Mettler-Toledo International Inc. Reports Fourth Quarter 2023 Results
- Reported sales declined 12% compared with the prior year. In local currency, sales decreased 13% in the quarter as currency increased sales growth by 1%.
-
Net earnings per diluted share as reported (EPS) were
$8.52 , compared with$11.86 in the prior-year period. Adjusted EPS was$9.40 , a decrease of 22% over the prior-year amount of$12.10 . Adjusted EPS is a non-GAAP measure, and a reconciliation to EPS is included on the last page of the attached schedules.
Fourth Quarter Results
GAAP Results
EPS in the quarter was
Compared with the prior year, total reported sales declined 12% to
Non-GAAP Results
Adjusted EPS was
Compared with the prior year, total sales in local currency decreased 13% as currency increased sales growth by 1%. By region, local currency sales declined 7% in the
Adjusted EPS and Adjusted Operating Profit are non-GAAP measures. Reconciliations to the most comparable GAAP measures are provided in the attached schedules.
Full Year Results
GAAP Results
EPS was
Compared with the prior year, total reported sales declined 3% to
Non-GAAP Results
Adjusted EPS was
Compared with the prior year, total sales in local currency decreased 3% as currency was neutral for the year. By region, local currency sales decreased 1% in the
Outlook
The Company stated that forecasting remains difficult. Management cautions that market conditions are uncertain and changes to the business environment can occur quickly. There is increased uncertainty in the economic environment today, including the risk of recession in many countries.
Based on today's assessment of market conditions, management anticipates local currency sales for the first quarter of 2024 will decline approximately 4% to 6%, and Adjusted EPS is forecast to be
For the full year, management anticipates local currency sales in 2024 will increase approximately 1% to 2%, and Adjusted EPS is forecast to be in the range of
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 are preparing for challenging market conditions to persist in the first half of 2024, while also remaining agile to quickly capitalize on growth opportunities and trends towards automation and digitalization, as well as customer investments in faster growth segments. Over the past couple years, we have continued to invest strongly in next-generation products and solutions and have also enhanced our best-in-class corporate programs by launching the next waves of Spinnaker and SternDrive. This will help us further increase our competitiveness and put us in an even more favorable position, especially once our markets pick up again.”
Other Matters
The Company will host a conference call to discuss its quarterly results tomorrow morning (
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
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
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
|
|||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
(amounts in thousands except share data) |
|||||||||||||||
(unaudited) |
|||||||||||||||
Three months ended |
Three months ended |
||||||||||||||
|
% of sales |
|
% of sales |
||||||||||||
Net sales |
$ |
934,992 |
|
(a) |
100.0 |
|
$ |
1,057,685 |
|
100.0 |
|
||||
Cost of sales |
|
383,354 |
|
41.0 |
|
|
425,545 |
|
40.2 |
|
|||||
Gross profit |
|
551,638 |
|
59.0 |
|
|
632,140 |
|
59.8 |
|
|||||
Research and development |
|
46,435 |
|
5.0 |
|
|
45,942 |
|
4.3 |
|
|||||
Selling, general and administrative |
|
223,427 |
|
23.9 |
|
|
227,586 |
|
21.5 |
|
|||||
Amortization |
|
18,078 |
|
1.9 |
|
|
16,542 |
|
1.6 |
|
|||||
Interest expense |
|
19,655 |
|
2.1 |
|
|
16,805 |
|
1.6 |
|
|||||
Restructuring charges |
