EX-99.1 2 ex-991mtd8xk2013q4.htm EXHIBIT EX-99.1 MTD 8-K 2013 Q4
FOR IMMEDIATE RELEASE
 
Exhibit 99.1

METTLER-TOLEDO INTERNATIONAL INC. REPORTS
FOURTH QUARTER 2013 RESULTS

- - Solid Earnings Growth - -

COLUMBUS, Ohio, USA - February 5, 2014 - Mettler-Toledo International Inc. (NYSE: MTD) today announced fourth quarter results for 2013. Provided below are the highlights:

Sales in local currency increased by 3% in the quarter compared with the prior year. Reported sales increased 4% which included a 1% benefit due to currency.

Net earnings per diluted share as reported (EPS) were $3.63, compared with $3.35 in the fourth quarter of 2012. Adjusted EPS was $3.82, an increase of 10% over the prior-year amount of $3.47. 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.

Fourth Quarter Results

Olivier Filliol, President and Chief Executive Officer, stated, “Results were solid in Europe and the Americas. As expected, weaker demand in China was offset by better conditions in other regions within Asia / Rest of World. We generated good EPS growth as we continue to benefit from our various margin improvement and cost control initiatives. Finally, we are pleased with the strong cash flow generation in 2013.”

EPS in the fourth quarter was $3.63, compared with the prior-year amount of $3.35. Adjusted EPS was $3.82, an increase of 10% over the prior-year amount of $3.47.

Sales were $684.3 million, a 3% increase in local currency sales, compared with $657.3 million in the prior-year quarter. Reported sales increased 4% and included a 1% benefit due to currency in the quarter. By region, local currency sales increased 2% in the Americas and 8% in Europe and were comparable to the prior-year in Asia / Rest of World. Adjusted operating income amounted to $165.0 million, an 8% increase from the prior-year amount of $153.4 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 $108.5 million, compared with $111.7 million in the prior-year quarter.

Full Year Results

EPS in 2013 was $9.96, compared with the prior-year amount of $9.14. Adjusted EPS was $10.58, an increase of 9% over the prior-year amount of $9.67.

Sales were $2.379 billion, a 1% increase in local currency sales, compared with $2.342 billion in the prior-year period. Reported sales growth was 2%, which included a 1% benefit due to currency. By region, local currency sales increased 3% in both the Americas and Europe and decreased 4% in Asia / Rest of World. Adjusted operating income amounted to $472.9 million, a 6% increase from the prior-year amount of $444.5 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 $345.9 million, compared with $327.7 million in the prior-year period.




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Cost Control Measures

As part of previously-announced cost control measures, the Company recorded pre-tax restructuring charges of $6.1 million in the quarter and $19.8 million for the full year of 2013.

Outlook

The Company updated its outlook for 2014 and noted that continued uncertainty in demand in many markets makes forecasting difficult. Based on today's assessment, management anticipates that local currency sales growth in 2014 will be in the range of 3% to 4% and Adjusted EPS in the range of $11.40 to $11.60, an increase of 8% to 10%. This compares to previous guidance of Adjusted EPS in the range of $11.35 to $11.55.

The Company stated that based on its assessment of market conditions today, management anticipates that local currency sales growth in the first quarter of 2014 will be approximately 3%. This sales growth will result in Adjusted EPS in the range of $1.93 to $1.98, an increase of 5% to 8%.

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 appear to have stabilized in the developed world and we are cautiously optimistic for these regions in 2014. Globally we continue to leverage our spinnaker sales and marketing programs to gain share and are selectively adding field resources to pursue additional growth opportunities. We also continue to make significant investments for long term growth through our investments in product development, Blue Ocean and other areas. We remain confident in our long term prospects.”

Other Matters

The Company will host a conference call to discuss its quarterly results today (Wednesday, February 5) 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 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.


