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Mettler-Toledo International Inc. Reports Third Quarter 2021 Results

COLUMBUS, Ohio, Nov. 4, 2021 /PRNewswire/ -- Mettler-Toledo International Inc. (NYSE: MTD) today announced third quarter results for 2021. Provided below are the highlights:

  • Reported sales increased 18% compared with the prior year. In local currency, sales increased 16% in the quarter as currency benefited reported sales growth by 2%.

  • Net earnings per diluted share as reported (EPS) were $8.71, compared with $6.68 in the prior-year period. Adjusted EPS was $8.72, an increase of 24% over the prior-year amount of $7.02. Adjusted EPS is a non-GAAP measure, and a reconciliation to EPS is included on the last page of the attached schedules.

Third Quarter Results

Patrick Kaltenbach, President and Chief Executive Officer, stated, "We had very strong sales growth with broad-based increases in all regions. Our Laboratory product lines had excellent growth and our Industrial business also performed very well. Our ability to meet heightened customer demand while navigating the challenges of the global supply chain is proving to be a competitive advantage in the current environment. Robust sales growth and agile execution drove strong growth in Adjusted Operating Profit, Adjusted EPS and cash flow generation." 

GAAP Results
EPS in the quarter was $8.71, compared with the prior-year amount of $6.68

Compared with the prior year, total reported sales increased 18% to $952.0 million. By region, reported sales increased 20% in the Americas, 12% in Europe and 21% in Asia/Rest of World. Earnings before taxes amounted to $247.6 million, compared with $205.8 million in the prior year.

Non-GAAP Results
Adjusted EPS was $8.72, an increase of 24% over the prior-year amount of $7.02.

Compared with the prior year, total sales in local currency increased 16% as currency benefited sales growth by 2%. By region, local currency sales increased 20% in the Americas, 10% in Europe and 16% in Asia/Rest of World. Adjusted Operating Profit amounted to $272.8 million, a 19% increase from the prior-year amount of $230.0 million.

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

Nine Month Results

GAAP Results
EPS was $22.86, compared with the prior-year amount of $15.92.

Compared with the prior year, total reported sales increased 25% to $2.681 billion. By region, reported sales increased 22% in the Americas, 22% in Europe and 31% in Asia/Rest of World. Earnings before taxes amounted to $663.4 million, compared with $479.6 million in the prior year.

Non-GAAP Results
Adjusted EPS was $23.37, an increase of 43% over the prior-year amount of $16.30.

Compared with the prior year, total sales in local currency increased 20% as currency benefited sales growth by 5%. By region, local currency sales increased 21% in the Americas, 15% in Europe and 23% in Asia/Rest of World. Adjusted Operating Profit amounted to $738.7 million, a 35% increase from the prior-year amount of $547.9 million.

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

Outlook   

The Company stated that forecasting continues to be challenging. Management cautions that market conditions are dynamic and changes to the business environment can happen quickly. Uncertainty remains surrounding the impact of COVID-19 and the challenges in the global supply chain on the economic environment. The estimates include uncertainty and management acknowledges that market conditions are subject to change.

Based on today's assessment of market conditions, management anticipates local currency sales growth for the fourth quarter of 2021 will be approximately 8%, and Adjusted EPS is forecasted to be $10.00 to $10.05, a growth rate of 8% to 9%.

For the full year 2021, local currency sales growth is expected to be approximately 17%, and Adjusted EPS is forecasted to be in the range of $33.35 to $33.40, an increase of 30%. This compares with previous guidance of Adjusted EPS in the range of $32.60 to $32.90.

The Company said that based on its assessment of market conditions today, management anticipates local currency sales growth in 2022 will be approximately 6%. This sales growth is expected to result in Adjusted EPS in the range of $37.25 to $37.65. Using the mid-point of 2021 guidance, this would result in Adjusted EPS growth of 12% to 13%.

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.

Conclusion

Kaltenbach concluded, "Our end markets remain favorable and our strategic initiatives are very effective at capturing growth. We continue to invest in the strength and breadth of our product portfolio, further extending our technology lead; leverage our excellent sales and marketing approaches; and reinforce customer trust through our global service offering, which supports customers' productivity. We have successfully navigated the challenges of the global supply chain to date but are cautious as dynamics remain challenging and conditions can change rapidly. Although pockets of uncertainty exist in the global economy, we believe we are ideally positioned to continue to gain market share. With our proven strategies, good demand in our end markets and continued focused execution of our growth and margin initiatives, we believe we are in an excellent position to deliver strong results in 2021 and 2022."

