EX-99.1 2 tp8kex99_1.txt EXHIBIT 99.1 METTLER-TOLEDO INTERNATIONAL INC. REPORTS SECOND QUARTER 2005 RESULTS - - IMPROVED LOCAL CURRENCY SALES GROWTH OF 5% - - - - STRONG EPS GROWTH EXCLUDING ONE-TIME CHARGE - - GREIFENSEE, Switzerland and COLUMBUS, Ohio, USA - July 28, 2005 - Mettler-Toledo International Inc. (NYSE: MTD) today announced net earnings of $18.3 million, or $0.42 per share on a diluted basis, for the quarter ended June 30, 2005. As more fully described below, net earnings in the quarter included a $0.30 per share charge for a non-cash intangible asset write-off and legal costs in conjunction with previously disclosed pipette litigation. In the second quarter of 2004, net earnings per share were $0.62 and included $0.02 per share in investigation-related costs. Excluding one-time items in both periods, net earnings per share would have increased 13% over the prior period. Sales for the quarter were $368.6 million, compared with $344.5 million in the prior year. This represents a 7% increase in reported sales, consisting of a 5% increase in local currency sales and a 2% increase due to currency. Adjusted operating income for the quarter amounted to $51.4 million, compared with the prior year quarter of $46.7 million which included $1.2 million of investigation-related costs. Cash flow from operations in the quarter was $50.6 million, compared with $45.5 million last year. Sales for the six-month period were $705.8 million, compared with $663.2 million in the prior year. This represents a 6% increase in reported sales, consisting of 4% local currency sales growth and a 2% increase due to currency. For the six-month period, net earnings per share were $0.89 in 2005 and included the above-mentioned $0.30 per share charge. Net earnings per share on a diluted basis in 2004 were $1.03 and included $0.02 per share in investigation costs. Excluding one-time items in the six month periods, net earnings per share would have increased 13% over the prior year period. Adjusted operating income for the six-month period was $87.1 million in 2005, compared with the prior period amount of $79.5 million which included $1.2 million of investigation-related costs. Cash flow from operations for the six-month period was $57.3 million, versus $74.9 million in the prior period. Robert F. Spoerry, Chairman, President and Chief Executive Officer, stated, "We are pleased with our improved local currency sales growth in the quarter, particularly our better performance in Europe. In the Americas, local currency sales growth was solid and in line with our expectations, while growth in Asia / Rest of World was strong in most regions. EPS growth was also strong in the quarter, excluding the one-time items in each period." Spoerry concluded, "We remain cautiously optimistic for the remainder of the year. As expected, we experienced an improved sales trend in Europe and Asia / Rest of World. Our strategic initiatives remain well on track including new product launches and Project Spinnaker, which is aimed at increasing the effectiveness of our global sales, service and marketing organization." The Company stated that they expect local currency sales growth and EPS in 2005 to be at the mid to high end of the previously given ranges of 3% to 5% and $2.65 to $2.75, respectively. The EPS guidance does not include the one-time charge related to the pipette litigation as discussed below. As previously disclosed, the Company is currently evaluating its legal options in a case relating to the exclusive distribution rights of its wholly owned subsidiary, Rainin Instrument Company, to distribute certain third party-manufactured pipettes in the United States. The other party commenced a lawsuit after Rainin, pursuant to its rights under the agreement, notified the party of its intention to manufacture the pipette in the United States to remain cost competitive. The judgment terminated the license agreement and awarded damages to the other party. In light of the pipette litigation, in the second quarter, the Company took a one-time charge of $21.8 million ($13.1 million after-tax) or $0.30 per share. The charge consists of the write-off of $19.9 million ($12 million after-tax) intangible asset relating to the terminated license agreement and litigation-related expenses of $1.9 million ($1.1 million after-tax) which includes $0.6 million in damages. The Company continues to believe that the consequences of the case will not have a material adverse effect on its consolidated financial condition or future results of operations. Rainin expects to minimize any impact to its sales and profitability by increasing the sales of its own higher-margin pipettes, including those Rainin already manufactures and sells outside the United States. For the six months ended June 30, 2005, the Company reported local currency sales growth of 5% in the Americas, 1% in Europe and 9% in Asia / Rest of World. During the second quarter, the Company repurchased 977,900 shares of its common stock. The Company has reconciled adjusted operating income to net earnings, the most comparable U.S. GAAP measure, in the attached schedules. The Company will host a conference call to discuss its second quarter results today (Thursday, July 28) 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 "Factors affecting our future operating results" in Part I, Item 1, of the Company's Annual Report on Form 10-K for the fiscal year December 31, 2004. 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 June 30, 2005 June 30, 2004 (unaudited) % (unaudited) % Net sales $ 368,637 100.0 (a) $ 344,492 100.0 Cost of sales 188,212 51.1 176,573 51.3 ---------- ----- ---------- ----- Gross profit 180,425 48.9 167,919 48.7 Research and development 20,936 5.7 20,164 5.8 Selling, general and administrative 108,115 29.3 101,020 29.3 (c) ---------- ----- ---------- ----- Adjusted operating income 51,374 13.9 46,735 13.6 Amortization 2,991 0.8 2,896 0.8 Interest expense 3,764 1.0 3,272 1.0 Other charges (income), net 21,581 5.9 (b) (32) (0.0) ---------- ----- ---------- ----- Earnings before taxes 23,038 6.2 40,599 11.8 Provision for taxes 4,727 1.2 12,181 3.6 ---------- ----- ---------- ----- Net earnings $ 18,311 5.0 (b) $ 28,418 8.2 (c) ========== ===== ========== ===== Diluted per share amounts: Net earnings $ 0.42 (b) $ 0.62 (c) Weighted average number of common shares 43,438,961 45,750,652 Notes: (a) Local currency sales increased 5% as compared to the same period in 2004. (b) Includes a $21.8 million ($13.1 million after-tax), or $0.30 per share, one-time pipette litigation charge related to a $19.9 million ($12 million after-tax) non-cash write-off of an intellectual property license and $1.9 million ($1.1 million after-tax) of related legal costs. (c) Includes $1.2 million ($0.8 million after-tax), or $0.02 per share, of costs related to an investigation into allegations made by an employee with respect to the Company and various company processes.
