EX-99.1 2 ex-991mtd8xk2012q2.htm EX-99.1 MTD 8-K 2012 Q2
FOR IMMEDIATE RELEASE
 
Exhibit 99.1


METTLER-TOLEDO INTERNATIONAL INC. REPORTS
SECOND QUARTER 2012 RESULTS

- - Solid Local Currency Sales and EPS Growth - -
  
COLUMBUS, Ohio, USA - July 26, 2012 - Mettler-Toledo International Inc. (NYSE: MTD) today announced second quarter results for 2012. Provided below are the highlights:

•
Sales in local currency increased by 6% in the quarter compared with the prior year. Reported sales increased 2%, which included a 4% negative currency impact.

•
Net earnings per diluted share as reported (EPS) were $1.93, compared with $1.82 in the second quarter of 2011. Adjusted EPS was $2.15, an increase of 13% over the prior-year amount of $1.90. 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.

Second Quarter Results

Olivier Filliol, President and Chief Executive Officer, stated, “We achieved solid sales growth in the quarter despite slowing market demand and strong sales comparisons in the prior year period. Our sales growth, combined with a focus on cost control, enabled us to generate good earnings growth in the quarter.”

EPS was $1.93, compared with the prior-year amount of $1.82. Adjusted EPS was $2.15, an increase of 13% over the prior-year amount of $1.90.

Sales were $570.3 million, a 6% increase in local currency sales, compared with $561.1 million in the prior-year quarter. Reported sales growth was 2%, which included a 4% negative currency impact. By region, local currency sales increased 6% in the Americas and 14% in Asia / Rest of World and decreased 2% in Europe. Adjusted operating income amounted to $101.1 million, a 7% increase from the prior-year amount of $94.5 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 $91.3 million, compared with $87.0 million in the prior-year quarter.

Six Month Results

EPS was $3.54, compared with the prior-year amount of $3.23. Adjusted EPS was $3.80, an increase of 14% over the prior-year amount of $3.34.

Sales were $1.106 billion, a 7% increase in local currency sales, compared with $1.060 billion in the prior-year period. Reported sales growth was 4%, which included a 3% negative currency impact. For the six month period, local currency sales increased 0% in Europe, 6% in the Americas and 16% in Asia / Rest of World. Adjusted operating income amounted to $181.9 million, an 8% increase from the prior-year amount of $168.3 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 $112.0 million, compared with $93.6 million in the prior-year period.




- more -

Cost Control Measures

The Company has initiated a series of cost control measures in response to current economic conditions. The Company will record pre-tax restructuring charges, consisting principally of severance-related costs, of approximately $20 million to $25 million, of which $7.8 million was recorded in the second quarter. The remaining amount will be recognized over the next two years. These cost control measures should reduce operating costs by approximately $40 million annually.

Outlook

The Company stated that there is greater uncertainty in its markets, which makes forecasting difficult. Based on today's assessment, management anticipates that local currency sales growth in 2012 will be in the range of 3% to 5% and Adjusted EPS in the range of $9.00 to $9.40, an increase of 8% to 12%. The Company previously provided guidance for Adjusted EPS of $9.20 to $9.50.

The Company stated that, based on its assessment of market conditions today, management anticipates local currency sales growth in the third quarter 2012 will be in the range of 0% to 4% while Adjusted EPS will be in the range of $2.15 to $2.35, an increase of 7% to 17%.

Adjusted EPS excludes purchased intangible amortization, discrete tax items, restructuring charges and other one-time items. While the Company has provided an outlook for Adjusted EPS, it has not provided an outlook for EPS as it would require an estimate of non-recurring items, which are not yet known.

Conclusion

Filliol concluded, “Market conditions have become more challenging in the last few months. In addition, we will continue to face strong sales growth comparisons from the prior year. We have initiated cost control measures in light of current economic conditions but continue to invest for future growth. We remain confident in our strategic initiatives and our ability to execute and believe we can outgrow the market and continue to gain share.”

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 is a leading global supplier of precision instruments and services. The Company has strong leadership positions in all businesses and believes it holds global number-one market positions in a majority of them. Specifically, METTLER TOLEDO is the largest provider of weighing instruments for use in laboratory, industrial and food retailing applications. The Company is also a leading provider in analytical instruments for use in life science, reaction engineering and real-time analytic systems used in drug and chemical compound development and process analytics instruments used for in-line measurement in production processes. In addition, METTLER TOLEDO is the largest supplier of end-of-line inspection systems used in production and packaging for food, pharmaceutical and other industries. Additional information about METTLER TOLEDO can be found at www.mt.com/investors.

