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Marel Q2 2014 results

22 Jul 2014

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Strong order intake – Refocusing on track

  • Revenue for Q2 2014 was 169.8m [Q2 2013: 178.4m].
  • Adjusted EBITDA (EBITDA before refocusing cost) was 18.0m or 10.6% of revenue. EBITDA was 13.0m or 7.7% of revenue [Q2 2013: 19.0m].
  • Adjusted operating profit (EBIT) was 10.7m or 6.3% of revenue. EBIT was 3.6m or 2.1% of revenue [Q2 2013: 12.3m].
  • Net result for Q2 2014 was 0.8m [Q2 2013: 5.2m]. Earnings per share was 0.10 euro cents [Q2 2013: 0.71 euro cents].
  • Cash flow from operating activities before interest and tax was 20.4m [Q2 2013: 25.3m]. Net interest bearing debt was 204.5m at the end of Q2 2014 [Q2 2013: 228.8m].
  • The order book was at 156.4m at the end of Q2 2014 compared with 138.4m at the end of Q1 2014 [Q2 2013: 131.8m]

Marel’s main markets are showing positive developments. With a focused market approach Marel secured well balanced orders in large systems, standard equipment and spares. Operational profit in Marel’s poultry segment is improving and salmon activities are performing well.

The refocusing plan of becoming simpler, smarter, and faster is proceeding according to plan. The plan’s objective is to serve customers’ needs more effectively and to reduce the company’s annual cost base by 20-25 million. Recurring annual cost saving targets from actions taken in the first half of the year amount to 8 million compared with one-off cost of 10.7 million.

In the beginning of the year Marel published guidance to reach organic revenue growth in 2014 with 55 million adjusted EBIT. Based on the current order book and market outlook organic revenue growth is realistic, however the guidance for adjusted EBIT is now updated to 40 - 50 million. Full focus is on strengthening the market approach and operational improvement with the aim to reach EBIT of over 100 million in 2017.

Arni Oddur Thordarson, CEO:

“We are pleased with milestones reached in Q2. Our operational performance improved, order intake is strong and we are moving forward with our refocusing plan.

Order intake, a good forward leading indicator of revenues, was 188 million in the quarter. The order intake was balanced between large systems, standard equipment and spares. The geographical spread in orders was as well diversified with orders coming in from India, China, the Middle-East and South America in addition to good order intake from our U.S. and European customers.

Operational results are not yet in line with potential. We are moving towards becoming a simpler, smarter, and faster company by taking decisive steps to focus our market approach and optimize our manufacturing footprint. The primary goal and principle is to increase customer and shareholder long-term value. ”

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Forward-looking statements
Statements in this press release that are not based on historical facts are forward-looking statements. Although such statements are based on management’s current estimates and expectations, forward-looking statements are inherently uncertain. We, therefore, caution the reader that there are a variety of factors that could cause business conditions and results to differ materially from what is contained in our forward-looking statements, and that we do not undertake to update any forward-looking statements. All forward-looking statements are qualified in their entirety by this cautionary statement.