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Marel Achieves 'Sustainable Performance'

by 5m Editor
30 July 2010, at 8:47a.m.

ICELAND - It was another good quarter for Marel, said the company's CEO as the financial results for seocnd quarter 2010 were presented yesterday, 29 July, at the company's headquarters. A short profile of one of its poultry processing equipment customers highlights how the market in Turkey shows strong growth in branded and value-added products.

For the second quarter in a row, the company achieved its long-term target of 10 to 12 per cent return on sale. The equipment order book grew for the sixth quarter in a row.

CEO, Theo Hoen, said: "We believe that this level of performance is sustainable and can serve as a baseline for further growth moving forward."

Erik Kaman, CFO, presented the financial results. Among the highlights was a 26.9 per cent increase in revenues from core business (€136.1 million) compared to Q2 2009. EBIT for Q2 2010 was €15.1 million (11.1 per cent of sales), compared to €6.5 million (6.1 per cent of sales) for Q2 2009. EBITDA was €21.1 million (15.5 per cent of sales), compared to €12.1 million (11.4 per cent of sales) for Q2 2009. The order book grew from €112 million to €125 million during the quarter.

Operating environment

Marel's core business focuses on four industry segments: fish, meat, poultry and further processing.

Poultry: Order intake for the quarter was well above budget. In the US in particular, a significant number of orders were received from major customers for primary and secondary processing installations, as well as a substantial number of Sensor X bone detection systems. The sale of the primary processing installations can be directly attributed to the new sales and marketing approach and new sales team introduced in the US at the beginning of the year. In the rest of world, Marel Stork Poultry Processing expanded its market share in South America, West Europe and Asia during the quarter. In Turkey, a substantial order was received for a fully integrated poultry processing plant featuring the latest integrated Marel/Stork solutions. Due to the higher order intake, the outlook for the rest of the year is good.

Fish: Prospects in the fish industry remain good, particularly in the salmon and aquaculture segments. In April, Marel participated in the annual Seafood Processing Europe (SPE) exhibition in Brussels and the number of leads generated clearly indicated keen interest among customers in the wide selection of fish processing equipment that Marel has to offer. This year, for the first time at a fish industry show, Marel presented its range of Townsend equipment aimed at the further processing sector. With the addition of the Townsend Further Processing range to the product portfolio for the fish industry, Marel's offering now spans virtually the entire value chain, from catch to packaged end product. In other areas, the growing trend toward sustainably sourced seafood is already generating a lot of opportunities and is expected to have even more impact in the future.

Meat: The trend towards cheaper proteins continues with Europe, once again, being the most active market. As expected, Australasia is also showing signs of increased activity. In May, Marel participated in IFFA, the world's biggest meat industry exhibition, held in Frankfurt every three years. The company exhibited a wide range of new equipment and systems from the Marel, Townsend and Stork brands, emphasising strongly why Marel should be the customers' choice in supplying integrated systems, products and services to the meat industry. The Marel stand attracted a great deal of interest and a large number of visitors. Many sales leads were generated and these are now being followed up by the companyfs sales teams around the world.

Further processing: Overall, it was an important quarter for Marel's further processing activity. The Townsend Further Processing brand, under which the company's entire range of further processing equipment is now being marketed, was introduced for the first time at the IFFA exhibition in Frankfurt in May. A number of new innovations for portioning and sausage making were launched at IFFA, including two versions of the RevoPortioner (small and large). Orders have already been received from Europe and the US for the RevoPortioner Large for red meat. Interest in co–extrusion systems and other sausage processing equipment is also on the rise.

Customer focus: Senpiliçc, Turkey:

Senpiliçc is one of the largest fully integrated poultry processors in Turkey, serving local and international markets, including the Middle East. With a long tradition and a strong focus on product quality, innovation and growth, the company is a prime example of a modern Turkish family business that can compete perfectly with European quality standards.

A strong drive to grow and improve quality was behind Senpiliçc's recent acquisition of a second high-capacity processing line from Marel, supplied by the company's Stork Poultry Processing industry center. With a capacity of 12,000 broilers per hour, the line produces cut-up products that find their way to different markets or are further processed on another line from Marel, from its Townsend Further Processing range. Nuggets, burgers and schnitzels are among the products produced for the fast food market, schools and retailers.

"The white meat industry in Turkey has developed a great deal in the last 20 years," says Hasim Gürdamar, CEO of Senpiliçc. "Chicken was previously sold as generic products but consumer demands have now turned to branded, portioned and further processed products. In order to meet these demands, we need the right equipment and flow of information to keep improving our products. Stork Poultry Processing has been our consultant and supplier for 20 years in this respect. We started with a 2,000bph cutting capacity and now, in six months, we will reach 30,000 bph. Our aim is to use the most advanced technologies available while continuing to increase our capacity."

Further Reading

- You can view the full report by clicking here.