February 6, 2014
Marel reports 2013 operating results with a decrease of 7.3% in revenues totalling €661.5 million (US$894 million) compared with the previous year at €714 million (US$965 million).
Marel's earnings before interests, taxes, depreciation and amortisations (EBITDA) were €69.4 million (US$93.8 million) or 10.5% of revenues compared with €86.0 million (US$116 million) in 2012. Operating profit was €42.9 million (US$58 million) or 6.5% of revenues compared with €61.1 million (US$82.6 million) in 2012.
Revenues from large projects were at a low level while recurring spare parts and service revenues continued to increase.
Management guidance is to reach organic revenue growth with €55 million (US$74 million) adjusted earnings before interests and taxes (EBIT) in 2014. The long term outlook in the industry remains favourable and Marel's goal is to continue to grow faster than market.
A refocusing plan has been launched where the organisational structure will be simplified in order to service customers better. Business units serving the same customer needs and that rely on the same technical capabilities will be combined. Simultaneously the primary focus has been changed from volume to value creation, with targeted operating profit (EBIT) exceeding €100 million (US$135 million) in 2017.
Arni Oddur Thordarson, Marel's chief executive officer said: "Marel's market position is strong on all continents as a leading provider of advanced solutions for poultry, meat and fish processors. Marel reached 4% average annual growth during the last five years. At the same time global economic growth has been historically low. This has been a difficult period for food processors that have seen a spike in corn and energy prices. The situation is improving and overall food processor returned healthy profits in 2013 which enabled them to strengthen their financials."
Thordarson added that there is now a clear need for expansion and modernisation. Marel delivered €43 million (US$58 million) operating profit last year which is not in line with potential. Following recent management changes they have taken several initiatives to simplify their structure and drive down fixed cost. Three business units in Marel´s operational structure were merged to better utilise existing innovation and sales capabilities. Among those units are Carnitech activities that were acquired last year.
He concluded that the organisational structure will be further simplified in order to service customers better. They will take careful steps to combine business units that serve the same customer needs and rely on the same technical capabilities.
