Mettler-Toledo International Inc. Reports Second Quarter 2014 Results - WBOY.com: Clarksburg, Morgantown: News, Sports, Weather

Mettler-Toledo International Inc. Reports Second Quarter 2014 Results

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SOURCE Mettler-Toledo International Inc.

- - Solid Earnings Growth Despite Currency Headwinds - -

COLUMBUS, Ohio, July 24, 2014 /PRNewswire/ -- Mettler-Toledo International Inc. (NYSE: MTD) today announced second quarter results for 2014.  Provided below are the highlights:

  • Sales in local currency increased by 4% in the quarter compared with the prior year. Reported sales increased 5% which included a 1% benefit from currency.
  • Net earnings per diluted share as reported (EPS) were $2.49, compared with $2.24 in the second quarter of 2013. Adjusted EPS was $2.57, an increase of 9% over the prior-year amount of $2.35. 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, "Market conditions were good in the Americas and solid in Europe, and we are benefitting from our growth strategies.  China's market conditions continued to stabilize, which contributed to improved growth in Asia / Rest of the World in the quarter.  Despite currency headwinds, we generated solid EPS growth as we continue to benefit from our various margin and cost control initiatives."  

EPS in the quarter was $2.49, compared with the prior-year amount of $2.24.  Adjusted EPS was $2.57, an increase of 9% over the prior-year amount of $2.35.  

Sales were $608.8 million, a 4% increase in local currency sales, compared with $578.7 million in the prior-year quarter.  Reported sales increased 5%, and included a 1% benefit from currency in the quarter.  By region, local currency sales increased 3% in Europe, 5% in the Americas and 3% in Asia / Rest of World as compared to the prior year.  Adjusted operating income amounted to $112.9 million, a 6% increase from the prior-year amount of $106.4 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 $108.1 million, compared with $91.0 million in the prior-year quarter.

Six Month Results

EPS for the six months was $4.41, compared with the prior-year amount of $3.93.  Adjusted EPS was $4.56, an increase of 9% over the prior-year amount of $4.19.  

Sales for the first six months were $1.159 billion, a 4% increase in local currency sales, compared with $1.103 billion in the prior-year period.  Reported sales increased 5%, and included a 1% benefit from currency.  By region, local currency sales increased 6% in Europe, 4% in the Americas and 2% in Asia / Rest of World as compared to the prior year.  Adjusted operating income amounted to $203.9 million, a 6% increase from the prior-year amount of $191.8 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 $151.0 million, compared with $114.6 million in the prior-year period.

Outlook 

The Company updated its outlook for 2014 and noted that uncertainty in demand in some markets makes forecasting challenging.  Based on today's assessment, management anticipates that local currency sales growth in 2014 will be approximately 4% and Adjusted EPS will be in the range of $11.45 to $11.60, an increase of 8% to 10%.  This guidance remains the same as the Company's previously provided guidance. 

The Company stated that based on its assessment of market conditions today, management anticipates local currency sales growth in the third quarter of 2014 will be approximately 4%.  This sales growth will result in Adjusted EPS in the range of $2.82 to $2.87, an increase of 8% to 10%. 

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, "We remain cautiously optimistic that market conditions will remain favorable.  We expect to benefit from relatively easier comparisons in China in the second half of the year, but will face more difficult comparisons in Europe.  Globally, we are seeking growth opportunities by leveraging existing field resources and making selected additions to capitalize on penetration opportunities.  We will also continue to benefit from our strong sales and marketing programs and excellent pipeline of new products.  As always, we remain focused on execution and are convinced we can continue to gain market share."  

