Mettler-Toledo International Inc. Reports Fourth Quarter 2015 Results

- - Strong Margin Expansion - -

- - Good Execution - -

04 Feb, 2016, 16:08 ET from Mettler-Toledo International Inc.

COLUMBUS, Ohio, Feb. 4, 2016 /PRNewswire/ -- Mettler-Toledo International Inc. (NYSE: MTD) today announced fourth quarter results for 2015.  Provided below are the highlights:

  • Sales in local currency increased 3% in the quarter compared with the prior year.  Reported sales decreased 3% as currency reduced sales growth by 6% in the quarter.
  • Net earnings per diluted share as reported (EPS) were $4.44, compared with $4.17 in the prior- year period.  Adjusted EPS was $4.65, an increase of 10% over the prior-year amount of $4.24.  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, "Market conditions throughout the world developed as expected and we continued to execute very well.  Sales growth in the Americas was strong with broad-based growth in most product lines.  Europe had good growth in laboratory instruments.  Sales declined in China and Brazil, while sales growth in our other emerging markets was solid overall.  We had strong margin expansion in the quarter and, despite currency headwinds, achieved solid EPS growth.  Finally, we had good cash flow generation in the quarter and for the full year." 

EPS in the quarter was $4.44, compared with the prior-year amount of $4.17.  Adjusted EPS was $4.65, an increase of 10% over the prior-year amount of $4.24.  

Sales were $673.5 million, a 3% increase in local currency sales, compared with $697.4 million in the prior-year quarter.  Reported sales decreased 3% as currency reduced sales growth by 6% in the quarter.  By region, local currency sales increased 9% in the Americas, were flat in Europe and declined 2% in Asia / Rest of World as compared to the prior-year period.  Adjusted operating income amounted to $182.2 million, a 3% increase from the prior-year amount of $176.3 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 $137.0 million, compared with $140.7 million in the prior-year quarter.

Full Year Results

EPS in 2015 was $12.48, compared with the prior-year amount of $11.44.  Adjusted EPS was $12.92, an increase of 10% over the prior-year amount of $11.72.  

Sales were $2.395 billion, a 3% increase in local currency sales, compared with $2.486 billion in the prior-year period.  Reported sales decreased 4% as currency reduced sales growth by 7% in the period.  By region, local currency sales increased 8% in the Americas, 2% in Europe and were flat in Asia / Rest of World as compared to the prior-year period.  Adjusted operating income amounted to $532.1 million, a 5% increase from the prior-year amount of $506.9 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 $426.9 million, compared with $418.9 million in the prior year.

Outlook 

The Company updated its outlook for 2016 and noted that forecasting remains challenging.  In particular, weak demand in certain emerging markets remains. 

Based on today's assessment, management anticipates that local currency sales growth in 2016 will be in the range of 3% to 4% and Adjusted EPS is forecasted to be in the range of $14.10 to $14.30, an increase of 9% to 11%. 

For the first quarter 2016, management anticipates that local currency sales growth will be approximately 4% and Adjusted EPS is forecasted to be in the range of $2.40 to $2.45, 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, "Despite considerable market weakness in China, Brazil and Russia and significant currency headwinds, we achieved good financial results in the quarter and for full year 2015.  Strong execution of our margin enhancement and productivity improvement programs were key contributors to our performance.  We continue to gain share through expanded field resources, exciting new products and proven sales and marketing initiatives.  Equally important, we are making investments for long-term growth.  While we remain cautious on the global economy, we believe we can continue to generate above market growth in 2016 and beyond."     

Other Matters

The Company will host a conference call to discuss its quarterly results today (Thursday, February 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 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

December 31, 2015

% of sales

December 31, 2014

% of sales

Net sales

$673,535

(a)

100.0

$697,428

100.0

Cost of sales

282,788

42.0

303,046

43.5

Gross profit

390,747

58.0

394,382

56.5

Research and development

31,110

4.6

31,323

4.5

Selling, general and administrative 

177,418

26.3

186,789

26.8

Amortization

8,022

1.2

7,610

1.1

Interest expense

6,755

1.0

6,924

1.0

Restructuring charges

5,960

0.9

1,468

0.2

Other charges (income), net

(9)

0.0

882

0.0

Earnings before taxes

161,491

24.0

159,386

22.9

Provision for taxes

38,140

5.7

38,214

5.5

Net earnings

$123,351

18.3

$121,172

17.4

Basic earnings per common share:

Net earnings 

$4.53

$4.27

Weighted average number of common shares

27,228,026

28,398,579

Diluted earnings per common share:

Net earnings 

$4.44

$4.17

Weighted average number of common 

27,755,045

29,045,269

  and common equivalent shares

Note:

(a)  Local currency sales increased 3% as compared to the same period in 2014.

RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME

Three months ended

Three months ended

December 31, 2015

% of sales

December 31, 2014

% of sales

Earnings before taxes

$161,491

$159,386

Amortization

8,022

7,610

Interest expense

6,755

6,924

Restructuring charges

5,960

1,468

Other charges (income), net

(9)

882

Adjusted operating income 

$182,219

(b)

27.1

$176,270

25.3

Note:

(b)  Adjusted operating income increased 3% as compared to the same period in 2014.

 

 

 

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands except share data)

(unaudited)

Twelve months ended

Twelve months ended

December 31, 2015

% of sales

December 31, 2014

% of sales

Net sales

$2,395,447

(a)

100.0

$2,485,983

100.0

Cost of sales

1,043,454

43.6

1,127,233

45.3

Gross profit

1,351,993

56.4

1,358,750

54.7

Research and development

119,076

5.0

123,297

5.0

Selling, general and administrative 

700,810

29.3

728,582

29.3

Amortization

30,951

1.3

29,185

1.2

Interest expense

27,451

1.1

24,537

1.0

Restructuring charges

11,148

0.5

5,915

0.2

Other charges (income), net

(867)

(0.1)

2,230

0.1

Earnings before taxes

463,424

19.3

445,004

17.9

Provision for taxes

110,604

4.6

106,763

4.3

Net earnings

$352,820

14.7

$338,241

13.6

Basic earnings per common share:

Net earnings 

$12.75

$11.71

Weighted average number of common shares

27,680,918

28,890,771

Diluted earnings per common share:

Net earnings 

$12.48

$11.44

Weighted average number of common 

28,269,615

29,571,308

  and common equivalent shares

Note:

(a)  Local currency sales increased 3% as compared to the same period in 2014.

RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME

Twelve months ended

Twelve months ended

December 31, 2015

% of sales

December 31, 2014

% of sales

Earnings before taxes

$463,424

$445,004

Amortization

30,951

29,185

Interest expense

27,451

24,537

Restructuring charges

11,148

5,915

Other charges (income), net

(867)

2,230

Adjusted operating income 

$532,107

(b)

22.2

$506,871

20.4

Note:

(b)  Adjusted operating income increased 5% as compared to the same period in 2014.

 

 

 

METTLER-TOLEDO INTERNATIONAL INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands)

(unaudited)

December 31, 2015

December 31, 2014

Cash and cash equivalents

$98,887

$85,263

Accounts receivable, net

411,420

435,648

Inventories

214,383

204,531

Other current assets and prepaid expenses

138,125

123,988

Total current assets

862,815

849,430

Property, plant and equipment, net

517,229

511,462

Goodwill and other intangible assets, net

561,536

556,869

Other non-current assets

76,905

91,349

Total assets

$2,018,485

$2,009,110

Short-term borrowings and maturities of long-term debt

$14,488

$116,164

Trade accounts payable

142,075

145,896

Accrued and other current liabilities

438,564

416,830

Total current liabilities

595,127

678,890

Long-term debt

576,984

335,790

Other non-current liabilities

265,917

274,835

Total liabilities

1,438,028

1,289,515

Shareholders' equity

580,457

719,595

Total liabilities and shareholders' equity

$2,018,485

$2,009,110

 

 

 

METTLER-TOLEDO INTERNATIONAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 (amounts in thousands)

 (unaudited)

Three months ended

Twelve months ended

December 31,

December 31,

2015

2014

2015

2014

Cash flow from operating activities:

    Net earnings

$      123,351

$      121,172

$      352,820

$      338,241

    Adjustments to reconcile net earnings to

      net cash provided by operating activities:

