Marel Q3 2013 results (All amounts in EUR)

(All amounts in EUR)

• Revenues for Q3 2013 totalled 156.9 million (m), a decrease of 4.5% compared to the same quarter of 2012 [164.3m].
• EBITDA was 19.5m or 12.4% of revenues [Q3 2012: 20.5m].
• Operating profit (EBIT) was 12.9 or 8.2% of revenues [Q3 2012:  14.1m].
• Net result for Q3 2013 was 6.0 [Q3 2012: 8.4m]. Earnings per share were 0.81 euro cents [Q3 2012: 1.15 euro cents].
• Cash flow from operating activities before interest and tax was 3.0m and 45.6 m YTD.  [YTD 2012: 37.0m]. Net interest bearing debt was 239.0m at the end of the quarter compared to 261.1m in Q3 2012.
• The order book was at 138.3m at the end of the quarter [Q3 2012: 151.4m] and has increased by 4.9% since the end of last quarter [131.8m].

Revenues for the first nine months of 2013 amounted to 493.4m and show a 7.9% decrease compared to the same period last year. This reflects challenging market situations and slower recovery than originally expected.  Operating profit (EBIT) YTD is 7.2% of revenues which is below the company´s target (10-12%) for the full year. Marel expects the EBIT margin in Q4 to be in line with Q3. 

Market conditions are still challenging with signals of improvements. While economic recovery seems to be gaining momentum in North-America, the Eurozone is still fragile and signals from emerging markets remain mixed with positive future prospects. Revenues from service and spare parts increased in Q3, while larger projects continue to be an uphill climb. Improved profit margins this quarter signal progress in operational efficiency and cost control despite delays of large projects.

Full year revenues 2013 are expected to decline by 6-8% compared with previous year. Marel  expects moderate growth of revenues next year on the heels of market recovery.

Theo Hoen, CEO:

“Marel is performing on a reasonable level considering market conditions.  The turnaround has been slower and more gradual than what we have seen before and had previously expected.  Lack of investments in large projects is affecting our revenue base. We remain confident that once the market bounces back we will capture increased demand with investment need building up. We saw this happen in 2009 when food processors delayed modernization of their equipment because of the economic uncertainty. Then in 2010 we saw it bounce back as the underlying demand for protein continued to grow as is the case now. In the meantime we are utilizing our extensive sales and service network to generate business by increased and better service to our customers. We remain optimistic about the future prospects and that´s why we will continue to maintain our network and a good level of investment in R&D while keeping our focus on operational efficiency”.  

5% increase in order book

Orders received amounted to 163.3m in the third quarter compared to 159.1m in Q2 2013. The order book amounted to 138.3m at the end of the third quarter compared with 131.8m at the end of Q2 [Q3 2012: 151.4m]. This represents an increase in the order book of around 5% compared with last quarter. This development reflects gradual recovery in Marel’s major markets while capturing that growth in the order book is still somewhat restrained by the absence of large projects.  This reflects the prolonged hesitation to invest in difficult market environment. Investment decisions now take longer than before. This applies to the market in general and Marel believes it is not losing market share. The company´s position in the market is strong and long term outlook for orders received is positive as the protein industry is expected to grow steadily in the coming years and need for investments is building up. 

Outlook                                                

Marel´s long term expected annual growth rate (CAGR) is 5-6%. The assumption that markets will recover has not changed but it is taking longer than anticipated. Marel expects that full year revenues will decline by 6-8% between years and anticipates moderate growth of revenues next year on the heels of market recovery.

Mid- and long-term, the company believes that Marel’s innovative products and global presence in all four industries will stimulate strong growth and increased profitability as the underlying market growth is still present.

It should be kept in mind that results may vary from quarter to quarter due to general economic developments, fluctuations in orders received and deliveries of larger systems.

See complete announcement in enclosed pdf. file.

Presentation of results, 24 October 2013

Marel will present its results at an investor meeting on Thursday, 24 October, at 8:30 am (GMT), at the company’s headquarters at Austurhraun 9, Gardabaer. The meeting will also be webcast at www.marel.com/webcast .

Publication days of Consolidated Financial Statements in 2014

4th quarter 2013                               5 February 2014

Annual General Meeting                  5 March 2014

1 ^st quarter 2014                                28 April 2014

2 ^nd quarter 2014                                23 July 2014

3 ^rd quarter 2014                                22 October 2014

4 ^th quarter 2014                                4 February 2015

Release of financial statements will take place after market closing at above-mentioned dates. 

For further information, contact:

Linda Jónsdóttir Corporate Director of Treasury and IR, tel: (+354) 563 8464 / mobile: (+354) 825 8464.

Auðbjörg Ólafsdóttir, Investor Relations specialist, tel: (+354) 563 8626 / mobile: (+354) 853 8626.

Erik Kaman, CFO, tel: (+354) 563 8072.