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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
 
 
 
 
 
December 31, 2013
 
% of sales
 
December 31, 2012
 
% of sales
 
 
 
 
 
 
 
 
 
 
Net sales
$
684,253

(a)
100.0
 
$
657,292

 
100.0
Cost of sales
308,896

 
45.1
 
300,504

 
45.7
Gross profit
375,357

 
54.9
 
356,788

 
54.3
 
 
 
 
 
 
 
 
 
 
Research and development
30,597

 
4.5
 
28,001

 
4.3
Selling, general and administrative
179,788

 
26.3
 
175,379

 
26.7
Amortization
6,935

 
1.0
 
5,586

 
0.8
Interest expense
6,211

 
0.9
 
5,667

 
0.9
Restructuring charges
6,100

 
0.9
 
5,426

 
0.8
Other charges (income), net
822

 
0.1
 
767

 
0.1
Earnings before taxes
144,904

 
21.2
 
135,962

 
20.7
 
 
 
 
 
 
 
 
 
 
Provision for taxes
34,742

 
5.1
 
31,329

 
4.8
Net earnings
$
110,162

 
16.1
 
$
104,633

 
15.9
 
 
 
 
 
 
 
 
 
 
Basic earnings per common share:
 
 
 
 
 
 
 
Net earnings
$
3.72

 
 
 
$
3.43

 
 
Weighted average number of common shares
29,596,949

 
 
 
30,532,491

 
 
 
 
 
 
 
 
 
 
 
 
Diluted earnings per common share:
 
 
 
 
 
 
 
Net earnings
$
3.63

 
 
 
$
3.35

 
 
Weighted average number of common
 
 
 
 
 
 
 
  and common equivalent shares
30,366,603

 
 
 
31,271,377

 
 
 
 
 
 
 
 
 
 
 
 
Note:
 
 
 
 
 
 
 
 
(a)
Local currency sales increased 3% as compared to the same period in 2012.
 
 
 
 
 
 
 
 
 
 
 
 
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended
 
 
 
Three months ended
 
 
 
 
 
December 31, 2013
 
% of sales
 
December 31, 2012
 
% of sales
 
 
 
 
 
 
 
 
 
 
Earnings before taxes
$
144,904

 
 
 
$
135,962

 
 
Amortization
6,935

 
 
 
5,586

 
 
Interest expense
6,211

(b)
 
 
5,667

 
 
Restructuring charges
6,100

 
 
 
5,426

 
 
Other charges (income), net
822

 
 
 
767

 
 
Adjusted operating income
$
164,972

(c)
24.1
 
$
153,408

 
23.3
 
 
 
 
 
 
 
 
 
 
Note:
 
 
 
 
 
 
 
 
(b)
Includes a $0.4 million charge associated with the termination of the Company's $880 million Credit Agreement, which was replaced with the Company's new $800 million Credit Agreement during the twelve months ended December 31, 2013.
(c)
Adjusted operating income increased 8% as compared to the same period in 2012.
 
 


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METTLER-TOLEDO INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except share data)
(unaudited)
 
 
 
Twelve months ended
 
 
 
Twelve months ended
 
 
 
 
 
December 31, 2013
 
% of sales
 
December 31, 2012
 
% of sales
 
 
 
 
 
 
 
 
 
 
Net sales
$
2,378,972

(a)
100.0
 
$
2,341,528

 
100.0
Cost of sales
1,096,946

 
46.1
 
1,100,473

 
47.0
Gross profit
1,282,026

 
53.9
 
1,241,055

 
53.0
 
 
 
 
 
 
 
 
 
 
Research and development
116,346

 
4.9
 
112,530

 
4.8
Selling, general and administrative
692,788

 
29.1
 
684,026

 
29.2
Amortization
24,539

 
1.0
 
21,357

 
0.9
Interest expense
22,711

 
1.0
 
22,764

 
1.0
Restructuring charges
19,830

 
0.8
 
16,687

 
0.7
Other charges (income), net
3,103

 
0.2
 
1,090

 
0.1
Earnings before taxes
402,709

 
16.9
 
382,601

 
16.3
 
 
 
 
 
 
 
 
 
 
Provision for taxes
96,615

 
4.0
 
91,754

 
3.9
Net earnings
$
306,094

 
12.9
 
$
290,847

 
12.4
 
 
 
 
 
 
 
 
 
 
Basic earnings per common share:
 
 
 
 
 
 
 
Net earnings
$
10.22

 
 
 
$
9.37

 
 
Weighted average number of common shares
29,945,954

 
 
 
31,044,532

 
 
 
 
 
 
 
 
 
 
 
 
Diluted earnings per common share:
 
 
 
 
 
 
 
Net earnings
$
9.96

 
 
 
$
9.14

 
 
Weighted average number of common
 
 
 
 
 
 
 
  and common equivalent shares
30,728,482

 
 
 
31,824,077

 
 
 
 
 
 
 
 
 
 
 
 
Note:
 
 
 
 
 
 
 
 
(a)
Local currency sales increased 1% as compared to the same period in 2012.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
 
