MTD Mettler Toledo International Inc

Mettler-Toledo International Inc. (NYSE: MTD) today announced first quarter results for 2024. Provided below are the highlights:

• Reported and local currency sales were flat compared with the prior year and benefited 6% from recovering previously announced delayed shipments from the fourth quarter of 2023.
• Net earnings per diluted share as reported (EPS) were $8.24, compared with $8.47 in the prior-year period. Adjusted EPS was $8.89, an increase of 2% over the prior-year amount of $8.69. Adjusted EPS is a non-GAAP measure, and a reconciliation to EPS is included on the last page of the attached schedules.

First Quarter Results

Patrick Kaltenbach, President and Chief Executive Officer, stated, “Our first quarter results were much better than expected, although we continued to face reduced market demand, especially in China, versus the prior year. We also substantially recovered our previously disclosed delayed product shipments from the fourth quarter of 2023, slightly better than forecast. Strong execution of our productivity and cost savings initiatives offset significant foreign exchange headwinds and resulted in modest Adjusted EPS growth in the quarter.”

GAAP Results

EPS in the quarter was $8.24, compared with the prior-year amount of $8.47.

Compared with the prior year, total reported sales were flat at $925.9 million. By region, reported sales increased 8% in Europe and 3% in the Americas and declined 12% in Asia/Rest of World. Earnings before taxes amounted to $220.5 million, compared with $226.6 million in the prior year.

Non-GAAP Results

Adjusted EPS was $8.89, an increase of 2% over the prior-year amount of $8.69.

Compared with the prior year, total sales in local currency were flat and benefited by 6% from recovering delayed shipments from the fourth quarter of 2023. By region, local currency sales increased 6% in Europe and 3% in the Americas and declined 8% in Asia/Rest of World. Excluding the benefit of delayed fourth quarter 2023 shipments, local currency sales decreased 5% in Europe, 1% in the Americas, and 12% in Asia/Rest of World. Adjusted Operating Profit amounted to $267.3 million, compared to the prior-year amount of $266.5 million.

Adjusted EPS and Adjusted Operating Profit are non-GAAP measures. Reconciliations to the most comparable GAAP measures are provided in the attached schedules.

Outlook

Management cautions that market conditions are uncertain and could change quickly. Based on today's assessment, management anticipates local currency sales for the second quarter of 2024 will decline approximately 4%, and Adjusted EPS is forecast to be $8.90 to $9.05, a decline of 11% to 13%. Included in the second quarter guidance is an estimated 2% headwind to Adjusted EPS growth due to adverse currency.

For the full year, management anticipates local currency sales in 2024 will increase approximately 2%, and Adjusted EPS is forecast to be in the range of $39.90 to $40.40, representing growth of approximately 5% to 6%. Included in the full year guidance is an estimated 2% headwind to Adjusted EPS growth due to adverse currency. This compares with previous local currency sales growth guidance of approximately 1% to 2% and Adjusted EPS guidance of $39.60 to $40.30.

The Company does not provide GAAP financial measures on a forward-looking basis because we are unable to predict with reasonable certainty and without unreasonable effort the timing and amount of future restructuring and other non-recurring items.

Conclusion

Kaltenbach concluded, “We expect soft market conditions in the second quarter of 2024, particularly in China. We remain focused on the diligent execution of our growth strategies, while continuing to drive innovation and further strengthen our Company for the future. Our product portfolio is in excellent shape with many successful recent product introductions, and enhancements to our best-in-class corporate programs such as Spinnaker and SternDrive position us very well for future growth.”

Other Matters

The Company will host a conference call to discuss its quarterly results tomorrow morning (Friday, May 10) at 8:30 a.m. Eastern Time. To listen to a live webcast or replay of the call, visit the investor relations page on the Company’s website at investor.mt.com. The presentation referenced on the conference call will be located on the website prior to the call.

METTLER TOLEDO (NYSE: 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.

Forward-Looking Statements Disclaimer

You should not rely on forward-looking statements to predict our actual results. Our actual results or performance may be materially different than reflected in forward-looking statements because of various risks and uncertainties, including statements about expected revenue growth, inflation, ongoing developments related to Ukraine, and the Israel-Hamas war. 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.”

We make forward-looking statements about future events or our future financial performance, including earnings and sales growth, earnings per share, strategic plans and contingency plans, growth opportunities or economic downturns, our ability to respond to changes in market conditions, planned research and development efforts and product introductions, adequacy of facilities, access to and the costs of raw materials, shipping and supplier costs, gross margins, customer demand, our competitive position, pricing, capital expenditures, cash flow, tax-related matters, the impact of foreign currencies, compliance with laws, effects of acquisitions, and the impact of inflation, ongoing developments related to Ukraine, and the Israel-Hamas war on our business.

