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Mettler-Toledo International Inc. Reports Second Quarter 2018 Results
- - Very Good Sales Growth - -
- - Strong EPS Growth - -

COLUMBUS, Ohio, July 26, 2018 /PRNewswire/ -- Mettler-Toledo International Inc. (NYSE: MTD) today announced second quarter results for 2018.  Provided below are the highlights:

  • Reported sales increased 10% as compared with the prior year.  In local currency, sales increased 7% in the quarter as currency benefited reported sales growth by 3%. 
  • Net earnings per diluted share as reported (EPS) were $4.31, compared with $3.84 in the prior-year period.  Adjusted EPS was $4.65, an increase of 19% over the prior-year amount of $3.92.  Adjusted EPS is a non-GAAP measure, and we have included a reconciliation to EPS on the last page of the attached schedules. 

Second Quarter Results

Olivier Filliol, President and Chief Executive Officer, stated, "We had very good sales growth in the quarter against an excellent prior year.  Our sales performance was broad-based with China being especially robust.  We also achieved another quarter of strong EPS growth."

GAAP Results
EPS in the quarter was $4.31, compared with the prior-year amount of $3.84.  

As compared with the prior year, total reported sales increased 10% to $722.0 million.  By region, reported sales increased 4% in the Americas, 14% in Europe and 15% in Asia/Rest of World.  Earnings before tax amounted to $143.6 million as compared to $126.8 million in the prior year. 

Non-GAAP Results
Adjusted EPS was $4.65, an increase of 19% over the prior-year amount of $3.92.      

As compared to the prior year, total sales in local currency increased 7% as currency benefited reported sales growth by 3%.  By region, local currency sales increased 4% in the Americas, 7% in Europe and 9% in Asia/Rest of World.  Adjusted operating income amounted to $169.3 million, a 15% increase from the prior-year amount of $147.4 million

Adjusted EPS and Adjusted operating income are non-GAAP measures. Reconciliations to the most comparable GAAP measures are provided in the attached schedules.

Six Month Results

GAAP Results
EPS in the first six months was $7.88, compared with the prior-year amount of $7.32.  

As compared with the prior-year period, total reported sales increased 11% to $1.383 billion.  By region, reported sales increased 5% in the Americas, 13% in Europe and 16% in Asia/Rest of World.  Earnings before tax amounted to $261.0 million as compared to $240.7 million in the prior year. 

Non-GAAP Results
Adjusted EPS was $8.38, an increase of 16% over the prior-year amount of $7.25.     

As compared to the prior-year period, total sales in local currency increased 6% as currency benefited reported sales growth by 5%. By region, local currency sales increased 5% in the Americas, 3% in Europe and 10% in Asia/Rest of World.  Adjusted operating income amounted to $308.8 million, a 13% increase from the prior-year amount of $273.9 million

Adjusted EPS and Adjusted operating income are non-GAAP measures. Reconciliations to the most comparable GAAP measures are provided in the attached schedules.

Outlook 

The Company said that, based on its assessment of market conditions today, management anticipates local currency sales growth in 2018 will be approximately 6%.  This sales growth is expected to result in Adjusted EPS in the range of $20.10 to $20.25, which reflects growth of 14% to 15%.  This guidance remains the same as previous guidance.   

Management anticipates that local currency sales growth in the third quarter 2018 will be approximately 6%, and Adjusted EPS is forecasted to be in the range of $4.97 to $5.02, an increase of 14% to 15%. 

While the Company has provided an outlook for local currency sales growth and Adjusted EPS, it has not provided an outlook for reported sales growth or EPS as it would require an estimate of currency exchange fluctuations and non-recurring items, which are not yet known.  The Company noted in making its outlook that economic uncertainty remains in certain regions of the world and market conditions are subject to change.   

Conclusion

Filliol concluded, "Demand remains solid in our markets and we continue to achieve favorable results from our growth initiatives.  Our sales growth achievement in the first half of the year was especially impressive given the excellent growth in the prior-year period.  Earnings growth was very good in the first half and, assuming market conditions do not deteriorate, we remain confident in our outlook for the remainder of the year.  We believe we are well-positioned to continue to gain share and drive further earnings growth through new product launches, sales and marketing programs, sales investments, and margin and productivity initiatives."

