MTD - Earnings call transcript Q3 2021 | Mettler-Toledo International Inc.

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Operator

Good day, and thank you for standing by. Welcome to the Mettler-Toledo 's Third Quarter 2021 Earnings Conference Call. This time all participants are in listen-only mode. After the speaker’s presentation, there will be a question-and-answer session. [Operator Instruction]. today's being that advised be conference recorded. is Please Instruction]. [Operator hand over to I would speaker conference to like Finnegan. now your the today, Mary ahead. go Please

Mary Finnegan

Thank CEO, Mettler-Toledo, everyone. for evening, I'm Officer. joined you you, Finnegan. Patrick call. Vadala, and responsible Kaltenbach, our by I'm Financial our to I'm the Investor Shawn happy and Mary at today to and welcome Relations good Chief

A a being replay on cover available just we couple of website. webcast on is me This that is the administrative on release Let call today's press for and available our presentation also and copy the matters. website. call the is to referred

activity, not the meaning and may page harbor be or presentation. the factors this Securities Act any actual the the results, historical me which U.S. and is uncertainties, forward-looking are U.S. Securities XXXX forward-looking implied These of in other or safe risk, statements Exchange statements within facts, those cause statements. X expressed summarize our of Act different involve from performance, constitute of achievements the that by XXXX. of outlined on of level Statements Let which materially language, to presentation,

these XX-K discussion with risks please a recent uncertainties, Form of For SEC. our and see filed reports other and the

and in All Results, Operating and the qualified the of the of filings. sections forward-looking reference condition Affecting statements and of financial of our Future operations in discussion their to captions, management by entirety analysis are and factors our business Factors discussed results under the

financial XX-K. with call, in and use respect measure directly information, other non-GAAP detailed on differences measures information financial Form comparable most of today's provided one GAAP use the may and is item Just between non-GAAP we to more

the me to call Let turn Patrick. now over

Patrick Kaltenbach

very strong good and be was Customer demand initiatives very and results. another Thanks pleased of continue I our report to growth effective. evening robust am quarter to Mary, everyone.

components, chain special very global acknowledgment throughout teams a respect a myriad I give and to materials, supply the team, to navigating Our well. which of with want transportation. our world is raw challenges are executing to

Our dynamic supply to advantage is a heightened environment. ability demand customer the be proving in competitive overcoming to the to chain meet in continue while this challenges

page presentation. in results. you Now, let The can all Local on see, turn And our of another very quarter. the to we financial regions. highlights had currency we XX% were X growth broad-based have me favorable and sales

the good business growth our was Laboratory growth retail all excellent very operating our quarter. adjusted lines execution, performed drove With had flow in we a a had product a achieved Cash also generation XX% in XX% as strong sales Our our sales growth and very well. quarter. and headwind, decline in we adjusted the in growth strong industrial income was significant Food and EPS. increase

very favorable effective are strategic remain end-markets initiatives capturing our growth. and Our at

and provide market while identify marketing exposure Our increasing our to also the customers. approach to the framework segments, force most Spinnaker strategic and pursue the sales most attractive sales

offering, portfolio, which technology productivity. to invest extending reinforcing customer service through our lead strength in breadth trust and also supports further product continue our of We our global and the customer’s

challenges global and challenging We dynamics have can date the cautious navigated rapidly. supply several conditions are successfully change to demand remain dynamic -- the but we -- as have of chain

deliver our global execution stronger our the proven With uncertainty positioned in and Although focused good continued position on markets, to share. economy, XXXX. we and strategies, pockets believe of are we exist in to land ideally an market margin in sales XXXX growth initiatives, in gain believe are excellent and we we demand

will the some me and year. our turn and additional Shawn? come with Let Shawn details, it on to commentary next outlook I now to guidance and the financial business cover for then back

Shawn Vadala

On currency. acquisition a Local in sales growth and grew an Asia, XX% increased with X% quarter, sales currency Sales XX% XX% The good growth as evening, PendoTECH in number and slide basis, the sales a XX% show approximately in increased XX% X U.S. sales of of year, X% from increase benefit were Europe, and increase area. next by our currency the dollar sales we $XXX World. Rest sales for increased X, Local in million by product by in Asia the quarter. Europe, quarter, The XX% X% the to Americas, China in Patrick growth. in shows the growth contributed sales in Americas, and of World. number by local region slide testing currency COVID currency in that COVID strong. headwind sales quarter. rest X, approximately everybody. a the currency the region. in in summarized local local the On was sales the Thanks, of to of XX% we Local XX% in estimate -- growth months, Last XX% particularly growth year-to-date. currency benefited On pipette was testing growth while business XX% labs we Slide sales

