EX-99.1 2 c07877exv99w1.htm EXHIBIT 99.1 Exhibit 99.1
Exhibit 99.1
FOR IMMEDIATE RELEASE
METTLER-TOLEDO INTERNATIONAL INC. REPORTS
THIRD QUARTER 2010 RESULTS
— Another Quarter of Excellent Local Currency Sales Growth —
— Strong Growth in Operating Profit and EPS —
COLUMBUS, Ohio, USA — November 4, 2010 — Mettler-Toledo International Inc. (NYSE: MTD) today announced third quarter results for 2010. Provided below are the highlights:
  •   Sales in local currency increased by 14% in the quarter compared with the prior year. Reported sales growth increased 13%, which includes a negative 1% currency impact.
 
  •   Net earnings per diluted share as reported (EPS) were $1.82, compared with $1.21 in the third quarter of 2009. Adjusted EPS was $1.71, a 26% increase over the prior-year amount of $1.36. Adjusted EPS is a non-GAAP measure and excludes purchased intangible amortization, discrete tax items, restructuring charges and other one-time items. A reconciliation to EPS is provided on the last page of the attached schedules.
Third Quarter Results
Olivier Filliol, President and Chief Executive Officer, stated, “We experienced another quarter of better-than-expected sales growth driven by strong momentum in Asia / Rest of World and the Americas. This momentum reflects a positive market environment combined with strong execution of our business strategies. I am also very pleased with the strong growth in operating profit and EPS growth.”
EPS was $1.82, compared with the prior-year amount of $1.21. Adjusted EPS was $1.71, an increase of 26% over the prior-year amount of $1.36.
Sales were $490.2 million, a 14% increase in local currency sales, compared with $435.7 million in the prior year. Reported sales growth was 13%, which included a negative 1% currency impact. By region, local currency sales increased 7% in Europe, 15% in the Americas and 25% in Asia / Rest of World. Adjusted operating income amounted to $85.8 million, a 17% increase from the prior-year amount of $73.2 million. Adjusted operating income is a non-GAAP measure, and a reconciliation to earnings before taxes is provided in the attached schedules.
Cash flow from operations was $86.0 million, compared with $79.6 million in 2009.
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Nine-Month Results
EPS was $4.41, compared with the prior-year amount of $3.02. Adjusted EPS was $4.39, a 26% increase over the prior-year amount of $3.48.
Sales were $1.375 billion, a 12% increase in local currency sales, compared with $1.217 billion in the prior year. Reported sales growth was 13%, which included a 1% benefit from currency. By region, local currency sales increased 5% in Europe, 14% in the Americas and 23% in Asia / Rest of World. Adjusted operating income amounted to $226.1 million, a 21% increase from the prior-year amount of $187.2 million. Adjusted operating income is a non-GAAP measure, and a reconciliation to earnings before taxes is provided in the attached schedules.
Cash flow from operations was $205.3 million, compared with $188.5 million in 2009.
Increase to Share Repurchase Program
The Company announced that the Board of Directors has authorized a $750 million increase to the share repurchase program. The Company currently has a $1.5 billion stock repurchase program through the end of December 2010 of which $1.24 billion has been utilized. Any amount remaining under the existing program at the end of the year will be incorporated into the new authorization. Filliol commented, “We are confident in our growth prospects now and into the future. Our balance sheet and cash flow generation remain very strong and we continue to believe that the repurchase program is an effective means to return capital to shareholders.” The Company expects the new authorization will be utilized over the next several years. The Company added that the repurchases will be made through open market transactions, and the amount and timing will depend on business and market conditions, stock price, trading restrictions, the level of acquisition activity and other factors.
Outlook
Based on today’s assessment, management anticipates that local currency sales growth in the fourth quarter will be in the range of 5% to 7% and Adjusted EPS in the range of $2.25 to $2.30, an increase of 8% to 10%.
For the full year 2010, local currency sales growth is expected to be in the range of 10% to 11% and Adjusted EPS in the range of $6.62 to $6.67, an increase of 19% to 20%. This compares with previous guidance of Adjusted EPS in the range of $6.35 to $6.45. Adjusted EPS excludes purchased intangible amortization, discrete tax items, restructuring charges and other one-time items.
The Company stated that based on their assessment of market conditions today, management anticipates local currency sales growth in 2011 will be in the range of 4% to 6% while Adjusted EPS will be in the range of $7.35 to $7.55. Using the midpoint of the 2010 Adjusted EPS range, this reflects an increase of 11% to 14%.
While the Company has provided an outlook for Adjusted EPS, it has not provided an outlook for EPS. EPS guidance would require an estimate of non-recurring items, which are not yet known.
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Conclusion
Filliol concluded, “We remain optimistic about the strength of our franchise and our ability to continue to gain market share. In emerging markets, we enjoy strong leadership positions and are executing well on our proven growth strategies. In developed markets, our innovative approaches to sales and marketing, combined with a strong product line-up, have allowed us to capture share. Finally, our cost-effective operating model is benefiting from our low-cost country manufacturing and sourcing. In summary, we are confident in our ability to execute our strategic initiatives but remain cautious given the uncertainty in the global economy.”
Other Matters
The Company will host a conference call to discuss its quarterly 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/investors. The presentation referenced in the conference call will be located on the website prior to the call.
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 supplier 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 at “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 8-K to which this release has been furnished as an exhibit. 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.
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METTLER-TOLEDO INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except share data)
(unaudited)
                                 
