Mettler-Toledo International Inc. Reports First Quarter 2013 Results

- Further Margin Improvement Drives Earnings Growth -

02 May, 2013, 16:01 ET from Mettler-Toledo International Inc.

COLUMBUS, Ohio, May 2, 2013 /PRNewswire/ -- Mettler-Toledo International Inc. (NYSE: MTD) today announced first quarter results for 2013.  Provided below are the highlights:

  • Sales in local currency decreased by 2% in the quarter compared with the prior year.  Reported sales also decreased 2%, as currency had no impact on sales in the quarter.
  • Net earnings per diluted share as reported (EPS) were $1.69, compared with $1.62 in the first quarter of 2012.  Adjusted EPS was $1.84, an increase of 11% over the prior-year amount of $1.66.  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. 

First Quarter Results

Olivier Filliol, President and Chief Executive Officer, stated, "Market conditions were challenging, particularly in Europe and Asia.  However, I am pleased to report that we continue to have strong execution in our various margin improvement and cost control initiatives, resulting in good EPS growth."

EPS was $1.69, compared with the prior-year amount of $1.62.  Adjusted EPS was $1.84, an increase of 11% over the prior-year amount of $1.66.  

Sales were $524.4 million, a 2% decrease in local currency sales, compared with $535.4 million in the prior-year quarter.  Reported sales also decreased 2%, as currency had no impact on sales in the quarter.  By region, local currency sales increased 1% in the Americas and decreased 5% in Europe and decreased 2% in Asia / Rest of World.  Adjusted operating income amounted to $85.4 million, a 6% increase from the prior-year amount of $80.8 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 $23.7 million, compared with $20.8 million in the prior-year quarter.

Cost Control Measures

As part of the cost control measures announced in the second quarter of 2012, the Company recorded pre-tax restructuring charges of $5.0 million in the quarter.

Outlook 

The Company updated its outlook for 2013 and noted that uncertainty in demand exists in most of its markets, which makes forecasting difficult.  Based on today's assessment, management anticipates that local currency sales growth in 2013 will be in the range of 1% to 3%, with growth stronger in the second half of the year.  This sales growth will result in Adjusted EPS in the range of $10.40 to $10.60, an increase of 8% to 10%.  This compares to previous guidance of Adjusted EPS in the range of $10.30 to $10.55.    

The Company stated that, based on its assessment of market conditions today, management anticipates that local currency sales growth for the second quarter of 2013 will be in the range of 0% to 2%, and Adjusted EPS will be in the range of $2.30 to $2.35, an increase of 7% to 9%.

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, "While market conditions remain challenging with significant uncertainty in the global economy, we expect conditions to improve as the year progresses.  We made adjustments to our cost structure last year in anticipation of slower market growth.  Therefore, while we will continue to monitor the environment closely, we believe we are well positioned to expand margins despite modest sales growth expectations for the year.  We remain focused on the execution of our strategic initiatives and continue to see opportunities to further gain market share, despite the environment."  

Other Matters

The Company will host a conference call to discuss its quarterly results today (Thursday, May 2) 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.  

 

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands except share data)

(unaudited)

Three months ended

Three months ended

March 31, 2013

% of sales

March 31, 2012

% of sales

Net sales

$524,353

(a)

100.0

$535,400

100.0

Cost of sales

245,100

46.7

258,298

48.2

Gross profit

279,253

53.3

277,102

51.8

Research and development

27,700

5.3

28,667

5.4

Selling, general and administrative 

166,120

31.7

167,641

31.3

Amortization

5,122

1.0

5,199

1.0

Interest expense

5,400

1.0

5,823

1.1

Restructuring charges

5,002

1.0

308

0.1

Other charges (income), net

773

0.1

156

0.0

Earnings before taxes

69,136

13.2

69,308

12.9

Provision for taxes

16,592

3.2

16,981

3.1

Net earnings

$52,544

10.0

$52,327

9.8

Basic earnings per common share:

Net earnings 

$1.73

$1.66

Weighted average number of common shares

30,299,569

31,531,915

Diluted earnings per common share:

Net earnings 

$1.69

$1.62

Weighted average number of common 

31,101,979

32,386,924

  and common equivalent shares

Note:

(a)  Local currency sales decreased 2% as compared to the same period in 2012.

RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME

Three months ended

Three months ended

March 31, 2013

% of sales

March 31, 2012

% of sales

Earnings before taxes

$69,136

$69,308

Amortization

5,122

5,199

Interest expense

5,400

5,823

Restructuring charges

5,002

308

Other charges (income), net

773

156

Adjusted operating income 

$85,433

(b)

16.3

$80,794

15.1

Note:

(b)  Adjusted operating income increased 6% as compared to the same period in 2012.

 

METTLER-TOLEDO INTERNATIONAL INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands)

(unaudited)

March 31, 2013

December 31, 2012

Cash and cash equivalents

$93,209

$101,702

Accounts receivable, net

410,650

437,390

Inventories

199,574

198,939

Other current assets and prepaid expenses

125,505

126,889

Total current assets

828,938

864,920

Property, plant and equipment, net

466,165

469,421

Goodwill and other intangibles assets, net

561,198

569,915

Other non-current assets

214,305

213,144

Total assets

$2,070,606

$2,117,400

Short-term borrowings and maturities of long-term debt

$17,959

$41,600

Trade accounts payable

116,678

142,362

Accrued and other current liabilities

343,658

378,715

Total current liabilities

478,295

562,677

Long-term debt

421,913

347,131

Other non-current liabilities

370,176

380,373

Total liabilities

1,270,384

1,290,181

Shareholders' equity

800,222

827,219

Total liabilities and shareholders' equity

$2,070,606

$2,117,400

 

METTLER-TOLEDO INTERNATIONAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 (amounts in thousands)

 (unaudited)

Three months ended

March 31,

2013

2012

Cash flow from operating activities:

    Net earnings

$52,544

$52,327

    Adjustments to reconcile net earnings to

      net cash provided by operating activities:

Depreciation

8,881

7,775

Amortization

5,122

5,199

Deferred tax benefit

(3,354)

(2,061)

Excess tax benefits from share-based payment arrangements

(256)

(276)

Other

2,831

4,185

Decrease in cash resulting from changes in

  operating assets and liabilities

(42,096)

(46,352)

                Net cash provided by operating activities

23,672

20,797

Cash flows from investing activities:

    Proceeds from sale of property, plant and equipment

36

87

    Purchase of property, plant and equipment

(19,018)

(18,529)

                Net cash used in investing activities

(18,982)

(18,442)

Cash flows from financing activities:

    Proceeds from borrowings

141,959

60,879

    Repayments of borrowings

(89,334)

(93,878)

    Proceeds from exercise of stock options

7,069

12,838

    Excess tax benefits from share-based payment arrangements

256

276

    Repurchases of common stock 

(72,300)

(63,721)

    Other financing activities

(483)

(164)

                Net cash used in financing activities

(12,833)

(83,770)

Effect of exchange rate changes on cash and cash equivalents

(350)

2,006

Net decrease in cash and cash equivalents

(8,493)

(79,409)

Cash and cash equivalents:

    Beginning of period

101,702

235,601

    End of period

$93,209

$156,192

RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW

Net cash provided by operating activities

$23,672

$20,797

    Excess tax benefits from share-based payment arrangements

256

276

    Payments in respect of restructuring activities

4,646

1,582

    Proceeds from sale of property, plant and equipment

36

87

    Purchase of property, plant and equipment

(19,018)

(18,529)

Free cash flow

$9,592

$4,213

 

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 March 31, 2013

(5%)

2%

(3%)

(2%)

Local Currency Sales Growth

Three Months Ended March 31, 2013

(5%)

1%

(2%)

(2%)

RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS 

(unaudited)

Three months ended

March 31,

2013

2012

%

Growth

EPS as reported, diluted

$1.69

$1.62

4%

Restructuring charges, net of tax

0.12

(a)

0.01

(a)

Purchased intangible amortization, net of tax

0.03

(b)

0.03

(b)

Adjusted EPS, diluted

$1.84

$1.66

11%

Notes:

(a)

Represents the EPS impact of restructuring charges of $5.0 million ($3.8 million after tax) and $0.3 million ($0.2 million after tax) for the three months ended March 31, 2013 and 2012, respectively, which primarily include severance costs.

(b)

Represents the EPS impact of purchased intangibles amortization, net of tax, of $0.9 million and $1.1 million for the three month periods ended March 31, 2013 and 2012, respectively.

 

 

SOURCE Mettler-Toledo International Inc.



RELATED LINKS

http://www.mt.com