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Mettler-Toledo International Inc.$590.01($2.67)(.45%)

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 Mettler-Toledo International Inc. Reports Second Quarter 2017 Results
   Thursday, July 27, 2017 4:05:00 PM ET

Mettler-Toledo International Inc. (MTD ) today announced second quarter results for 2017. Provided below are the highlights:

-- Sales in local currency increased 10% in the quarter compared with the prior year. Reported sales increased 7% as currency reduced sales growth by 3% in the quarter.

-- Net earnings per diluted share as reported (EPS) were $3.84, compared with $2.93 in the prior-year period. Adjusted EPS was $3.92, an increase of 22% over the prior-year amount of $3.22. Adjusted EPS is a non-GAAP measure and we have included a reconciliation to EPS on the last page of the attached schedules.

Second Quarter Results

Olivier Filliol, President and Chief Executive Officer, stated, "Sales growth in the quarter was very strong with excellent growth in Asia/Rest of World and the Americas. We continue to benefit from our productivity and margin initiatives which contributed to further margin expansion and excellent growth in EPS."

EPS in the quarter was $3.84, compared with the prior-year amount of $2.93. Adjusted EPS was $3.92, an increase of 22% over the prior-year amount of $3.22.

Sales were $653.7 million, a 10% increase in local currency sales, compared with $608.3 million in the prior-year quarter. Reported sales increased 7% as currency reduced sales growth by 3% in the quarter. As compared to the prior year, local currency sales increased 10% in the Americas, 4% in Europe and 15% in Asia/Rest of World. Adjusted operating income amounted to $148.5 million, a 15% increase from the prior-year amount of $129.1 million. Adjusted operating income is a non-GAAP measure, and a reconciliation to earnings before taxes is provided in the attached schedules.

Six Month Results

EPS for the six months was $7.32, compared with the prior-year amount of $5.32. Adjusted EPS was $7.25, an increase of 28% over the prior-year amount of $5.68.

Sales were $1.248 billion, an 11% increase in local currency sales, compared with $1.148 billion in the prior-year period. Reported sales increased 9% as currency reduced sales growth by 2% in the period. As compared to the prior year, local currency sales increased 12% in the Americas, 8% in Europe and 12% in Asia/Rest of World. Adjusted operating income amounted to $275.9 million, a 19% increase from the prior-year amount of $231.1 million. Adjusted operating income is a non-GAAP measure, and a reconciliation to earnings before taxes is provided in the attached schedules.

Outlook

The Company said that based on its assessment of market conditions today, management anticipates local currency sales growth in 2017 will be approximately 8%. This sales growth is expected to result in Adjusted EPS in the range of $17.25 to $17.35, an increase of 17%. This compares to previous guidance of Adjusted EPS in the range of $16.95 to $17.15.

For the third quarter 2017, local currency sales growth is expected to be approximately 5% and Adjusted EPS in the range of $4.25 to $4.30, an increase of 9% to 11%.

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. The Company noted in making its outlook that economic uncertainty remains in certain regions of the world and market conditions are subject to change.

Conclusion

Filliol concluded, "Our operating results for the last several quarters have been excellent. Our Field Turbo investments, Spinnaker sales and marketing initiatives and new product launches are yielding tangible results and we continue to further our margin and productivity initiatives. We will face more challenging comparisons for the remainder of the year but with continued strong execution, we believe we can continue to gain share and deliver a strong performance in 2017."

Other Matters

The Company will host a conference call to discuss its quarterly results today (Thursday, July 27) 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 (MTD ) is a leading global supplier of precision instruments and services. We have strong leadership positions in all of our businesses and believe we hold global number-one market positions in most of them. We are recognized as an innovation leader and our solutions are critical in key R&D, quality control, and manufacturing processes for customers in a wide range of industries including life sciences, food, and chemicals. Our sales and service network is one of the most extensive in the industry. Our products are sold in more than 140 countries and we have a direct presence in approximately 40 countries. With proven growth strategies and a focus on execution, we have achieved a long-term track record of strong financial performance. For more information, please visit 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.