XX%, For in up industrial we expected Food the than XX%, in increased retail decline with sales X-month XX%, by year-to-date. worse quarter. The product currency increased up the XX%, quarter, shows XX%. for and of came and industrial retail third XX% next core Food up product product with industrial declined slide core XX%, period. the X%. laboratory inspection increased with inspection XX%, up Laboratory increased local X% Industrial area, growth sales sales a

year, prior-year cost on impact the over a part we last amounted due the X. increased XX.X%, XX.X%. basis We're basis, of increase now quarter, undertaken summarized higher undertook volume in level sales rest R&D namely On XX% to a local point in factors this million. period. and in $XXX over me of the couple points with $XX.X actions of temporary currency on marketing XX basis this costs, expense very variable sales increase the of X-year amount and reflects a quarter. the quarter pandemic. in A execution. margin amounted $XXX.X the number is compensation, project reached contributed the year savings of over and chain, we year, logistics, million, temporary transportation, benefited operating growth from increase year. Amortization as good with increase, the to were currency the the implemented Gross which well level million $X.X that margins in prior-year as million the strong in prior reflecting margins a Let Other principal P&L pleased which quarter, Adjusted our amounted Adjusted a comments P&L. supply combined up from prior point to the in increase benefited the million, XX.X%, impact over operating amounted to is move $XXX.X prior-year as income was cost of final cost investments million combined higher temporary the prior the actions million to global was impact XXX the amounted were the activity margin increase. of and a basis local cost to quarter. in of income. offset increase non-service-related challenges primarily was the the which greater we the to the undertook in $XX.X $XX driving slide Interest the the quarter material which XX% in We in by to pension and profit XX.X%. The XX XX% XXXX. last in over The increase. SG&A savings pricing,

XX% is flow XX was prior $XX.X basis increased offset -- XX% option year. a sales year-to-date. on flow prior amounted cash in covers the increase XX%, the than at on a was in cash $X.XX tax year. $X.XX tax to and XXX XX.X%. the $XXX.X of between is $X.XX as as rate the now DSO in That by $X.XX our XX% exercises. $X.XX, the year-to-date million, let million the comment currency slide Our days, XX% and Fully income adjusted year. On prior me in amounted which up quarter grew which a On to adjusted an as $XXX.X of of million, basis days the Adjusted timing to reported the the difference P&L cash year. adjusted the operating generation. adjusted basis. margins on intangible quarter, XX EPS and We're the quarter, a came free effective deductions The option of in P&L, on compared flow for stock an the EPS before is free year. compared a $X.XX diluted next with prior of less amount cash quarter, items shows of X% due Reported compared to prior quarterly is rate grew quarter to shares last increase restructuring, Adjusted Local due basis very basis, from over was slightly points. flow. discrete the better which EPS the ITO our to amounted prior per-share EPS XX% year. annual which In year increase X.X purchased for of than amortization, to X times, timing a includes decline stock year-to-date our per-share to a with $X.XX. was happy the basis

now Let turn guidance. to me

in chain the the in While the China. pockets our widespread and There notably uncertainty. be Furthermore, economy, uncertainty global end-markets are remained to inflationary corresponding transportation within most impact the and creates continues in of favorable, supply logistics forecasting challenging. in also challenges

the we seen to of remaining changes which unprecedented reflects quickly. our adapting navigate in the with how organization. Finally, believe over of lockdowns our variance have to importance we can and occur strength ability We the last agile years, the several X very and months recognize the COVID pleased of unexpected We're environment. last the challenges

our to our cautious drive and and control, stern to margin our improvement market feel outside pricing remain ability initiatives gain good via While about we growth of initiatives. continue drive very our factors share about we and

me specifics. the cover let Now

XX%. now currency in expect XXXX the of be growth sales full-year approximately XXXX, local This XX%. For we to compares previous guidance to

range be We to in EPS X%. X% adjusted rate to in EPS is to growth of to $XX.XX, local guidance respect a $XX to the currency of growth quarter, expect to range growth expect we the the to sales $XX.XX. of With range be which X% the rate approximately would $XX.XX expect of and fourth compares to be a EPS adjusted $XX.XX of to This previous $XX.XX full-year adjusted of in XX%.

