AI assistant
Marel Investor Presentation 2015
2191_rns_2015-07-30_5a82ffd3-f01f-4082-8ca6-b43f5212b536.pdf
Investor Presentation
Open in viewerOpens in your device viewer
Q2 2015 Presentation
July 30, 2015
iMareI
Innovation Through Partnership®
iMareI Innovation Through Partnership
Arni Oddur Thordarson, CEO
imarel
Innovation Through Partnership
Organic growth and strong operational performance
- Record revenue of €218 million compared to €170 million in Q2 2014
- Good geographical and product mix
- Order intake of €206 million
- Adjusted EBIT €29.7 million or 13.6%
- Adjusted EBITDA €37.2 million or 17.1%
- Free Cash Flow €13.9 million
- Net result €19.5 million
* Refocusing costs in Q2 2015 amount to €1.1 million
imarel
Order intake at a good level in Q2 2015
imarel
Innovation Through Partnership
Operational results improving with strong cash flow
- Revenue growth of 29% from last year
- Adjusted EBIT of €29.7 million
- Order book at end of Q2 2015 is €166 million compared to €156 million at the same time one year ago
- Management guidance for 2015 remains organic revenue growth with solid increase in operational and net profit
- At the beginning of 2014, management announced the aim to reach EBIT of over €100 million in 2017
EBITDA improvement and strong cash flow has driven Net Debt/adjusted EBITDA down to 1.2
Base! Innovation Through Partnership
Business overview for the first half of 2015
Other segments such as vegetable and cheese account for 2% of revenue
Poultry
Strong first half of the year with good volume, profitability and strong order intake
Good mix of Greenfields, modernization, and maintenance business around the globe
54% of revenue
17.1% adj. EBIT
Fish
Very good first half of the year for Marel's fish segment with good volume, profitability and strong order intake
Conditions in salmon and white fish segments are favorable
16% of revenue
9.9% adj. EBIT
Meat
Significant improvement in revenue and profitability compared with previous years
Market conditions in Q2 are softer resulting in lower order intake
15% of revenue
9.4% adj. EBIT
Further Processing
Streamlining of U.S. activities continued with the ongoing transfer of activities from Des Moines to Gainesville
Innovation and sales efforts will be stepped up in order to increase profitability going forward
13% of revenue
-0.4% adj. EBIT
imarel
Innovation Through Partnership
Linda Jonsdottir, CFO
Business results
marel Innovation Through Partnership
| EUR thousands | Q2 2015 | Q2 2014 | Change in % |
|---|---|---|---|
| Revenue | 218,272 | 169,848 | 28.5 |
| Gross profit before refocusing cost | 84,264 | 60,344 | 39.6 |
| as a % of revenue | 38.6 | 35.5 | |
| Before refocusing costs | |||
| Result from operations (adjusted EBIT) | 29,659 | 10,741 | 176.1 |
| as a % of revenue | 13.6 | 6.3 | |
| Adjusted EBITDA | 37,219 | 18,011 | 106.6 |
| as a % of revenue | 17.1 | 10.6 | |
| After refocusing costs | |||
| Result from operations (EBIT) | 28,537 | 3,553 | 703.2 |
| as a % of revenue | 13.1 | 2.1 | |
| EBITDA | 38,135 | 13,022 | 192.9 |
| as a % of revenue | 17.5 | 7.7 | |
| Net result | 19,516 | 766 | 2,447.7 |
| Orders received (including service revenues) | 206,168 | 187,826 | 9.8 |
| Order book | 165,938 | 156,427 | 6.1 |
imarel
Innovation Through Partnership®
Firm steps taken to improve profitability