Other Matters

The Company will host a conference call to discuss its quarterly results today (Thursday July 24) 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






June 30, 2014



% of sales



June 30, 2013


% of sales

























Net sales


$608,834

(a)


100.0



$578,680


100.0

Cost of sales


280,658



46.1



269,837


46.6

Gross profit


328,176



53.9



308,843


53.4













Research and development


32,125



5.3



29,003


5.0

Selling, general and administrative 


183,103



30.1



173,434


30.0

Amortization


7,283



1.2



5,807


1.0

Interest expense


5,956



1.0



5,543


1.0

Restructuring charges


1,905



0.3



3,196


0.6

Other charges (income), net


406



0.0



987


0.1

Earnings before taxes


97,398



16.0



90,873


15.7













Provision for taxes


23,376



3.8



21,811


3.8

Net earnings


$74,022



12.2



$69,062


11.9













Basic earnings per common share:











Net earnings 


$2.55






$2.29



Weighted average number of common shares


29,074,695






30,119,889















Diluted earnings per common share:











Net earnings 


$2.49






$2.24



Weighted average number of common 


29,750,815






30,849,934



  and common equivalent shares























Note:











(a) Local currency sales increased 4% as compared to the same period in 2013.















RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME















Three months ended





Three months ended






June 30, 2014



% of sales



June 30, 2013


% of sales













Earnings before taxes


$97,398






$90,873



Amortization


7,283






5,807



Interest expense


5,956






5,543



Restructuring charges


1,905






3,196



Other charges (income), net


406






987



Adjusted operating income 


$112,948

(b)


18.6



$106,406


18.4













Note:











(b) Adjusted operating income increased 6% as compared to the same period in 2013.

 

 

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands except share data)

(unaudited)















Six months ended





Six months ended






June 30, 2014



% of sales



June 30, 2013


% of sales

























Net sales


$1,159,455

(a)


100.0



$1,103,033


100.0

Cost of sales


538,638



46.5



515,032


46.7

Gross profit


620,817



53.5



588,001


53.3













Research and development


61,622



5.3



56,703


5.1

Selling, general and administrative 


355,294



30.6



339,459


30.8

Amortization


14,377



1.2



10,929


1.0

Interest expense


11,622



1.0



10,943


1.0

Restructuring charges


3,397



0.3



8,198


0.7

Other charges (income), net


723



0.1



1,760


0.2

Earnings before taxes


173,782



15.0



160,009


14.5













Provision for taxes


41,709



3.6



38,403


3.5

Net earnings


$132,073



11.4



$121,606


11.0













Basic earnings per common share:











Net earnings 


$4.52






$4.03



Weighted average number of common shares


29,221,647






30,209,729















Diluted earnings per common share:











Net earnings 


$4.41






$3.93



Weighted average number of common 


29,918,456






30,975,957



  and common equivalent shares























Note:











(a)  Local currency sales increased 4% as compared to the same period in 2013.















RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME















Six months ended





Six months ended






June 30, 2014



% of sales



June 30, 2013


% of sales













Earnings before taxes


$173,782






$160,009



Amortization


14,377






10,929



Interest expense


11,622






10,943



Restructuring charges


3,397






8,198



Other charges (income), net


723






1,760



Adjusted operating income 


$203,901

(b)


17.6



$191,839


17.4













Note:











(b)  Adjusted operating income increased 6% as compared to the same period in 2013.

 

 

METTLER-TOLEDO INTERNATIONAL INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands)

(unaudited)




















June 30, 2014



December 31, 2013










Cash and cash equivalents


$111,012





$111,874


Accounts receivable, net


427,495





466,703


Inventories


224,448





210,414


Other current assets and prepaid expenses


123,433





124,996


Total current assets


886,388





913,987











Property, plant and equipment, net


521,884





514,438


Goodwill and other intangible assets, net


572,016





570,260


Other non-current assets


163,132





154,134


Total assets


$2,143,420





$2,152,819











Short-term borrowings and maturities of long-term debt


$121,306





$17,067


Trade accounts payable


140,105





145,993


Accrued and other current liabilities


378,970





401,128


Total current liabilities


640,381





564,188











Long-term debt


345,364





395,960


Other non-current liabilities


249,961





257,619


Total liabilities


1,235,706





1,217,767











Shareholders' equity


907,714





935,052


Total liabilities and shareholders' equity


$2,143,420





$2,152,819


 

METTLER-TOLEDO INTERNATIONAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 (amounts in thousands)

 (unaudited)