METTLER-TOLEDO INTERNATIONAL INC. CONSOLIDATED STATEMENTS OF OPERATIONS (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)
AS REPORTED AS REPORTED ----------- ----------- THREE months ended THREE months ended June 30, 2005 June 30, 2004 (unaudited) (unaudited) Net sales $ 368,637 $ 344,492 Cost of sales 188,212 176,573 ---------- ---------- Gross profit 180,425 167,919 Research and development 20,936 20,164 Selling, general and administrative 108,115 101,020 Amortization 2,991 2,896 Interest expense 3,764 3,272 Other charges (income), net 21,581 (32) ---------- ---------- Earnings before taxes 23,038 40,599 Provision for taxes 4,727 12,181 ---------- ---------- Net earnings $ 18,311 $ 28,418 ========== ========== Basic earnings per common share: Net earnings $ 0.43 $ 0.64 Weighted average number of common shares 42,356,672 44,469,648 Diluted earnings per common share: Net earnings $ 0.42 $ 0.62 Weighted average number of common shares 43,438,961 45,750,652
METTLER-TOLEDO INTERNATIONAL INC. COMPARATIVE FINANCIAL INFORMATION (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)
SIX months ended SIX months ended June 30, 2005 June 30, 2004 (unaudited) % (unaudited) % Net sales $ 705,797 100.0 (a) $ 663,201 100.0 Cost of sales 362,577 51.4 345,006 52.0 ---------- ----- ---------- ----- Gross profit 343,220 48.6 318,195 48.0 Research and development 41,738 5.9 40,819 6.2 Selling, general and administrative 214,432 30.4 197,829 29.8 (c) ---------- ----- ---------- ----- Adjusted operating income 87,050 12.3 79,547 12.0 Amortization 5,799 0.8 5,704 0.9 Interest expense 7,280 1.0 6,738 1.0 Other charges (income), net 21,245 3.0 (b) (96) (0.0) ---------- ----- ---------- ----- Earnings before taxes 52,726 7.5 67,201 10.1 Provision for taxes 13,634 2.0 20,161 3.0 ---------- ----- ---------- ----- Net earnings $ 39,092 5.5 (b) $ 47,040 7.1 (c) ========== ===== ========== ===== Diluted per share amounts: Net earnings $ 0.89 (b) $ 1.03 (c) Weighted average number of common shares 43,913,966 45,793,793 Notes: (a) Local currency sales increased 4% as compared to the same period in 2004. (b) Includes a $21.8 million ($13.1 million after-tax), or $0.30 per share, one-time pipette litigation charge related to a $19.9 million ($12 million after-tax) non-cash write-off of an intellectual property license and $1.9 million ($1.1 million after-tax) of related legal costs. (c) Includes $1.2 million ($0.8 million after-tax), or $0.02 per share, of costs related to an investigation into allegations made by an employee with respect to the Company and various company processes.