For the adjusted in of be to approximately and assessment sales would of EPS based range the today, we $XX.XX market full-year $XX.XX. be expect Using local XXXX, midpoint the currency rate COVID growth on testing to our a our X% conditions to on sales of XX% guidance, guidance, further comments growth headwind reflects we impact business. slight on pipette expect growth XX% of XXXX to of a this the XXXX Some to from

in below XXXX, XXXX amortization pretax intangible amortization share Purchased profit, XXXX, increase in expect expected interest is to amortization intangible million. expected on higher including at in estimated due income, in million total or expense This operating be from We $XX to other is XXXX. million. adjusted approximately $X.XX $XX excluded per which $XX an to a approximately than In be will purchased $XX.X pension the and EPS million $XX.X basis is is to amount in income. million

be Finally, will in items we our assume XXXX. XXXX effective tax both and before discrete rate XX.X%

free terms In it share XXXX, growth per which estimate reach flow million, we of XX% $XXX will for basis. on reflects cash a a now

Once strong the million. flow range. will impacted Net XXX% very grow with share free in compensation payments For by performance get flow cash flow line in variable in will earnings XXXX would range share conversion be per free we higher Income to estimate in related per in Cash cash XXXX. $XXX and beyond the the XXXX, expect XXXX, of we is we

billion repurchase which of XXXX shares $X ratio approximately to times. maintain debt XXXX, a us EBITDA in allow in expect should We net approximately and to X.X to both

impact final we decrease growth, approximately relatively and to growth currency QX. to approximately would on guidance; the of sales be by with currency In sales X% and we Some increase to expect sales in expect XXXX, XXXX neutral X%. to growth details by respect sales in currency growth

be it growth Patrick. approximately We by is X% EPS side, adjusted in adjusted adjusted a terms XXXX I'll EPS the will in currency to to impact now XXXX. and That it not EPS, of and to back in expect currency growth slight my for In do turn fourth headwind benefit quarter.

Patrick Kaltenbach

Thanks, Shawn.

our on with results. start me some Let comments operating

Almost business more strong than had and faced very all first growth having it in year. lines despite of quarter in regions third half lab the Our challenging the the growth. comparisons outstanding had product

be growth quarter, it year-to-date. expect We good we the in have level fourth but the won't seen same

end-markets year. to catch-up like continue to we favorable this demand that biopharma benefited expect from and trends we As But well. from we look own do XXXX, the at benefit to strong chemical, expect segments other be we've

We by tip global cost-effectively and production the and us the improving time will productivity. with tips. also which well business tip grant and the within although testing capture gain also grant nice laboratory from happy surrounding we California. enhance growth increase end us to An business. while our our to this from same we we a lab pipette to share approximately expand a obtained COVID XXXX, expand and estimate automation, that the in U.S. we Department headwind in XX% our production normal of our bit is We're in Defense the continue additional expect are to activity, positioned our at grant of pipette our believe to warehouse, by will market million allow manufacturing, development logistics of capacity $XX of business allows

Turning as we benefit been third well automation in benefiting trends some from our fourth have and a business, industrial increasing in did Industrial industrial from digitalization. solid demand quarter quarter. core Core the should positioned in are catch-up to well have to and

in We overall. to XX% to inspection strong share expect tougher the quarter. Growth in continue Americas. market but Product gains will comparisons grew in XXXX, was Core Industrial face in drive especially the

good packaged our the growth we're in quarter, food from some we XXXX, expect benefit growth customers large as optimistic product cautiously fourth about We and solid should strong pent-up from in portfolio. investments and

the in declined world. rest declines retail XX%, Asia, pronounce food in Finally, the of with and Americas,

were as more components use standardized impacted these of of timing We impacted consumer used also project electronic products was Our in that products. are components, by by also production activity. the electronic shortages

decline You the food retail would expect to in also quarter. fourth

we XXXX for manage this We to are not as business growth in forecasting much continue profitability.

