EX-99.1 2 tp8kex99_1.txt EXHIBIT 99.1 METTLER-TOLEDO INTERNATIONAL INC. REPORTS THIRD QUARTER 2004 RESULTS - - SOLID EARNINGS AND CASH FLOW GENERATION - - -- ADDITIONAL $200 MILLION STOCK REPURCHASE PROGRAM AUTHORIZED -- GREIFENSEE, Switzerland and COLUMBUS, Ohio, USA - November 4, 2004 - Mettler-Toledo International Inc. (NYSE: MTD) today announced net earnings of $24.6 million, or $0.54 per share on a diluted basis, for the quarter ended September 30, 2004. This compares with net earnings per share of $0.53 for the third quarter of 2003. Costs related to the previously disclosed investigation included in the third quarter 2004 net earnings amounted to $0.04 per share. Sales for the quarter were $342.0 million, compared with $320.8 million in the prior year. This represents a 7% increase in reported sales, consisting of a 3% increase in local currency sales and a 4% increase due to currency. Adjusted operating income amounted to $40.9 million, compared with $39.8 million last year. Included in adjusted operating income in the current quarter are $2.7 million in investigation costs. Operating cash flow in the quarter increased 20% over the prior year to $47.0 million. Sales for the nine-month period were $1.005 billion, compared with $934.0 million in the prior year. This represents an 8% increase in reported sales, consisting of 3% local currency sales growth and a 5% increase due to currency. For the nine-month period, net earnings per share were $1.57 in 2004, compared with $1.38 in 2003. The 2004 amount includes $0.06 per share in investigation costs. The 2003 amount includes a restructuring charge related to the closure of the Company's French manufacturing facility. Net earnings per share for the 2003 period would have been $0.09 higher without this charge. Adjusted operating income for the nine month period was $120.4 million in 2004 and $107.8 million in 2003. Adjusted operating income in 2004 includes investigation-related costs of $3.9 million and in 2003 includes the restructuring charge of $5.4 million. Operating cash flow for the nine-month period was $121.9 million, versus $78.5 million in the prior period, an increase of 55%. Robert F. Spoerry, Chairman, President and Chief Executive Officer, stated, "We are pleased with our operating performance in the quarter. Local currency sales growth was in line with our expectations and gross margins were strong. Most product lines achieved growth, with our business in China particularly robust. We are also pleased to deliver another quarter of solid cash flow generation." The Board of Directors had previously authorized a $100 million stock repurchase program through the end of 2005 of which the Company has spent $60 million to date. The Company expects to utilize the remainder of the current program by year end. The Company announced that the Board of Directors authorized an additional $200 million in share repurchases through December 31, 2006. Spoerry commented, "Our cash flow generation is excellent, and the expanded share repurchase program reflects our continued confidence in the strength of our franchise. We believe this program will enhance shareholder value and given our strong balance sheet and growing cash flow will not constrain our acquisition strategy." The Company added that repurchases will be made through open market transactions, and the timing will depend on the level of acquisition activity, business and market conditions, stock price, trading restrictions and other factors. Spoerry concluded, "The economic outlook for the next year remains uncertain given the potential impact of higher oil prices and the strength of the recovery in Europe. While this uncertainty remains a concern, we are confident that our strategic initiatives remain well on track. These initiatives include improving the effectiveness of our sales, service and marketing organization; introducing exciting new products; and continuing efforts to improve the efficiency of our supply chain. Based on these growth initiatives and an economic environment similar to today's, we are currently targeting 2005 EPS in the range of $2.65 to $2.75, assuming local currency sales growth of 3% to 5% before acquisitions." The Company noted that the EPS guidance does not reflect proposed accounting changes for equity-based compensation. The Company added that it expects 2004 EPS to be at the high end of the current guidance of $2.35 to $2.40 per share, excluding investigation-related costs. The Company estimates that the remaining costs associated with the investigation will be between $1 million and $2 million through the end of 2004. For the nine months ended September 30, 2004, the Company reported local currency sales growth of 3% in the Americas and 16% in Asia and Rest of World and a 1% decline in local currency sales in Europe. The Company will host a conference call to discuss its third quarter results today (Thursday, November 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. METTLER TOLEDO is a leading global supplier of precision instruments and services. The Company is the world's largest manufacturer and marketer of weighing instruments for use in laboratory, industrial and food retailing applications. The Company also holds top-three market positions in several related analytical instruments and is a