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.

- more -

METTLER-TOLEDO INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except share data)
(unaudited)
 
 
 
Three months ended
 
 
 
Three months ended
 
 
 
 
 
June 30, 2012
 
% of sales
 
June 30, 2011
 
% of sales
 
 
 
 
 
 
 
 
 
 
Net sales
$
570,283

(a)
100.0
 
$
561,088

(a)
100.0
Cost of sales
271,275

 
47.6
 
264,897

 
47.2
Gross profit
299,008

 
52.4
 
296,191

 
52.8
 
 
 
 
 
 
 
 
 
 
Research and development
27,966

 
4.9
 
29,605

 
5.3
Selling, general and administrative
169,985

 
29.8
 
172,054

 
30.7
Amortization
5,357

 
0.9
 
4,325

 
0.8
Interest expense
5,706

 
1.0
 
5,692

 
1.0
Restructuring charges
7,835

 
1.4
 
1,971

 
0.3
Other charges (income), net
433

 
0.1
 
1,207

 
0.2
Earnings before taxes
81,726

 
14.3
 
81,337

 
14.5
 
 
 
 
 
 
 
 
 
 
Provision for taxes
20,022

 
3.5
 
21,149

 
3.8
Net earnings
$
61,704

 
10.8
 
$
60,188

 
10.7
 
 
 
 
 
 
 
 
 
 
Basic earnings per common share:

 
 
 
 
 
 
Net earnings
$
1.97

 
 
 
$
1.88

 
 
Weighted average number of common shares
31,267,660

 
 
 
31,997,850

 
 
 
 
 
 
 
 
 
 
 
 
Diluted earnings per common share:
 
 
 
 
 
 
 
Net earnings
$
1.93

 
 
 
$
1.82

 
 
Weighted average number of common
 
 
 
 
 
 
 
  and common equivalent shares
32,038,928

 
 
 
33,013,887

 
 
 
 
 
 
 
 
 
 
 
 
Note:
 
 
 
 
 
 
 
 
(a)
Local currency sales increased 6% as compared to the same period in 2011.
 
 
 
 
 
 
 
 
 
 
 
 
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended
 
 
 
Three months ended
 
 
 
 
 
June 30, 2012
 
% of sales
 
June 30, 2011
 
% of sales
 
 
 
 
 
 
 
 
 
 
Earnings before taxes
$
81,726

 
 
 
$
81,337

 
 
Amortization
5,357

 
 
 
4,325

 
 
Interest expense
5,706

 
 
 
5,692

 
 
Restructuring charges
7,835

 
 
 
1,971

 
 
Other charges (income), net
433

 
 
 
1,207

 
 
Adjusted operating income
$
101,057

(b)
17.7
 
$
94,532

(b)
16.8
 
 
 
 
 
 
 
 
 
 
Note:
 
 
 
 
 
 
 
 
(b)
Adjusted operating income increased 7% as compared to the same period in 2011.


- more -


METTLER-TOLEDO INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except share data)
(unaudited)
 
 
 
Six months ended
 
 
 
Six months ended
 
 
 
 
 
June 30, 2012
 
% of sales
 
June 30, 2011
 
% of sales
 
 
 
 
 
 
 
 
 
 
Net sales
$
1,105,683

(a)
100.0
 
$
1,059,854

(a)
100.0
Cost of sales
529,573

 
47.9
 
502,156

 
47.4
Gross profit
576,110

 
52.1
 
557,698

 
52.6
 
 
 
 
 
 
 
 
 
 
Research and development
56,633

 
5.1
 
55,956

 
5.3
Selling, general and administrative
337,626

 
30.5
 
333,432

 
31.5
Amortization
10,556

 
1.0
 
7,947

 
0.7
Interest expense
11,529

 
1.0
 
11,403

 
1.1
Restructuring charges
8,143

 
0.7
 
2,469

 
0.2
Other charges (income), net
589

 
0.1
 
1,876

 
0.2
Earnings before taxes
151,034

 
13.7
 
144,615

 
13.6
 
 
 
 
 
 
 
 
 
