Mettler-Toledo International Inc. (NYSE: MTD) today announced
first quarter results for 2023. Provided below are the
highlights:
- Reported sales increased 3% compared with the prior year. In
local currency, sales increased 7% in the quarter as currency
reduced sales growth by 4%.
- Net earnings per diluted share as reported (EPS) were $8.47,
compared with $7.55 in the prior-year period. Adjusted EPS was
$8.69, an increase of 10% over the prior-year amount of $7.87.
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, “We had a very good start to the year with our first
quarter results and benefited from broad-based growth across
geographic regions and product categories, including very strong
momentum in our service business. We were also pleased with our
strong execution on margin initiatives and cost control, which
resulted in solid growth in Adjusted EPS despite a very significant
currency headwind.”
GAAP Results
EPS in the quarter was $8.47, compared with the prior-year
amount of $7.55.
Compared with the prior year, total reported sales increased 3%
to $929 million. By region, reported sales increased 5% in the
Americas and 2% in both Europe and Asia/Rest of World. Earnings
before taxes amounted to $226.6 million, compared with $213.0
million in the prior year.
Non-GAAP Results
Adjusted EPS was $8.69, an increase of 10% over the prior-year
amount of $7.87.
Compared with the prior year, total sales in local currency
increased 7% as currency reduced sales growth by 4%. By region,
local currency sales increased 6% in both the Americas and Europe
and 10% in Asia/Rest of World. Adjusted Operating Profit amounted
to $266.5 million, a 10% increase from the prior-year amount of
$241.2 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
The Company stated that forecasting remains challenging.
Management cautions that market conditions are dynamic and changes
to the business environment can occur quickly. There is uncertainty
in the economic environment today, including the risk of recession
in many countries, and management acknowledges that market
conditions are subject to change.
Based on today's assessment of market conditions, management
anticipates local currency sales growth for the second quarter of
2023 will be approximately 3%, and Adjusted EPS is forecast to be
$9.90 to $10.00, a growth rate of 5% to 7%. Included in the second
quarter guidance is an estimated 4% headwind to Adjusted EPS growth
due to adverse currency.
For the full year, management anticipates local currency sales
growth in 2023 will be approximately 5%, and Adjusted EPS is
forecast to be in the range of $43.65 to $43.95, representing
growth of approximately 10% to 11%. This compares with previous
local currency sales growth guidance of approximately 5% and
Adjusted EPS guidance of $43.55 to $43.95. Included in the 2023
guidance is an estimated 2% headwind to Adjusted EPS growth due to
adverse currency.
While the Company has provided an outlook for local currency
sales growth and Adjusted EPS, it has not provided an outlook for
reported sales growth or EPS as it would require an estimate of
currency exchange fluctuations and non-recurring items, which are
not yet known.
Conclusion
Kaltenbach concluded, “There is uncertainty in the global
economy and our end markets, but we remain focused on the factors
we can control, namely capitalizing on our Spinnaker sales and
marketing programs and executing on our productivity and margin
expansion initiatives. Investment in our broad product portfolio
will extend our technology leadership and deliver innovative
solutions for customers that increase productivity, enhance
compliance, and improve quality. We believe our unique growth
strategies, tremendous diversity, and culture of operational
excellence and agility position us very well to gain market share
and deliver solid financial results in 2023.”
Other Matters
The Company will host a conference call to discuss its quarterly
results tomorrow (Friday, May 5) at 8:30 a.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 (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 and ongoing developments related
to Ukraine. 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 and ongoing developments related to
Ukraine 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, and the ongoing developments related to Ukraine. See in
particular “Factors Affecting Our Future Operating Results” and
“Management’s Discussion and Analysis of Financial Condition and
Results of Operations” in our Annual Report on Form 10-K for the
year ended December 31, 2022 and other reports filed with the SEC
from time to time.
METTLER-TOLEDO INTERNATIONAL INC. CONSOLIDATED STATEMENTS
OF OPERATIONS (amounts in thousands except share data)
(unaudited)
Three months ended
Three months ended
March 31, 2023
% of sales
March 31, 2022
% of sales Net sales
$928,738
(a)
100.0
$897,791
100.0
Cost of sales
382,172
41.1
378,206
42.1
Gross profit
546,566
58.9
519,585
57.9
Research and development
45,477
4.9
43,028
4.8
Selling, general and administrative
234,638
25.3
235,312
26.2
Amortization
17,779
1.9
16,604
1.8
Interest expense
18,184
2.0
11,338
1.3
Restructuring charges
4,274
0.4
4,011
0.5
Other charges (income), net
(396)
(0.0)
(3,709)
(0.4)
Earnings before taxes
226,610
24.4
213,001
23.7
Provision for taxes
38,184
4.1
39,000
4.3
Net earnings
$188,426
20.3
$174,001
19.4
Basic earnings per common share: Net earnings
$8.53
$7.64
Weighted average number of common shares
22,083,456
22,768,298
Diluted earnings per common share: Net earnings
$8.47
$7.55
Weighted average number of common
22,253,435
23,040,231
and common equivalent shares Note: (a) Local currency sales
increased 7% as compared to the same period in 2022.