    Three months ended             Three months ended        
    September 30, 2010     % of sales     September 30, 2009     % of sales  
 
                                
Net sales
   $ 490,213 (a)     100.0     $ 435,650       100.0  
Cost of sales
     234,158       47.8       210,457       48.3  
 
                        
Gross profit
     256,055       52.2       225,193       51.7  
 
                                
Research and development
     24,992       5.1       22,309       5.1  
Selling, general and administrative
     145,303       29.6       129,686       29.8  
Amortization
     3,667       0.7       3,237       0.7  
Interest expense
     4,792       1.0       6,974       1.6  
Restructuring charges
     566       0.1       6,064       1.4  
Other charges (income), net
     (127 )     0.0       13       0.0  
 
                        
Earnings before taxes
     76,862       15.7       56,910       13.1  
 
                                
Provision for taxes
     14,781       3.0       15,365       3.6  
 
                        
Net earnings
   $ 62,081       12.7     $ 41,545       9.5  
 
                        
 
                                
Basic earnings per common share:
                                
Net earnings
   $ 1.87             $ 1.23          
Weighted average number of common shares
     33,171,017               33,728,931          
 
                                
Diluted earnings per common share:
                                
Net earnings
   $ 1.82             $ 1.21          
Weighted average number of common and common equivalent shares
     34,027,191               34,413,656          
Note:
 
(a)   Local currency sales increased 14% as compared to the same period in 2009.
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
                                 
    Three months ended             Three months ended        
    September 30, 2010     % of sales     September 30, 2009     % of sales  
 
                                
Earnings before taxes
   $ 76,862             $ 56,910          
Amortization
     3,667               3,237          
Interest expense
     4,792               6,974          
Restructuring charges
     566               6,064          
Other charges (income), net
     (127 )             13          
 
                        
Adjusted operating income
   $ 85,760 (b)     17.5     $ 73,198       16.8  
 
                            
Note:
 
(b)   Adjusted operating income increased 17% as compared to the same period in 2009.
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METTLER-TOLEDO INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except share data)
(unaudited)
                                 
    Nine months ended             Nine months ended        
    September 30, 2010     % of sales     September 30, 2009     % of sales  
 
                                
Net sales
   $ 1,375,413 (a)     100.0     $ 1,217,171       100.0  
Cost of sales
     654,807       47.6       597,822       49.1  
 
                        
Gross profit
     720,606       52.4       619,349       50.9  
 
                                
Research and development
     70,562       5.1       65,954       5.4  
Selling, general and administrative
     423,919       30.8       366,209       30.1  
Amortization
     10,613       0.8       8,734       0.7  
Interest expense
     14,757       1.1       18,975       1.6  
Restructuring charges
     2,476       0.2       28,398       2.3  
Other charges (income), net
     857       0.0       1,149       0.1  
 
                        
Earnings before taxes
     197,422       14.4       129,930       10.7  
 
                                
Provision for taxes
     46,126       3.4       26,775       2.2  
 
                        
Net earnings
   $ 151,296       11.0     $ 103,155       8.5  
 
                        
Basic earnings per common share:
                                