strong make Europe let with Sales geography. the Now, lap. me growth increased additional XX% very in some comments in in quarter by

core solid very Inspection. growth in Product in in Europe excellent growth would has America good industrial against with increased growth XXXX in You lap, quarter expect XX% in XXXX, the and

mentioned down earlier, food significantly in retail As was Americas. the

overall While in expect Americas the we will good challenging face growth. we comparisons XXXX, in

had their the Finally, inspection. well. with Asia growth the and XX% in industrial growth year. Rest good did laboratory, quarter in China and good in also Core in of prior growth World growth the given grew strong the product outstanding particularly

expect seen the We in in same won't and XXXX, be at QX growth level we in have good China although year-to-date. it

be acknowledge China to volatility but good shorter term. over feel medium-term, continue We about the in the that there can

performed the China and the We is XX% final team and are the in were well. business, very in One strongly on executing positioned comment well Service quarter. and up Consumables

provide further as pleased continue We my from be business. pandemic context Company the ways. several XXXX concludes let That growth the business me We on and and to in in guidance. the competition our emerging we ourselves this important from believe and this of very comments some are a on now stronger are part with profitable distancing

already but our the started approach. During accelerate from We had digital the COVID-XX years, allowed significantly sales in digital this our on disruption have marketing. X and to accelerated us last transformation we path,

in vast Our of a telemarketing and expand selling we selling. to use in allow customer customer and These to materials, selling to are differentiators development of digital expect clear continue interactions face-to-face increase digital telesales our our tools of library utilization And our us expanded manner. reach remote greater services for Desmos, and guides, while XXXX. of drill cost-effective

we ability force in is the share in have focus to Increasing sharpening guide our addition opportunities. also sales fundamental us accelerate the made most attractive digital gains. In allowing gains growth to to segments, data to sales on best and the our strides to analytics in market sophistication our marketing, great market

as provide potential actionable refer territory we the qualify integrate to tailored, internally setting. our We about opportunities, continue information to what of and [Indiscernible]. planning alerts These sales market top organization, which provide and into target

greater for analytics data trend XXXX the beyond. sophistication see and and continuing of You use in

utilize service increases Service customers, led network period is likely to satisfaction. the service if customer purchase Our has and trust, this products keeps our customer us additional offering. to global to builds service to they ability steady during our and close our much more customers continue to in

service to We continue to develop customer needs. tailored specific

utilized European requirements example, For from January. quickly developed control to for who effect tool in balances Pharmacopeia in the customers analytical new a that goes service quality we into meet

as of important. compliance. software software just increasingly our addition, consistent These becoming are X customers integral solutions, examples. our regulatory The harmonized enable becoming is LabX service In meet for part performance support offering software control and are achieve services new instrument to to

within and more our to opportunities base. We data competitors. within portfolio. approach the same install leverage service believe provide growth And a for many will have from analytics our opportunity We we good continue differentiation our service used to

also potential. development be will to the I am that product the year. place growth coming continues many our core over about launches New to take excited

very continues be strong Our on our and leadership. reinforce to technology product product pipeline launches

pharma While a chemical great most offering, will be and complement Scale-up a also product software and small like scale-up and these for the leading and Scale-Up provider We is process AutoChem now which acquired have development done addition software of reaction Company, software and completed we It is Systems, our in industries. a to acquisitions, comprehensive modeling development October. we will one continue the for offering in-house, chemical we a to and customers. pharma for

supply chain now and to Turning initiatives. margin

agility mentioned, chain inflationary support increasing and risks to our already supply logistics dynamic customers. As supply market adapting and markets. and tremendous transportation to has in and are in There chain team pressures shown conditions continuing the very

offset, strategies but are have conditions quickly. to as cautious and continue place effectively, help can manage change in mitigation to can We believe we

shows our that pressures coming continue face and context market program and the solid will the Operator provides we line and gain to growth, in and us confidence productivity our to I months. Drive this XXXX, to traction inflationary some I in in initiatives offset the trust to have ability now have Stern capture help good and pricing would share guidance Our continue to for will earnings questions. to in open to XXXX, the like ask we growth deliver beyond. likely

Operator

Q&A reminder, by As Please we the [Operator roster. stand Instructions] compile a while

come will question. from the your Eric question first from proceed of Our with Chung line Please Stifel.

Eric Chung

Good for today. for question. Chung, taking This Arias the on Eric Thanks afternoon, is Dan guys.

there's opportunities First, you within in China, And lab versus any emerge, growth pre dynamics China COVID? within market -COVID coming the can and organic share are competitive you of pandemic out versus different, seeing changes if any industrial? post separate that look China,

Shawn Vadala

this Shawn, take and color can one Patrick Eric, end hey that I'll of it. is the Yeah, maybe some at add

as thrilled of In year, had businesses X you competitive are well. how share continue strong region team both experienced as and a a market in about has Industrial extremely by hold And terms our business had really as year like mentioned to the prepared overall, a our there I'm just the the on a been second. double-digit last and business. we on well, at they're getting you like competitive on And business we in growth QX strong feel look here, XX% our QX particularly advantage good. on the comments. know, China, executing When well in but XX%. we in supply basis, competitive China high Core just in -- the Patrick positioned particularly up general chain take with We're business, China, performing. and you numbers also in the good third strong there these team environment. well very I particular, quarter, laboratory side our at as feel of the we was when of then Overall, last really look of the up XXs was is Industrial landscape as very I We Industrial in in grew globally in growth my feel a feel our reminder, notes competitive we're year.