Other Matters

The Company will host a conference call to discuss its quarterly results today (Thursday, July 26) at 4:30 p.m. Eastern Time.  To hear a live webcast or replay of the call, visit the investor relations page on the Company's website at www.mt.com/investors.  The presentation referenced in the conference call will be located on the website prior to the call.

METTLER TOLEDO (NYSE: MTD) is a leading global supplier of precision instruments and services. We have strong leadership positions in all of our businesses and believe we hold global number-one market positions in most of them. We are recognized as an innovation leader and our solutions are critical in key R&D, quality control, and manufacturing processes for customers in a wide range of industries including life sciences, food, and chemicals. Our sales and service network is one of the most extensive in the industry. Our products are sold in more than 140 countries and we have a direct presence in approximately 40 countries. With proven growth strategies and a focus on execution, we have achieved a long-term track record of strong financial performance. For more information, please visit www.mt.com.

Statements in this press release which are not historical facts constitute "forward-looking statements" within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934.  These statements involve known and unknown risks, uncertainties and other factors that may cause our or our businesses' actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by any forward-looking statements.  In some cases, you can identify forward-looking statements by terminology such as "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," "believe," "estimate," "predict," "potential" or "continue" or the negative of those terms or other comparable terminology.  For a discussion of these risks and uncertainties, please see the discussion on forward-looking statements in our current report on Form 10-K.  All of the forward-looking statements are qualified in their entirety by reference to the factors discussed under the captions "Factors affecting our future operating results" and in the "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of our annual report on Form 10-K for the most recently completed fiscal year, which describe risks and factors that could cause results to differ materially from those projected in those forward-looking statements.

 

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands except share data)

(unaudited)

























Three months ended








Three months ended









June 30, 2018


% of sales



June 30, 2017


% of sales






















Net sales



$721,996


(a)


100.0





$653,656




100.0



Cost of sales



309,371




42.8





278,044


(b)


42.5



Gross profit



412,625




57.2





375,612




57.5























Research and development



35,315




4.9





32,582


(b)


5.0



Selling, general and administrative 



208,024




28.8





195,624


(b)


29.9



Amortization



11,970




1.7





10,249




1.6



Interest expense



8,309




1.2





8,171




1.3



Restructuring charges



7,321




1.0





4,023




0.6



Other charges (income), net



(1,916)




(0.3)





(1,884)


(b)


(0.3)



Earnings before taxes



143,602




19.9





126,847




19.4























Provision for taxes



32,134




4.5





25,267




3.9



Net earnings



$111,468




15.4





$101,580




15.5























Basic earnings per common share:



















Net earnings 



$4.41









$3.94







Weighted average number of common shares



25,299,414









25,751,374



























Diluted earnings per common share:



















Net earnings 



$4.31









$3.84







Weighted average number of common 



25,867,383









26,439,529







  and common equivalent shares







































Note:



















(a)

Local currency sales increased 7% as compared to the same period in 2017.



(b)

In accordance with the new accounting rules that went into effect on January 1, 2018, the Company reclassified a net pension benefit of $1.1 million into other charges (income) from other income statement categories for the three months ended June 30, 2017 to be consistent with the 2018 presentation.






















RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME

























Three months ended








Three months ended









June 30, 2018


% of sales



June 30, 2017


% of sales






















Earnings before taxes



$143,602









$126,847







Amortization



11,970









10,249







Interest expense



8,309









8,171







Restructuring charges



7,321









4,023







Other charges (income), net



(1,916)









(1,884)


(b)





Adjusted operating income 



$169,286


(c)


23.4





$147,406




22.6























Note:



















(c)

Adjusted operating income increased 15% as compared to the same period in 2017.







