Q1 2021: Scaling up ahead of the growth curve

Abstract 5.jpg

Strong orders received and pipeline is growing. Margins impacted by logistics and mobility challenges as the pandemic escalated. Profitability hampered by step up in sales and service coverage and strategic improvement initiatives.

Financial highlights Q1 2021

  • Strong orders received and pipeline is growing
  • Margins impacted by logistics and mobility challenges as the pandemic escalated
  • Profitability hampered by step up in sales and service coverage and strategic improvement initiatives

  • Orders received were EUR 369.4m (1Q20: 351.8m).
  • The order book was EUR 455.3m (4Q20: 415.7m, 1Q20: 464.6m). 
  • Revenues were EUR 334.0m (1Q20: 301.6m). 
  • EBIT1 was EUR 38.0m (1Q20: 25.4m), translating to an EBIT1 margin of 11.4% (1Q20: 8.4%). 
  • Net result was EUR 21.2m (1Q20: 13.4m).
  • Basic earnings per share (EPS) were EUR 2.82 cents (1Q20: 1.76 cents).
  • Cash flow from operating activities before interest and tax was EUR 60.2m (1Q20: 61.5m).
  • Free cash flow at EUR 45.5m (1Q20: 38.6m)
  • Net debt/EBITDA was 0.8x at the end of March (4Q20: 1.0x, 1Q20: 0.4x). Targeted capital structure is 2-3x net debt/EBITDA. 

Corporate highlights Q1 2021

  • Curio was consolidated into Marel’s financial results as of 4 Jan 2021,.
  • Acquisition of Dutch duck processing solutions provider Poultry Machinery Joosten (PMJ) announced on 21 Jan 2021, and acquisition of a 40% stake in Stranda Prolog, a Norwegian provider of salmon processing solutions, announced on 29 Jan 2021.
  • The 2020 virtual AGM on 17 Mar approved all proposals and the Board was re-elected with Arnar Thor Masson as the new chairman.

Latest financial results

Q1 2021 key figures

Scaling up ahead of the growth curve


Revenues in EUR


Adjusted EBIT in EUR


Orders received in EUR


Order book in EUR

Arni Oddur Thordarson, CEO

We start the year on a strong note with orders received of EUR 369 million, compared to the previous record orders of EUR 352 million in 1Q 2020. The dynamics this year are different. While 2020 started strong and slowed down from March onwards, 2021 started slow but really took off in March and the outlook is positive.

We are stepping up investments in local sales and service coverage around the world, and continue to innovate and introduce new revolutionary solutions focused on the consumer-ready market. Orders received for standard equipment and aftermarket were strong in the quarter. Conversion from pipeline for large greenfield projects was at a record level in the meat segment where we secured landmark orders, albeit softer in the poultry and fish segment in the quarter. The pipeline continues to grow in all industry segments and we are targeting strong orders received in the coming quarters. Automation and digital solutions in the food value chain continue to be key drivers for our industry, and Marel is well positioned to support the food industry to prepare for shifting market dynamics and change in consumer behavior.

In China we secured a large greenfield project with Muyuan Group, the world’s second largest pig breeder, that is vertically integrating its operations to encompass feed mills, farming and processing facilities. The project consists of several lines replicated across multiple locations to ensure a harmonized way of working and seamless flow of high quality pork products. We are also working with the large and forward-thinking customer Frimesa on a pork processing plant in Brazil, which will be the largest and most advanced in Latin America.

Operational profit was 11.4% on a revenue base of EUR 334 million in the quarter. Challenges in terms of logistics and mobility in the quarter were at a greater magnitude than before. Ensuring timely delivery and installation did lead to higher costs in manufacturing, aftermarket and transportation, impacting gross profit. Sales and administrative cost was also at higher levels than in past quarters. We are stepping up market coverage and taking on important initiatives to automate and digitize our manufacturing platform, supply chain and aftermarket business to create more agility and flexibility in our operations ahead of the anticipated growth curve. I am encouraged and proud to see how our passionate team managed to engage with our customers and deliver sales, installation and services in a very challenging environment.

Cash flow was robust and leverage was 0.8x net debt/EBITDA at the end of March. We continued to strengthen our full-line offering with acquisitions focused on the fish and duck markets in the quarter. In times of such transformation on top of economic uncertainties, there will be fluctuations quarter-by-quarter. At Marel, we remain fully committed to our ambitious mid-, and long-term targets with continued growth and value creation.”

Financial performance

Strong orders received in the quarter  

Orders received in the quarter were EUR 369.4m, up 15.5% QoQ and 5.0% YoY. Orders received in the first quarter include orders from the newly acquired entities of TREIF (meat and other), Curio (fish) and PMJ (poultry).