Patrick Kaltenbach

business. healthy little is investments in investments that's driven for Well, for And and and is in we in very have us. see lab Open investments by business right Shawn. lab, both really a for research a for in new If I may lap flavor industrial that here China. businesses

to think be local our serve end market. well I that So as manufactured that products have we well-positioned We follow is team exceptionally will in high products as China.

and we to portfolio in well. turnover, lab actually especially There is in what think with solutions, side automation demand and is lot we growth new solutions, from the right world. XXX on launched, China really the etc. a continue for not demand our have of -- of And see the to in the the in similar like rest productivity have we industrial, products the I industry as that see industry's

drive in automation well-positioned They slow are demand looking our customers China are more that not I'm they continue see to is to We become from systems that and hear upgrade -- what to and continue to I will help productivity -- extremely what for ways to we productive. hearing installed down.

Eric Chung

a of China? That's into operational about the variant guys translated cases helpful. benefits the year talked is in with concerns business or seeing next along so you as something the And that in product efficiency to given How about quarter business, Delta rising to any and you this pivot I U.S. year the driver site, a you step running Tampa that in up product was the been that it. emergence think over are inspection recognize when and inspection and saw Great. it's got you at since and

Patrick Kaltenbach

the we can I the see really pleased take and strong south products. Look, side they mean, is for business with The operating is well. it. great very extremely Tampa really and I are the demand of we're output

think right I now. full at operations running is capacity

have effective of this think we the of When side. Tampa. of on years consolidated ago a couple very we in So with regard side, a no sizes, it's operations couple I concerns

pull but sight. well with we market serve the I think are effort to initial everything now positioned some very to Of course, there was together, that

we that actually there demand in forward momentum the up I additional PI. continue can looking that we said, pent good the cautiously of serve. optimistic also, see And terms as slow QX, is still market demand for to In XXXX, bearing are in for we

on think market portfolio. lines do and an a launched mid-range We help new all portfolio, particularly launched a continue to of just -- system, well. also the we upsetting also for leadership technology China, and great China is We opener in recently couple which to product in on Ex-XX as our we a quarter us extremely market well. additions In system that the strong market door just I of the have product China, us a and ago, serve to which as helps mid-range to products, in is us the to

Operator

from line next will proceed with of Your question. question come the Vijay Kumar from your Evercore. Please

Kevin Cassidy

Kevin is This Hi. on for Vijay.

at XXXX. margin to the you operating pricing talk Looking is what XXXX? being assumptions for And in behind for Can guidance implied guide? expansion

Shawn Vadala

Yes. Kevin, that Sure. one. I'll take

range. So we're kind for something of targeting year, the a in pricing next X% for

on we're the course Of when proceed into at year. our as inflationary necessary expect we we basis, a we'll range And adjust compound in year. good the that be so when And we look particularly operating and feel to start acknowledge an environment, margin about XXX on expansion, in as then not we multi-year you basis we of point to that. this top

the look year. you will than year, at previous be higher If XXX points basis a this

prepared long-term out higher in to a at remarks. about XXXX transportation and So we lot the program. there's world expansion we of as Stern also points. of terms continued the deliver various we cost, of in talked acknowledge Drive margin But material We challenges our the costs initiatives, well about in same good time, that our basis feel of our as at end very our pricing, guidance

Kevin Cassidy

And the follow-up.

and down XX%, you about the outlook talk can being in food quarter at the going Looking forward? more segment

Shawn Vadala

the business. of customer in be that lumpy was businesses in are X% our products. is consumer can retailing components we negatively or growth down At impacted out food quarter. our and a also we of not use certain business orders. component necessarily the So the project total same by That because that electronics only was common scales for of you overall, business, one manage time business of by impacted timing it's shortages in know, that used some as XX% business for about that retail our the That was profitability all

to single-digit. the don't fourth of then We if then low at I time, And be in low as business, just from that lumpy you we growth be for say, period up longer-term will every business, over But the expect, forward, in single-digit going quarter-to-quarter. it's similarly much and business down but expect XXXX, probably look now probably a a it quarter, always

Kevin Cassidy

Thank you.