 

 

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands except share data)

(unaudited)

























Six months ended








Six months ended









June 30, 2018


% of sales



June 30, 2017


% of sales


















Net sales



$1,382,817


(a)


100.0





$1,248,223




100.0



Cost of sales



595,259




43.0





529,222

(b)


42.4



Gross profit



787,558




57.0





719,001




57.6























Research and development



70,028




5.1





63,782

(b)


5.1



Selling, general and administrative 



408,698




29.6





381,280

(b)


30.5



Amortization



23,705




1.7





20,294




1.6



Interest expense



16,668




1.2





15,912




1.3



Restructuring charges



11,734




0.8





5,455




0.4



Other charges (income), net



(4,316)




(0.3)





(8,417)

(b)(c)


(0.6)



Earnings before taxes



261,041




18.9





240,695




19.3























Provision for taxes



56,269




4.1





46,649




3.8



Net earnings



$204,772




14.8





$194,046




15.5























Basic earnings per common share:



















Net earnings 



$8.07









$7.51







Weighted average number of common shares



25,383,402









25,841,243



























Diluted earnings per common share:



















Net earnings 



$7.88









$7.32







Weighted average number of common 



25,979,508









26,514,311







  and common equivalent shares







































Note:



















(a)

Local currency sales increased 6% as compared to the same period in 2017.



(b)

In accordance with the new accounting rules that went into effect on January 1, 2018, the Company reclassified a net pension benefit of $1.9 million into other charges (income) from other income statement categories for the six months ended June 30, 2017 to be consistent with the 2018 presentation.


(c)

Other charges (income), net includes a one-time gain of $3.4 million for the six months ended June 30, 2017 relating to the sale of a facility in Switzerland in connection with our initiative to consolidate certain Swiss operations into a new facility.























RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME

























Six months ended








Six months ended









June 30, 2018


% of sales



June 30, 2017


% of sales






















Earnings before taxes



$261,041









$240,695







Amortization



23,705









20,294







Interest expense



16,668









15,912







Restructuring charges



11,734









5,455







Other charges (income), net



(4,316)









(8,417)

(b)(c)





Adjusted operating income 



$308,832

(d)


22.3





$273,939




21.9























Note:



















(d)

Adjusted operating income increased 13% as compared to the same period in 2017.







 

METTLER-TOLEDO INTERNATIONAL INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands)

(unaudited)























June 30, 2018



December 31, 2017











Cash and cash equivalents



$183,190





$148,687


Accounts receivable, net



486,203





528,615


Inventories



270,047





255,390


Other current assets and prepaid expenses



63,867





74,031


Total current assets



1,003,307





1,006,723












Property, plant and equipment, net



678,706





668,271


Goodwill and other intangibles assets, net



756,265





766,556


Other non-current assets



119,938





108,255


Total assets



$2,558,216





$2,549,805












Short-term borrowings and maturities of long-term debt



$52,052





$19,677


Trade accounts payable



170,865





167,627


Accrued and other current liabilities



465,900





502,369


Total current liabilities



688,817





689,673












Long-term debt



1,020,420





960,170


Other non-current liabilities



316,545





352,682


Total liabilities



2,025,782





2,002,525












Shareholders' equity



532,434





547,280


Total liabilities and shareholders' equity



$2,558,216





$2,549,805












 

 

 

METTLER-TOLEDO INTERNATIONAL INC.


CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


 (amounts in thousands)


 (unaudited)














Three months ended


Six months ended




June 30,


June 30,




2018


2017


2018


2017












Cash flow from operating activities:









    Net earnings

$111,468


$101,580


$204,772


$194,046


    Adjustments to reconcile net earnings to









      net cash provided by operating activities:









Depreciation

9,449


7,953


18,606


15,919


Amortization

11,970


10,249


23,705


20,294


Deferred tax benefit

(3,693)


(2,264)


(10,109)


(3,840)


Other

3,951


4,211


7,036


4,629


Increase (decrease) in cash resulting from changes in









  operating assets and liabilities

7,050


16,049


(27,251)


(25,671)


                Net cash provided by operating activities

140,195


$137,778


$216,759


$205,377












Cash flows from investing activities:









    Proceeds from sale of property, plant and equipment

23


206


4,530


10,209


    Purchase of property, plant and equipment

(31,812)


(27,514)


(61,586)


(48,529)


    Acquisitions

-


(697)


(500)


(697)


    Net hedging settlements on intercompany loans

3,738


(1,345)


7,042


(1,033)


                Net cash used in investing activities

(28,051)


(29,350)


(50,514)


(40,050)












Cash flows from financing activities:









