Mettler-Toledo International Inc. Reports Fourth Quarter 2020 Results

COLUMBUS, Ohio, Feb. 4, 2021 /PRNewswire/ -- Mettler-Toledo International Inc. (NYSE: MTD) today announced fourth quarter results for 2020. Provided below are the highlights:

  • Reported sales increased 11% compared with the prior year. In local currency, sales increased 7% in the quarter as currency benefited reported sales growth by 4%.
  • Net earnings per diluted share as reported (EPS) were $9.03, compared with $7.84 in the prior-year period. Adjusted EPS was $9.26, an increase of 19% over the prior-year amount of $7.78. Adjusted EPS is a non-GAAP measure, and a reconciliation to EPS is included on the last page of the attached schedules.

Quarterly Results

Olivier Filliol, President and Chief Executive Officer, stated, "We ended the year with very good sales growth in all regions, with particularly strong growth in our Laboratory business and in China. We benefited from strong execution and were well positioned to capture growth as customer demand improved, however, we continued to be negatively impacted by COVID-19 in certain businesses and end markets. Strong sales growth, combined with good cost control and the benefit of our ongoing margin and productivity initiatives, contributed to strong growth in Adjusted Operating Profit and Adjusted EPS. Finally, cash flow generation in the quarter, and for the full year, was excellent."

GAAP Results
EPS in the quarter was $9.03, compared with the prior-year amount of $7.84.

Compared with the prior year, total reported sales increased 11% to $938.0 million. By region, reported sales increased 8% in the Americas, 14% in Europe and 12% in Asia/Rest of World. Earnings before taxes amounted to $269.2 million, compared with $231.1 million in the prior year.

Non-GAAP Results
Adjusted EPS was $9.26, an increase of 19% over the prior-year amount of $7.78.

Compared with the prior year, total sales in local currency increased 7% as currency benefited sales growth by 4%. By region, local currency sales increased 8% in the Americas, 7% in Europe and 8% in Asia/Rest of World. Adjusted Operating Profit amounted to $292.8 million, a 14% increase from the prior-year amount of $256.3 million.

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

Year-to-Date Results

GAAP Results
EPS for the year was $24.91, compared with the prior-year amount of $22.47.

Compared with the prior year, total reported sales increased 3% to $3.085 billion. By region, reported sales increased 1% in the Americas, 3% in Europe and 3% in Asia/Rest of World. Earnings before taxes amounted to $748.7 million, compared with $681.4 million in the prior year.

Non-GAAP Results
Adjusted EPS was $25.72, an increase of 13% over the prior-year amount of $22.77.

Compared with the prior year, total sales in local currency increased 2% as currency increased reported sales by 1%. By region, local currency sales increased 2% in the Americas, 1% in Europe and 3% in Asia/Rest of World. Adjusted Operating Profit amounted to $840.7 million, an 8% increase from the prior-year amount of $778.1 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 continues to be challenging given the uncertainty surrounding COVID-19 and ensuing impact to the global economic environment. Management cautions that market dynamics and impacts related to COVID-19 are fluid and changes to the business environment can happen quickly. The estimates include significant uncertainty and management acknowledges that market conditions are subject to change.

Based on today's assessment of market conditions, management anticipates local currency sales growth in 2021 will be in the range of 5% to 7%, and Adjusted EPS is forecasted to be in the range of $29.20 to $29.80, an increase of 14% to 16%. This compares with previous guidance of Adjusted EPS in the range of $27.50 to $28.30.

For the first quarter of 2021, based on current market conditions, the Company anticipates that local currency sales growth will be in the range of 11% to 13%, and Adjusted EPS is forecasted to be $5.55 to $5.70, a growth rate of 39% to 43%.

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

Filliol concluded, "In 2020, we strengthened our franchise with our ability to support our customers, while prioritizing on the safety of our employees and customers. We differentiated from competition by leveraging and quickly adjusting our digital sales and marketing and Go-to-Market approaches to identify and pursue pockets of growth and effectively engage with customers. Our agility in responding to the unprecedented market conditions led to further share gains that would not have been possible without our Spinnaker sales and marketing foundation, excellent product portfolio, world-class service organization and strong culture of execution. We are in a strong position to capitalize on growth as customer demand improves throughout the world. While uncertainty remains surrounding the ultimate impact to the economy from COVID-19, we will continue to focus on serving our customers and driving our growth and margin initiatives. We will remain agile and adapt to changes in market conditions as necessary. We have good momentum as we enter 2021 and believe we are well positioned to continue to gain share and deliver strong results."