Depreciation

8,109

8,148

33,087

33,617

Amortization

8,022

7,610

30,951

29,185

Deferred tax benefit

10,503

19,135

7,258

13,033

Excess tax benefits from share-based payment arrangements

(11,511)

6,902

(12,929)

(3,557)

Other

3,865

3,939

14,378

13,822

Increase (decrease) in cash resulting from changes in

  operating assets and liabilities

(5,297)

(26,232)

1,303

(5,429)

                Net cash provided by operating activities

137,042

140,674

426,868

418,912

Cash flows from investing activities:

    Proceeds from sale of property, plant and equipment

668

295

949

728

    Purchase of property, plant and equipment

(25,750)

(27,980)

(82,506)

(89,388)

    Acquisitions

(2,810)

(2,399)

(13,779)

(5,784)

    Net hedging settlements on intercompany loans

148

(59)

(5,415)

123

                Net cash used in investing activities

(27,744)

(30,143)

(100,751)

(94,321)

Cash flows from financing activities:

    Proceeds from borrowings

191,862

115,855

741,864

628,832

    Repayments of borrowings

(219,586)

(147,338)

(594,477)

(585,867)

    Proceeds from exercise of stock options

7,722

7,002

29,556

21,047

    Excess tax benefits from share-based payment arrangements

11,511

(6,902)

12,929

3,557

    Repurchases of common stock 

(123,743)

(117,524)

(494,966)

(414,000)

    Debt issuance costs

(934)

-

(1,366)

(941)

    Acquisition contingent consideration paid

-

(859)

(572)

(859)

                Net cash used in financing activities

(133,168)

(149,766)

(307,032)

(348,231)

Effect of exchange rate changes on cash and cash equivalents

(542)

(1,813)

(5,461)

(2,971)

Net increase (decrease) in cash and cash equivalents

(24,412)

(41,048)

13,624

(26,611)

Cash and cash equivalents:

    Beginning of period

123,299

126,311

$85,263

111,874

    End of period

$        98,887

$        85,263

$        98,887

$        85,263

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

Net cash provided by operating activities

$      137,042

$      140,674

$      426,868

$      418,912

    Excess tax benefits from share-based payment arrangements

11,511

(6,902)

12,929

3,557

    Payments in respect of restructuring activities

2,966

1,682

6,568

9,657

    Proceeds from sale of property, plant and equipment

668

295

949

728

    Purchase of property, plant and equipment

(25,750)

(27,980)

(82,506)

(89,388)

Free cash flow

$      126,437

$      107,769

$      364,808

$      343,466

 

 

 

METTLER-TOLEDO INTERNATIONAL INC.

OTHER OPERATING STATISTICS

SALES GROWTH BY DESTINATION

(unaudited)

Europe

Americas

Asia/RoW

Total

U.S. Dollar Sales Growth (Decrease)

Three Months Ended December 31, 2015

(10%)

7%

(8%)

(3%)

Twelve Months Ended December 31, 2015

(12%)

6%

(5%)

(4%)

Local Currency Sales Growth (Decrease)

Three Months Ended December 31, 2015

0%

9%

(2%)

3%

Twelve Months Ended December 31, 2015

2%

8%

0%

3%

RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS 

(unaudited)

Three months ended 

Twelve months ended

December 31

December 31

2015

2014

% Growth

2015

2014

% Growth

EPS as reported, diluted

$4.44

$4.17

6%

$12.48

$11.44

9%

Restructuring charges, net of tax

0.17

(a)

0.04

(a)

0.30

(a)

0.15

(a)

Purchased intangible amortization, net of tax

0.04

(b)

0.03

(b)

0.14

(b)

0.13

(b)

Adjusted EPS, diluted

$4.65

$4.24

10%

$12.92

$11.72

10%

Notes:

(a)

Represents the EPS impact of restructuring charges of $6.0 million ($4.6 million after tax) and $1.5 million ($1.1 million after tax) for the three months ended December 31, 2015 and 2014, respectively and $11.1 million ($8.5 million after tax) and $5.9 million ($4.5 million after tax) for the twelve months ended December 31, 2015 and 2014, respectively.

(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 December 31, 2015 and 2014, respectively and $3.9 million for both the twelve months ended December 31, 2015 and 2014, respectively.

 

SOURCE Mettler-Toledo International Inc.



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