Operator

Our Citi. proceed your the of Patrick come line will from question. with next Donnelly question from Please

Elizabeth

Hi, in guys. This what Elizabeth, about a you're I'm about bit on Patrick. general. and that's You guys talk in Thanks. if is in for wondering, internally, wondering affecting wages inflation could little was if general. just labor I you talk seeing

Shawn Vadala

Yes.

So, in to wage higher terms of inflation, wage experience inflation. we're going

of it's I Company every market in labor the -- world. world, think like there's parts competitive all certainly in the a

are a local overall component about so. And of differentiated upon cost we wages at X% significant our highly look it's As go up of our But be it. By going you at geography, our based structure for year, course, if to cost course next overall look cost markets. structure. will structure of or labor

Elizabeth

me. for it That's you. Thank Great.

Shawn Vadala

you. Thank

Operator

proceed line Our your Jack question. next question come Research, will Nephron from Meehan Please of with from the

Nisarg Shah

Nisarg is supply This start, Jack. afternoon. impact here on lab segment performed challenges, the chain you good well the despite in heightened To expecting Hey, for fourth are quarter?

Patrick Kaltenbach

Can it? repeat we didn't you Can -- -- Can expect the question? sorry get was what we it.

Nisarg Shah

Are expecting impact lab fourth you in segment supply despite The in quarter. the well a quarter? Sorry. heightened third chain performed the challenges

Patrick Kaltenbach

a can take Okay. I is.

supply we get part Sorry, didn't that chain. about

products -- you seen in in lap. the impact Now, the the is we fourth as look, -- on don't It material there. dynamic and bigger trends have logistics we for in and supply QX. quarter very actually a the Both -- a business, that I expect really situation side have all in say out

notice, the business. retail will in exposed are You as we

are we lab business. concerned for be honest. already So to the Dare not

Nisarg Shah

Thanks. Great.

Operator

America. proceed of Please Our line Bank the comes with of De next question your Bruin from Derik question. from

Derik De Bruin

a now between bouncing now is people? the my ones on some around are and of more the lot emphasis versus your campaigns, it's to capabilities calls, and so there here. turbo I I've digital? digital of and marketing your put any on electronic hiring return costs how Good apologies where I'm being such building and more do Hey. how field redundant spend afternoon. how need like, those other out efforts and if street, Yeah. been pushing you electronic can a on higher of the But your much do and think of feet -- those into about e-commerce much -- expanding guess, or and you you

Patrick Kaltenbach

an excellent That's question. Thanks.

at but end tours there that fuel well you it to made engine, -- digital continue we actually digital actually industry this because that sales question, paying it's at to for Looking both some quickly putting more And We great of in we fuel and demand, its side, back it's a a engine and as well, and the very closures mentioned really it's and be have look etc. fleet significant us overall quite have invested mobile angles is to ensure bit its and to on as returns. from different widely, you good demand lot tubular. direct saw engine investments the marketing a also the year see X as that

provided for have that. It very has we both has We been And us oversee always on great returns. have approach. both we also effective -- will at

a which customers. is direct with the accremate consolidate have We in Salesforce,

products, then, our digital capabilities to serve continue end And higher to transactional we also out build dedicated more have selling. sales more very capabilities. our continue to marketing that our strengthen need digital For etc. and -- consolidated we

the pandemic always well strides of are I'm actually I'm by investments accelerate fleets generated how by see we lot again, that think more -- which all to received. a are and we customers, with It's business. are things and a on forward has for year we been great increase well number they of that well do the us I of -- interact and they that. returns think very are a are we perform other these how of positioned, despite very we customers. well things great number the at pleased to extremely during leads tool [Indiscernible] and received Again, we I great on made capabilities, a so we a this did monitoring looking significant and

Derik De Bruin

you Great. very much. Thank

Operator

line your Our from comes Couillard next question please of with question. Brandon proceed with the Jefferies,

Brandon Couillard

There type thoughts on but tied that. software afternoon. for on the revenue, your whether Third fill a of deals. is similar of it kind whole that the acquisition, bolt-on is of small touch really deal portfolio in Good material appetite and Quarter, any Thanks. small to