Three months ended


Six months ended



June 30,


June 30,



2014


2013


2014


2013










Cash flow from operating activities:








   Net earnings

$        74,022


$        69,062


$      132,073


$      121,606

   Adjustments to reconcile net earnings to net cash provided by operating activities:















Depreciation

8,454


8,566


16,874


17,447

Amortization

7,283


5,807


14,377


10,929

Deferred tax benefit

(2,747)


(2,333)


(3,442)


(5,687)

Excess tax benefits from share-based payment arrangements

(5,074)


(263)


(9,569)


(519)

Other

3,339


3,429


6,577


6,260

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








22,855


6,692


(5,913)


(35,404)

                Net cash provided by operating activities

108,132


90,960


150,977


114,632










Cash flows from investing activities:








    Proceeds from sale of property, plant and equipment

107


79


296


115

    Purchase of property, plant and equipment

(20,404)


(17,763)


(37,120)


(36,781)

    Acquisitions

(2,864)


(213)


(3,255)


(213)

                Net cash used in investing activities

(23,161)


(17,897)


(40,079)


(36,879)










Cash flows from financing activities:








    Proceeds from borrowings

164,139


69,153


310,018


211,112

    Repayments of borrowings

(163,382)


(46,996)


(256,611)


(136,330)

    Proceeds from exercise of stock options

5,582


5,480


9,032


12,549

    Excess tax benefits from share-based payment arrangements

5,074


263


9,569


519

    Repurchases of common stock 

(101,480)


(72,544)


(183,978)


(144,844)

    Other financing activities

154


(687)


(81)


(1,170)

                Net cash used in financing activities

(89,913)


(45,331)


(112,051)


(58,164)










Effect of exchange rate changes on cash and cash equivalents

150


(724)


291


(1,074)










Net increase (decrease) in cash and cash equivalents

(4,792)


27,008


(862)


18,515










Cash and cash equivalents:








    Beginning of period

115,804


93,209


111,874


101,702

    End of period

$      111,012


$      120,217


$      111,012


$      120,217



















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










Net cash provided by operating activities

$      108,132


$        90,960


$      150,977


$      114,632

    Excess tax benefits from share-based payment arrangements

5,074


263


9,569


519

    Payments in respect of restructuring activities

2,817


4,661


5,958


9,307

    Proceeds from sale of property, plant and equipment

107


79


296


115

    Purchase of property, plant and equipment

(20,404)


(17,763)


(37,120)


(36,781)

Free cash flow

$        95,726


$        78,200


$      129,680


$        87,792

 

 

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, 2014

8%


5%


2%


5%




Six Months Ended June 30, 2014

10%


4%


1%


5%
















Local Currency Sales Growth











Three Months Ended June 30, 2014

3%


5%


3%


4%




Six Months Ended June 30, 2014

6%


4%


2%


4%





























RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS 

(unaudited)
















Three months ended 


Six months ended



June 30,


June 30,



2014


2013


% Growth


2014


2013


% Growth














EPS as reported, diluted

$2.49


$2.24


11%


$4.41


$3.93


12%














Restructuring charges, net of tax

0.05

(a)

0.08

(a)



0.09

(a)

0.20

(a)


Purchased intangible amortization, net of tax

0.03

(b)

0.03

(b)



0.06

(b)

0.06

(b)















Adjusted EPS, diluted

$2.57


$2.35


9%


$4.56


$4.19


9%














Notes:












(a)

Represents the EPS impact of restructuring charges of $1.9 million ($1.4 million after tax) and $3.2 million ($2.4 million after tax) for the three months ended June 30, 2014 and 2013, respectively and $3.4 million ($2.6 million after tax) and $8.2 million ($6.2 million after tax) for the six months ended June 30, 2014 and 2013, respectively, which primarily include employee related costs.

(b)

Represents the EPS impact of purchased intangibles amortization, net of tax, of $1.0 million and $0.9 million for the three months ended June 30, 2014 and 2013, respectively and $1.9 million and $1.8 million for the six months ended June 30, 2014 and 2013, respectively.

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