|
13,055 |
|
1.4 |
|
|
1,753 |
|
0.2 |
|
|||||
Other charges (income), net |
|
(1,568 |
) |
(0.2 |
) |
|
(1,502 |
) |
(0.1 |
) |
|||||
Earnings before taxes |
|
232,556 |
|
24.9 |
|
|
325,014 |
|
30.7 |
|
|||||
Provision for taxes |
|
47,761 |
|
5.1 |
|
|
59,180 |
|
5.6 |
|
|||||
Net earnings |
$ |
184,795 |
|
19.8 |
|
$ |
265,834 |
|
25.1 |
|
|||||
Basic earnings per common share: | |||||||||||||||
Net earnings |
$ |
8.56 |
|
$ |
11.97 |
|
|||||||||
Weighted average number of common shares |
|
21,593,616 |
|
|
22,209,188 |
|
|||||||||
Diluted earnings per common share: | |||||||||||||||
Net earnings |
$ |
8.52 |
|
$ |
11.86 |
|
|||||||||
Weighted average number of common and common equivalent shares |
|
21,687,577 |
|
|
22,407,796 |
|
|||||||||
Note: | |||||||||||||||
(a) Local currency sales decreased 13% as compared to the same period in 2022. |
|||||||||||||||
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING PROFIT |
|||||||||||||
|
|
|
|
|
|
|
|
|
|
||||
|
Three months ended |
|
|
|
|
|
Three months ended |
|
|
||||
|
|
|
|
|
% of sales |
|
|
|
% of sales |
||||
Earnings before taxes |
$ |
232,556 |
|
$ |
325,014 |
|
|||||||
Amortization |
|
18,078 |
|
|
16,542 |
|
|||||||
Interest expense |
|
19,655 |
|
|
16,805 |
|
|||||||
Restructuring charges |
|
13,055 |
|
|
1,753 |
|
|||||||
Other charges (income), net |
|
(1,568 |
) |
|
(1,502 |
) |
|||||||
Adjusted operating profit |
$ |
281,776 |
|
(b) |
30.1 |
$ |
358,612 |
|
33.9 |
||||
Note: | |||||||||||||
(b) Adjusted operating profit decreased 21% as compared to the same period in 2022. |
|||||||||||||
|
|||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
(amounts in thousands except share data) |
|||||||||||||||
(unaudited) |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||
|
Twelve months ended |
|
|
|
|
|
Twelve months ended |
|
|
||||||
|
|
|
|
|
% of sales |
|
|
|
% of sales |
||||||
Net sales |
$ |
3,788,309 |
|
(a) |
100.0 |
|
$ |
3,919,709 |
|
100.0 |
|
||||
Cost of sales |
|
1,547,023 |
|
40.8 |
|
|
1,611,667 |
|
41.1 |
|
|||||
Gross profit |
|
2,241,286 |
|
59.2 |
|
|
2,308,042 |
|
58.9 |
|
|||||
Research and development |
|
185,284 |
|
4.9 |
|
|
177,122 |
|
4.5 |
|
|||||
Selling, general and administrative |
|
904,106 |
|
23.9 |
|
|
938,461 |
|
23.9 |
|
|||||
Amortization |
|
72,213 |
|
1.9 |
|
|
66,239 |
|
1.7 |
|
|||||
Interest expense |
|
77,366 |
|
2.0 |
|
|
55,392 |
|
1.4 |
|
|||||
Restructuring charges |
|
32,735 |
|
0.9 |
|
|
9,556 |
|
0.2 |
|
|||||
Other charges (income), net |
|
(4,146 |
) |
(0.1 |
) |
|
(9,320 |
) |
(0.1 |
) |
|||||
Earnings before taxes |
|
973,728 |
|
25.7 |
|
|
1,070,592 |
|
27.3 |
|
|||||
Provision for taxes |
|
184,950 |
|
4.9 |
|
|
198,090 |
|
5.0 |
|
|||||
Net earnings |
$ |
788,778 |
|
20.8 |
|
$ |
872,502 |
|
22.3 |
|
|||||
Basic earnings per common share: | |||||||||||||||
Net earnings |
$ |
36.10 |
|
$ |
38.79 |
|
|||||||||
Weighted average number of common shares |
|
21,848,122 |
|
|
22,491,790 |
|
|||||||||
Diluted earnings per common share: | |||||||||||||||
Net earnings |
$ |
35.90 |
|
$ |
38.41 |
|
|||||||||
Weighted average number of common and common equivalent shares |
|
21,971,528 |
|
|
22,718,290 |
|
|||||||||
Note: | |||||||||||||||
(a) Local currency sales decreased 3% as compared to the same period in 2022. |
|||||||||||||||
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING PROFIT |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||
|
Twelve months ended |
|
|
|
|
|
Twelve months ended |
|
|
||||||
|
|
|
|
|
% of sales |
|
|
|
% of sales |
||||||
Earnings before taxes |
$ |
973,728 |
|
$ |
1,070,592 |
|
|||||||||
Amortization |
|
72,213 |
|
|
66,239 |
|
|||||||||
Interest expense |
|