Patrick Kaltenbach

question Company, the software but specifically? sorry, linked What AutoChem are a requires well. on specifically of revenues not type it Company large -- to What's Scale Up look, portfolio is in System our very a compliments

that growing very long player AutoChem for a time has are strong now. We a in double-digit business been

in the pleased we combination We together with better and this are capabilities software And future. require our existing serve see we to that customers of much that with customers our certainly the -- portfolio continued new extremely that. additional can serve

force. better have Systems a will much regions [Indiscernible] couldn't go We reach into with Scale Up where

perform X actually I customers a the out well-received of Systems X we customers. regard. in think by Up overall. X more the existing the Scale They very it's very also solution by And equals this have that with positive see received then than feedback acquisition on

technologies and to or But in the we -- huge Yeah, the we if bolt-on think mentioned that continue we will your of We've portfolio where the in complement of necessary are then -- in other is parts overall acquisitions terms part line. these that other transformation. either think part, that of the nothing small -- area it's technology and we call So in we areas, acquisitions. continue in of are down I our and in medium-size technologies make other see need terms every customer that question workflows. acquisitions bolt-on strength terms -- here that to

Brandon Couillard

be impact segment next and to Thanks. by year? be assumptions of quantify the able demand lap you change on for would helpful through, Shawn, year, it growth the top-line lower your us walk could if next

Shawn Vadala

Sure. Yes. QX start as with business, the Hey, year, next well maybe to do Brandon? and want I'll you me as lab

Brandon Couillard

That'll be cheaper?

Shawn Vadala

through this Hey, everybody. I'll Great. for just run

And QX, be mid And For high then for year, we which looking us year, next which at low would lab single-digit Industrial. then growth range the would core mid-single-digit. we put lab to more to full for for high for at like looking for XX% single-digit We're we're -- for low look teens for high full QX, put year. next double-digit year. in a would at at the for us

XXXX. QX, high single-digit single-digit which for at for For the and product be year would high also us we'd full high inspection, put for single-digit

at For high in looking Europe mid low put in QX, growth. put be in to mid-single-digit we're year, we food to year the looking double-digit growth full geography, a to to at us retailing, QX, saw for similar single-digit decline would year. be and the full QX would which looking we're we'd down what us low at at low which single-digit be By for for then next

to year, we're at For mid-single-digit next growth. looking low

the And the in for And growth. question double-digit looking -- terms QX, next of us have for Americas, we're at that would for of in to the -- low be terms growth. looking we're next at would -- growth And for slight at then year. at it double-digit next QX For in part in put testing year, mid-single-digit China, full of which the be looking we're And the growth would full put year, COVID year, mid-XXs then approximately -- other your have low mid-teens we headwind. would we would for then headwinds us looking year. we're at a in XX% that which the

year. be baseline to if headwind know would assumption. modest think I X%. be less our That's round than it quite it don't but will would I a next it probably X%,

Brandon Couillard

you. thank Excellent,

Shawn Vadala

welcome. You're

Operator

proceed come of will with next Cleveland your from line Waldman question Please question. Our Research. from Josh the

Josh Waldman

appreciate detail question. Hi, guys, the on thanks I for all the taking outlook. my

Just two for you, guess. I

And mean, a U.S. you orders What provide bit here the seeing but single-digit there's more it comp on from you in an context seems other the First, geographies? a guess forward, like as commentary, could, pretty it quoting optimism mean, Inspection, you're on based what from seems activity. look I then the I in sounds XXXX. strong the I high wondering cautious of seeing strong. on you was are quick like and if Product follow-up

detail be giving helpful. kind what’s on more would of any Just you confidence for next year

Patrick Kaltenbach

Good Yes. Sir question, Josh.

that current just again, launched -- see have and in just that demand on for inspections it some how that pleased models pent-up has there high-single-digits. We China, The to We the very the momentum new that actually demands positioned product said we situation for we're demands, in as pent-up with high about the if both U.S. Europe. requests Europe. in well well. see putting growth a being activity quarter U.S. capabilities, I So, right but quarter and higher having But that, older leads mentioned the at more now. that are are Americas. again, the -- also cautiously a look as XXXX, think there gave there's our pretty Dave well Europe we getting, capture we they're is I is are product you. more ago. I demand. Overall, very we the a QX, we're Shawn of see portfolio, lead of as superseding, product can optimistic lot in that well We pent-up we from than operating even and about we and think our including terms for effective. We're very manufacturing

supply not have lot for chain We on that product of line. seen side a impact

as retail. and components, to it's as So, we to for exposed semiconductors it of in not etc. mentioned exposure terms