 
Provision for taxes
37,003

 
3.4
 
37,600

 
3.5
Net earnings
$
114,031

 
10.3
 
$
107,015

 
10.1
 
 
 
 
 
 
 
 
 
 
Basic earnings per common share:
 
 
 
 
 
 
 
Net earnings
$
3.63

 
 
 
$
3.33

 
 
Weighted average number of common shares
31,399,788

 
 
 
32,144,223

 
 
 
 
 
 
 
 
 
 
 
 
Diluted earnings per common share:
 
 
 
 
 
 
 
Net earnings
$
3.54

 
 
 
$
3.23

 
 
Weighted average number of common
 
 
 
 
 
 
 
  and common equivalent shares
32,212,927

 
 
 
33,152,760

 
 
 
 
 
 
 
 
 
 
 
 
Note:
 
 
 
 
 
 
 
 
(a)
Local currency sales increased 7% as compared to the same period in 2011.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
 
 
 
 
 
 
 
 
 
 
 
 
 
Six months ended
 
 
 
Six months ended
 
 
 
 
 
June 30, 2012
 
% of sales
 
June 30, 2011
 
% of sales
 
 
 
 
 
 
 
 
 
 
Earnings before taxes
$
151,034

 
 
 
$
144,615

 
 
Amortization
10,556

 
 
 
7,947

 
 
Interest expense
11,529

 
 
 
11,403

 
 
Restructuring charges
8,143

 
 
 
2,469

 
 
Other charges (income), net
589

 
 
 
1,876

 
 
Adjusted operating income
$
181,851

(b)
16.4
 
$
168,310

(b)
15.9
 
 
 
 
 
 
 
 
 
 
Note:
 
 
 
 
 
 
 
 
(b)
Adjusted operating income increased 8% as compared to the same period in 2011.

- more -

METTLER-TOLEDO INTERNATIONAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
(unaudited)
 
 
 
 
 
June 30, 2012
 
December 31, 2011
 
 
 
 
Cash and cash equivalents
$
134,766

 
$
235,601

Accounts receivable, net
397,238

 
425,147

Inventories
217,231

 
241,421

Other current assets and prepaid expenses
111,741

 
116,694

Total current assets
860,976

 
1,018,863

 
 
 
 
Property, plant and equipment, net
427,666

 
410,007

Goodwill and other intangible assets, net
564,719

 
569,153

Other non-current assets
202,265

 
205,451

Total assets
$
2,055,626

 
$
2,203,474

 
 
 
 
Short-term borrowings and maturities of long-term debt
$
27,075

 
$
28,300

Trade accounts payable
129,988

 
168,109

Accrued and other current liabilities
365,939

 
413,435

Total current liabilities
523,002

 
609,844

 
 
 
 
Long-term debt
431,730

 
476,715

Other non-current liabilities
325,920

 
335,778

Total liabilities
1,280,652

 
1,422,337

 
 
 
 
Shareholders’ equity
774,974

 
781,137

Total liabilities and shareholders’ equity
$
2,055,626

 
$
2,203,474



- more -

METTLER-TOLEDO INTERNATIONAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
(unaudited)
 
Three months ended
 
Six months ended
 
June 30,
 
June 30,
 
2012
 
2011
 
2012
 
2011
 
 
 
 
 
 
 
 
Cash flow from operating activities:
 
 
 
 
 
 
 
Net earnings
$
61,704

 
$
60,188

 
$
114,031

 
$
107,015

 Adjustments to reconcile net earnings to
 
 
 
 
 
 
 
net cash provided by operating activities:
 
 
 
 
 
 
 
Depreciation
8,331

 
7,471

 
16,106

 
14,854

Amortization
5,357

 
4,325

 
10,556

 
7,947

Deferred tax benefit
(2,697
)
 
(1,465
)
 
(4,758
)
 
(8,058
)
Excess tax benefits from share-based payment arrangements
(64
)
 
(2,584
)
 
(340
)
 
(4,931
)
Other
3,027

 
2,047

 
7,212

 
5,207

Increase (decrease) in cash resulting from changes in
 
 
 
 
 
 
 
operating assets and liabilities
15,594

 
17,047

 
(30,758
)
 
(28,481
)
Net cash provided by operating activities
91,252

 
87,029

 
112,049

 
93,553

 
 
 
 
 
 
 
 
Cash flows from investing activities:
 
 
 
 
 
 
 