77,366 |
|
|
55,392 |
|
|||||||||
Restructuring charges |
|
32,735 |
|
|
9,556 |
|
|||||||||
Other charges (income), net |
|
(4,146 |
) |
|
(9,320 |
) |
|||||||||
Adjusted operating profit |
$ |
1,151,896 |
|
(b) |
30.4 |
|
$ |
1,192,459 |
|
30.4 |
|
||||
Note: | |||||||||||||||
(b) Adjusted operating profit decreased 3% as compared to the same period in 2022. |
|||||||||||||||
|
||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||
(amounts in thousands) |
||||||
(unaudited) |
||||||
|
|
|||||
Cash and cash equivalents |
$ |
69,807 |
|
$ |
95,966 |
|
Accounts receivable, net |
|
663,893 |
|
|
709,321 |
|
Inventories |
|
385,865 |
|
|
441,694 |
|
Other current assets and prepaid expenses |
|
110,638 |
|
|
128,108 |
|
Total current assets |
|
1,230,203 |
|
|
1,375,089 |
|
Property, plant and equipment, net |
|
803,374 |
|
|
778,600 |
|
|
|
955,537 |
|
|
966,224 |
|
Other non-current assets |
|
366,441 |
|
|
372,482 |
|
Total assets |
$ |
3,355,555 |
|
$ |
3,492,395 |
|
Short-term borrowings and maturities of long-term debt |
$ |
192,219 |
|
$ |
106,054 |
|
Trade accounts payable |
|
210,411 |
|
|
252,538 |
|
Accrued and other current liabilities |
|
778,452 |
|
|
789,139 |
|
Total current liabilities |
|
1,181,082 |
|
|
1,147,731 |
|
Long-term debt |
|
1,888,620 |
|
|
1,908,480 |
|
Other non-current liabilities |
|
435,791 |
|
|
411,391 |
|
Total liabilities |
|
3,505,493 |
|
|
3,467,602 |
|
Shareholders’ equity |
|
(149,938 |
) |
|
24,793 |
|
Total liabilities and shareholders’ equity |
$ |
3,355,555 |
|
$ |
3,492,395 |
|
|
||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||||||||||
(amounts in thousands) |
||||||||||||||||
(unaudited) |
||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
Three months ended |
|
Twelve months ended |
||||||||||||
|
|
|
|
|
||||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Cash flow from operating activities: |
||||||||||||||||
Net earnings |
$ |
184,795 |
|
$ |
265,834 |
|
$ |
788,778 |
|
$ |
872,502 |
|
||||
Adjustments to reconcile net earnings to net cash provided by operating activities: |
||||||||||||||||
Depreciation |
|
12,545 |
|
|
11,783 |
|
|
48,951 |
|
|
46,784 |
|
||||
Amortization |
|
18,078 |
|
|
16,542 |
|
|
72,213 |
|
|
66,239 |
|
||||
Deferred tax benefit |
|
(8,918 |
) |
|
31,398 |
|
|
(13,373 |
) |
|
26,517 |
|
||||
Share-based compensation |
|
5,478 |
|
|
5,730 |
|
|
17,928 |
|
|
19,661 |
|
||||
Increase (decrease) in cash resulting from changes in operating assets and liabilities |
|
69,528 |
|
|
(27,644 |
) |
|
51,377 |
|
|
(172,636 |
) |
||||
Net cash provided by operating activities |
|
281,506 |
|
|
303,643 |
|
|
965,874 |
|
|
859,067 |
|
||||
|
||||||||||||||||
Cash flows from investing activities: |
||||||||||||||||
Proceeds from sale of property, plant and equipment |
|
167 |
|
|
163 |
|
|
835 |
|
|
399 |
|
||||
Purchase of property, plant and equipment |
|
(32,416 |
) |
|
(32,028 |
) |
|
(105,323 |
) |
|
(121,241 |
) |
||||
Proceeds from government funding (a) |
|
3,498 |
|
|
1,000 |
|
|
6,094 |
|
|
29,670 |
|
||||
Acquisitions |
|
(5,198 |
) |
|
(12,363 |
) |
|
(5,811 |
) |
|
(37,951 |
) |
||||
Other investing activities |
|
(1,552 |
) |
|
(6,809 |
) |
|
(27,489 |
) |
|
(10,272 |
) |
||||
Net cash used in investing activities |
|
(35,501 |
) |
|
(50,037 |
) |
|
(131,694 |
) |
|
(139,395 |
) |
||||
Cash flows from financing activities: |
||||||||||||||||
Proceeds from borrowings |
|
556,824 |
|
|
786,195 |
|
|
2,126,797 |
|
|
2,307,256 |
|
||||
Repayments of borrowings |
|
(629,795 |
) |
|
(810,354 |
) |
|
(2,097,023 |
) |
|
(1,947,398 |
) |
||||
Proceeds from exercise of stock options |
|
- |
|
|
13,756 |
|
|
19,234 |
|
|
33,216 |
|
||||
Repurchases of common stock |