    Proceeds from borrowings

266,668


200,189


603,180


672,921


    Repayments of borrowings

(171,410)


(205,281)


(502,524)


(615,162)


    Proceeds from exercise of stock options

4,291


8,734


9,960


16,935


    Repurchases of common stock 

(118,749)


(124,952)


(237,499)


(249,949)


    Other financing activities

(1,635)


(7,205)


(1,635)


(7,205)


                Net cash used in financing activities

(20,835)


(128,515)


(128,518)


(182,460)












Effect of exchange rate changes on cash and cash equivalents

(7,067)


1,528


(3,224)


4,793












Net increase (decrease) in cash and cash equivalents

84,242


(18,559)


34,503


(12,340)












Cash and cash equivalents:









    Beginning of period

98,948


164,893


$148,687


158,674


    End of period

$183,190


$146,334


$183,190


$146,334






















RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO ADJUSTED FREE CASH FLOW












Net cash provided by operating activities

$140,195


$137,778


$216,759


$205,377


    Payments in respect of restructuring activities

8,167


2,748


13,409


5,326


    Transition tax payment

4,200


-


4,200


-


    Proceeds from sale of property, plant and equipment

23


206


4,530


10,209


    Purchase of property, plant and equipment

(31,812)


(27,514)


(61,586)


(48,529)


Adjusted free cash flow

$120,773


$113,218


$177,312


$172,383












 

 

 

METTLER-TOLEDO INTERNATIONAL INC.


OTHER OPERATING STATISTICS




























SALES GROWTH BY DESTINATION


(unaudited)



















Europe


Americas


Asia/RoW

Total
















U.S. Dollar Sales Growth













Three Months Ended June 30, 2018



14%


4%


15%


10%




Six Months Ended June 30, 2018



13%


5%


16%


11%
















Local Currency Sales Growth













Three Months Ended June 30, 2018



7%


4%


9%


7%




Six Months Ended June 30, 2018



3%


5%


10%


6%































RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS 


(unaudited)

















Three months ended

Six months ended



June 30,

June 30,



2018


2017


% Growth


2018


2017


% Growth














EPS as reported, diluted

$4.31


$3.84


12%


$7.88


$7.32


8%














Restructuring charges, net of tax

0.22

(a)

0.12

(a)



0.35

(a)

0.16

(a)


Purchased intangible amortization, net of tax

0.10

(b)

0.06

(b)



0.19

(b)

0.11

(b)


Income tax expense

0.02

(c)

(0.10)

(c)



(0.04)

(c)

(0.24)

(c)


Gain on facility sale

-


-




-


(0.10)

(d)















Adjusted EPS, diluted

$4.65


$3.92


19%


$8.38


$7.25


16%














Notes:












(a)

Represents the EPS impact of restructuring charges of $7.3 million ($5.7 million after tax) and $4.0 million ($3.1 million after tax) for the three months ended June 30, 2018 and 2017, and $11.7 million ($9.2 million after tax) and $5.5 million ($4.3 million after tax) for the six months ended June 30, 2018 and 2017, respectively. Restructuring charges in 2018 primarily relates to employee and other costs associated with the consolidation of facilities.

(b)

Represents the EPS impact of purchased intangibles amortization, net of tax, of $2.5 million and $1.5 million for the three months ended June 30, 2018 and 2017, and $5.0 million and $3.0 million for the six months ended June 30, 2018 and 2017, respectively.

(c)

Represents the EPS impact of the difference between our reported tax rate during the three and six months ending June 30, 2018 and 2017, respectively, and our annual income tax rate of 22%, due to excess tax benefits associated with stock option exercises. 

(d)

Represents the EPS impact of a one-time gain of $3.4 million ($2.7 million after tax) for the six months ended June 30, 2017 relating to the sale of a facility in Switzerland in connection with our initiative to consolidate certain Swiss operations into a new facility.

 

Cision View original content:http://www.prnewswire.com/news-releases/mettler-toledo-international-inc-reports-second-quarter-2018-results-300687466.html

SOURCE Mettler-Toledo International Inc.

Mary T. Finnegan, Treasurer, Investor Relations, Mettler-Toledo International Inc., +1-614-438-4748, Fax: +1-614-438-4646, unless told otherwise.