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING
PROFIT
Three months ended
Three months ended
March 31, 2023 % of sales
March 31, 2022
% of sales Earnings before taxes
$226,610
$213,001
Amortization
17,779
16,604
Interest expense
18,184
11,338
Restructuring charges
4,274
4,011
Other charges (income), net
(396)
(3,709)
Adjusted operating profit
$266,451
(b)
28.7
$241,245
26.9
Note: (b) Adjusted operating profit increased 10% as
compared to the same period in 2022.
METTLER-TOLEDO INTERNATIONAL
INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(amounts in thousands)
(unaudited)
March 31, 2023 December 31, 2022 Cash and cash
equivalents
$89,085
$95,966
Accounts receivable, net
640,050
709,321
Inventories
427,549
441,694
Other current assets and prepaid expenses
130,083
128,108
Total current assets
1,286,767
1,375,089
Property, plant and equipment, net
780,013
778,600
Goodwill and other intangibles assets, net
961,876
966,224
Other non-current assets
381,251
372,482
Total assets
$3,409,907
$3,492,395
Short-term borrowings and maturities of long-term debt
$107,131
$106,054
Trade accounts payable
176,733
252,538
Accrued and other current liabilities
720,385
789,139
Total current liabilities
1,004,249
1,147,731
Long-term debt
2,015,779
1,908,480
Other non-current liabilities
414,348
411,391
Total liabilities
3,434,376
3,467,602
Shareholders’ equity
(24,469)
24,793
Total liabilities and shareholders’ equity
$3,409,907
$3,492,395
METTLER-TOLEDO INTERNATIONAL INC. CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (amounts in
thousands) (unaudited) Three months ended March
31,
2023
2022
Cash flow from operating activities: Net earnings
$188,426
$174,001
Adjustments to reconcile net earnings to net cash provided by
operating activities: Depreciation
12,023
11,880
Amortization
17,779
16,604
Deferred tax provision (benefit)
602
(1,096)
Share-based compensation
4,027
4,509
Decrease in cash resulting from changes in operating assets and
liabilities
(69,595)
(115,061)
Net cash provided by operating activities
153,262
90,837
Cash flows from investing activities: Purchase of property,
plant and equipment
(23,196)
(19,151)
Proceeds from government funding (a)
-
18,000
Acquisitions
(613)
(9,704)
Other investing activities
1,423
3,743
Net cash used in investing activities
(22,386)
(7,112)
Cash flows from financing activities: Proceeds from
borrowings
605,018
684,037
Repayments of borrowings
(503,516)
(478,479)
Proceeds from exercise of stock options
11,473
5,289
Repurchases of common stock
(249,999)
(275,000)
Other financing activities
(611)
(332)
Net cash used in financing activities
(137,635)
(64,485)
Effect of exchange rate changes on cash and cash equivalents
(122)
(855)
Net increase in cash and cash equivalents
(6,881)
18,385
Cash and cash equivalents: Beginning of period
95,966
98,564
End of period
$89,085
$116,949
RECONCILIATION OF NET CASH PROVIDED BY OPERATING
ACTIVITIES TO ADJUSTED FREE CASH FLOW Net cash provided
by operating activities
$153,262
$90,837
Payments in respect of restructuring activities
1,983
1,914
Purchase of property, plant and equipment, net (a)
(19,908)
(17,472)
Payments for acquisition costs
-
174
Adjusted free cash flow
$135,337
$75,453
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 will receive
funding of $35.8 million, which will offset future capital
expenditures. Funding proceeds of $18.0 million during the three
months ended March 31, 2022 and the related purchase of property,
plant and equipment of $3.3 million and $1.7 million for the three
months ended March 31, 2023 and 2022, respectively, are excluded
from Adjusted free cash flow.
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, 2023
2%
5%
2%
3%
Local Currency Sales Growth Three Months Ended March 31,
2023
6%
6%
10%
7%
RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED
EPS (unaudited) Three months ended March 31,
2023
2022
% Growth
EPS as reported, diluted
$8.47
$7.55
12%
Purchased intangible amortization, net of tax
0.23
(a)
0.22
(a)
Restructuring charges, net of tax
0.16
(b)
0.14
(b)
Income tax expense
(0.17)
(c)
(0.06)
(c)
Acquisition costs, net of tax
-
(d)
0.02
(d)
Adjusted EPS, diluted
$8.69
$7.87
10%
Notes: (a) Represents the EPS impact of purchased intangibles
amortization of $6.6 million ($5.1 million after tax) for the three
months ended March 31, 2023 and 2022. (b) Represents the EPS impact
of restructuring charges of $4.3 million ($3.5 million after tax)
and $4.0 million ($3.2 million after tax) for the three months
ended March 31, 2023 and 2022, 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, 2023 and 2022 due to the timing of excess tax benefits
associated with stock option exercises. (d) Represents the EPS
impact of acquisition costs of $0.5 million ($0.4 million after
tax) for the three months ended March 31, 2022.
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version on businesswire.com: https://www.businesswire.com/news/home/20230504005913/en/
Adam Uhlman Head of Investor Relations METTLER TOLEDO Direct:
614-438-4794 adam.uhlman@mt.com
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