Other Matters

The Company will host a conference call to discuss its quarterly results today (Thursday, Nov. 4) at 5:00 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. You should not rely on forward-looking statements to predict our actual results. Our actual results or performance may be materially different than reflected in forward-looking statements because of various risks and uncertainties, including statements about expected revenue growth and long-term impacts of the COVID-19 pandemic. 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." We make forward-looking statements about future events or our future financial performance, including earnings and sales growth, earnings per share, strategic plans and contingency plans, growth opportunities or economic downturns, our ability to respond to changes in market conditions, customer demand, our competitive position, pricing, our supply chain, adequacy of our facilities, access to and the costs of raw materials, shipping and supplier costs, gross margins, planned research and development efforts and product introductions, capital expenditures, cash flow, tax-related matters, the impact of foreign currencies, compliance with laws, effects of acquisitions and the impact of the COVID-19 pandemic on our businesses. Our forward-looking statements may not be accurate or complete, and we do not intend to update or revise them in light of actual results. New risks also periodically arise. Please consider the risks and factors that could cause our results to differ materially from what is described in our forward-looking statements, including the uncertain duration and severity of the COVID-19 pandemic. See in particular "Factors Affecting Our Future Operating Results" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2020 and other reports filed with the SEC from time to time.

 

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands except share data)

(unaudited)





Three months ended




Three months ended





September 30, 2021


% of sales


September 30, 2020


% of sales










Net sales

$951,950

(a)

100.0


$807,357


100.0

Cost of sales

396,130


41.6


337,749


41.8

Gross profit

555,820


58.4


469,608


58.2










Research and development

42,276


4.4


34,656


4.3

Selling, general and administrative 

240,734


25.3


204,974


25.4

Amortization

16,039


1.7


14,121


1.7

Interest expense

11,791


1.2


9,310


1.2

Restructuring charges

650


0.1


4,570


0.6

Other charges (income), net

(3,257)


(0.3)


(3,832)


(0.5)

Earnings before taxes

247,587


26.0


205,809


25.5










Provision for taxes

43,899


4.6


44,042


5.5

Net earnings

$203,688


21.4


$161,767


20.0










Basic earnings per common share:








Net earnings 

$8.83




$6.76



Weighted average number of common shares

23,056,924




23,922,272












Diluted earnings per common share:








Net earnings 

$8.71




$6.68



Weighted average number of common 

23,393,579




24,225,204



  and common equivalent shares

















Note:








(a)   Local currency sales increased 16% as compared to the same period in 2020.










RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING PROFIT












Three months ended




Three months ended





September 30, 2021


% of sales


September 30, 2020


% of sales










Earnings before taxes

$247,587




$205,809



Amortization

16,039




14,121



Interest expense

11,791




9,310



Restructuring charges

650




4,570



Other charges (income), net

(3,257)




(3,832)



Adjusted operating profit

$272,810

(b)

28.7


$229,978


28.5










Note:








(b)   Adjusted operating profit increased 19% as compared to the same period in 2020.


 

 

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands except share data)

(unaudited)




Nine months ended




Nine months ended





September 30, 2021


% of sales


September 30, 2020


% of sales










Net sales

$2,680,691

(a)

100.0


$2,147,192


100.0

Cost of sales

1,116,271


41.6


905,205


42.2

Gross profit

1,564,420


58.4


1,241,987


57.8










Research and development

124,151


4.6


100,236


4.7

Selling, general and administrative 

701,531


26.2


593,852


27.7

Amortization

46,141


1.7


42,008


2.0

Interest expense

31,701


1.2


29,111


1.3

Restructuring charges

2,719


0.1


7,335


0.3

Other charges (income), net

(5,208)


(0.2)


(10,118)


(0.5)

Earnings before taxes

663,385


24.8


479,563


22.3










Provision for taxes

125,271


4.7


93,119


4.3

Net earnings

$538,114


20.1


$386,444


18.0










Basic earnings per common share:








Net earnings 

$23.19




$16.13



Weighted average number of common shares

23,203,257




23,963,311












Diluted earnings per common share:








Net earnings 

$22.86




$15.92



Weighted average number of common 

23,536,615




24,272,354



  and common equivalent shares

















Note:








(a)   Local currency sales increased 20% as compared to the same period in 2020.










RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING PROFIT












Nine months ended




Nine months ended





September 30, 2021


% of sales


September 30, 2020


% of sales










Earnings before taxes

$663,385




$479,563



Amortization

46,141




42,008



Interest expense

31,701




29,111



Restructuring charges

2,719




7,335



Other charges (income), net

(5,208)




(10,118)



Adjusted operating profit

$738,738

(b)

27.6


$547,899


25.5










Note:








(b)   Adjusted operating profit increased 35% as compared to the same period in 2020.


 

 


CONDENSED CONSOLIDATED BALANCE SHEETS


(amounts in thousands)


(unaudited)

























September 30, 2021



December 31, 2020












Cash and cash equivalents



$183,672





$94,254


Accounts receivable, net



603,364





593,809


Inventories



381,457





297,611


Other current assets and prepaid expenses



77,731





71,230


Total current assets



1,246,224





1,056,904













Property, plant and equipment, net



783,813





798,868


Goodwill and other intangibles assets, net



927,777





747,055


Other non-current assets



249,347





211,722


Total assets



$3,207,161





$2,814,549













Short-term borrowings and maturities of long-term debt



$53,524





$50,317


Trade accounts payable



219,294





175,801


Accrued and other current liabilities



728,743





614,209


Total current liabilities



1,001,561





840,327













Long-term debt



1,639,583





1,284,174


Other non-current liabilities



406,846





407,373


Total liabilities



3,047,990





2,531,874













Shareholders' equity



159,171





282,675


Total liabilities and shareholders' equity



$3,207,161





$2,814,549


 

