Marel Food Systems Q4 CFS 2007

12 Feb 2008

Condensed Consolidated Interim Financial Statements 31 December 2007
Financial Statements Q4 2007

Marel Food SystemsYear 2007

  • Sales for 2007 totaled EUR 290 million compared with EUR 209 million, which is an increase of about 39% from the previous year. Proforma growth in sales for the period was about 4.5%. At a fixed exchange rate EUR/USD the proforma growth is 6.1%.
  • Net profit for 2007 totaled EUR 6.1 million compared with 0.2 million in 2006.
  • Profit from operations EBIT in 2007 was EUR 10.0 million compared with EUR 7.5 million the previous year. Charged one-time costs resulting from integration totaled about EUR 5 million for the first half of the year. Profit from operations EBIT before one-time costs was 5.2% of sales (15 million) compared with 3.6% the year before.
  • Working capital from operations totaled EUR 13.0 million. In 2006, this was 2.7 million.
  • Net profit from shares in Stork was EUR 4.6 million.
  • Net cash at end of the period totaled EUR 30.4 million, compared with EUR 63.1 million at the end of 2006. The change can be traced to the purchase of shares in Stork NV and increases in shares in the company. All shares in Stork were sold on 17 January which gave EUR 53 million after repayment of related debts.
  • Shares in Marel Food Systems sold for EUR 34.6 million in 2007, with a strong showing by Icelandic pension funds.
  • Equity totaled EUR 182 million compared with 144 million the year before, and equity ratio was 42.5% at the end of 2007.
  • An agreement was reached whereby the company acquires Stork Food Systems for EUR 415 million, which has been fully financed. The agreement is subject to approval by European competition authorities.

Fourth quarter 2007

  • Sales in the fourth quarter of 2007 totaled EUR 78.9 milljón compared with 71.9 million for the same period the year before. Sales therefore increased by about 9.7% from the previous year and 11.8% at fixed exchange rate of EUR/USD.
  • Net profit for the period totaled EUR 3.4 million compared with a loss of EUR 0.5 million in 2006.
  • Profit from operations EBIT for the period October to December 2007 was EUR 1.6 million, which is 2.0% of revenue compared with 1.1 million the previous year.
  • Shares in the Dutch company Stork NV are entered at market value, and a profit of EUR 5.1 million was realized from associated companies in the fourth quarter.

Hörður Arnarson, CEO:

“ The year 2007 was characterized by the extensive integration of Marel, Scanvaegt, AEW/Delford and Carnitech. An agreement for the acquisition of Stork Food Systems was signed last November. With the acquisition of Stork, Marel Food Systems will have grown almost fivefold since the company‘s strategy was introduced in 2006. The full focus will now be on increased profitability and internal growth.

Integration of the companies has in large part progressed well and the company has retained market share in a fast growing market. It is disappointing, however, that synergies have not yet impacted the company‘s profits.

For the year 2008 the company is now projecting an EBIT about 8% but remain dedicated to reach above 10% EBIT margin level before year end. These projection are without the effects of Stork Food Systems. The core business of Stork Food Systems had sales of about 300 million euros in 2007 with 10.6% EBIT. Continuous healthy organic growth with continued good profitability is expected in the core business of Stork Food System.”

Presentation of results

Marel will present performance results at a meeting on Wednesday 13 February 2008 at 8:30 in the company’s headquarters at Austurhraun 9 in Garðabær, Iceland.

Publication days of the Consolidated Financial Statements in 2008 and the Annual General Meeting 2009

Annual General Meeting Marel Food Systems hf 7 March 2008
Publication dates of the Financial Statements for 2008:

1st quarter 6 May 2008
2nd quarter 12 August 2008
3rd quarter 4 November 2008
Annual Financial Statements and 4th quarter 2008 10 February 2009
Annual General Meeting Marel Food Systems hf 10 March 2009

For further information, contact:

Hörður Arnarson, CEO Tel: (+354) 563-8000