 
 
 
 
 
 
 
 
 
 
 
 
Twelve months ended
 
 
 
Twelve months ended
 
 
 
 
 
December 31, 2013
 
% of sales
 
December 31, 2012
 
% of sales
 
 
 
 
 
 
 
 
 
 
Earnings before taxes
$
402,709

 
 
 
$
382,601

 
 
Amortization
24,539

 
 
 
21,357

 
 
Interest expense
22,711

(b)
 
 
22,764

 
 
Restructuring charges
19,830

 
 
 
16,687

 
 
Other charges (income), net
3,103

 
 
 
1,090

 
 
Adjusted operating income
$
472,892

(c)
19.9
 
$
444,499

 
19.0
 
 
 
 
 
 
 
 
 
 
Note:
 
 
 
 
 
 
 
 
(b)
Includes a $.04 million charge associated with the termination of the Company's $880 million Credit Agreement, which was replaced with the Company's new $800 million Credit Agreement during the twelve months ended December 31, 2013.
(c)
Adjusted operating income increased 6% as compared to the same period in 2012.
 
 

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METTLER-TOLEDO INTERNATIONAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
(unaudited)
 
 
 
 
 
December 31, 2013
 
December 31, 2012
 
 
 
 
Cash and cash equivalents
$
111,874

 
$
101,702

Accounts receivable, net
466,703

 
437,390

Inventories
210,414

 
198,939

Other current assets and prepaid expenses
124,996

 
126,206

Total current assets
913,987

 
864,237

 
 
 
 
Property, plant and equipment, net
514,438

 
469,421

Goodwill and other intangible assets, net
570,260

 
569,915

Other non-current assets
154,134

 
118,715

Total assets
$
2,152,819

 
$
2,022,288

 
 
 
 
Short-term borrowings and maturities of long-term debt
$
17,067

 
$
41,600

Trade accounts payable
145,993

 
142,362

Accrued and other current liabilities
401,128

 
378,032

Total current liabilities
564,188

 
561,994

 
 
 
 
Long-term debt
395,960

 
347,131

Other non-current liabilities
257,619

 
285,944

Total liabilities
1,217,767

 
1,195,069

 
 
 
 
Shareholders’ equity
935,052

 
827,219

Total liabilities and shareholders’ equity
$
2,152,819

 
$
2,022,288



- more -


METTLER-TOLEDO INTERNATIONAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
(unaudited)
 
Three months ended
 
Twelve months ended
 
December 31,
 
December 31,
 
2013
 
2012
 
2013
 
2012
 
 
 
 
 
 
 
 
Cash flow from operating activities:
 
 
 
 
 
 
 
Net earnings
$
110,162

 
$
104,633

 
$
306,094

 
$
290,847

 Adjustments to reconcile net earnings to
 
 
 
 
 
 
 
net cash provided by operating activities:
 
 
 
 
 
 
 
Depreciation
8,741

 
9,143

 
34,765

 
33,421

Amortization
6,935

 
5,586

 
24,539

 
21,357

Deferred tax benefit
16,623

 
12,309

 
8,816

 
5,420

Excess tax benefits from share-based payment arrangements
(1,282
)
 
(8,863
)
 
(1,847
)
 
(9,365
)
Other
3,742

 
4,034

 
13,137

 
14,640

Increase (decrease) in cash resulting from changes in
 
 
 
 
 
 
 
operating assets and liabilities
(36,408
)
 
(15,116
)
 
(39,576
)
 
(28,616
)
Net cash provided by operating activities
108,513

 
111,726

 
345,928

 
327,704

 
 
 
 
 
 
 
 
Cash flows from investing activities:
 
 
 
 
 
 
 
Proceeds from sale of property, plant and equipment
3

 
82

 
211

 
426

Purchase of property, plant and equipment
(25,349
)
 
(31,296
)
 
(82,349
)
 
(95,588
)
Acquisitions
(2,448
)
 

 
(2,661
)
 
(2,098
)
Net cash used in investing activities
(27,794
)
 
(31,214
)
 
(84,799
)
 
(97,260
)
 
 
 
 
 
 
 
 
Cash flows from financing activities:
 
 
 
 
 
 
 
Proceeds from borrowings
173,954

 
150,632

 
556,059

 
445,425

Repayments of borrowings
(162,033
)
 
(178,165
)
 
(531,045
)
 
