Hexpol blames tariff threat for North American sales decline

Hexpol AB on Friday reported lower second-quarter sales and profit, blaming the decline on weak demand in North America stemming from uncertainty over potential trade tariffs.

The Swedish polymer group said sales for the quarter fell to 4.997 billion Swedish krona from 5.454 billion krona a year earlier.

Earnings before interest and taxes, or EBIT, decreased to 756 million krona from 911 million krona, with the EBIT margin narrowing to 15.1% from 16.7%.

"The challenge in demand is mainly visible in North America, which is affected negatively by the uncertainty linked to the threat of trade barriers in the form of tariffs," the company said in its report.

Hexpol also cited a negative currency impact from a stronger Swedish krona, which it said reduced quarterly sales by 367 million krona and EBIT by 52 million krona.

Despite the North American challenges, the company noted that its European operations showed resilience and its Engineered Products business area grew.

For the first half of the year, sales were 10.38 billion krona, down from 10.77 billion krona in the same period last year.