Across all industries, orders received were strong for standard equipment and aftermarket. Marel has stepped up market coverage and recently launched revolutionary solutions in consumer-ready products.

Marel Meat secured several landmark orders in the quarter, while conversion from pipeline of large orders was soft for Marel Poultry and Marel Fish. The pipeline for large greenfields and modernization projects is building up in all industries.

The need for automation and digital solutions in the food value chain is driven by secular trends like population growth and urbanization. COVID-19 has been an accelerator for these trends in terms of social distancing, access to labor and hygiene. In addition, shifting market dynamics and change in consumer behavior are also driving demand.

The book-to-bill ratio in the quarter was 1.11, compared to an average of 1.00 in the past 4 quarters (1Q20-4Q20). 

A healthy order book with landmark orders from China and Brazil

The order book at end of March was EUR 455.3m (4Q20: 415.7m, 1Q20: 464.6m), representing 36% of 12-month trailing revenues. 

Marel Meat secured a landmark order from Muyuan Group, the world’s second-largest pig breeder. Muyuan is building sophisticated processing facilities in China, close to the pig farms to help control and eliminate ASF and other animal diseases. Muyuan is adopting Marel’s most advanced primary meat processing lines to take best advantage of industry-leading electronic and digital technology.

Another landmark project for Marel Meat is the Frimesa pork processing plant in Brazil, which will be the largest and the most advanced in Latin America.

Greenfields, such as large equipment orders, and projects with longer lead times constitute the vast majority of the order book while services, spares and standard equipment have shorter lead times and run faster through the order book.

Revenues of EUR 334m with 39% solid recurring aftermarket revenues

Revenues were EUR 334.0m in 1Q21, up by 10.7% YoY, and down 2.7% QoQ.

Aftermarket represented 39% of total revenues in the quarter (4Q20: 38%, 1Q20: 41%). Robust spare parts revenues compensated for lower service revenues due to travel restrictions and logistical challenges.

Revenues from consolidation of Curio (as of 4 Jan 2021) and acquisition of PMJ (as of 21 Jan 2021), were around EUR 3m in 1Q21. The 40% stake in Stranda Prolog is categorized as investment in associates.

Profitability hampered by rising logistics costs, step up in sales and service coverage and strategic improvement initiatives 

COVID-19 had an impact on 1Q21 results. As the pandemic escalated in Jan-Feb, stringent lockdowns across several key geographies had an impact on the efficiency of operations. Ensuring timely delivery and installation for customers during a period of significant challenges in mobility and logistics, led to higher costs in manufacturing, aftermarket and transportation.

Gross profit margin was 37.2% in the quarter (1Q20: 35.6%) and gross profit was EUR 124.4m (1Q20: 107.3m), positively impacted by mix but volume and margin were negatively impacted by mobility and logistics challenges.

Sales and marketing (S&M) costs were at a level of 12.0% of revenues and reflect the step up in market coverage, and innovation cost was at 6.2% in line with plans to leverage global reach and digital solutions.

General administrative (G&A) costs were high or 7.7% of revenues, rising temporarily due to several improvement projects to increase resilience and agility of operations. These are important initiatives to better service our customers and prepare for the organic growth ahead in line with a growing pipeline. Marel does not adjust results for non-recurring costs.

EBIT1 was EUR 38.0m (4Q20: 52.3m, 1Q20: 25.4m), translating to an EBIT1 margin of 11.4% (4Q20: 15.2%, 1Q20: 8.4%).

Net results was EUR 21.2m in the quarter (4Q20: 29.1m, 1Q20: 13.4m).

EPS was EUR 2.82 cents (4Q20: 3.87 cents, 1Q20: 1.76 cents).


Robust cash flow generation to support continued investments 

Both operational and free cash flow was robust in the quarter.

Cash generated from operating activities in the quarter was EUR 60.2m (1Q20: 61.5m).

Free cash flow in 1Q21 was EUR 45.5m (1Q20: 38.6m).

Strong cash conversion supports continued investments in innovation, infrastructure and strategic moves.

Investments to support organic and strategic growth 

To best serve customer needs and capture growth opportunities from changing market dynamics, Marel is focusing on increasing digitalization and agility, leading to an increased level of investments in the coming years.

Important initiatives identified, e.g. stepping up market coverage, innovation investments in digital solutions, and improvement projects to streamline the back end, as well as automating and digitizing the manufacturing platform, supply chain and aftermarket.

In 2021, Marel will open sales and service offices, as well as new demo centers in both Shanghai, China and Campinas, Brazil.

