HMS Networks AB (publ): history, ownership, mission, how it works & makes money

A Brief History of HMS Networks AB (publ)

HMS Networks AB, founded in 1988, is a leading supplier of communication technology for industrial automation. The company initially focused on developing products for the needs of the industrial sector, primarily in the area of industrial Ethernet and fieldbus communication.

In 1994, HMS introduced its first product, the Anybus Communicator, which served as a gateway for different industrial protocols. This innovation set the stage for the company's future growth and diversification within the automation sector.

By 1998, HMS Networks was listed on the Stockholm Stock Exchange, enhancing its capital and visibility in the market. The IPO opened avenues for acquisitions and expanded product lines.

In 2001, HMS Networks launched Anybus X-gateways, which allowed seamless communication between various industrial devices and networks, significantly broadening its user base.

The company continued to grow through acquisitions, with a key purchase in 2004 of the company ESD, enhancing its expertise in network communication for industrial applications.

In 2011, HMS Networks acquired the research and development company, which enabled it to innovate further in the field of communication technology. This acquisition supported the introduction of the Anybus CompactCom, a modular communication solution for embedded devices.

In 2016, HMS launched the Anybus Wireless Bolt, which aimed to simplify wireless communication in industrial applications. The product garnered attention for addressing the growing need for wireless solutions in factories.

By 2020, the company's revenue reached approximately 1.5 billion SEK, indicating a robust growth trajectory over the years. In the same year, HMS Networks reported an operating profit of 450 million SEK.

As of the end of 2022, HMS Networks reported a revenue of 1.76 billion SEK, with an operating profit margin of 27%, showcasing its effective operational efficiency and strong market position.

In 2023, HMS Networks continues to strengthen its market position through ongoing innovation, particularly focusing on Industry 4.0 and IoT applications. The company's product lineup now includes solutions that integrate cloud services and provide advanced analytics capabilities. This strategy aligns with global trends towards digital transformation in industrial settings.

HMS Networks is recognized for its commitment to quality, demonstrated by its compliance with international standards including ISO 9001 and ISO 14001, which emphasize quality management and environmental responsibility. The company’s growth strategy is further bolstered by a strong R&D budget, which typically represents around 10% of its revenue.

A Who Owns HMS Networks AB (publ)

HMS Networks AB (publ), a publicly traded company on the NASDAQ Stockholm exchange, has a diverse ownership structure comprising institutional investors, individual shareholders, and company insiders. The latest data as of October 2023 reflects the following ownership breakdown:

The major institutional shareholders include several well-known investment firms and funds. Here are the top five institutional investors as of the latest reporting:

Within the context of individual shareholders, there are several prominent figures. Notably, Håkan Jonsson is among the top individual shareholders, owning approximately 1,000,000 shares, representing about 5.4% of the total. Company insiders, including executive management and board members, maintain a significant position in the company, reinforcing their commitment to HMS Networks' long-term goals.

As of the latest earnings report, HMS Networks reported a total of 18,700,000 shares outstanding, translating into a market capitalization of approximately SEK 3.1 billion based on a recent share price of SEK 165, reflecting a growth of 12% year-to-date.

The stock performance has shown resilience, with an average trading volume of about 200,000 shares per day, indicating healthy liquidity and interest from both institutional and retail investors.

HMS Networks AB (publ) Mission Statement

HMS Networks AB (publ) focuses on providing solutions that enhance communication within industrial automation and the Internet of Things (IoT). Their mission statement emphasizes innovation, customer-centric solutions, and sustainability. The company aims to empower industries with seamless connectivity, helping customers increase productivity and efficiency while reducing their environmental impact.

As of their latest financial report in Q3 2023, HMS Networks reported a turnover of SEK 300 million, marking a growth of 12% compared to the same quarter of the previous year. This growth highlights the effectiveness of their mission to adapt to market demands while maintaining a focus on quality and innovation.

HMS Networks’ dedication to research and development is reflected in their annual investment of approximately 8% of revenue towards innovative technologies and solutions, aligning with their mission to be at the forefront of the industrial connectivity sector.

In addition, the company has implemented sustainability initiatives that have resulted in a reduction of greenhouse gas emissions by 15% in the last fiscal year, demonstrating their commitment to environmental responsibility as part of their mission.