Net earnings
   $ 4.52             $ 3.06          
Weighted average number of common shares
     33,488,099               33,683,443          
 
                                
Diluted earnings per common share:
                                
Net earnings
   $ 4.41             $ 3.02          
Weighted average number of common and common equivalent shares
     34,318,582               34,200,834          
Note:
 
(a)   Local currency sales increased 12% as compared to the same period in 2009.
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
                                 
    Nine months ended             Nine months ended        
    September 30, 2010     % of sales     September 30, 2009     % of sales  
 
                                
Earnings before taxes
   $ 197,422             $ 129,930          
Amortization
     10,613               8,734          
Interest expense
     14,757               18,975 (c)        
Restructuring charges
     2,476               28,398          
Other charges (income), net
     857               1,149          
 
                        
Adjusted operating income
   $ 226,125 (b)     16.4     $ 187,186       15.4  
 
                            
Notes:
 
(b)   Adjusted operating income increased 21% as compared to the same period in 2009.
 
(c)   Includes costs to tender $75 million of the Company’s 4.85% $150 million Senior Notes and other financing-related costs totaling $1.8 million during the nine months ended September 30, 2009.
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Exhibit 99.1
METTLER-TOLEDO INTERNATIONAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
(unaudited)
                 
    September 30, 2010     December 31, 2009  
 
                
Cash and cash equivalents
   $ 142,884     $ 85,031  
Accounts receivable, net
     331,954       312,998  
Inventories
     215,316       168,042  
Other current assets and prepaid expenses
     96,575       80,036  
 
            
Total current assets
     786,729       646,107  
 
                
Property, plant and equipment, net
     334,803       316,334  
Goodwill and other intangibles assets, net
     554,683       546,234  
Other non-current assets
     231,412       210,112  
 
            
Total assets
   $ 1,907,627     $ 1,718,787  
 
            
 
                
Short-term borrowings and maturities of long-term debt
   $ 89,350     $ 89,968  
Trade accounts payable
     121,339       103,160  
Accrued and other current liabilities
     395,335       301,547  
 
            
Total current liabilities
     606,024       494,675  
 
                
Long-term debt
     245,866       203,590  
Other non-current liabilities
     300,194       309,384  
 
            
Total liabilities
     1,152,084       1,007,649  
 
                
Shareholders’ equity
     755,543       711,138  
 
            
Total liabilities and shareholders’ equity
   $ 1,907,627     $ 1,718,787  
 
            
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Exhibit 99.1
METTLER-TOLEDO INTERNATIONAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
(unaudited)
                                 
    Three months ended     Nine months ended  
    September 30,     September 30,  
    2010     2009     2010     2009  
 
                                
Cash flow from operating activities:
                                
Net earnings
   $ 62,081     $ 41,545     $ 151,296     $ 103,155  
Adjustments to reconcile net earnings to net cash provided by operating activities:
                                
Depreciation
     7,796       7,573       22,261       21,926  
Amortization
     3,667       3,237       10,613       8,734  
Deferred tax provision
     (2,858 )     (4,976 )     (7,392 )     (15,773 )
Excess tax benefits from share-based payment arrangements
     (692 )     (407 )     (3,410 )     (609 )
Other
     3,059       2,638       9,197       8,485  
Increase in cash resulting from changes in operating assets and liabilities
     12,959       29,971       22,705       62,557  
 
                        
Net cash provided by operating activities
     86,012       79,581       205,270       188,475  
 
                        
 
                                
Cash flows from investing activities:
                                
Proceeds from sale of property, plant and equipment
     55       62       157       1,979  
Purchase of property, plant and equipment
     (18,761 )     (12,626 )     (38,564 )     (36,646 )
Acquisitions
     —       —       (12,557 )     (170 )
 
                        
Net cash used in investing activities
     (18,706 )     (12,564 )     (50,964 )     (34,837 )
 
                        
 
                                
Cash flows from financing activities:
                                