leading provider of automated chemistry systems used in drug and chemical compound discovery and development. In addition, the Company is the world's largest manufacturer and marketer of metal detection and other end-of-line inspection systems used in production and packaging and holds a leading position in certain process analytics applications. Additional information about METTLER TOLEDO can be found on the World Wide Web at "www.mt.com." Statements in this discussion which are not historical facts may be considered "forward-looking statements" that involve risks and uncertainties. For a discussion of these risks and uncertainties, which could cause actual events or results to differ from those contained in the forward-looking statements, see Exhibit 99.1 to the Company's Annual Report on Form 10-K for the most recently ended fiscal year. The Company assumes no obligation to update this press release. METTLER-TOLEDO INTERNATIONAL INC. COMPARATIVE FINANCIAL INFORMATION (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)
THREE months ended THREE months ended September 30, 2004 September 30, 2003 (unaudited) % (unaudited) % Net sales $ 342,048 100.0 (a) $ 320,814 100.0 Cost of sales 176,293 51.5 168,950 52.7 ---------- ------ ------------ ------ Gross profit 165,755 48.5 151,864 47.3 Research and development 20,190 5.9 19,277 6.0 Selling, general and administrative 104,683 30.6 92,783 28.9 ---------- ------ ------------ ----- Adjusted operating income 40,882 12.0 39,804 12.4 Amortization 2,925 0.9 2,909 0.9 Interest expense 2,909 0.8 3,102 1.0 Other charges (income), net (135) (0.0) (753) (0.3) ---------- ----- ------------ ----- Earnings before taxes 35,183 10.3 34,546 10.8 Provision for taxes 10,555 3.1 10,364 3.3 ---------- ------ ------------ ------ Net earnings $ 24,628 7.2 $ 24,182 7.5 ========== ====== ============ ====== Diluted per share amounts: Net earnings $ 0.54 $ 0.53 Weighted average number of common shares 45,520,086 45,568,383
Notes: (a) Net sales in U.S. dollars increased 7% as compared to the same period in 2003, of which 4% was due to currency exchange rate fluctuations. METTLER-TOLEDO INTERNATIONAL INC. CONSOLIDATED STATEMENTS OF OPERATIONS (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)
AS REPORTED AS REPORTED ----------- ----------- THREE months ended THREE months ended September 30, 2004 September 30, 2003 (unaudited) (unaudited) Net sales $ 342,048 $ 320,814 Cost of sales 176,293 168,950 ---------- ---------- Gross profit 165,755 151,864 Research and development 20,190 19,277 Selling, general and administrative 104,683 92,783 Amortization 2,925 2,909 Interest expense 2,909 3,102 Other charges (income), net (135) (753) ----------- ----------- Earnings before taxes 35,183 34,546 Provision for taxes 10,555 10,364 ---------- ---------- Net earnings $ 24,628 $ 24,182 ========== ========== Basic earnings per common share: Net earnings $ 0.56 $ 0.54 Weighted average number of common shares 44,320,477 44,485,712 Diluted earnings per common share: Net earnings $ 0.54 $ 0.53 Weighted average number of common shares 45,520,086 45,568,383
METTLER-TOLEDO INTERNATIONAL INC. COMPARATIVE FINANCIAL INFORMATION (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)
NINE months ended NINE months ended September 30, 2004 September 30, 2003 (unaudited) % (unaudited) % Net sales $1,005,249 100.0 (a) $ 933,985 100.0 Cost of sales 521,299 51.9 492,052 52.7 ---------- ----- ---------- ----- Gross profit 483,950 48.1 441,933 47.3 Research and development 61,009 6.0 57,085 6.1 Selling, general and administrative 302,512 30.1 271,596 29.1 Restructuring charge - - 5,444 0.6 (b)(c) ---------- ----- ----------- ----- Adjusted operating income 120,429 12.0 107,808 11.5 Amortization 8,629 0.8 8,576 0.9 Interest expense 9,647 1.0 10,678 1.1 Other charges (income), net (231) (0.0) (1,298) (0.1) ---------- ----- ---------- ----- Earnings before taxes 102,384 10.2 89,852 9.6 Provision for taxes 30,716 3.1 26,955 2.9 ---------- ----- ----------- ----- Net earnings $ 71,668 7.1 $ 62,897 6.7 ========== ====== =========== ===== Diluted per share amounts: Net earnings $ 1.57 $ 1.38 (d) Weighted average number of common shares 45,702,557 45,441,437
Notes: (a) Net sales in U.S. dollars increased 8% as compared to the same period in 2003, of which 5% was due to currency exchange rate fluctuations. (b) Relates to the final union settlement on the facility closure in France. As described in Note 15 in the Company's Annual Report on Form 10-K for the year ended December 31, 2003, in accordance with U.S. GAAP, the Company accrued the minimum contractual payment required by French law in the restructuring charge taken in the second quarter of 2002. (c) In the Consolidated Statements of Operations, the restructuring charge is included in Other charges (income), net. (d) Includes the impact of $0.09 from the restructuring charge, net of tax benefit. METTLER-TOLEDO INTERNATIONAL INC. CONSOLIDATED STATEMENTS OF OPERATIONS (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)