Leverage ratio of 0.8x and strong financial position to support 2017-2026 growth strategy

Low leverage, committed liquidity of EUR 668.4m at the end of March, including fully committed all-senior funding in place until 2025, enables continued investment and will facilitate future strategic moves in the ongoing industry consolidation wave, in line with the company’s 2017-2026 growth strategy.

Leverage was 0.8x at the end of 1Q21, compared to 1.0x at the end of 4Q20 following the TREIF acquisition closing in October 2020, and well below the targeted capital structure (2-3x).

For acquisitions of Curio and PMJ, in addition to the 40% holding in Stranda Prolog, EUR 21.7m was paid out during the quarter.

Dividend paid out in April corresponding to EUR 41.0m or 40% of net results (2020: 40%, 2019: 30%).

Resilient business model in a quarter of lockdown and logistics challenges

The full economic impact of COVID-19 on Marel is uncertain.

Significant investments in recent years in Marel’s global reach, digital platform and infrastructure, have been instrumental in positioning the company to successfully navigate a business environment colored by the pandemic, geopolitical uncertainty, trade constraints and rapidly changing market dynamics and shifts in consumer behavior. 

Marel is a critical infrastructure company in the food industry. All manufacturing sites have remained open throughout the pandemic. In early 2020, Marel’s manufacturing sites in close cooperation with our suppliers, diligently organized themselves to ensure business continuity and safety for both employees and customers.

Marel’s effort in recent years, to shorten production lead times and co-locate production, created more resilience in the supply chain. This together with the strategic inventory build-up allowed more agility in terms of serving customers’ needs better and keeping the food value chain running.

Marel provides virtual and remote support from our global platform to our local teams to engage and connect with our customers.

The 2021 virtual AGM approved all proposals and new board elected

Arnar Thor Masson will lead the Board as Chairman, and Olafur Gudmundsson as the Vice-Chairman of the Board.

After serving on the Board for 11 years, thereof more than 7 years as Chairman, Asthildur Margret Otharsdottir did not declare candidature. The Marel Board and management sincerely extend their gratitude for her strategic direction and excellent leadership throughout the years.

Dr Svafa Gronfeldt is a new director elected to the Board. A Professor of Practice at MIT, Svafa is a founding member of MIT’s newest innovation accelerator DesignX focused on the design and development of technology- and service-based ventures created at MIT, and a co-founder of the MET fund, a Cambridge based seed investment fund. Svafa is a director of the Board and Audit Committee of both Össur and Icelandair.

Remuneration policy was approved with ESG added as a parameter for the Executive Team total remuneration.

Industry performance Q1 2021

Marel Poultry - 48% of total revenues with 16.2% EBIT1 margin

Full-line offering with one of the largest installed bases world-wide, focusing on roll-out of innovative products and market penetration through cross-selling of secondary and further processing solutions.

M&A: Following the acquisition of PMJ, Marel will expand its third pillar within poultry processing and become the industry’s only full-line provider of duck processing solutions for this large and growing market, where 70% of demand comes from China.

Orders received for Marel Poultry in 1Q21 were strong in standard equipment and aftermarket, while orders for larger projects were soft. Pipeline is building up in all processing steps, although timing of conversion into firm orders is uncertain.

Revenues in 1Q21 for Marel Poultry were EUR 159.1m, up 5.3% YoY compared to 1Q20 which was a soft revenue quarter for Marel Poultry.

EBIT in 1Q21 was EUR 25.8m (1Q21: 18.2m) and the EBIT margin was 16.2% (1Q21: 12.0%). EBIT was positively impacted by product mix, while lower volume of large projects had a negative impact.

Marel Meat - 38% of total revenues with 7.8% EBIT1 margin

Full-line offering with focus on strong product development, increased standardization, modularization and market penetration and further cross- and upselling.

M&A: The TREIF acquisition doubled standard equipment sales for Marel Meat and enhanced the full-line offering from post-farm to dispatch of consumer-ready products.

Newly launched solutions, SensorX Magna and Accuro, are gaining traction for focus on food safety and sustainability in consumer-ready products.

Orders received in 1Q21 for Marel Meat were strong in both large projects and standard equipment. Landmark deals secured in China and Brazil, as customers pursue greater automation and channel flexibility. Pipeline remains strong.

Revenues in 1Q21 for Marel Meat were EUR 125.8m, up by 21.4% YoY (1Q21: 103.6m).

EBIT in 1Q21 was EUR 9.8m (1Q20: 4.6m) and the EBIT margin was 7.8% (1Q20: 4.4%). Profitability in the quarter impacted by  mix and lower than expected margins for large projects.