|
(176,002 |
) |
|
(274,999 |
) |
|
(900,000 |
) |
|
(1,099,998 |
) |
||||
Acquisition contingent consideration payment |
|
- |
|
|
- |
|
|
(7,767 |
) |
|
(7,912 |
) |
||||
Other financing activities |
|
- |
|
|
(31 |
) |
|
(826 |
) |
|
(1,203 |
) |
||||
Net cash used in financing activities |
|
(248,973 |
) |
|
(285,433 |
) |
|
(859,585 |
) |
|
(716,039 |
) |
||||
|
||||||||||||||||
Effect of exchange rate changes on cash and cash equivalents |
|
3,100 |
|
|
5,657 |
|
|
(754 |
) |
|
(6,231 |
) |
||||
|
||||||||||||||||
Net increase (decrease) in cash and cash equivalents |
|
132 |
|
|
(26,170 |
) |
|
(26,159 |
) |
|
(2,598 |
) |
||||
|
||||||||||||||||
Cash and cash equivalents: |
||||||||||||||||
Beginning of period |
|
69,675 |
|
|
122,136 |
|
|
95,966 |
|
|
98,564 |
|
||||
End of period |
$ |
69,807 |
|
$ |
95,966 |
|
$ |
69,807 |
|
$ |
95,966 |
|
||||
|
||||||||||||||||
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO ADJUSTED FREE CASH FLOW |
||||||||||||||||
|
||||||||||||||||
Net cash provided by operating activities |
$ |
281,506 |
|
$ |
303,643 |
|
$ |
965,874 |
|
$ |
859,067 |
|
||||
Payments in respect of restructuring activities |
|
10,877 |
|
|
1,449 |
|
|
25,818 |
|
|
7,965 |
|
||||
Proceeds from sale of property, plant and equipment |
|
167 |
|
|
164 |
|
|
835 |
|
|
399 |
|
||||
Purchase of property, plant and equipment, net (a) |
|
(32,416 |
) |
|
(32,474 |
) |
|
(97,593 |
) |
|
(93,131 |
) |
||||
Acquisition payments (b) |
|
- |
|
|
72 |
|
|
4,775 |
|
|
2,678 |
|
||||
Transition tax payment |
|
- |
|
|
- |
|
|
8,042 |
|
|
4,289 |
|
||||
Adjusted free cash flow |
$ |
260,134 |
|
$ |
272,854 |
|
$ |
907,751 |
|
$ |
781,267 |
|
Notes: |
||
(a) | In |
|
(b) | Includes |
|
||||||||||||
OTHER OPERATING STATISTICS | ||||||||||||
SALES GROWTH BY DESTINATION | ||||||||||||
(unaudited) | ||||||||||||
|
|
|
Total | |||||||||
|
||||||||||||
Three Months Ended |
(6 |
%) |
(11 |
%) |
(19 |
%) |
(12 |
%) |
||||
Twelve Months Ended |
(1 |
%) |
- |
% |
(9 |
%) |
(3 |
%) |
||||
Local Currency Sales Growth | ||||||||||||
Three Months Ended |
(7 |
%) |
(16 |
%) |
(18 |
%) |
(13 |
%) |
||||
Twelve Months Ended |
(1 |
%) |
(2 |
%) |
(5 |
%) |
(3 |
%) |
||||
RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS |
||||||||||||||||||||||||||
(unaudited) |
||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Three months ended |
|
Twelve months ended |
|||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||||
|
2023 |
|
|
2022 |
|
|
% Growth |
|
2023 |
|
|
2022 |
|
|
% Growth |
|||||||||||
EPS as reported, diluted |
$ |
8.52 |
$ |
11.86 |
|
-28 |
% |
$ |
35.90 |
$ |
38.41 |
-7 |
% |
|||||||||||||
Purchased intangible amortization, net of tax |
|
0.23 |
(a) |
|
0.21 |
|
(a) |
|
0.93 |
(a) |
|
0.87 |
(a) | |||||||||||||
Restructuring charges, net of tax |
|
0.49 |
(b) |
|
0.06 |
|
(b) |
|
1.20 |
(b) |
|
0.34 |
(b) | |||||||||||||
Acquisition costs, net of tax |
|
- |
(c) |
|
0.01 |
|
(c) |
|
- |
(c) |
|
0.03 |
(c) | |||||||||||||
Income tax expense |
|
0.16 |
(d) |
|
(0.04 |
) |
(d) |
|
- |
|
- |
|||||||||||||||
Adjusted EPS, diluted |
$ |
9.40 |
$ |
12.10 |
|
-22 |
% |
$ |
38.03 |
$ |
39.65 |
-4 |
% |
Notes: | ||
(a) | Represents the EPS impact of purchased intangibles amortization of |
|
(b) | Represents the EPS impact of restructuring charges of |
|
(c) | Represents the EPS impact of acquisition transaction costs of |
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(d) | 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. Also includes a |
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Head of Investor Relations
Direct: 614-438-4794
adam.uhlman@mt.com
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