Mettler-Toledo International (MTD) 8-K Mettler-toledo International Inc. Reports

FOR IMMEDIATE RELEASE Exhibit 99.1

METTLER-TOLEDO INTERNATIONAL INC. REPORTS

THIRD QUARTER 2018 RESULTS

- - Very Good Sales Growth - -

- - Strong EPS Growth - -

COLUMBUS, Ohio, USA - November 8, 2018 - Mettler-Toledo International Inc. (NYSE: MTD) today announced third quarter results for 2018. Provided below are the highlights:

• Reported sales increased 5% as compared with the prior year. In local currency, sales increased 7% in the quarter as currency reduced sales growth by 2%.

• Net earnings per diluted share as reported (EPS) were $4.93, compared with $3.99 in the prior-year period. Adjusted EPS was $5.12, an increase of 17% over the prior-year amount of $4.36. Adjusted EPS is a non-GAAP measure, and we have included a reconciliation to EPS on the last page of the attached schedules.

Third Quarter Results

Olivier Filliol, President and Chief Executive Officer, stated, “We had very good sales growth with particularly strong results in our Laboratory products. In addition, China had very good growth despite a difficult comparison with excellent sales growth in the prior year. Earnings growth was again strong as we continue to benefit from our margin and productivity initiatives.”

GAAP Results

EPS in the quarter was $4.93, compared with the prior-year amount of $3.99.

Compared with the prior year, total reported sales increased 5% to $734.8 million. By region, reported sales increased 5% in the Americas, 1% in Europe and 9% in Asia/Rest of World. Earnings before tax amounted to $160.4 million, compared with $139.6 million in the prior year.

Non-GAAP Results

Adjusted EPS was $5.12, an increase of 17% over the prior-year amount of $4.36.

Compared with the prior year, total sales in local currency increased 7% as currency reduced reported sales growth by 2%. By region, local currency sales increased 5% in the Americas, 3% in Europe and 11% in Asia/Rest of World. Adjusted Operating Income amounted to $182.0 million, a 13% increase from the prior-year amount of $161.7 million.

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

Nine Month Results

GAAP Results

EPS in the first nine months was $12.81, compared with the prior-year amount of $11.31.

Compared with the prior-year period, total reported sales increased 9% to $2.118 billion. By region, reported sales increased 5% in the Americas, 9% in Europe and 14% in Asia/Rest of World. Earnings before tax amounted to $421.4 million, compared with $380.3 million in the prior year.

Non-GAAP Results

Adjusted EPS was $13.50, an increase of 16% over the prior-year amount of $11.61.

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Compared to the prior-year period, total sales in local currency increased 6% as currency benefited reported sales growth by 3%. By region, local currency sales increased 5% in the Americas, 3% in Europe and 10% in Asia/Rest of World. Adjusted Operating Income amounted to $490.8 million, a 13% increase from the prior-year amount of $435.7 million.

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

Share Repurchase Authorization

The Company has a $4.5 billion stock repurchase program of which $4.3 billion has been utilized. The Company announced that the Board of Directors authorized an additional $2.0 billion to the share repurchase program. Any amount remaining under the existing program will be incorporated into the new authorization. Filliol commented, "The additional authorization allows us to continue the share repurchase program which has provided strong returns for our shareholders over many years. We are confident in our future growth prospects and our balance sheet and cash flow generation remain very strong." The Company expects the additional authorization will be utilized over the next several years. The Company added that the repurchases will be made through open market transactions, and the amount and timing will depend on business and market conditions, stock price, trading restrictions, the level of acquisition activity and other factors.

Outlook

Based on today's assessment of market conditions, management anticipates that local currency sales growth in the fourth quarter 2018 will be approximately 6%, and Adjusted EPS is forecasted to be in the range of $6.72 to $6.77, an increase of 13%. Included in the fourth quarter guidance is an estimated 5% headwind to Adjusted EPS growth due to adverse currency and higher tariff costs.

For the full year 2018, local currency sales growth is expected to be approximately 6%. This sales growth is expected to result in Adjusted EPS in the range of $20.20 to $20.25, an increase of 15%. This compares with previous guidance of Adjusted EPS in the range of $20.10 to $20.25.