Other Matters

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

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. 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 and long-term impacts of the COVID-19 pandemic. 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." 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, customer demand, our competitive position, pricing, our supply chain, adequacy of our facilities, access to and the costs of raw materials, shipping and supplier costs, gross margins, planned research and development efforts and product introductions, capital expenditures, cash flow, tax-related matters, the impact of foreign currencies, compliance with laws, effects of acquisitions and the impact of the COVID-19 pandemic on our businesses. 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 the uncertain duration and severity of the COVID-19 pandemic. 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, 2019 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

         
   

December 31, 2020

 

% of sales

 

December 31, 2019

 

% of sales

 
                                       

Net sales

   

$937,985

(a)

 

100.0

       

$843,969

     

100.0

   

Cost of sales

   

378,941

     

40.4

       

345,672

     

41.0

   

Gross profit

   

559,044

     

59.6

       

498,297

     

59.0

   
                                       

Research and development

   

39,866

     

4.3

       

35,299

     

4.2

   

Selling, general and administrative

   

226,369

     

24.1

       

206,717

     

24.5

   

Amortization

   

14,657

     

1.6

       

12,813

     

1.5

   

Interest expense

   

9,505

     

1.0

       

9,635

     

1.1

   

Restructuring charges

   

3,181

     

0.3

       

4,614

     

0.5

   

Other charges (income), net

   

(3,714)

     

(0.4)

       

(1,924)

     

(0.3)

   

Earnings before taxes

   

269,180

     

28.7

       

231,143

     

27.3

   
                                       

Provision for taxes

   

52,885

     

5.6

       

38,394

(b)

 

4.5

   

Net earnings

   

$216,295

     

23.1

       

$192,749

     

22.8

   
                                       

Basic earnings per common share:

                                   

Net earnings

   

$9.15

               

$7.95

           

Weighted average number of common shares

   

23,642,415

               

24,241,383

           
                                       

Diluted earnings per common share:

                                   

Net earnings

   

$9.03

               

$7.84

           

Weighted average number of common

   

23,965,853

               

24,599,702

           

and common equivalent shares

                                   
                                       

Note:

                                   

(a)

Local currency sales increased 7% as compared to the same period in 2019.

   

(b)

Provision for taxes includes a non-cash deferred net benefit of $15.8 million for the three months ended December 31, 2019 related to the enactment of Swiss tax reform.

   
                                       

RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING PROFIT

                                       
     

Three months ended

           

Three months ended

         
   

December 31, 2020

 

% of sales

 

December 31, 2019

 

% of sales

 
                                       

Earnings before taxes

   

$269,180

               

$231,143

           

Amortization

   

14,657

               

12,813

           

Interest expense

   

9,505

               

9,635

           

Restructuring charges

   

3,181

               

4,614

           

Other charges (income), net

   

(3,714)

               

(1,924)

           

Adjusted operating profit

   

$292,809

(c)

 

31.2

       

$256,281

     

30.4

   
                                       

Note:

                                   

(c)

Adjusted operating profit increased 14% as compared to the same period in 2019.

   

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands except share data)

(unaudited)

                                       
   

Twelve months ended

         

Twelve months ended

         
   

December 31, 2020

 

% of sales

 

December 31, 2019

 

% of sales

 
                               

Net sales

   

$3,085,177

(a)

 

100.0

       

$3,008,652

     

100.0

   

Cost of sales

   

1,284,146

     

41.6

       

1,267,441

     

42.1

   

Gross profit

   

1,801,031

     

58.4

       

1,741,211

     

57.9

   
                                       

Research and development

   

140,102

     

4.5

       

143,950

     

4.8

   

Selling, general and administrative

   

820,221

     

26.6

       

819,183

     

27.2

   

Amortization

   

56,665

     

1.8

       

49,690

     

1.7

   

Interest expense

   

38,616

     

1.3

       

37,411

     

1.2

   

Restructuring charges

   

10,516

     

0.3

       

15,760

     

0.5

   

Other charges (income), net

   

(13,832)

     

(0.4)

       

(6,177)

     

(0.3)

   

Earnings before taxes

   

748,743

     

24.3

       

681,394

     

22.6

   
                                       

Provision for taxes

   

146,004

     

4.8

       

120,285

(b)

 

4.0

   

Net earnings

   

$602,739

     

19.5

       

$561,109

     

18.6

   
                                       

Basic earnings per common share:

                                   

Net earnings

   

$25.24

               

$22.84

           

Weighted average number of common shares

   

23,882,648

               

24,567,609

           
                                       

Diluted earnings per common share:

                                   

Net earnings

   

$24.91

               

$22.47

           

Weighted average number of common

   

24,199,230

               

24,974,457

           

and common equivalent shares

                                   
                                       

Note:

                                   

(a)

Local currency sales increased 2% compared to the same period in 2019.