Proceeds from sale of property, plant and equipment
66

 
2,254

 
153

 
2,302

Purchase of property, plant and equipment
(24,704
)
 
(22,958
)
 
(43,233
)
 
(40,517
)
Acquisitions
(1,541
)
 
(931
)
 
(1,541
)
 
(15,463
)
Other investing activities
—

 
20

 
—

 
(882
)
Net cash used in investing activities
(26,179
)
 
(21,615
)
 
(44,621
)
 
(54,560
)
 
 
 
 
 
 
 
 
Cash flows from financing activities:
 
 
 
 
 
 
 
Proceeds from borrowings
83,332

 
17,659

 
99,813

 
46,443

Repayments of borrowings
(96,132
)
 
(92,712
)
 
(145,612
)
 
(104,200
)
Proceeds from exercise of stock options
426

 
3,520

 
13,264

 
6,583

Excess tax benefits from share-based payment arrangements
64

 
2,584

 
340

 
4,931

Repurchases of common stock
(72,045
)
 
(57,000
)
 
(135,766
)
 
(114,179
)
Other financing activities
(379
)
 
154

 
(543
)
 
67

Net cash used in financing activities
(84,734
)
 
(125,795
)
 
(168,504
)
 
(160,355
)
 
 
 
 
 
 
 
 
Effect of exchange rate changes on cash and cash equivalents
(1,765
)
 
1,042

 
241

 
2,548

 
 
 
 
 
 
 
 
Net decrease in cash and cash equivalents
(21,426
)
 
(59,339
)
 
(100,835
)
 
(118,814
)
 
 
 
 
 
 
 
 
Cash and cash equivalents:
 
 
 
 
 
 
 
    Beginning of period
156,192

 
388,102

 
235,601

 
447,577

    End of period
$
134,766

 
$
328,763

 
$
134,766

 
$
328,763

 
 
 
 
 
 
 
 
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW
 
 
 
 
 
 
 
 
Net cash provided by operating activities
$
91,252

 
$
87,029

 
$
112,049

 
$
93,553

Excess tax benefits from share-based payment arrangements
64

 
2,584

 
340

 
4,931

Payments in respect of restructuring activities
2,583

 
1,425

 
4,165

 
2,838

Proceeds from sale of property, plant and equipment
66

 
2,254

 
153

 
2,302

Purchase of property, plant and equipment
(24,704
)
 
(22,958
)
 
(43,233
)
 
(40,517
)
Free cash flow
$
69,261

 
$
70,334

 
$
73,474

 
$
63,107


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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, 2012
 
(11
)%
 
5
%
 
14
%
 
2
%
 
 
 
Six Months Ended June 30, 2012
 
(6
)%
 
6
%
 
17
%
 
4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Local Currency Sales Growth
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended June 30, 2012
 
(2
)%
 
6
%
 
14
%
 
6
%
 
 
 
Six Months Ended June 30, 2012
 
—
 %
 
6
%
 
16
%
 
7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS
(unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended
 
Six months ended
 
 
June 30,
 
June 30,
 
 
2012
 
2011
 
% Growth
 
2012
 
2011
 
% Growth
 
 
 
 
 
 
 
 
 
 
 
 
 
EPS as reported, diluted
$
1.93

 
$
1.82

 
6
%
 
$
3.54

 
$
3.23

 
10%
 
 
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges, net of tax
0.18

(a)
0.05

(a)
 
 
0.19

(a)
0.05

(a)
 
Purchased intangible amortization, net of tax
0.04

(b)
0.03

(b)
 
 
0.07

(b)
0.06

(b)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted EPS, diluted
$
2.15

 
$
1.90

 
13
%
 
$
3.80

 
$
3.34

 
14%
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes:
 
 
 
 
 
 
 
 
 
 
 
(a)
Represents the EPS impact of restructuring charges of $7.8 million ($5.9 million after tax) and $2.0 million ($1.5 million after tax) for the three months ended June 30, 2012 and 2011, respectively and $8.1 million ($6.1 million after tax) and $2.5 million ($1.8 million after tax) for the six months ended June 30, 2012 and 2011, respectively, which primarily includes severance costs.
(b)
Represents the EPS impact of purchased intangibles amortization, net of tax, of $1.1 million and $1.0 million for the three months ended June 30, 2012 and 2011, respectively and $2.3 million and $1.9 million for the six months ended June 30, 2012 and 2011, respectively.

###