Annual report 2018
For the period 2017-2026 Marel has set a target of 12% average annual increase in revenue, through both organic growth and acquisitions. Our growth plan involves capitalizing on strong innovation investment to drive expansion and market penetration. We will also focus on strategic partnerships and acquisitions to fill gaps in the value chain, and to augment our full-line product offering.
Marel's strategic objective is to be a full-line provider to the poultry, meat and fish industries. Our focus is to put our advanced, automated systems and solutions to work at every step of the production process and to cover the relevant geographical areas in our industries. Strong organic growth and strategic acquisitions have helped make Marel a leader in its field.
Our product line includes standalone equipment, individual systems and full production lines, all controlled and integrated with Innova, our overarching software solution.
This offers our customers process control, real-time traceability and monitoring of throughput and yield that is hard to replicate. Seamless flow and integration between different applications result in higher overall efficiency and improved yield. Marel has thus become a one-stop shop for customers’ needs for equipment, software and service.
In line with our strategy, we have actively reinforced our value chain in recent years. Strong cash flow has made it possible to support organic growth actively through innovation, advancing our manufacturing facilities and updating our IT platform across geographies. It has also allowed Marel to undertake strategic acquisitions, such as Sulmaq in 2017 and MAJA in 2018, without issuing new shares or taking out new loans for that purpose. We will continue to fill the remaining application gaps in our value chain through innovation, organic growth, strategic partnerships and acquisitions.
Marel aims to achieve on average 12% annual revenue growth in the period 2017-2026. The growth is expected to be a balanced mix of organic and acquired growth.
The market for food processing equipment is expected to grow 4-6% annually on average in the long term. Driven by our significant innovation investment, market penetration and extensive product portfolio, we aim at organic growth outperforming that of the market. Ongoing and continued investment in the future scalability of our platform, IT infrastructure and global reach supports organic growth going forward.
We will also supplement our full-line offering and accelerate market penetration through acquisitions. We believe our solid operational performance and strong cash flow can support 5-7% revenue growth on average annually through acquisitions. This growth is not expected to be linear but reflect opportunities which become available and economic fluctuations. To capture the full value of acquired companies, we are further professionalizing our integration capabilities and expertise to become a solid integration partner.
Acquisition of MPS paved the way for entry into primary meat processing
The acquisition of Sulmaq strengthens Marel’s market presence in Latin America.