   

(b)

Provision for taxes includes a non-cash deferred net benefit of $15.8 million for the twelve months ended December 31, 2019 related to the enactment of Swiss tax reform.

   
                                       

RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING PROFIT

                                       
     

Twelve months ended

           

Twelve months ended

         
   

December 31, 2020

 

% of sales

 

December 31, 2019

 

% of sales

 
                                       

Earnings before taxes

   

$748,743

               

$681,394

           

Amortization

   

56,665

               

49,690

           

Interest expense

   

38,616

               

37,411

           

Restructuring charges

   

10,516

               

15,760

           

Other charges (income), net

   

(13,832)

               

(6,177)

           

Adjusted operating profit

   

$840,708

(c)

 

27.2

       

$778,078

     

25.9

   
                                       

Note:

                                   

(c)

Adjusted operating profit increased 8% as compared to the same period in 2019.

   
 

METTLER-TOLEDO INTERNATIONAL INC.

 

CONDENSED CONSOLIDATED BALANCE SHEETS

 

(amounts in thousands)

 

(unaudited)

                     
                     
   

December 31, 2020

   

December 31, 2019

                     

Cash and cash equivalents

   

$94,254

       

$207,785

 

Accounts receivable, net

   

593,809

       

566,256

 

Inventories

   

297,611

       

274,285

 

Other current assets and prepaid expenses

   

71,230

       

61,321

 

Total current assets

   

1,056,904

       

1,109,647

 
                     

Property, plant and equipment, net

   

798,868

       

748,657

 

Goodwill and other intangibles assets, net

   

747,055

       

742,221

 

Other non-current assets

   

211,722

       

188,796

 

Total assets

   

$2,814,549

       

$2,789,321

 
                     

Short-term borrowings and maturities of long-term debt

   

$50,317

       

$55,868

 

Trade accounts payable

   

175,801

       

185,592

 

Accrued and other current liabilities

   

614,209

       

513,052

 

Total current liabilities

   

840,327

       

754,512

 
                     

Long-term debt

   

1,284,174

       

1,235,350

 

Other non-current liabilities

   

407,373

       

378,679

 

Total liabilities

   

2,531,874

       

2,368,541

 
                     

Shareholders' equity

   

282,675

       

420,780

 

Total liabilities and shareholders' equity

   

$2,814,549

       

$2,789,321

 

METTLER-TOLEDO INTERNATIONAL INC.

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(amounts in thousands)

 

(unaudited)

 
                   
   

Three months ended

 

Twelve months ended

 
   

December 31,

 

December 31,

 
   

2020

 

2019

 

2020

 

2019

 
                   

Cash flow from operating activities:

               

Net earnings

$216,295

 

$192,749

 

$602,739

 

$561,109

 

Adjustments to reconcile net earnings to

               

net cash provided by operating activities:

               

Depreciation

11,095

 

9,643

 

42,044

 

38,991

 

Amortization

14,657

 

12,813

 

56,665

 

49,690

 

Deferred tax (benefit) expense

(5,794)

 

29,166

 

(12,784)

 

11,203

 

Share-based compensation

5,439

 

5,002

 

18,687

 

18,285

 

Swiss tax reform benefit (a)

-

 

(15,833)

 

-

 

(15,833)

 

Other

(2,399)

 

161

 

(2,399)

 

133

 

Increase (decrease) in cash resulting from changes in

               

operating assets and liabilities

11,576

 

(31,992)

 

19,747

 

(60,128)

 

Net cash provided by operating activities

250,869

 

201,709

 

724,699

 

603,450

 
                   

Cash flows from investing activities:

               

Proceeds from sale of property, plant and equipment

60

 

174

 

3,106

 

1,422

 

Purchase of property, plant and equipment

(35,066)

 

(25,714)

 

(92,494)

 

(97,341)

 

Acquisitions

-

 

-

 

(6,242)

 

(2,004)

 

Net hedging settlements on intercompany loans

4,691

 

2,939

 

(4,730)

 

(1,160)

 

Net cash used in investing activities

(30,315)

 

(22,601)

 

(100,360)

 

(99,083)

 
                   

Cash flows from financing activities:

               

Proceeds from borrowings

340,680

 

627,370

 

1,489,040

 

1,435,081

 

Repayments of borrowings

(252,678)

 

(515,989)

 

(1,483,869)

 

(1,176,784)

 

Proceeds from exercise of stock options

525

 

9,665

 

26,719

 

47,581

 