The company’s strategic partnerships and collaborations further enhance their ability to meet the evolving needs of their customers. As of Q3 2023, HMS Networks maintains partnerships with over 200 global manufacturers, enabling them to integrate their connectivity solutions seamlessly across a wide range of industries.

HMS Networks’ mission statement is not just a declaration, but a guiding principle that shapes their operational strategies, financial health, and profound influence in the automation and IoT landscape.

How HMS Networks AB (publ) Works

HMS Networks AB (publ) is a leading provider of communication technology for industrial automation. The company specializes in providing products and solutions that enable the connection and communication of automation devices across various industries. HMS operates under several well-known brands, including Anybus, Ixxat, and Ewon.

The company focuses primarily on three business areas: industrial communication, remote access, and embedded systems. As of the latest financial reporting for Q3 2023, HMS Networks reported:

• Net sales of SEK 484 million, an increase of 17% year-over-year.
• Operating profit (EBIT) of SEK 104 million, representing a margin of 21.5%.
• Net profit of SEK 82 million, resulting in earnings per share (EPS) of SEK 3.71.

HMS Networks has seen a steady growth trajectory, driven by the increasing demand for connectivity solutions in automation. The company's products seamlessly integrate various industrial protocols, which is crucial for facilitating communication in smart factories and Industry 4.0 environments.

The company has also expanded its global reach, with sales growing across multiple regions. The breakdown of sales by region for Q3 2023 shows:

• Europe: 60% of total sales
• North America: 25% of total sales
• Asia: 15% of total sales

HMS Networks invests significantly in research and development to maintain its competitive edge, with R&D costs representing approximately 9% of total sales. The company's innovation in wireless communication technology is pivotal in expanding its product offerings. Recent product launches include the Anybus Wireless Bolt, which has garnered attention in the market for its robust performance in industrial environments.

In terms of market position, HMS Networks has established itself as a leader in the industrial communication sector. According to the latest industry reports, the global industrial IoT market is projected to grow at a CAGR of 23.1% from 2023 to 2028, providing HMS Networks with ample growth opportunities. The company’s proactive strategies in leveraging partnerships with leading technology firms further bolster its market presence.

As of October 2023, HMS Networks trades on the NASDAQ Stockholm under the ticker symbol HMS. The company's stock has demonstrated solid performance, with a year-to-date increase of 42%, reflecting investor confidence in its growth strategy and operational execution. The current market capitalization stands at approximately SEK 5 billion.

How HMS Networks AB (publ) Makes Money

HMS Networks AB (publ) operates primarily in the area of industrial communication technology, providing solutions that connect devices in automation systems. The company's revenue streams are categorized through various products and services aimed at different sectors, including manufacturing, energy, and transportation.

Revenue Composition

As of the most recent financial reports, HMS Networks' total revenue in 2022 was approximately SEK 1.2 billion, reflecting a growth rate of 26% compared to 2021. The company’s revenue is mainly derived from the sale of hardware, software, and support services.

Product Lines

HMS Networks offers several product lines, notably Anybus, IXXAT, and eWON, which serve different industrial needs:

• Anybus: Provides solutions for industrial networking and is integral in connecting devices across various communication protocols.
• IXXAT: Focuses on communication solutions for embedded systems in industries like automotive and automation.
• eWON: Specializes in remote access and monitoring solutions, allowing users to access devices from anywhere.

Geographical Revenue Distribution

The company's market presence spans across various regions, contributing to its revenue as shown below:

Operating Profitability

In terms of profitability, HMS Networks reported an operating profit of SEK 200 million in 2022, resulting in an operating margin of 16.7%. The net profit for the same year was SEK 160 million, with a net margin of 13.3%.

Strategic Partnerships and Acquisitions

The company enhances its revenue-generating potential through strategic partnerships and acquisitions. In 2021, HMS Networks acquired 2.2% of the shares in the US-based company, Acromag, aimed at strengthening its position in the North American market.

Outlook and Future Trends

Looking ahead, HMS Networks anticipates continued growth driven by the increasing demand for industrial automation and IoT solutions. With a compound annual growth rate (CAGR) projected at 15% over the next five years, the company is well-positioned to capitalize on emerging trends in smart manufacturing and digitalization.