The Company said that based on its assessment of market conditions today, management anticipates local currency sales growth in 2019 will be approximately 5%. This sales growth is expected to result in Adjusted EPS in the range of $22.40 to $22.60. Using the mid-point of 2018 guidance, this would result in Adjusted EPS growth of 11% to 12%. The percentage headwind to Adjusted EPS growth in 2019 due to adverse currency and higher tariff costs will be similar to what we expect in the fourth quarter 2018.

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 economic uncertainty remains in certain regions of the world and market conditions are subject to change.

Conclusion

Filliol concluded, “Demand remains solid in our markets and we are benefiting from our growth initiatives including investments in our field force, Spinnaker sales and marketing programs and new product launches. While global business activity remains good overall, we are more cautious on the global economy compared with earlier in the year. We will monitor closely and remain agile and adapt our plans if market conditions change. We are confident in our ability to execute on our growth initiatives and believe we are well positioned to continue to gain market share. Looking ahead to 2019, we assume current market conditions will remain largely unchanged. With the benefit of our margin and productivity initiatives, and despite greater headwinds due to currency and tariffs, we believe we can continue to deliver strong results for 2018 and 2019.”

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Other Matters

The Company will host a conference call to discuss its quarterly results today (Thursday, Nov. 8) 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. These statements involve known and unknown risks, uncertainties and other factors that may cause our or our businesses’ actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by any forward-looking statements. 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” or the negative of those terms or other comparable terminology. For a discussion of these risks and uncertainties, please see the discussion on forward-looking statements in our current report on Form 10-K. All of the forward-looking statements are qualified in their entirety by reference to the factors discussed under the captions “Factors affecting our future operating results” and in the “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of our annual report on Form 10-K for the most recently completed fiscal year, which describe risks and factors that could cause results to differ materially from those projected in those forward-looking statements.

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METTLER-TOLEDO INTERNATIONAL INC. CONSOLIDATED STATEMENTS OF OPERATIONS (amounts in thousands except share data) (unaudited)
		Three months ended						Three months ended
		September 30, 2018				% of sales		September 30, 2017				% of sales
Net sales		$	734,846		(a)	100.0		$	698,799			100.0
Cost of sales		315,592				42.9		297,824			(b)	42.6
Gross profit		419,254				57.1		400,975				57.4
Research and development		34,838				4.7		32,203			(b)	4.6
Selling, general and administrative		202,451				27.6		207,033			(b)	29.6
Amortization		11,856				1.6		10,716				1.5
Interest expense		9,003				1.2		8,248				1.2
Restructuring charges		2,222				0.3		3,385				0.5
Other charges (income), net		(1,479		)		(0.1	)	(237		)	(b)	0.0
Earnings before taxes		160,363				21.8		139,627				20.0
Provision for taxes		33,710				4.6		34,677				5.0
Net earnings		$	126,653			17.2		$	104,950			15.0
Basic earnings per common share:
Net earnings		$	5.04					$	4.10
Weighted average number of common shares		25,126,061						25,613,433
Diluted earnings per common share:
Net earnings		$	4.93					$	3.99
Weighted average number of common and common equivalent shares		25,683,365						26,303,529
Note:
(a)	Local currency sales increased 7% as compared to the same period in 2017.
(b)	In accordance with the new accounting rules that went into effect on January 1, 2018, the Company reclassified a net pension benefit of $1.2 million into other charges (income) from other income statement categories for the three months ended September 30, 2017 to be consistent with the 2018 presentation.
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
		Three months ended						Three months ended
		September 30, 2018				% of sales		September 30, 2017				% of sales
Earnings before taxes		$	160,363					$	139,627
Amortization		11,856						10,716
Interest expense		9,003						8,248
Restructuring charges		2,222						3,385
Other charges (income), net		(1,479		)				(237		)	(b)
Adjusted operating income		$	181,965		(c)	24.8		$	161,739			23.1
Note:
(c)	Adjusted operating income increased 13% as compared to the same period in 2017.