Repurchases of common stock

(374,999)

 

(216,249)

 

(774,998)

 

(774,999)

 

Acquisition contingent consideration payment

-

 

-

 

-

 

(10,000)

 

Other financing activities

-

 

-

 

(800)

 

1,753

 

Net cash used in financing activities

(286,472)

 

(95,203)

 

(743,908)

 

(477,368)

 
                   

Effect of exchange rate changes on cash and cash equivalents

6,486

 

3,348

 

6,038

 

2,676

 
                   

Net increase (decrease) in cash and cash equivalents

(59,432)

 

87,253

 

(113,531)

 

29,675

 
                   

Cash and cash equivalents:

               

Beginning of period

153,686

 

120,534

 

$207,785

 

178,110

 

End of period

$94,254

 

$207,787

 

$94,254

 

$207,785

 
                   
                   

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

 
                   

Net cash provided by operating activities

$250,869

 

$201,709

 

$724,699

 

$603,450

 

Payments in respect of restructuring activities

2,280

 

7,033

 

8,541

 

16,483

 

Proceeds from sale of property, plant and equipment

60

 

174

 

3,106

 

1,422

 

Purchase of property, plant and equipment

(35,066)

 

(25,714)

 

(92,494)

 

(97,341)

 

Payments for one-time legal charge (b)

-

 

2,992

 

-

 

2,992

 

Transition tax payment

-

 

-

 

4,264

 

4,289

 

Adjusted free cash flow

$218,143

 

$186,194

 

$648,116

 

$531,295

 
                   

(a)

Represents a non-cash deferred net benefit of $15.8 million for the three and twelve months ended December 31, 2019 related to the enactment of Swiss tax reform.

 

(b)

Represents cash payment made in 2019, related to the one-time legal charge recorded during the three months ended December 31, 2018.

 

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, 2020

   

14%

 

8%

 

12%

 

11%

   
 

Twelve Months Ended December 31, 2020

   

3%

 

1%

 

3%

 

3%

   
                         

Local Currency Sales Growth (Decrease)

                     
 

Three Months Ended December 31, 2020

   

7%

 

8%

 

8%

 

7%

   
 

Twelve Months Ended December 31, 2020

   

1%

 

2%

 

3%

 

2%

   
                         
                         

RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS

 

(unaudited)

 
                         
   

Three months ended

Twelve months ended

   

December 31,

December 31,

   

2020

 

2019

 

% Growth

 

2020

 

2019

 

% Growth

                         

EPS as reported, diluted

$9.03

 

$7.84

 

15%

 

$24.91

 

$22.47

 

11%

                         

Restructuring charges, net of tax

0.11

(a)

0.15

(a)

   

0.35

(a)

0.50

(a)

 

Purchased intangible amortization, net of tax

0.12

(b)

0.11

(b)

   

0.46

(b)

0.43

(b)

 

Income tax expense

-

(c)

0.32

(c)

   

-

 

-

   

Swiss Tax reform

-

 

(0.64)

(d)

   

-

 

(0.63)

(d)

 
                         

Adjusted EPS, diluted

$9.26

 

$7.78

 

19%

 

$25.72

 

$22.77

 

13%

                         

Notes:

                     

(a)

Represents the EPS impact of restructuring charges of $3.2 million ($2.6 million after tax) and $4.6 million ($3.7 million after tax) for the three months ended December 31, 2020 and 2019, and $10.5 million ($8.5 million after tax) and $15.8 million ($12.6 million after tax) for the twelve months ended December 31, 2020 and 2019, respectively, which primarily include employee related costs.

(b)

Represents the EPS impact of purchased intangibles amortization of $3.7 million ($2.8 million after tax) and $3.8 million ($2.8 million after tax) for the three months ended December 31, 2020 and 2019, and of $14.9 million ($11.2 million after tax) and $14.3 million ($10.8 million after tax) for the twelve months ended December 31, 2020 and 2019, respectively.

(c)

Represents the EPS impact of the difference between our reported and annual tax rate before non-recurring discrete items, due to the timing of excess tax benefits associated with stock option exercises and a $0.20 EPS benefit for the three months ended December 31, 2020 for the reduction in our annualized effective tax rate to 19.5% for the first three quarters of 2020.

(d)

Represents the EPS impact of a non-cash deferred net benefit of $15.8 million related to the enactment of Swiss tax reform for the three and twelve months ended December 31, 2019.

Cision View original content:http://www.prnewswire.com/news-releases/mettler-toledo-international-inc-reports-fourth-quarter-2020-results-301222717.html

SOURCE Mettler-Toledo International Inc.


Company Codes: NYSE:MTD

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