Marel hf. - Financial Statement Release

Marel Q2 2011 results

Strong revenue growth

(All amounts in EUR)

  -- Revenues for Q2 2011 totalled 161.9 mln, an increase of 19% compared to
     revenues for the same period the year before [Q2 2010: 136.1 mln].
  -- Normalised EBITDA
[1]
     was 20.9 mln, or 12.9% of revenues [Q2 2010: 21.1 mln normalised].
  -- Normalised operating profit (EBIT) was 15.0 mln, or 9.2% of revenues [Q2
     2010: 15.2 mln normalised].
  -- One‐off costs related to an agreement on the future arrangements of the
     Stork Pension Fund, amounting to 11.1 mln, are included in the consolidated
     income statement for Q2 2011.
  -- Taking into account the above one-off costs, net result was 0.2 mln for Q2
     2011 [Q2 2010: 0.1 mln].
  -- Cash flow remains healthy and net interest bearing debt is 248.8 mln at the
     end of Q2 2011 [Q2 2010: 284.1 mln].
  -- The order book continues to grow as a result of a strong product pipeline
     and favourable market conditions. The order book stands at 176.3 mln at the
     end of the quarter [Q2 2010: 125.3 mln].



Q2 2011 was a good quarter for Marel. Revenues totalled 162 mln, an increase of
19% compared to Q2 2010 and 5% compared to the previous quarter. The EBIT
margin was 9.2% in Q2 and 10.2% for the first half of the year, which is within
the company's target of 10-12% return on revenues for the year. The outlook for
the remainder of the year is positive. 

Orders received continue to exceed orders booked off, leading to a continuing
increase in the order book, which stood at 176 mln at the end of the quarter,
compared to 125 mln at the same time the year before. 



Revenues of 315 million in 1H 2011 with EBIT margin of 10.2%

  -- Revenues totalled 315.4 mln for the first half of the year, an increase of
     19% compared to revenues for the same period the year before [1H 2010:
     264.9 mln from core business].
  -- Normalised operating profit (EBIT) was 32.1 mln for the first half of the
     year, or 10.2% of revenues [1H 2010: 30.3 mln normalised from core
     business].
  -- Net result was 9.0 mln for the first half of the year [1H 2010: 5.7 mln
     consolidated].



Theo Hoen, CEO:

“We are pleased with the continuing growth of our business. The order book is
mounting and has reached an exceptionally high level, reflecting the positive
reception that our latest products have met with in the market. The
RevoPortioner, SensorX, StreamLine and Modular Oven Systems are all selling
very well and our QX co-extrusion system for sausage production is also taking
off. We see good growth in countries like Ukraine, South Korea, Brazil and
China, compensating for non-growth in the U.S. 

To stimulate future growth, we are investing in further geographical expansion,
as well as increasing our manufacturing capacity. We are, for example,
increasing the number of employees in manufacturing by approximately 300
worldwide during the course of the year. This is temporarily putting pressure
on our margins. Nevertheless, the EBIT margin for the first six months of the
year is within our target range of 10-12% and the outlook for the remainder of
the year is positive.” 



Order book at record level

Marel continues to benefit from its strong market position and product
pipeline. Orders received, including service revenues, amounted to 168.8 mln in
Q2 2011, compared to 149.4 mln for the same period the year before. Orders
received once again exceeded orders booked off. The result is a continuing
increase in the order book, which stood at a record 176.3 mln at the end of Q2
2011, compared to 125.3 mln at the same time the year before. 

Operational cash flow before interest and tax remains healthy at 7.4 mln for Q2
2011. The balance sheet is strong and net interest bearing debt amounts to
248.8 mln compared with 284.1 mln in Q2 2010. 



Outlook

Market conditions continue to improve. Marel has strengthened its market
position and the excellent level of the order book ensures a good continuation
of the year. Nevertheless, results may vary from quarter to quarter due to
fluctuations in orders received and deliveries of larger systems. 



Presentation of results, 28 July 2011

Marel will present its results at a meeting on Thursday, 28 July, at 8:30 a.m.,
at the company‘s headquarters at Austurhraun 9, Gardabaer, Iceland. The meeting
will also be webcast: www.marel.com/webcast 



Publication days of the Consolidated Financial Statements in 2011 and the
Annual General Meeting 2012 

  -- 3rd quarter 2011                                                           
26 October 2011
  -- 4th quarter 2011                                                           
1 February 2012
  -- Annual General Meeting of Marel 
hf.                                   29 February 2012



For further information, contact:

Jón Ingi Herbertsson, Investor and Public Relations Manager, tel: (+354)
563-8451 

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

Sigsteinn Grétarsson, Managing Director of Marel ehf., tel: (+354) 563-8072





About Marel

Marel is the leading global provider of advanced equipment, systems and
services to the fish, meat and poultry industries. With offices and
subsidiaries in close to 30 countries and a global network of more than 100
agents and distributors, we work side-by-side with our customers to extend the
boundaries of food processing performance. Advance with Marel for all your
processing needs. 

Forward-looking statements

Statements in this press release that are not based on historical facts are
forward-looking statements.   Although such statements are based on
management's current estimates and expectations, forward-looking statements are
inherently uncertain. We, therefore, caution the reader that there are a
variety of factors that could cause business conditions and results to differ
materially from what is contained in our forward-looking statements, and that
we do not undertake to update any forward-looking statements. All
forward-looking statements are qualified in their entirety by this cautionary
statement. 






[1]In Q2 2011, one-off costs related to a principle agreement on the future
arrangement of the pensions currently managed by the Stork Pension Fund are
included in the consolidated income statement but excluded from the normalised
figures in order to make a clean comparison with 2010 normalised figures
possible. (The agreement is discussed in further detail under “Key events
during the period”.)

Attachments:

Financial Statements Q2 2011.pdf

Press Release Q2 2011.pdf