METTLER-TOLEDO INTERNATIONAL INC. CONSOLIDATED STATEMENTS OF OPERATIONS (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)
AS REPORTED AS REPORTED ----------- ----------- SIX months ended SIX months ended June 30, 2005 June 30, 2004 (unaudited) (unaudited) Net sales $ 705,797 $ 663,201 Cost of sales 362,577 345,006 ---------- ---------- Gross profit 343,220 318,195 Research and development 41,738 40,819 Selling, general and administrative 214,432 197,829 Amortization 5,799 5,704 Interest expense 7,280 6,738 Other charges (income), net 21,245 (96) ---------- ---------- Earnings before taxes 52,726 67,201 Provision for taxes 13,634 20,161 ---------- ---------- Net earnings $ 39,092 $ 47,040 ========== ========== Basic earnings per common share: Net earnings $ 0.91 $ 1.06 Weighted average number of common shares 42,747,953 44,513,546 Diluted earnings per common share: Net earnings $ 0.89 $ 1.03 Weighted average number of common shares 43,913,966 45,793,793
METTLER-TOLEDO INTERNATIONAL INC. CONDENSED CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS)
June 30, December 31, 2005 2004 (unaudited) Cash and cash equivalents $ 103,864 $ 67,176 Accounts receivable, net 253,760 271,097 Inventories 148,856 156,539 Other current assets and prepaid expenses 54,906 57,545 ----------- ----------- Total current assets 561,386 552,357 Property, plant and equipment, net 218,441 242,709 Goodwill and other intangibles 530,088 560,181 Other non-current assets 125,315 124,825 ----------- ----------- Total assets $ 1,435,230 $ 1,480,072 =========== =========== Short-term debt $ 7,196 $ 6,913 Accounts payable 69,663 85,129 Accrued and other current liabilities 250,238 256,204 ----------- ----------- Total current liabilities 327,097 348,246 Long-term debt 257,473 196,290 Other non-current liabilities 195,227 214,650 ----------- ----------- Total liabilities 779,797 759,186 Shareholders' equity 655,433 720,886 ----------- ----------- Total liabilities and shareholders' equity $ 1,435,230 $ 1,480,072 =========== ===========
METTLER-TOLEDO INTERNATIONAL INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (AMOUNTS IN THOUSANDS) CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS THREE months ended SIX months ended June 30, June 30, 2005 2004 2005 2004 (unaudited) (unaudited) (unaudited) (unaudited) Cash flow from operating activities: Net earnings $ 18,311 $ 28,418 $ 39,092 $ 47,040 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 6,463 6,438 13,116 12,911 Amortization 2,991 2,896 5,799 5,704 Other 10,184 (52) 7,578 281 Increase (decrease) in cash resulting from changes in operating assets and liabilities 12,643 7,800 (8,305) 8,987 ---------- ---------- ---------- ---------- Net cash provided by operating activities 50,592 45,500 57,280 74,923 ---------- ---------- ---------- ---------- Cash flows from investing activities: Proceeds from sale of property, plant and equipment 176 1,013 594 1,376 Purchase of property, plant and equipment (6,578) (4,798) (11,923) (10,667) Acquisitions - (991) (213) (991) ---------- ---------- ---------- ---------- Net cash used in investing activities (6,402) (4,776) (11,542) (10,282) ---------- ---------- ---------- ---------- Cash flows from financing activities: Proceeds from borrowings 52,364 4,758 86,619 36,738 Repayments of borrowings (15,005) (45,006) (23,436) (86,500) Proceeds from exercise of stock options 1,951 5,148 3,925 6,906 Repurchases of common stock (46,297) (2,981) (74,650) (19,572) ---------- ---------- ---------- ---------- Net cash used in financing activities (6,987) (38,081) (7,542) (62,428) ---------- ---------- ---------- ---------- Effect of exchange rate changes on cash and cash equivalents (1,119) 202 (1,508) 284 Net increase in cash and cash equivalents 36,084 2,845 36,688 2,497 Cash and cash equivalents: Beginning of period 67,780 44,768 67,176 45,116 ---------- ---------- ---------- ---------- End of period $ 103,864 $ 47,613 $ 103,864 $ 47,613 ========== ========== ========== ==========
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW Net cash provided by operating activities $ 50,592 $ 45,500 $ 57,280 $ 74,923 Payments in respect of restructuring activities 1,096 699 1,521 2,735 Proceeds from sale of property, plant and equipment 176 1,013 594 1,376 Purchase of property, plant and equipment (6,578) (4,798) (11,923) (10,667) ---------- ---------- ---------- ---------- Free cash flow $ 45,286 $ 42,414 $ 47,472 $ 68,367 ========== ========== ========== ==========
METTLER-TOLEDO INTERNATIONAL INC. OTHER OPERATING STATISTICS LOCAL CURRENCY SALES GROWTH BY DESTINATION
Europe Americas Asia/RoW Total ------------------------------------------------------------------- Three Months Ended June 30, 2005 3% 3% 13% 5% Six Months Ended June 30, 2005 1% 5% 9% 4%
RECONCILIATION OF EPS AS REPORTED TO EPS EXCLUDING ONE TIME ITEMS
Three months ended Six months ended June 30, June 30, 2005 2004 2005 2004 (unaudited) (unaudited) (unaudited) (unaudited) EPS as reported, diluted $ 0.42 $ 0.62 $ 0.89 $ 1.03 Non-cash intangible write-off and litigation (a) 0.30 0.30 Investigation related costs (b) 0.02 0.02 -------- -------- -------- -------- EPS excluding one-time items, diluted $ 0.72 $ 0.64 $ 1.19 $ 1.05 ======== ======== ======== ======== Notes: (a) EPS impact of one-time pipette litigation charge related to a $19.9 million ($12 million after-tax) non-cash write-off of an intellectual property license and $1.9 million ($1.1 million after-tax) of related legal costs. (b) EPS impact of costs related to an investigation into allegations made by an employee with respect to the Company and various company processes.