Proceeds from borrowings
     41,554       30,167       93,697       198,072  
Repayments of borrowings
     (5,057 )     (106,615 )     (52,115 )     (323,948 )
Debt issuance costs
     —       (18 )     —       (620 )
Debt extinguishment costs
     —       (15 )     —       (1,316 )
Proceeds from exercise of stock options
     2,860       1,464       12,244       6,073  
Excess tax benefits from share-based payment arrangements
     692       407       3,410       609  
Repurchases of common stock
     (76,000 )     —       (148,794 )     —  
Other financing activities
     (3,403 )     94       (6,941 )     (984 )
 
                        
Net cash used in financing activities
     (39,354 )     (74,516 )     (98,499 )     (122,114 )
 
                        
 
                                
Effect of exchange rate changes on cash and cash equivalents
     3,341       1,721       2,046       4,351  
 
                                
Net increase (decrease) in cash and cash equivalents
     31,293       (5,778 )     57,853       35,875  
 
                                
Cash and cash equivalents:
                                
Beginning of period
     111,591       119,726       85,031       78,073  
 
                        
End of period
   $ 142,884     $ 113,948     $ 142,884     $ 113,948  
 
                        
 
                                
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW
 
                                
Net cash provided by operating activities
   $ 86,012     $ 79,581     $ 205,270     $ 188,475  
Excess tax benefits from share-based payment arrangements
     692       407       3,410       609  
Payments in respect of restructuring activities
     2,257       4,226       8,883       18,538  
Proceeds from sale of property, plant and equipment
     55       62       157       1,979  
Purchase of property, plant and equipment
     (18,761 )     (12,626 )     (38,564 )     (36,646 )
 
                        
Free cash flow
   $ 70,255     $ 71,650     $ 179,156     $ 172,955  
 
                        
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Exhibit 99.1
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, 2010
     0 %     15 %     28 %     13 %
Nine Months Ended September 30, 2010
     3 %     15 %     27 %     13 %
 
                                
Local Currency Sales Growth
                                
Three Months Ended September 30, 2010
     7 %     15 %     25 %     14 %
Nine Months Ended September 30, 2010
     5 %     14 %     23 %     12 %
RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS
(unaudited)
                                                 
    Three months ended     Nine months ended  
    September 30,     September 30,  
                    %                     %  
    2010     2009     Growth     2010     2009     Growth  
 
                                                
EPS as reported, diluted
   $ 1.82     $ 1.21       50 %   $ 4.41     $ 3.02       46 %
 
                                                
Restructuring charges, net of tax
     0.01   (a)     0.13 (a)             0.05   (a)     0.61   (a)        
Debt extinguishment and financing costs, net of tax
     —       —               —       0.04   (d)        
Purchased intangible amortization, net of tax
     0.03   (b)     0.02 (b)             0.08   (b)     0.06   (b)        
Discrete tax items
     (0.15 ) (c)     —               (0.15 ) (c)     (0.25 ) (e)        
 
                                        
 
                                                
Adjusted EPS, diluted
   $ 1.71     $ 1.36       26 %   $ 4.39     $ 3.48       26 %
 
                                        
Notes:
(a)   Represents the EPS impact of restructuring charges of $0.6 million ($0.4 million after tax) and $6.1 million ($4.4 million after tax) for the three months ended September 30, 2010 and 2009, respectively and $2.5 million ($1.8 million after tax) and $28.4 million ($20.7 million after tax) for the nine months ended September 30, 2010 and 2009, respectively, which primarily include severance and lease termination costs.
 
(b)   Represents the EPS impact of purchased intangible amortization, net of tax, of $0.9 million and $0.7 million for the three months ended September 30, 2010 and 2009, respectively and $2.7 million and $2.0 million for the nine months ended September 30, 2010 and 2009, respectively.
 
(c)   Discrete tax items for the three and nine months ended September 30, 2010 pertain to the EPS impact of a net tax benefit of $5.2 million primarily related to the favorable resolution of certain prior year tax matters.
 
(d)   Represents the EPS impact of costs to tender $75 million of the Company’s 4.85% $150 million Senior Notes and other financing-related costs totaling $1.8 million ($1.3 million after tax) for the nine months ended September 30, 2009.
 
(e)   Discrete tax items for the nine months ended September 30, 2009 pertain to the EPS impact of a net tax benefit of $8.3 million primarily related to the favorable resolution of certain prior year tax matters.
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