JBT Marel Q1 Earnings Call Highlights

Key Points

• JBT Marel said first-quarter orders topped $1 billion for the second straight quarter, driven by strong global poultry demand and broad-based growth across its end markets.
• The company posted a solid Q1 with revenue up 10% to $936 million, adjusted EBITDA up 27%, and margin expansion to 15.2%, while free cash flow reached $100 million and leverage fell to 2.6x.
• Management reaffirmed full-year 2026 guidance despite tariff headwinds, and said it remains on track to reduce leverage to about 2x by year-end while pursuing its next-gen strategy for profitable growth through 2028.

JBT Marel NYSE: JBTM reported a solid start to 2026, with first-quarter orders exceeding $1 billion for the second consecutive quarter and management reaffirming its full-year earnings guidance.

CEO Brian Deck said the company demonstrated “commercial momentum” during the quarter, citing continued robust global demand from poultry customers, year-over-year margin expansion, synergy savings and strong cash flow that helped further reduce financial leverage.

“As a result, we remain confident in delivering our original earnings guidance for the year,” Deck said.

Revenue rises 10% as EBITDA margin expands

Chief Financial Officer Matthew J. Meister said first-quarter consolidated revenue was $936 million, up approximately 10% year over year. Organic revenue growth was 4%, while foreign exchange contributed an additional 6%.

Consolidated adjusted EBITDA was $142 million, up 27% from the prior year. Adjusted EBITDA margin improved 210 basis points to 15.2%.

In Protein Solutions, revenue increased 22% year over year to $460 million, including an approximately 8% benefit from foreign exchange. Meister said organic growth was driven primarily by higher poultry volume as the company executed against a strong backlog built in 2025. Segment adjusted EBITDA margin improved more than 500 basis points to 21.7%, helped by poultry volume leverage, synergy benefits and continuous improvement initiatives in Marel Meat and Fish.

Prepared Food and Beverage Solutions revenue was $476 million, flat from a year earlier, including an approximately 4% benefit from foreign exchange. Meister said prior softness in the CPG end market contributed to lower volume. Segment adjusted EBITDA margin declined 170 basis points to 14.7%, reflecting higher tariff costs, the volume decline and underperformance in the Warehouse Automation business.

JBT Marel generated free cash flow of $100 million in the quarter, supported by earnings performance and increased customer advance payments tied to strong order intake. Free cash flow conversion to adjusted EBITDA was 70%. The company’s leverage ratio was 2.6 times at quarter-end, and Meister said JBT Marel remains on track to reduce leverage to approximately 2 times by year-end.

Full-year guidance maintained despite tariff headwinds

Management maintained its full-year 2026 guidance. At the midpoint, the outlook implies revenue growth of 6%, adjusted EBITDA margin expansion of 145 basis points and a 29% improvement in adjusted earnings per share.

For the second quarter, JBT Marel expects revenue of $975 million to $1 billion and adjusted EBITDA margins of 17% to 17.5%.

Meister said the company expects the benefit from the elimination of IEEPA tariffs to be essentially offset by incremental Section 122 and Section 232 tariff increases. The guidance does not include any IEEPA tariff payment refunds. He said the full-year outlook continues to include a 25-basis-point to 50-basis-point headwind from tariffs after mitigation actions.

Orders exceed $1 billion on poultry strength

Deck said orders exceeded $1 billion in the first quarter, up 17% year over year. He attributed the increase to continued strong demand from poultry customers globally, as well as broader strength across the company’s diversified end markets.

Both Protein Solutions and Prepared Food and Beverage posted double-digit year-over-year order growth, Deck said. The company saw increased investment in Prepared Foods, meat, and fruit and vegetable end markets. Geographically, demand increased sequentially in Europe, North America and Latin America.

Deck also said the company continues to capture “synergistic orders” through cross-selling between legacy JBT and Marel solutions.