METTLER-TOLEDO INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except share data)
(unaudited)
                                    Three months ended                                          Three months ended
                                                  June 30, 2017               % of sales                June 30, 2016               % of sales
Net sales                                                 $653,656    (a)             100.0                     $608,286                    100.0
Cost of sales                                             278,739                     42.6                      260,710                     42.9
Gross profit                                              374,917                     57.4                      347,576                     57.1
Research and development                                  32,854                      5.0                       30,701                      5.0
Selling, general and administrative                       193,517                     29.6                      187,798                     30.9
Amortization                                              10,249                      1.6                       8,655                       1.4
Interest expense                                          8,171                       1.3                       6,872                       1.1
Restructuring charges                                     4,023                       0.6                       2,205                       0.4
Other charges (income), net                               (744)                       (0.1)                     8,173                       1.3
Earnings before taxes                                     126,847                     19.4                      103,172                     17.0
Provision for taxes                                       25,267                      3.9                       23,584                      3.9
Net earnings                                              $101,580                    15.5                      $79,588                     13.1
Basic earnings per common share:
Net earnings                                              $3.94                                                 $2.99
Weighted average number of common shares                  25,751,374                                            26,631,015
Diluted earnings per common share:
Net earnings                                              $3.84                                                 $2.93
Weighted average number of common                         26,439,529                                            27,143,284
and common equivalent shares
Note:
(a)     Local currency sales increased 10% as compared to the same period in 2016.
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
                                    Three months ended                                          Three months ended
                                                  June 30, 2017               % of sales                June 30, 2016               % of sales
Earnings before taxes                                     $126,847                                              $103,172
Amortization                                              10,249                                                8,655
Interest expense                                          8,171                                                 6,872
Restructuring charges                                     4,023                                                 2,205
Other charges (income), net                               (744)                                                 8,173       (c)
Adjusted operating income                                 $148,546    (b)             22.7                      $129,077                    21.2
Note:
(b)     Adjusted operating income increased 15% as compared to the same period in 2016.
(c)     Other charges (income), net includes a one-time non-cash pension settlement charge of $8.2 million related to a lump sum
settlement to former employees of our U.S. pension plan for the three months ended June 30, 2016.
METTLER-TOLEDO INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except share data)
(unaudited)
                                    Six months ended                                        Six months ended
                                                  June 30, 2017             % of sales             June 30, 2016             % of sales
Net sales                                                $1,248,223  (a)           100.0                  $1,147,960                100.0
Cost of sales                                            530,406                   42.5                   500,477                   43.6
Gross profit                                             717,817                   57.5                   647,483                   56.4
Research and development                                 64,246                    5.1                    59,674                    5.2
Selling, general and administrative                      377,689                   30.3                   356,719                   31.1
Amortization                                             20,294                    1.6                    17,079                    1.5
Interest expense                                         15,912                    1.3                    13,452                    1.2
Restructuring charges                                    5,455                     0.4                    3,085                     0.2
Other charges (income), net                              (6,474)                   (0.5)                  7,889                     0.7
Earnings before taxes                                    240,695                   19.3                   189,585                   16.5
Provision for taxes                                      46,649                    3.8                    44,323                    3.8
Net earnings                                             $194,046                  15.5                   $145,262                  12.7
Basic earnings per common share:
Net earnings                                             $7.51                                            $5.42
Weighted average number of common shares                 25,841,243                                       26,781,154
Diluted earnings per common share:
Net earnings                                             $7.32                                            $5.32
Weighted average number of common                        26,514,311                                       27,283,012
and common equivalent shares
Note:
(a)     Local currency sales increased 11% as compared to the same period in 2016.
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
                                    Six months ended                                        Six months ended
                                                  June 30, 2017             % of sales             June 30, 2016             % of sales
Earnings before taxes                                    $240,695                                         $189,585
Amortization                                             20,294                                           17,079
Interest expense                                         15,912                                           13,452
Restructuring charges                                    5,455                                            3,085
Other charges (income), net                              (6,474)     (b)                                  7,889       (d)
Adjusted operating income                                $275,882    (c)           22.1                   $231,090                  20.1
Note:
(b)     Other charges (income), net includes a one-time gain of $3.4 million for the six months ended June 30, 2017 relating to the
sale of a facility in Switzerland in connection with our initiative to consolidate certain Swiss operations into a new facility.
(c)     Adjusted operating income increased 19% as compared to the same period in 2016.
(d)     Other charges (income), net includes a one-time non-cash pension settlement charge of $8.2 million related to a
lump sum settlement to former employees of our U.S. pension plan for the six months ended June 30, 2016.
METTLER-TOLEDO INTERNATIONAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
(unaudited)
                                                       June 30, 2017      December 31, 2016
Cash and cash equivalents                                   $146,334            $158,674
Accounts receivable, net                                    448,098             454,988
Inventories                                                 253,734             222,047
Other current assets and prepaid expenses                   65,587              61,075
Total current assets                                        913,753             896,784
Property, plant and equipment, net                          600,900             563,707
Goodwill and other intangibles assets, net                  647,891             643,433
Other non-current assets                                    85,406              62,853