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METTLER-TOLEDO INTERNATIONAL INC. CONSOLIDATED STATEMENTS OF OPERATIONS (amounts in thousands except share data) (unaudited)
		Nine months ended						Nine months ended
		September 30, 2018				% of sales		September 30, 2017				% of sales
Net sales		$	2,117,663		(a)	100.0		$	1,947,022			100.0
Cost of sales		910,851				43.0		827,046			(b)	42.5
Gross profit		1,206,812				57.0		1,119,976				57.5
Research and development		104,866				5.0		95,985			(b)	4.9
Selling, general and administrative		611,149				28.9		588,313			(b)	30.2
Amortization		35,561				1.7		31,010				1.6
Interest expense		25,671				1.2		24,160				1.2
Restructuring charges		13,956				0.6		8,840				0.5
Other charges (income), net		(5,795		)		(0.3	)	(8,654		)	(b)(c)	(0.4	)
Earnings before taxes		421,404				19.9		380,322				19.5
Provision for taxes		89,979				4.2		81,326				4.1
Net earnings		$	331,425			15.7		$	298,996			15.4
Basic earnings per common share:
Net earnings		$	13.10					$	11.60
Weighted average number of common shares		25,296,680						25,764,472
Diluted earnings per common share:
Net earnings		$	12.81					$	11.31
Weighted average number of common and common equivalent shares		25,877,979						26,446,677
Note:
(a)	Local currency sales increased 6% as compared to the same period in 2017.
(b)	In accordance with the new accounting rules that went into effect on January 1, 2018, the Company reclassified a net pension benefit of $3.1 million into other charges (income) from other income statement categories for the nine months ended September 30, 2017 to be consistent with the 2018 presentation.
(c)	Other charges (income), net includes a one-time gain of $3.4 million for the nine months ended September 30, 2017 relating to the sale of the facility in Switzerland in connection with our initiative to consolidate certain Swiss operations into a new facility.
RECONCILIATION OF EARNINGS BEFORE TAXES TO ADJUSTED OPERATING INCOME
		Nine months ended						Nine months ended
		September 30, 2018				% of sales		September 30, 2017				% of sales
Earnings before taxes		$	421,404					$	380,322
Amortization		35,561						31,010
Interest expense		25,671						24,160
Restructuring charges		13,956						8,840
Other charges (income), net		(5,795		)				(8,654		)	(b)(c)
Adjusted operating income		$	490,797		(d)	23.2		$	435,678			22.4
Note:
(d)	Adjusted operating income increased 13% as compared to the same period in 2017.

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METTLER-TOLEDO INTERNATIONAL INC. CONDENSED CONSOLIDATED BALANCE SHEETS (amounts in thousands) (unaudited)
	September 30, 2018		December 31, 2017
Cash and cash equivalents	$	137,448	$	148,687
Accounts receivable, net	494,887		528,615
Inventories	277,266		255,390
Other current assets and prepaid expenses	61,898		74,031
Total current assets	971,499		1,006,723
Property, plant and equipment, net	697,689		668,271
Goodwill and other intangible assets, net	758,766		766,556
Other non-current assets	129,710		108,255
Total assets	$	2,557,664	$	2,549,805
Short-term borrowings and maturities of long-term debt	$	55,753	$	19,677
Trade accounts payable	156,447		167,627
Accrued and other current liabilities	485,269		502,369
Total current liabilities	697,469		689,673
Long-term debt	988,894		960,170
Other non-current liabilities	339,686		352,682
Total liabilities	2,026,049		2,002,525
Shareholders’ equity	531,615		547,280
Total liabilities and shareholders’ equity	$	2,557,664	$	2,549,805