Addressing the conflict in the Middle East, Deck said JBT Marel has not seen a noteworthy impact on its order book or pipeline. He noted that the region has historically represented less than 5% of total company revenue. However, he said the conflict is contributing to a more challenging logistics, fertilizer and energy inflation environment, which the company is monitoring for potential impacts on JBT Marel and its customers.

Management highlights next-generation strategy

During the call, management also reviewed the company’s “next-gen” strategy, which was discussed at its March Investor Day. The strategy is focused on profitable growth and margin expansion through 2028 as food and beverage customers shift toward outcome-based models requiring integrated solutions, lifecycle support, uptime and data-driven processing insights.

The company said key elements of the strategy include:

• Advancing a customer-centric service model through prescriptive maintenance, improved parts delivery and greater regional accountability.
• Enhancing product offerings, full-line solutions and digital capabilities through targeted innovation and food application expertise.
• Capturing commercial opportunities through cross-selling, emerging market growth and end-to-end solutions.
• Using continuous improvement to improve efficiency and support reinvestment.
• Pursuing disciplined strategic M&A at the appropriate time to expand the company’s offering.

Management said it expects revenue to grow at a three-year organic compound annual rate of 5% to 7% and is targeting a 20% adjusted EBITDA margin in 2028, supported by margin initiatives and volume growth.

Analysts ask about inflation, poultry cycle and warehouse automation

In response to a question from Sam Carlo of William Blair about input cost inflation, Deck said poultry customers are in a stronger position than they were a few years ago, with strong end-customer demand, balanced supply, favorable price-cost spreads and strong balance sheets. He said corn and soybean supplies remain abundant and lower-cost in 2026 compared with 2022, when prices were elevated following the Russia-Ukraine conflict.

Deck said the combined JBT Marel business is more diversified than in 2022, with broader poultry exposure across primary, secondary, end-of-line and further processing, along with broader geographic and end-market exposure.

Asked by Justin Ages of CJS Securities about Prepared Food and Beverage headwinds, Meister said Warehouse Automation customers were more affected by tariff changes than the rest of JBT Marel’s business. He said the business also worked through several discrete projects over the past two quarters, which management believes are largely behind it. Actions to improve margins are expected to begin affecting results late in the second quarter and continue into the third and fourth quarters.

Deck said poultry demand is broad-based geographically, with strength in Europe, North America and South America. He said North America is earlier in the cycle than Europe and could benefit from potential investment tied to line speeds. South America could be on track for a record year for the company, he added.

In response to Mircea Dobre of R.W. Baird, Deck said poultry demand is supported by global protein consumption trends, including flexibility in flavor profiles, limited religious restrictions and shifts from grain-based to meat-based diets. He said recent demand has been strongest in primary and secondary processing, with further processing opportunities expected later in the cycle.

Deck also discussed potential changes to USDA poultry line-speed rules, saying JBT Marel’s technology is built for higher speeds already used in Europe and elsewhere. If North American line speeds move from 140 birds per minute to 175 birds per minute, Deck said that would likely require broader system investments rather than a simple equipment change. Even without rule changes, he said customers are investing in line splits that can improve productivity under current limits.

On Prepared Food and Beverage, Deck said the company is seeing some recovery in end markets that were more challenged in 2025, including CPG and quick-service restaurants. Meister said the segment had close to double-digit order improvement in the first quarter and is expected to see organic growth of roughly 3% to 4% for the year, below the company’s overall midpoint growth rate. He said margins in the segment are expected to improve sequentially through 2026 and be up year over year.

About JBT Marel NYSE: JBTM

JBT Marel Corporation provides technology solutions to food and beverage industry in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. It offers value-added processing that includes chilling, mixing/grinding, injecting, blending, marinating, tumbling, flattening, forming, portioning, coating, cooking, frying, freezing, extracting, pasteurizing, sterilizing, concentrating, high pressure processing, weighing, inspecting, filling, closing, sealing, end of line material handling, and packaging solutions to the food, beverage, and health market.

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