Total assets                                                $2,247,950          $2,166,777
Short-term borrowings and maturities of long-term debt      $21,608             $18,974
Trade accounts payable                                      143,607             146,593
Accrued and other current liabilities                       423,594             421,948
Total current liabilities                                   588,809             587,515
Long-term debt                                              947,781             875,056
Other non-current liabilities                               249,441             269,263
Total liabilities                                           1,786,031           1,731,834
Shareholders’ equity                                        461,919             434,943
Total liabilities and shareholders’ equity                  $2,247,950          $2,166,777
METTLER-TOLEDO INTERNATIONAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
(unaudited)
                                                             Three months ended              Six months ended
                                                             June 30,                        June 30,
                                                             2017            2016            2017            2016
Cash flow from operating activities:
Net earnings                                                 $101,580        $79,588         $194,046        $145,262
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation                                                 7,953           7,994           15,919          16,116
Amortization                                                 10,249          8,655           20,294          17,079
Deferred tax benefit                                         (2,264)         (5,548)         (3,840)         (8,852)
Other                                                        4,211           3,569           8,023           7,148
Gain on facility sale                                        -               -               (3,394)         -
Non-cash pension settlement charge                           -               8,189           -               8,189
Increase (decrease) in cash resulting from changes in
operating assets and liabilities                             16,049          18,425          (25,671)        (22,565)
Net cash provided by operating activities                    137,778         $120,872        205,377         $162,377
Cash flows from investing activities:
Proceeds from sale of property, plant and equipment(a)       206             83              10,209          218
Purchase of property, plant and equipment                    (27,514)        (14,510)        (48,529)        (28,858)
Acquisitions                                                 (697)           -               (697)           (4,329)
Net hedging settlements on intercompany loans                (1,345)         (1,053)         (1,033)         1,075
Net cash used in investing activities                        (29,350)        (15,480)        (40,050)        (31,894)
Cash flows from financing activities:
Proceeds from borrowings                                     200,189         163,147         672,921         392,560
Repayments of borrowings                                     (205,281)       (145,217)       (615,162)       (269,684)
Proceeds from exercise of stock options                      8,734           8,056           16,935          13,965
Repurchases of common stock                                  (124,952)       (124,997)       (249,949)       (249,997)
Other financing activities                                   (7,205)         (555)           (7,205)         (680)
Net cash used in financing activities                        (128,515)       (99,566)        (182,460)       (113,836)
Effect of exchange rate changes on cash and cash equivalents 1,528           (1,775)         4,793           (888)
Net (decrease) increase in cash and cash equivalents         (18,559)        4,051           (12,340)        15,759
Cash and cash equivalents:
Beginning of period                                          164,893         110,595         158,674         98,887
End of period                                                $146,334        $114,646        $146,334        $114,646
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW
Net cash provided by operating activities                    $137,778        $120,872        $205,377        $162,377
Payments in respect of restructuring activities              2,748           2,461           5,326           4,302
Proceeds from sale of property, plant and equipment          206             83              10,209          218
Purchase of property, plant and equipment                    (27,514)        (14,510)        (48,529)        (28,858)
Free cash flow                                               $113,218        $108,906        $172,383        $138,039
(a)     Proceeds from sale of property, plant and equipment includes $9.9 million relating to the sale of a facility in Switzerland in connection with our
initiative to consolidate certain Swiss operations into a new facility for the six months ended June 30, 2017.
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, 2017                         1%                      9%           13%                     7%
                        Six Months Ended June 30, 2017                           4%                      11%          10%                     9%
Local Currency Sales Growth
                        Three Months Ended June 30, 2017                         4%                      10%          15%                     10%
                        Six Months Ended June 30, 2017                           8%                      12%          12%                     11%
RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS
(unaudited)
                                                         Three months ended                                           Six months ended
                                                         June 30,                                                     June 30,
                                                         2017                    2016                    % Growth     2017                    2016                    % Growth
EPS as reported, diluted                                 $3.84                   $2.93                   31%          $7.32                   $5.32                   38%
Restructuring charges, net of tax                        0.12        (a)         0.06        (a)                      0.16        (a)         0.09        (a)
Purchased intangible amortization, net of tax            0.06        (b)         0.04        (b)                      0.11        (b)         0.08        (b)
Income tax expense                                       (0.10)      (c)         -                                    (0.24)      (c)         -
Gain on facility sale                                    -                       -                                    (0.10)      (d)         -
Non-cash pension settlement charge, net of tax           -                       0.19        (e)                      -                       0.19        (e)
Adjusted EPS, diluted                                    $3.92                   $3.22                   22%          $7.25                   $5.68                   28%
Notes:
(a)     Represents the EPS impact of restructuring charges of $4.0 million ($3.1 million after tax) and $2.2 million ($1.7 million after tax) for the
three months ended June 30, 2017 and 2016, and $5.5 million ($4.3 million after tax) and $3.1 million ($2.3 million after tax) for the six
months ended June 30, 2017 and 2016, respectively, which primarily include employee related costs.
(b)     Represents the EPS impact of purchased intangibles amortization, net of tax, of $1.5 million and $1.0 million for the three months
ended June 30, 2017 and 2016, and $3.0 million and $2.1 million for the six months ended June 30, 2017 and 2016, respectively.
(c)     Represents the EPS impact of the difference between our reported tax rate of 20% and 19% during the three and six
months ending June 30, 2017 and our estimated annual income tax rate of 22%, which reflects a 2% benefit pertaining to
excess tax benefits associated with stock option exercises.
(d)     Represents the EPS impact of a one-time gain of $3.4 million ($2.7 million after tax) for the six months ended June 30, 2017
relating to the sale of a facility in Switzerland in connection with our initiative to consolidate certain Swiss operations into
a new facility.
(e)     Represents the EPS impact of a one-time non-cash pension settlement charge of $8.2 million ($5.1 million after tax) related
to a lump sum settlement to former employees of our U.S. pension plan for the three and six months ended June 30, 2016.

View original content:http://www.prnewswire.com/news-releases/mettler-toledo-international-inc-reports-second-quarter-2017

SOURCE Mettler-Toledo International Inc.

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