Our forward-looking statements may not be accurate or complete, and we do not intend to update or revise them in light of actual results. New risks also periodically arise. Please consider the risks and factors that could cause our results to differ materially from what is described in our forward-looking statements, including inflation, ongoing developments related to Ukraine, and the Israel-Hamas war. See in particular “Factors Affecting Our Future Operating Results” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

METTLER-TOLEDO INTERNATIONAL INC. CONSOLIDATED STATEMENTS OF OPERATIONS (amounts in thousands except share data) (unaudited)  

Three months ended

 

 

 

Three months ended

 

 

March 31, 2024

 

% of sales

 

March 31, 2023

 

% of sales

  Net sales

$

925,949

 

(a)

100.0

 

$

928,738

 

100.0

 

Cost of sales

 

377,816

 

 

40.8

 

 

382,172

 

41.1

 

Gross profit

 

548,133

 

 

59.2

 

 

546,566

 

58.9

 

 

 

 

 

 

Research and development

 

46,415

 

 

5.0

 

 

45,477

 

4.9

 

Selling, general and administrative

 

234,390

 

 

25.3

 

 

234,638

 

25.3

 

Amortization

 

18,228

 

 

2.0

 

 

17,779

 

1.9

 

Interest expense

 

19,232

 

 

2.1

 

 

18,184

 

2.0

 

Restructuring charges

 

9,664

 

 

1.0

 

 

4,274

 

0.4

 

Other charges (income), net

 

(343

)

 

(0.0

)

 

(396

)

(0.0

)

Earnings before taxes

 

220,547

 

 

23.8

 

 

226,610

 

24.4

 

 

 

 

 

 

Provision for taxes

 

43,038

 

 

4.6

 

 

38,184

 

4.1

 

Net earnings

$

177,509

 

 

19.2

 

$

188,426

 

20.3

 

 

 

 

 

 

Basic earnings per common share:

 

 

 

 

 

Net earnings

$

8.28

 

 

 

$

8.53

 

 

Weighted average number of common shares

 

21,437,673

 

 

 

 

22,083,456

 

 

 

 

 

 

 

Diluted earnings per common share:

 

 

 

 

 

Net earnings

$

8.24

 

 

 

$

8.47

 

 

Weighted average number of common and common equivalent shares

 

21,543,313

 

 

 

 

22,253,435

 

 

 

 

 

 

 

Note:

 

 

 

 

 

(a) Local currency sales were flat compared to the same period in 2023.

 

 

 

 

 

RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING PROFIT

 

 

 

 

 

Three months ended

 

 

 

Three months ended

 

 

March 31, 2024

 

% of sales

 

March 31, 2023

 

% of sales

 

 

 

 

 

Earnings before taxes

$

220,547

 

 

 

$

226,610

 

 

Amortization

 

18,228

 

 

 

 

17,779

 

 

Interest expense

 

19,232

 

 

 

 

18,184

 

 

Restructuring charges

 

9,664

 

 

 

 

4,274

 

 

Other charges (income), net

 

(343

)

 

 

 

(396

)

 

Adjusted operating profit

$

267,328

 

(b)

28.9

 

$

266,451

 

28.7

 

  Note:

(b) Adjusted operating profit was flat as compared to the same period in 2023.

METTLER-TOLEDO INTERNATIONAL INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands)

(unaudited)

  March 31, 2024 December 31, 2023   Cash and cash equivalents

$

70,191

 

 

$

69,807

 

Accounts receivable, net

 

650,333

 

 

 

663,893

 

Inventories

 

373,670

 

 

 

385,865

 

Other current assets and prepaid expenses

 

116,920

 

 

 

110,638

 

Total current assets

 

1,211,114

 

 

 

1,230,203

 

 

 

 

Property, plant and equipment, net

 

773,495

 

 

 

803,374

 

Goodwill and other intangibles assets, net

 

940,191

 

 

 

955,537

 

Other non-current assets

 

358,317

 

 

 

366,441

 

Total assets

$

3,283,117

 

 

$

3,355,555

 

 

 

 

Short-term borrowings and maturities of long-term debt

$

183,173

 

 

$

192,219

 

Trade accounts payable

 

189,449

 

 

 

210,411

 

Accrued and other current liabilities

 

759,310

 

 

 

778,452

 

Total current liabilities

 

1,131,932

 

 

 

1,181,082

 

 

 

 

Long-term debt

 

1,903,574

 

 

 

1,888,620

 

Other non-current liabilities

 

406,328

 

 

 

435,791

 

Total liabilities

 

3,441,834

 

 

 

3,505,493

 

 

 

 