Management continues to target medium and long-term EBIT margin expansion for Marel Meat, and has accelerated market coverage and operational improvement initiatives.  

Marel Fish - 12% of total revenues with 5.3% EBIT1 margin

Objective to reach full-line offering across farmed and wild whitefish and salmon through continued focus on innovation and M&A.

M&A: Curio consolidated as of 4 Jan 2021. Salmon primary processing offering solidified through the strategic partnership with Stranda Prolog and 40% acquisition of their shares.

Innovation roadmap accelerated to close certain application gaps to reach full-line offering for both salmon, as well as wild and farmed whitefish. 

Orders received in 1Q21 were soft for large projects. Pipeline for large projects is building up and conversion into orders is expected to pick up.

Revenues for Marel Fish in 1Q21 were EUR 39.8m, on par YoY (1Q21: 39.4m).

EBIT in 1Q21 was EUR 2.1m (1Q20: 1.7m) and the EBIT margin was 5.3% (1Q20: 4.3%), higher volume is needed to deliver sufficient margin improvement.

Management continues to target medium and long-term EBIT margin expansion for Marel Fish. 


Market conditions have been challenging due to geopolitical uncertainty and the ongoing COVID-19 pandemic. Marel enjoys a balanced exposure to global economies and local markets through its global reach, innovative product portfolio and diversified business mix. At the moment it is not known what the full economic impact of COVID-19 will be on Marel in 2021. 

Marel is committed to achieve its mid- and long-term growth targets. Our strategic mid-term targets are to achieve gross profit around 40%, SG&A of around 18% and Innovation at the 6% strategic level by year-end 2023.  

In the period 2017-2026, Marel is targeting 12% average annual revenue growth through market penetration and innovation, complemented by strategic partnerships and acquisitions.

  • Marel’s management expects 4-6% average annual market growth in the long term. Marel aims to grow organically faster than the market, driven by innovation and growing market penetration. 
  • Maintaining solid operational performance and strong cash flow is expected to support 5-7% revenues growth on average by acquisition. 
  • Marel’s management expects basic EPS to grow faster than revenues. 


Growth is not expected to be linear but based on opportunities and economic fluctuations. Operational results may vary from quarter to quarter due to general economic developments, fluctuations in orders received and timing of deliveries of larger systems. 

1 Operating income adjusted for PPA related costs, including depreciation and amortization, and as of Q4 2020, acquisition related costs. 2 Including acquired order book of Curio and PMJ of EUR 4.2m
in 1Q21.


Virtual investor meeting and live webcast/conference call 29 April 2021

On Thursday 29 April 2021, at 8:30 am GMT (10:30 am CET), Marel will host a virtual investor meeting where CEO Arni Oddur Thordarson and CFO Linda Jonsdottir will give an overview of the financial results and operational highlights in the first quarter.

The virtual meeting will be webcast live on marel.com/webcast and a recording will be available after the meeting on marel.com/ir.

Members of the investment community can join the conference call at:

  • IS: +354 800 7520
  • NL: +31 20 721 9496
  • UK: +44 33 3300 9268
  • US: +1 833 526 8398


Upcoming virtual investor events

  • Kepler Cheuvreux European SMID Mega Trends Days, 10 May
  • Citi’s 10th Annual Virtual Frontier Markets Symposium, 17 May
  • Berenberg Conference USA 2021, 20 May
  • ABN AMRO – ODDO Benelux Equities Conference, 26 May
  • HSBC Frontier Markets Roadshow, 4 June
  • JP Morgan European Capital Goods CEO Conference, 11 June


Upcoming events

  • North Atlantic Seafood Forum, digitalization – virtual 8-10 Jun
  • Intralogistics – virtual Jun
  • Let’s Fish, whitefish including Curio – virtual May
  • Fish Forum Russia, 6-8 Jul
  • FoodPro Australia – 27-28 Jul


Financial Calendar

Marel will publish its (Condensed) Consolidated Financial Statements according to the below financial calendar:

  • Q2 – 21 July 2021
  • Q3 – 20 October 2021
  • Q4 – 2 February 2022


Financial results will be disclosed and published after market closing of both NASDAQ Iceland and Euronext Amsterdam.

Contact IR

For further information, please contact Marel Investor Relations via email IR@marel.com or tel. (+354) 563 8001

Tinna Molphy

Tinna Molphy

Marino Thor Jakobsson

Marino Thor Jakobsson

Get in touch

Our dedicated team is here to help and answer any questions you may have. Please complete the form, and we’ll get back to you as soon as possible. We look forward to hearing from you.

Login to get full access

Enter password to continue

Wrong password