February 22, 2013

 

 

In 2012, Marel's operational profit (EBIT) was US$61.1 million, or 8.6% compared to normalised EBIT of EUR 73.2 million (10.9%) in 2011. "We feel this is a good result in a difficult environment even though it falls below our target range of 10-12% of revenues," says Erik Kaman, chief financial officer.

 

Marel's performance was below target as its major poultry markets of Western Europe and USA suffered from the global economic situation and higher feed costs. In the second half of 2013, Marel expects significant improvements in this situation, especially in USA. Marel realized important projects in growing markets such as China, South Korea and Brazil.

 

Moreover, the pork market was not in a strong position in 2012. Pork producers were struggling on account of higher feed prices as well as from overproduction in their markets. Several pork producers faced quite difficult situation in 2012.

 

Marel maintained a solid revenue base in Further Processing segment and showed very strong growth in the Fish segment. All in all, Marel revenues grew by a solid 6.8% in the face of challenging economic conditions.

 

Marel's two-phased strategy was announced during the Annual General Meeting in 2006. We are now implementing the second phase of this strategy. In phase one, Marel's growth was fuelled by acquisitions, which were concluded with the acquisition of Stork Food Systems in 2008. It is now in the middle of the second phase, where its focus is on strong organic growth.

 

Two years ago Marel changed from a more or less product oriented organisation into a market oriented one, establishing four industry centers: Poultry, Meat, Fish and Further Processing. This reorganisation brought good results, in particular, its activities serving the fish industry brought about very strong growth of 21%, attributed to the new market-oriented approach. In 2013, Marel expects that its four industry centers will further strengthen.

 

Marel's CEO Theo Hoen says, "Looking at 2013, we expect that our major poultry markets in Europe and USA will improve. We could start to see this in the second half of the year, when Marel will be poised to resume the growth rate of past years."

 

In the Far East, Marel realised several key projects, among them large scale greenfield plants that offer the most complete, automatic high speed processing solutions for processing broilers and a high capacity duck processing line (6,000 bph).

 

In China, Marel strengthened local presence further by scaling up the sales and service teams and by starting the production of parts of the processing lines in the Marel facility. Early in 2012, Marel concluded its largest-ever single sale to the fish processing industry with a seafood processor in northeast China. The new whitefish processing flowlines feature solutions specifically developed to meet the requirements of Chinese fish processors.

 

In Russia several large projects were realised, amongst which two high speed processing lines and a completely integrated greenfield project, especially designed for the production of fresh products. Several other projects were secured and are under construction. One project sets the new standard in high speed duck processing in the whole region.

 

The company's position in Latin America has been strengthened during the year. The new offices in Mexico and Colombia are good platform for a more intensive market approach and enable further growth and development in the whole region. The successful realisation of projects is a clear indication that this part of the global poultry market is rationalising its industry.