Q2 2024 Marel hf Earnings Call Transcript
Key Points
- Marel hf (CHIX:MARELa) reported an encouraging profitability improvement with a 9.1% EBIT margin and a 13% EBITDA margin on EUR415 million in revenues.
- The company has a healthy pipeline and expects stronger orders in the second half, particularly in the poultry segment.
- Recurring aftermarket revenues remain robust, with trailing 12-month levels staying above EUR800 million, accounting for 48.5% of total revenues.
- Operational performance is trending positively, with improved EBIT margins due to cost discipline and efficiency initiatives.
- Marel hf (CHIX:MARELa) is launching innovative solutions in the poultry segment, such as the ATHENA and ALPINE systems, which are expected to enhance market competitiveness and customer value.
- The company is operating in a challenging environment with geopolitical tensions, persistent inflation, and high interest rates impacting short-term certainty.
- Orders received were soft at EUR393 million, with a book-to-bill ratio of 0.95, indicating a decline in new orders.
- The poultry segment experienced particularly soft orders due to delays in customer decision-making, impacting future revenue and operational performance.
- Operating cash flow was negative by EUR4 million, affected by increased working capital commitments and lower orders received.
- Leverage increased to 3.9 times, above the target level of 2 to 3 times, due to higher working capital, although liquidity remains ample.
Good morning, and a warm welcome to our second quarter results meeting broadcast to you live from our headquarters in Iceland. My name is Tinna Molphy, Director of Investor Relations, and I will be your moderator today.
We will start with presentations from CEO, Arni Sigurdsson; and CFO, Sebastiaan Boelen, who will go over the second quarter results and some key business highlights and provide an update on the JBT process. We will then conclude with Q&A. And if you would like to ask a question, please use the raise your hand feature in Zoom or you can also e-mail [email protected].
With that, let's go over to you, Arni Sigurdsson.
Thank you, Tinna. Good morning to everyone, and thank you for joining us today. There are three key points that we want to share with you. First, it is our financial results in the second quarter. Second, it is the outlook for 2024 and key business highlights. And third, an update on the potential combination with
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