Gardabaer, Iceland-based Marel posted higher sales and revenue in 2022, but its net result dropped to EUR 58.7 million (USD 62.3) in 2022, down from EUR 96.2 million (USD 102 million) in 2021.
Its revenue total hit EUR 1.7 billion (USD 1.8 billion) for 2022, and its earnings before interest and taxes (EBIT) reached EUR 163.4 million (USD 173.6).
The processing-equipment manufacturer was buoyed by a record Q4, posting EUR 489 million (USD 519 million) in revenue, reaching an EBIT margin of EUR 60.9 million (USD 64 million).
In 2022, it made numerous acquisitions, including Wenger, Sleegers Technique, Curio, and a joint agreement with Tyson Ventures to purchase Soft Robotics Inc. Wenger, purchased for USD 540 million (EUR 573 million), became Marel’s fourth business segment after meat, poultry, and fish, and was expected to account for around 10 percent of Marel’s total revenues and 12 percent of its EBIT following the transaction. Marel saw record order intake from China in 2022.
However, it was hurt by the bankruptcy of Stranda Prolog in September 2022, which forced the company to take an estimated EUR 7 million (EUR ) impairment in Q3 2022. And it cut 5 percent of its global workforce in July 2022 due to “continued supply chain disruption and inflation at high levels leading to slower ramp up of revenues than originally planned.” The headcount reduction resulted in an annualized cost saving of EUR 20 million (USD 21 million) with a one-off cost of around EUR 10 million (USD 10.6 million), Marel estimates.
Marel delivered “improved operational performance on higher volume enabled by automation and infrastructure investments, solid customer deliveries, as well as better price/cost coverage” in 2022, it said in its results release on 8 February.
“2022 will be a year to remember – a year of transformation for Marel in a time of disruption in global supply chains and shifting consumer behavior impacting the food value-chain. Against a wider backdrop of macroeconomic uncertainty and volatility, we close[d] the year with a record quarter,” Marel CEO Arni Oddur Thordarson said in the release. “Although adding to non-recurring costs in 2022, our transformative infrastructure investments to further automate and digitize our platform enabled us to improve operational efficiency and increase volumes through solid customer deliveries. Higher revenues in turn provided better cost coverage resulting in improved operational performance towards our year-end 2023 run-rate target of 14 to 16 percent EBIT. Additionally, actions already enacted, such as the 5 percent global workforce reduction, had a positive impact on EBIT margin. Further levers to support margin expansion center around cost/price discipline, after market penetration on current installed base, in addition to optimizing our manufacturing footprint and supply base.”
Thordarson said the company had posted record aftermarket revenues for 11 consecutive quarters, and that aftermarket revenue now accounts for 40 percent of Marel’s total revenues, “reflecting strong market position as a trusted maintenance partner.”
“To position our business for future growth, we will continue our CAPEX at 4 to 5 percent in the coming years to shorten lead times and support the 2026 target of 50 percent of revenues coming from service and software. Acquisitions and strategic partnerships have accelerated our innovation road map,” he said. “The platform acquisition of Wenger in 2022 represents an exciting new growth avenue for Marel, focused on petfood, plant-based protein, and aquafeed. The acquisition was margin and earnings enhancing for Marel and there are immediate opportunities for growth and value creation by leveraging Marel’s global reach and digital platforms in Wenger’s sizeable and high-growth markets.”
Marel launched 33 new products in 2022, designed to improve yield and decrease waste in the food value-chain, and reduce the CO2 footprint accountability of food processors. One of those products was the FilleXia machine, which it said
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Photo courtesy of Marel
