Mettler-Toledo International Reports Q4-2019 Results

Columbus / OH. (mti) Mettler-Toledo International Inc. announced fourth quarter results for 2019. Provided below are the highlights:

• Reported sales increased 3 percent compared with the prior year. In local currency, sales increased 4 percent in the quarter as currency reduced sales growth by 1 percent.

• Net earnings per diluted share as reported (EPS) were USD 7.84, compared with USD 7.11 in the prior-year period. Adjusted EPS was USD 7.78, an increase of 14 percent over the prior-year amount of USD 6.85. Adjusted EPS is a non-GAAP measure, and we have included a reconciliation to EPS on the last page of the attached schedules.

Quarterly Results

Olivier Filliol, President and Chief Executive Officer, stated, «We had good sales growth in the quarter, particularly in light of the excellent growth in the prior year. Sales growth was strong in the Americas and China. With the benefit of our margin and productivity initiatives, we overcame meaningful currency and tariff headwinds to generate strong margin improvement and earnings growth in the quarter. Finally, we had excellent cash flow generation in the quarter and for the full year.»

GAAP Results

EPS in the quarter was USD 7.84, compared with the prior-year amount of USD 7.11. EPS included a one-time, non-cash, deferred tax gain of USD 0.64, while prior year EPS included a one-time, non-cash, acquisition-related gain of USD 0.75.

Compared with the prior year, total reported sales increased 3 percent to USD 844.0 million. By region, reported sales increased 6 percent in the Americas and 4 percent in Asia/Rest of World. Reported sales in Europe declined by 1 percent. Earnings before taxes amounted to USD 231.1 million, compared with USD 230.5 million in the prior year. Earnings before taxes in the prior year included a one-time, non-cash, acquisition-related gain of USD 18.7 million.

Non-GAAP Results

Adjusted EPS was USD 7.78, an increase of 14 percent over the prior-year amount of USD 6.85.

Compared with the prior year, total sales in local currency increased 4 percent as currency reduced reported sales growth by 1 percent. By region, local currency sales increased 6 percent in the Americas, 1 percent in Europe and 5 percent in Asia/Rest of World. Adjusted Operating Profit amounted to USD 256.3 million, a 7 percent increase from the prior-year amount of USD 239.7 million.

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 in 2019 was USD 22.47, compared with the prior-year amount of USD 19.88. EPS included a one-time, non-cash, deferred tax gain of USD 0.63, while prior year EPS included a one-time, non-cash, acquisition-related gain of USD 0.74.

Compared with the prior year, total reported sales increased 2 percent in 2019 to USD 3.009 billion. By region, reported sales increased 5 percent in the Americas and 3 percent in Asia/Rest of World. Reported sales in Europe declined 2 percent. Earnings before taxes amounted to USD 681.4 million, compared with USD 651.9 million in the prior year. Earnings before taxes in the prior year included a one-time, non-cash, acquisition-related gain of USD 18.7 million.

Non-GAAP Results

Adjusted EPS in 2019 was USD 22.77, an increase of 12 percent over the prior-year amount of USD 20.32.

Compared with the prior year, total sales in local currency increased 5 percent as currency reduced reported sales growth by 3 percent. By region, local currency sales increased 6 percent in the Americas, 3 percent in Europe and 6 percent in Asia/Rest of World. Adjusted Operating Profit amounted to USD 778.1 million, a 7 percent increase from the prior-year amount of USD 730.5 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

The Company said that based on its assessment of market conditions today, management anticipates local currency sales growth in 2020 will be approximately 4 percent. This sales growth is expected to result in Adjusted EPS in the range of USD 24.85 to USD 25.10, a growth rate of 9 percent to 10 percent. Management noted that local currency sales growth and Adjusted EPS guidance remains unchanged from previous guidance.

Management noted that they will face tough comparisons in the first quarter 2020 due to strong sales in the prior-year quarter and will face strong headwinds to Adjusted EPS due to adverse currency and the impact of tariff costs in the first quarter. In addition, based on today’s assessment, the Company expects a significant impact on its China sales in the first quarter due to the Wuhan Coronavirus.

Based on market conditions today, the Company anticipates that local currency sales growth in the first quarter 2020 will be approximately 0 percent to 1 percent, and Adjusted EPS is forecasted to be in the range of USD 4.20 to USD 4.30, an increase of 2 percent to 5 percent.

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. The Company noted in making its outlook that uncertainty remains in the macroeconomic environment and market conditions are subject to change.

Conclusion

Filliol concluded, «Demand in our markets remains solid with the exception of Food Retail and the potential short-term impact of the Wuhan Coronavirus. We continue to invest for growth via our investments in our field force, Spinnaker sales and marketing programs and new product development. We remain confident in executing on our growth, productivity and margin initiatives. We will monitor the macroeconomic environment as uncertainty exists in certain regions of the world, and remain agile and adapt if market conditions change. Based on market conditions today, we believe we can continue to gain share and deliver strong results in 2020.»