Shareholders’ equity

 

(158,717

)

 

 

(149,938

)

Total liabilities and shareholders’ equity

$

3,283,117

 

 

$

3,355,555

 

METTLER-TOLEDO INTERNATIONAL INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (amounts in thousands) (unaudited)   Three months ended March 31,

 

2024

 

 

2023

 

  Cash flow from operating activities: Net earnings

$

177,509

 

$

188,426

 

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

 

12,522

 

 

12,023

 

Amortization

 

18,228

 

 

17,779

 

Deferred tax provision (benefit)

 

(2,063

)

 

602

 

Share-based compensation

 

4,722

 

 

4,027

 

Decrease in cash resulting from changes in operating assets and liabilities

 

(20,931

)

 

(69,595

)

Net cash provided by operating activities

 

189,987

 

 

153,262

 

  Cash flows from investing activities:

Purchase of property, plant and equipment

 

(17,391

)

 

(23,196

)

Acquisitions

 

(1,000

)

 

(613

)

Other investing activities

 

9,456

 

 

1,423

 

Net cash used in investing activities

 

(8,935

)

 

(22,386

)

  Cash flows from financing activities: Proceeds from borrowings

 

449,863

 

 

605,018

 

Repayments of borrowings

 

(418,280

)

 

(503,516

)

Proceeds from exercise of stock options

 

1,831

 

 

11,473

 

Repurchases of common stock

 

(212,499

)

 

(249,999

)

Other financing activities

 

-

 

 

(611

)

Net cash used in financing activities

 

(179,085

)

 

(137,635

)

  Effect of exchange rate changes on cash and cash equivalents

 

(1,583

)

 

(122

)

  Net increase in cash and cash equivalents

 

384

 

 

(6,881

)

  Cash and cash equivalents: Beginning of period

 

69,807

 

 

95,966

 

End of period

$

70,191

 

$

89,085

 

    RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO ADJUSTED FREE CASH FLOW   Net cash provided by operating activities

$

189,987

 

$

153,262

 

Payments in respect of restructuring activities

 

9,714

 

 

1,983

 

Purchase of property, plant and equipment, net (a)

 

(17,391

)

 

(19,908

)

Adjusted free cash flow

$

182,310

 

$

135,337

 

Note: (a) In September 2021, the Company entered into an agreement with the U.S. Department of Defense to increase the domestic production capacity of pipette tips and enhance manufacturing automation and logistics. The Company received funding of $35.8 million in prior years, which offset capital expenditures. During the three months ended March 31, 2023 the related purchase of property, plant and equipment of $3.3 million are excluded from Adjusted free cash flow.

METTLER-TOLEDO INTERNATIONAL INC.

OTHER OPERATING STATISTICS

 

SALES GROWTH BY DESTINATION (unaudited)  

Americas

 

Europe

 

Asia/RoW

 

Total

 

 

 

 

 

 

 

U.S. Dollar Sales Growth

 

 

 

 

 

 

 

Three Months Ended March 31, 2024

3%

 

8%

 

(12%)

 

0%

 

 

 

 

 

 

 

Local Currency Sales Growth

 

 

 

 

 

 

 

Three Months Ended March 31, 2024

3%

 

6%

 

(8%)

 

0%

Note: (a) The Company estimates net sales benefited by 6% from recovering previously delayed shipments from the fourth quarter of 2023. By geographic destination, net sales benefited approximately 4% in the Americas, 11% in Europe and 4% in Asia/Rest of World. RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS (unaudited)   Three months ended March 31,

2024

2023

% Growth

  EPS as reported, diluted

$

8.24

$

8.47

 

-3

%

  Purchased intangible amortization, net of tax

 

0.24

(a)

 

0.23

 

(a)

Restructuring charges, net of tax

 

0.36

(b)

 

0.16

 

(b)

Income tax expense

 

0.05

(c)

 

(0.17

)

(c)

  Adjusted EPS, diluted

$

8.89

$

8.69

 

2

%

Notes: (a) Represents the EPS impact of purchased intangibles amortization of $6.6 million ($5.1 million after tax) for both three month periods ended March 31, 2024 and 2023. (b) Represents the EPS impact of restructuring charges of $9.7 million ($7.8 million after tax) and $4.3 million ($3.5 million after tax) for the three months ended March 31, 2024 and 2023, respectively, which primarily include employee related costs. (c) Represents the EPS impact of the difference between our quarterly and estimated annual tax rate before non-recurring discrete items during the three months ended March 31, 2024 and 2023 due to the timing of excess tax benefits associated with stock option exercises.

 

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Adam Uhlman Head of Investor Relations METTLER TOLEDO Direct: 614-438-4794 adam.uhlman@mt.com