(563,109
)
Proceeds from exercise of stock options
3,755

 
5,741

 
19,745

 
21,927

Excess tax benefits from share-based payment arrangements
1,282

 
8,863

 
1,847

 
9,365

Repurchases of common stock
(77,563
)
 
(70,822
)
 
(294,976
)
 
(278,672
)
Debt issuance costs
(1,241
)
 
(363
)
 
(1,522
)
 
(363
)
Acquisition contingent consideration paid

 
(325
)
 

 
(325
)
Other financing activities
345

 
139

 
(1,224
)
 
(645
)
Net cash used in financing activities
(61,501
)
 
(84,300
)
 
(251,116
)
 
(366,397
)
 
 
 
 
 
 
 
 
Effect of exchange rate changes on cash and cash equivalents
434

 
116

 
159

 
2,054

 
 
 
 
 
 
 
 
Net decrease in cash and cash equivalents
19,652

 
(3,672
)
 
10,172

 
(133,899
)
 
 
 
 
 
 
 
 
Cash and cash equivalents:
 
 
 
 
 
 
 
    Beginning of period
92,222

 
105,374

 
101,702

 
235,601

    End of period
$
111,874

 
$
101,702

 
$
111,874

 
$
101,702

 
 
 
 
 
 
 
 
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW
 
 
 
 
 
 
 
 
Net cash provided by operating activities
$
108,513

 
$
111,726

 
$
345,928

 
$
327,704

Excess tax benefits from share-based payment arrangements
1,282

 
8,863

 
1,847

 
9,365

Payments in respect of restructuring activities
4,756

 
4,354

 
18,949

 
12,591

Proceeds from sale of property, plant and equipment
3

 
82

 
211

 
426

Purchase of property, plant and equipment
(25,349
)
 
(31,296
)
 
(82,349
)
 
(95,588
)
Free cash flow
$
89,205

 
$
93,729

 
$
284,586

 
$
254,498


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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 December 31, 2013
 
12
%
 
1
%
 
(2
)%
 
4
%
 
 
 
Twelve Months Ended December 31, 2013
 
6
%
 
3
%
 
(5
)%
 
2
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Local Currency Sales Growth
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31, 2013
 
8
%
 
2
%
 
0
 %
 
3
%
 
 
 
Twelve Months Ended December 31, 2013
 
3
%
 
3
%
 
(4
)%
 
1
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS
(unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended
 
Twelve months ended
 
 
December 31,
 
December 31,
 
 
2013
 
2012
 
% Growth
 
2013
 
2012
 
% Growth
 
 
 
 
 
 
 
 
 
 
 
 
 
EPS as reported, diluted
$
3.63

 
$
3.35

 
8%
 
$
9.96

 
$
9.14

 
9%
 
 
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges, net of tax
0.15

(a)
0.13

(a)
 
 
0.49

(a)
0.39

(a)
 
Purchased intangible amortization, net of tax
0.03

(b)
0.03

(b)
 
 
0.12

(b)
0.14

(b)
 
Debt extinguishment and financing costs, net of tax
0.01

(c)

 
 
 
0.01

(c)

 
 
Benefit in Q4 of adjusting Q3 YTD tax rate

 
(0.04
)
(d)
 
 

 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted EPS, diluted
$
3.82

 
$
3.47

 
10%
 
$
10.58

 
$
9.67

 
9%
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes:
 
 
 
 
 
 
 
 
 
 
 
(a)
Represents the EPS impact of restructuring charges of $6.1 million ($4.6 million after tax) and $5.4 million ($4.0 million after tax) for the three months ended December 31, 2013 and 2012, respectively and $19.8 million ($15.1 million after tax) and $16.7 million ($12.5 million after tax) for the twelve months ended December 31, 2013 and 2012, respectively.
(b)
Represents the EPS impact of purchased intangibles amortization, net of tax, of $0.9 million and $1.0 million for the three months ended December 31, 2013 and 2012, respectively and $3.6 million and $4.5 million for the twelve months ended December 31, 2013 and 2012, respectively.
(c)
Represents the EPS impact of costs associated with the termination of the Company's $880 million Credit Agreement that was replaced with the Company's new $800 million Credit Agreement totaling $0.4 million ($0.3 million after tax) for the three and twelve months ended December, 31, 2013.
(d)
Represents the EPS impact of adjusting the annual effective tax rate from 24.5% to 24% during the three months ended December 31, 2012, related to the nine months ended September 30, 2012.

###