 

METTLER-TOLEDO INTERNATIONAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 (amounts in thousands)

 (unaudited)












Three months ended


Nine months ended



September 30,


September 30,



2021


2020


2021


2020










Cash flow from operating activities:








    Net earnings

$203,688


$161,767


$538,114


$386,444

    Adjustments to reconcile net earnings to








      net cash provided by operating activities:








Depreciation

11,179


10,622


33,440


30,949

Amortization

16,039


14,121


46,141


42,008

Deferred tax expense (benefit)

1,351


(2,420)


(6,072)


(6,990)

Other

4,737


4,430


13,893


13,248

Increase in cash resulting from changes in








  operating assets and liabilities

26,313


36,559


42,203


8,171

                Net cash provided by operating activities

263,307


225,079


667,719


473,830










Cash flows from investing activities:








    Proceeds from sale of property, plant and equipment

151


1,021


3,399


3,046

    Purchase of property, plant and equipment

(22,433)


(20,339)


(69,796)


(57,428)

    Acquisitions

(7,853)


-


(193,387)


(6,242)

    Net hedging settlements on intercompany loans

4,955


(140)


8,559


(9,421)

                Net cash used in investing activities

(25,180)


(19,458)


(251,225)


(70,045)










Cash flows from financing activities:








    Proceeds from borrowings

433,325


72,262


1,638,321


1,148,360

    Repayments of borrowings

(383,024)


(63,066)


(1,249,177)


(1,231,191)

    Proceeds from exercise of stock options

7,081


8,444


14,914


26,194

    Repurchases of common stock 

(252,499)


(199,999)


(727,498)


(399,999)

    Other financing activities

(576)


-


(2,864)


(800)

                Net cash used in financing activities

(195,693)


(182,359)


(326,304)


(457,436)










Effect of exchange rate changes on cash and cash equivalents

(1,014)


3,147


(772)


(448)










Net increase (decrease) in cash and cash equivalents

41,420


26,409


89,418


(54,099)










Cash and cash equivalents:








    Beginning of period

142,252


127,277


94,254


207,785

    End of period

$183,672


$153,686


$183,672


$153,686



















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










Net cash provided by operating activities

$263,307


$225,079


$667,719


$473,830

    Payments in respect of restructuring activities

1,874


1,634


7,422


6,261

    Payments for acquisition costs

153


-


2,244


-

    Transition tax payment

-


4,264


4,288


4,264

    Proceeds from sale of property, plant and equipment

151


1,021


3,399


3,046

    Purchase of property, plant and equipment

(22,433)


(20,339)


(69,796)


(57,428)

Adjusted free cash flow

$243,052


$211,659


$615,276


$429,973

 

 

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 September 30, 2021



12%


20%


21%


18%




Nine Months Ended September 30, 2021



22%


22%


31%


25%
















Local Currency Sales Growth













Three Months Ended September 30, 2021



10%


20%


16%


16%




Nine Months Ended September 30, 2021



15%


21%


23%


20%





























RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS 


(unaudited)

















Three months ended


Nine months ended



September 30,


September 30,



2021


2020


% Growth


2021


2020


% Growth














EPS as reported, diluted

$8.71


$6.68


30%


$22.86


$15.92


44%














Purchased intangible amortization, net of tax

0.18

(a)

0.12

(a)



0.49

(a)

0.35

(a)


Restructuring charges, net of tax

0.02

(b)

0.15

(b)



0.09

(b)

0.24

(b)


Income tax expense

(0.19)

(c)

0.07

(c)



(0.17)

(c)

(0.21)

(c)


Acquisition costs, net of tax

-


-




0.10

(d)

-
















Adjusted EPS, diluted

$8.72


$7.02


24%


$23.37


$16.30


43%














Notes:












(a)

Represents the EPS impact of purchased intangibles amortization of $5.5 million ($4.1 million net of tax) and $3.8 million ($2.8 million net of tax) for the three months ended September 30, 2021 and 2020, and of $15.2 million ($11.5 million net of tax) and $11.2 million ($8.5 million net of tax) for the nine months ended September 30, 2021 and 2020, respectively.

(b)

Represents the EPS impact of restructuring charges of $0.7 million ($0.5 million after tax) and $4.6 million ($3.6 million after tax) for the three months ended September 30, 2021 and 2020, and $2.7 million ($2.2 million after tax) and $7.3 million ($5.8 million after tax) for the nine months ended September 30, 2021 and 2020, respectively, which primarily include employee related costs.

(c)

Represents the EPS impact of the difference between our quarterly and estimated annual tax rate before non-recurring discrete items during the three and nine months ended September 30, 2021 and 2020 due to the timing of excess tax benefits associated with stock option exercises.

(d)

Represents the EPS impact of acquisition costs of $2.8 million ($2.3 million after tax) for the nine months ended September 30, 2021.

 

 

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SOURCE Mettler-Toledo International Inc.

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