JBT Corporation acquires powder filling machine manufacturer for $37m

31-Jul-2017 - Last updated on 01-Aug-2017 at 10:00 GMT

PLF manufactures powder filling machines for the F&B industry. Picture: PLF.

JBT Corporation has acquired PLF International for £28m ($37m), which designs and manufactures powder filling machines for the food and beverage industry.

Tom Giacomini, CEO, JBT, said the two companies have worked together on successful projects over the past 10 years and it plans to expand PLF's business geographically and strengthen its aftermarket opportunities.

Growth markets

"JBT and PLF's sales collaborations during the past 10 years and complementary products make this combination a natural fit," said Giacomini.

"The addition of PLF expands our presence in the high-value part of the packaging line, serving attractive growth markets."

PLF, based in Essex, UK, makes machines that are easy to clean with quick changeover, minimum giveaway and gentle product handling (for example, baby milk formula).

The technology can be semi or fully automatic and each machine can be fitted with PLF’s accumulated or individual head-update weight control systems for product accuracy and minimum giveaway.

Its designs are capable of filling a range of container types, including glass, cans, PET and composite.

JBT Corporation recently announced its Q2 financial results for 2017, declaring revenue had increased 17% compared to the same period in 2016, representing 4% organic growth and 13% growth from acquisitions.

Segment operating profit declined 1% year over year and segment operating profit margin declined 205 basis points to 10.9% in the second quarter of 2017, due to a 120 basis point impact from acquisitions, as well as product mix at FoodTech and AeroTech.

FoodTech orders

"JBT delivered solid performance in the second quarter of 2017, with strong new equipment and aftermarket sales growth," said Giacomini.

"We were also pleased with orders, with notable year-over-year gains at FoodTech as well as exceptionally strong levels at AeroTech."

For the second quarter of 2017, inbound orders of $418m increased 36% from the prior year, reflecting a gain of 41% at FoodTech and a 26% increase at AeroTech. Backlog improved 16% from the year-ago period.

On July 3, 2017, JBT acquired Aircraft Maintenance Support Services, (AMSS), a manufacturer of military aviation equipment.

"The combination will enhance our military product offerings and provide expanded access to foreign militaries," added Giacomini.

Together, PLF and AMSS are expected to generate revenue of approximately $20m in 2017, or $45m on an annualized basis, with earnings dilution of approximately $0.06 per share in 2017, followed by accretion of $0.07 - $0.09 per share in 2018 and $0.10 - $0.12 per share in 2019.

"With a strong outlook for the second half of 2017, we are raising our full-year revenue guidance and maintaining the earnings per share guidance range of $2.95 - $3.10 for 2017, while absorbing $0.06 dilution from PLF and AMSS," said Brian Deck, executive VP/CFO, JBT.

JBT is raising its revenue growth guidance to 19% to 20% for the year, composed of 6% to 7% organic growth and approximately 13% from acquisitions.

Previously, the company guided to a 16% revenue growth rate, with 4% to 6% organic growth and 11% from acquisitions. At the same time, the company expects segment margins to be flat to up 25 basis points, down from previous guidance of a 25 to 50 basis point expansion, primarily due to the two July acquisitions.

The company expects third quarter 2017 earnings of $0.76 - $0.79 per share as it absorbs most of the dilution from the PLF and AMSS acquisitions in the quarter.