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METTLER-TOLEDO INTERNATIONAL INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (amounts in thousands) (unaudited)
	Three months ended						Nine months ended
	September 30,						September 30,
	2018			2017			2018			2017
Cash flow from operating activities:
Net earnings	$	126,653		$	104,950		$	331,425		$	298,996
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation	9,283			8,502			27,889			24,421
Amortization	11,856			10,716			35,561			31,010
Deferred tax benefit	(1,792		)	(3,914		)	(11,901		)	(7,754		)
Other	2,763			4,027			9,799			8,656
Increase (decrease) in cash resulting from changes in
operating assets and liabilities	911			21,577			(26,340		)	(4,094		)
Net cash provided by operating activities	149,674			145,858			366,433			351,235
Cash flows from investing activities:
Proceeds from sale of property, plant and equipment	3,279			228			7,809			10,437
Purchase of property, plant and equipment	(35,079		)	(37,297		)	(96,665		)	(85,826		)
Acquisitions	(4,462		)	(107,748		)	(4,962		)	(108,445		)
Net hedging settlements on intercompany loans	(7,822		)	4,749			(780		)	3,716
Net cash used in investing activities	(44,084		)	(140,068		)	(94,598		)	(180,118		)
Cash flows from financing activities:
Proceeds from borrowings	169,094			312,773			772,274			985,694
Repayments of borrowings	(201,180		)	(218,899		)	(703,704		)	(834,061		)
Proceeds from exercise of stock options	4,817			6,380			14,777			23,315
Repurchases of common stock	(118,750		)	(85,049		)	(356,249		)	(334,998		)
Other financing activities	(29		)	—			(1,664		)	(7,205		)
Net cash used in financing activities	(146,048		)	15,205			(274,566		)	(167,225		)
Effect of exchange rate changes on cash and cash equivalents	(5,284		)	1,757			(8,508		)	6,550
Net (decrease) increase in cash and cash equivalents	(45,742		)	22,752			(11,239		)	10,412
Cash and cash equivalents:
Beginning of period	183,190			146,334			148,687			158,674
End of period	$	137,448		$	169,086		$	137,448		$	169,086
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO ADJUSTED FREE CASH FLOW
Net cash provided by operating activities	$	149,674		$	145,858		$	366,433		$	351,235
Payments in respect of restructuring activities	3,292			2,375			16,701			7,701
Payments for acquisition costs	140			764			140			764
Transition tax payment	—			—			4,200			—
Proceeds from sale of property, plant and equipment	3,279			228			7,809			10,437
Purchase of property, plant and equipment	(35,079		)	(37,297		)	(96,665		)	(85,826		)
Adjusted free cash flow	$	121,306		$	111,928		$	298,618		$	284,311

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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 September 30, 2018				1%			5%	9%				5%
	Nine Months Ended September 30, 2018				9%			5%	14%				9%
Local Currency Sales Growth
	Three Months Ended September 30, 2018				3%			5%	11%				7%
	Nine Months Ended September 30, 2018				3%			5%	10%				6%
RECONCILIATION OF DILUTED EPS AS REPORTED TO ADJUSTED DILUTED EPS
(unaudited)
		Three months ended							Nine months ended
		September 30,							September 30,
		2018			2017			% Growth	2018				2017				% Growth
EPS as reported, diluted		$	4.93		$	3.99		24%	$	12.81			$	11.31			13%
Restructuring charges, net of tax		0.07		(a)	0.10		(a)		0.42			(a)	0.26			(a)
Purchased intangible amortization, net of tax		0.10		(b)	0.07		(b)		0.29			(b)	0.18			(b)
Income tax expense		0.02		(c)	0.15		(c)		(0.02		)	(c)	(0.09		)	(c)
Acquisition costs, net of tax		—			0.05		(d)		—				0.05			(d)
Gain on facility sale		—			—				—				(0.10		)	(e)
Adjusted EPS, diluted		$	5.12		$	4.36		17%	$	13.50			$	11.61			16%
Notes:
(a)	Represents the EPS impact of restructuring charges of $2.2 million ($1.7 million after tax) and $3.4 million ($2.6 million after tax) for the three months ended September 30, 2018 and 2017, and $14.0 million ($10.9 million after tax) and $8.8 million ($6.9 million after tax) for the nine months ended September 30, 2018 and 2017, respectively. Restructuring charges in 2018 primarily relates to employee and other costs associated with the consolidation of facilities.
(b)	Represents the EPS impact of purchased intangibles amortization, net of tax, of $3.4 million ($2.5 million after tax) and $2.6 million ($1.7 million after tax) for the three months ended September 30, 2018 and 2017, and $10.0 million ($7.5 million after tax) and $7.2 million ($4.7 million after tax) for the nine months ended September 30, 2018 and 2017, respectively.
(c)	Represents the EPS impact on our reported tax rate during the three and nine months ending September 30, 2018 and 2017, respectively, due to excess tax benefits associated with stock option exercises.
(d)	Represents the EPS impact of acquisition costs of $1.7 million ($1.3 million after tax) for the three and nine months ended September 30, 2017.
(e)	Represents the EPS impact of a one-time gain of $3.4 million ($2.7 million after tax) for the nine months ended September 30, 2017 relating to the sale of a facility in Switzerland in connection with our initiative to consolidate certain Swiss operations into a new facility.

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