increased demand in Asia in 2011




46   HEXAGON INTERIM REPORT Q3 2011
Summary Q3 2011



                                      • Another strong quarter for
                                        Hexagon
                                      • Solid growth, high
                                        profitability and strong
                                        cash flow
                                      • 20% EBIT in Measurement
                                        Technologies, in spite of
                                        seasonal weakness and
                                        currency headwinds




47   HEXAGON INTERIM REPORT Q3 2011
Disclaimer

"This presentation contains forward-looking statements. When used in this presentation, words such as "anticipate", "believe",
"estimate", "expect", "intend", "plan" and "project" are intended to identify forward-looking statements. They may involve risks and
uncertainties, including technological advances in the measurement field, product demand and market acceptance, the effect of
economic conditions, the impact of competitive products and pricing, foreign currency exchange rates and other risks. These
forward-looking statements reflect the views of Hexagon's management as of the date made with respect to future events and are
subject to risks and uncertainties. All of these forward-looking statements are based on estimates and assumptions made by
Hexagon's management and are believed to be reasonable, though are inherently uncertain and difficult to predict. Actual results
or experience could differ materially from the forward-looking statements. Hexagon disclaims any intention or obligation to update
these forward-looking statements.

This communication is directed only at persons who (i) have professional experience in matters relating to investments or (ii) are
persons falling within Article 49(2)(a) to (d) (high net worth companies, unincorporated associations, etc) of The Financial Services
and Markets Act 2000 (Financial Promotion) Order 2001 (as amended) or to whom it may otherwise lawfully be communicated (all
such persons together being referred to as relevant persons). This communication must not be acted on or relied on by persons
who are not relevant persons. Any investment or investment activity to which this communication relates is available only to
relevant persons and will be engaged in only with relevant persons.

It should be noted, that past performance is not a guide to future performance. Please also note that interim results are not
necessarily indicative of the full year results. Persons requiring advice should consult an independent adviser.

THIS COMMUNICATION DOES NOT CONTAIN AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES;
SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR EXEMPTION FROM
REGISTRATION, AND ANY PUBLIC OFFERING OF SECURITIES TO BE MADE IN THE UNITED STATES WILL BE MADE BY
MEANS OF A PROSPECTUS THAT MAY BE OBTAINED FROM THE ISSUER AND THAT WILL CONTAIN DETAILED
INFORMATION ABOUT THE COMPANY AND MANAGEMENT, AS WELL AS FINANCIAL STATEMENTS."




49       HEXAGON INTERIM REPORT Q3 2011

				
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