* Results are normalized
Adj. EBIT 13.6%
Record revenue and good order intake
marel
Innovation Through Partnership
- Marel has discontinued product families and operations in Singapore, Spain and the U.K. that were running on low gross margin and negative EBIT
- On annual basis, they accounted for close to €30 million in orders received and revenue
- Order book at the end of Q2 reflects continued operations and refocused product portfolio
Cmarel Innovation Through Partnership
Condensed consolidated balance sheet
ASSETS (EUR thousands)
| 30/06 2015 | 31/12 2014 | |
|---|---|---|
| Non-current assets | ||
| Property, plant and equipment | 86,484 | 96,139 |
| Goodwill | 389,671 | 387,103 |
| Other intangible assets | 107,777 | 114,916 |
| Receivables | 17 | 94 |
| Deferred income tax assets | 9,045 | 7,873 |
| 592,994 | 606,125 | |
| Current assets | ||
| Inventories | 91,689 | 88,450 |
| Production contracts | 23,318 | 29,123 |
| Trade receivables | 93,280 | 77,125 |
| Assets held for sale | 4,944 | 2,500 |
| Other receivables and prepayments | 31,631 | 23,551 |
| Cash and cash equivalents | 87,457 | 24,566 |
| 332,319 | 245,315 | |
| Total assets | 925,313 | 851,440 |
iMareI Innovation Through Partnership
Condensed consolidated balance sheet (continued)
LIABILITIES AND EQUITY (EUR thousands)
| 30/06 2015 | 31/12 2014 | |
|---|---|---|
| Equity | 436,898 | 427,498 |
| LIABILITIES | ||
| Non-current liabilities | ||
| Borrowings | 224,841 | 180,278 |
| Deferred income tax liabilities | 13,854 | 11,308 |
| Provisions | 10,675 | 7,292 |
| Derivative financial instruments | 4,463 | 5,399 |
| 253,833 | 204,277 | |
| Current liabilities | ||
| Production contracts | 72,577 | 64,958 |
| Trade and other payables | 128,592 | 122,479 |
| Current income tax liabilities | 5,010 | 4,185 |
| Borrowings | 18,601 | 18,635 |
| Provisions | 9,802 | 9,408 |
| 234,582 | 219,665 | |
| Total liabilities | 488,415 | 423,942 |
| Total equity and liabilities | 925,313 | 851,440 |
imarel
Innovation Through Partnership
Q2 2015 cash flow composition and change in net debt
| Operating activities (before interest & tax) | Tax | Invest-ment activities | Free cash flow | Net finance cost | Sale of non-core assets* | Treasury shares | 16.5 million | * High-speed slicing operations in Norwich and proceeds from real estate in Oss. ** Tax on dividend, currency effect and change in capitalized finance charges. |
|---|---|---|---|---|---|---|---|---|
| 3.9 million | ||||||||
| 23.7 million | 5.9 million | 13.9 million | 3.4 million | 16.5 million | Decrease in Net Debt | |||
| 5.7 million | ||||||||
| Other items** | ||||||||
| 0.3 million |
Anatel Innovation Through Partnership
Ample room for stimulating further growth
- Net debt / EBITDA ratio currently stronger than the target of 2-3 x EBITDA
- Marel is stimulating further revenue and operational profit growth by:
- Streamlining the business
- Continuous innovation
- Investing in the business
- In Q2 Marel acquired 15 million treasury shares for the total amount of 18.2 million on the basis of authorization to purchase up to 25 million own shares to be used as a payment for potential future acquisitions.
- After the purchase and exercise of stock options during the quarter with net cash outflow of 16.5 million the company holds 21.7 million treasury shares.