AS REPORTED AS REPORTED ----------- ----------- NINE months ended NINE months ended September 30, 2004 September 30, 2003 (unaudited) (unaudited) Net sales $ 1,005,249 $ 933,985 Cost of sales 521,299 492,052 ----------- ----------- Gross profit 483,950 441,933 Research and development 61,009 57,085 Selling, general and administrative 302,512 271,596 Amortization 8,629 8,576 Interest expense 9,647 10,678 Other charges (income), net (231) 4,146 (a) ----------- ----------- Earnings before taxes 102,384 89,852 Provision for taxes 30,716 26,955 (b) ----------- ----------- Net earnings $ 71,668 $ 62,897 =========== =========== Basic earnings per common share: Net earnings $ 1.61 $ 1.42 Weighted average number of common shares 44,449,189 44,437,879 Diluted earnings per common share: Net earnings $ 1.57 $ 1.38 Weighted average number of common shares 45,702,557 45,441,437
(a) Includes a restructuring charge of $5,444 ($3,811 after tax) related to the final union settlement on the facility closure in France. As described in Note 15 in the Company's Annual Report on Form 10-K for the year ended December 31, 2003, in accordance with U.S. GAAP, the Company accrued the minimum contractual payment required by French law in the restructuring charge taken in the second quarter of 2002. (b) Includes a tax benefit of $1,633 in respect of (a) above. METTLER-TOLEDO INTERNATIONAL INC. CONDENSED CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS)
September 30, December 31, 2004 2003 (unaudited) Cash and cash equivalents $ 54,048 $ 45,116 Accounts receivable, net 239,939 249,353 Inventories, net 156,038 151,764 Other current assets and prepaid expenses 59,660 59,304 ------------ ---------- Total current assets 509,685 505,537 Property, plant and equipment, net 224,247 231,512 Goodwill and other intangibles 548,670 548,814 Other non-current assets 100,611 101,413 ------------ ---------- Total assets $ 1,383,213 $1,387,276 ============ ========== Short-term debt $ 9,512 $ 18,277 Accounts payable 60,259 68,243 Accrued and other current liabilities 271,981 241,389 ------------ ---------- Total current liabilities 341,752 327,909 Long-term debt 185,323 223,239 Other non-current liabilities 182,336 182,132 ------------ ---------- Total liabilities 709,411 733,280 Shareholders' equity 673,802 653,996 ------------ ---------- Total liabilities and shareholders' equity $ 1,383,213 $1,387,276 ============ ==========
METTLER-TOLEDO INTERNATIONAL INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (AMOUNTS IN THOUSANDS)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS THREE months ended NINE months ended September 30, September 30, 2004 2003 2004 2003 (unaudited) (unaudited) (unaudited) (unaudited) Cash flow from operating activities: Net earnings $ 24,628 $ 24,182 $ 71,668 $ 62,897 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 6,728 6,163 19,639 18,852 Amortization 2,925 2,909 8,629 8,576 Other (425) (2,791) (144) (2,619) Increase (decrease) in cash resulting from changes in operating assets and liabilities 13,150 8,600 22,137 (9,252) ---------- ---------- ---------- ---------- Net cash provided by operating activities 47,006 39,063 121,929 78,454 ---------- ---------- ---------- ---------- Cash flows from investing activities: Proceeds from sale of property, plant and equipment 339 1,250 1,715 1,854 Purchase of property, plant and equipment (6,850) (7,040) (17,517) (17,642) Acquisitions (1,296) (1,514) (2,287) (3,486) ---------- ---------- ---------- ---------- Net cash used in investing activities (7,807) (7,304) (18,089) (19,274) ---------- ---------- ---------- ---------- Cash flows from financing activities: Proceeds from borrowings 31,607 14,303 68,345 51,604 Repayments of borrowings (28,183) (47,932) (114,683) (110,622) Proceeds from exercise of stock options 3,993 954 10,899 2,130 Repurchases of common stock (40,523) - (60,095) - ---------- ---------- ---------- ---------- Net cash used in financing activities (33,106) (32,675) (95,534) (56,888) ---------- ---------- ---------- ---------- Effect of exchange rate changes on cash and cash equivalents 342 1,161 626 1,676 ---------- ---------- ---------- ---------- Net increase in cash and cash equivalents 6,435 245 8,932 3,968 Cash and cash equivalents: Beginning of period 47,613 35,150 45,116 31,427 ---------- ---------- ---------- ---------- End of period $ 54,048 $ 35,395 $ 54,048 $ 35,395 ========== ========== ========== ========== RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW Net cash provided by operating activities $ 47,006 $ 39,063 $ 121,929 $ 78,454 Payments in respect of restructuring activities 585 4,606 3,320 13,139 Proceeds from sale of property, plant and equipment 339 1,250 1,715 1,854 Purchase of property, plant and equipment (6,850) (7,040) (17,517) (17,642) Other - (1,204) - (3) --------- ---------- ---------- ---------- Free cash flow $ 41,080 $ 36,675 $ 109,447 $ 75,802 ========== ========== ========== ==========
METTLER-TOLEDO INTERNATIONAL INC. OTHER OPERATING STATISTICS SALES GROWTH BY DESTINATION
3 months ended September 30, 2004 -------------------------------------------------------------- Europe Americas Asia/RoW Total U.S. dollar sales growth 7% 3% 14% 7% Impact of currency exchange rate fluctuations -8% 0% -3% -4% --- -- --- --- Local currency sales growth -1% 3% 11% 3% 9 months ended September 30, 2004 -------------------------------------------------------------- Europe Americas Asia/RoW Total U.S. dollar sales growth 8% 3% 20% 8% Impact of currency exchange rate fluctuations -9% 0% -4% -5% --- -- --- --- Local currency sales growth -1% 3% 16% 3%