iMareI Innovation Through Partnership
Arni Oddur Thordarson, CEO
Good mix of Greenfields, Modernization, and Maintenance
marel Innovation Through Partnership
Modernization and standard equipment
- Investment in expansion and modernization projects picking up, especially in the Americas and in Europe
Greenfields
- Small and medium sized Greenfield projects in all segments and large-scale projects in poultry and fish in Q2 2015
Maintenance
- Marel has the largest installment base in its industry
- Recurring service and spare parts revenues increasing steadily and are currently around 40% of total revenues
imarel
Manufacturing and innovation footprint streamlined
Marel's new innovation center in Iowa
marel Innovation Through Partnership
- Modern 3,500 m² facility located close to the city center of Des Moines
- Employs 90 people in sales, service and innovation
cmaReI Innovation Through Partnership
Maintaining competitive advantage in the sausage market
- The innovation team in Des Moines will be developing global products for the sausage and hot dog market
- The team will also be developing global products for meat, fish and poultry industries relating to skinning and trimming technology
- Innovation center will support training and customers demonstrations
Simpler, Smarter, Faster: 2014-2015
Full potential
Product portfolio optimized
At the customer, for the customer
Marel is stimulating further revenue growth and solid operational improvements:
- Streamlining the business
- Continuous innovation
- Investing in the business
Manufacturing footprint optimized
| 2014 | 2015 year-to-date | 2016 | 2017 |
|---|---|---|---|
| Revenue growth 7.7% | |||
| Adj. EBIT €48.8 m | |||
| Free cash flow €75.5m | Revenue €428m | ||
| Adj. EBIT €53.5m | |||
| Free cash flow €44.9m | Organic growth | ||
| Solid operational improvement | |||
| Good cash conversion | Organic growth | ||
| > €100 million EBIT | |||
| Good cash conversion |
Cash-out cost to date €14 million compared to estimated total cash-out cost of €25 million throughout the program
Disclaimer
marel
Innovation Through Partnership
This Presentation is being furnished for the sole purpose of assisting the recipient in deciding whether to proceed with further analysis of this potential opportunity. This Presentation is for informational purposes only and shall not be construed as an offer or solicitation for the subscription or purchase or sale of any securities, or as an invitation, inducement or intermediation for the sale, subscription or purchase of securities.
The information set out in this Presentation may be subject to updating, completion, revision and amendment and such information may change materially. Even though Marel hf. has given due care and attention in the preparation of this Presentation, no representation or warranty, express or implied, is or will be made by Marel hf. as to the accuracy, completeness or fairness of the information or opinions contained in this Presentation and any reliance the recipient places on them will be at its own sole risk. Without prejudice to the foregoing, Marel hf. does not accept any liability whatsoever for any loss howsoever arising, directly or indirectly, from use of this Presentation or its contents or otherwise arising in connection therewith. Any recipient of this Presentation is recommended to seek its own financial advice.
There is no representation, warranty or other assurance that any of the projections in the Presentation will be realized. The recipient should conduct its own investigation and analysis of the business, data and property described herein. Any statement contained in this Presentation that refers to estimated or anticipated future results or future activities are forward-looking statements which reflect current analysis of existing trends, information and plans. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially and could adversely affect the outcome and financial effects of the plans and events described herein. As a result, the recipient is cautioned not to place undue reliance on such forward-looking statements.
Transactions with financial instruments by their very nature involve high risk. Historical price changes are not necessarily an indication of future price trends. Any recipient of this Presentation are encouraged to acquire general information from expert advisors concerning securities trading, investment issues, taxation, etc. in connection with securities transactions.
This Presentation and its contents are confidential and may not be further distributed, published or reproduced, in whole or in part, by any medium or in any form for any purpose, without the express written consent of Marel hf. By accepting this Presentation the recipient has agreed, upon request, to return promptly all material received from Marel hf. (including this Presentation) without retaining any copies. In furnishing this Presentation, Marel hf. undertakes no obligation to provide the recipient with access to any additional information or to update this Presentation or to correct any inaccuracies therein which may become apparent.
The distribution of this Presentation, or any of the information contained in it, in other jurisdictions than the Republic of Iceland may be restricted by law, and persons into whose possession this Presentation comes should inform themselves about, and observe, any such restrictions. Any failure to comply with these restrictions may constitute a violation of the laws of any such other jurisdictions.
Cmarel Innovation Through Partnership
Thank you
Takk fyrir
Dank u wel
Mange tak