Josh Waldman

us then some I give your is it. production, in acquisitions, into you. for the assumptions guess, maybe from your could wondered on from of light thinking business. coming portion recent Got XXXX PendoTECH. And now revenue I of an if you And that update Thank bio built what what's then of

Shawn Vadala

sure. Yeah

have precise So is say overall third on overall, life we a typically like number business. but that, that a about we our sciences to in of Josh, don't total

large bit high right given had now down in we've knowledge bio-production area. is And of pieces, of the that also an few breaks probably that in a particular acquisitions that, that. into important general and more in that of last the an done in is course, think molecule growth just I of is some than the we've years then a piece then important part few in

XX% you benefit in maybe bio-production, the bio-production. of If it, little of in an important be which as our process is our into range business, of that the product just well. of Industrial course we pieces sell probably other analytics most applications a total is the would analytics process bio-production in business, bit in in the like area we But -- part environment also more the of scales

Josh Waldman

Okay. guys. it, Yeah, appreciate

Shawn Vadala

Yeah. you. Thank

Operator

question. line will Tycho of from Our Peterson your from proceed with come JP next question the Morgan. Please

Rachel

This Rachel for Thanks in taking Hi. Tycho. for questions. is the

services Currently, XX% was in talk wondering I the bit was said trends think you about third-party and consumables quarter. touch you roughly could of within I you So a those? was And goal revenue on, is of seeing also competing providers? Thank you're the your up about service What's then if those. service just long-term could that of XX%. are against both and consumables XX% just you. how each you about for

Patrick Kaltenbach

Very good there. question

the for it Looking with very at and consumables of service the -- pleased us. profitable extremely part is performance business of events,

right think It is now. growth times could services [Indiscernible] rate higher for In maybe terms growth Consumables rate. about mid-single-digits more high-single-digit, it, high. of

We for side as have comprehensive we mentioned And example, inventory products, -- sophisticated maintenance that increase of opportunities well. also products. consumable are to services think the but for for higher-value the both of providing contracts there portfolio our for there I -- increasingly in Scale think who to for positioning forward preventive of services, the we overall areas. ourselves differentiated other some That we well, things, is competition our services We continuing in the providing and customers. have higher very as just the our is, launched. serve Europe a out to out grow we're products. We solution we're by lot like to and as course, on service management also more I lot also that base a a solutions provide have But areas, our that future products I of X, Pharmacopoeia installed there's moving

So, the competitive very well-positioned opportunity. terms in Again, optimistic very accrued of about position. very, are we

it software As provide more they our solution, some so we and also services competitors of products. the And hardware of that services. for that solutions all also, are a take can over exclusively some mobile linking difficult makes

Rachel

for you. Great. me. Thank That's it

Operator

Please Sachs. from line from proceed your Goldman the Matt with question. comes Skykes question next of Our

Matt Sykes

taking Appreciate Hey, everybody. Thanks it. questions. for my

Just picture Big one me. for question question.

is or enhancements you. wondering, gives become process over really am chain supply been looking of a has change in and a you think implement supply environment and in levers just we've ways you and about this how Stern number I it made the has something seen you of that it, just to how chain years. a it, implement years current certain just caused constraints, the Just iterative inflation from about looking the you and seen of like cost environment Has with pull, you Drive at constraint different is how just productivity it differently sort think successful perspective? and the we aspects haven't can driver-driven program it that this different that given at institutionalize can

Patrick Kaltenbach

that beat challenges on skip overcome the well, to logistic say and just it We inflationary the promised had team some other had activities chain activities. good areas, fulfillment be flavors, up of that recently is Good given for call it's restrictions it's product launched -- automation necessary, wave XXXX question. they going long of a ideas, Stern the through running the this some year. it's -- next and top-line market seen several as and our happy We the program we they that that just a in a delivered by the us we of that has showed all concerns ideas for helps didn't year this waves the it's order actually actually the many team many potential of list manufacturing back-office promised activities whole actually, given impacted Stern -- it's etc. all Drive, us But -- these could Drive waves. come with redesign, ideas, to a Yeah. been has the which that weren't The I'm years, there some has have savings stern-drive had internally we team pressures. setup the

different supply on do they're Now, very signs, no, XD activities side, shift because shipments alternatives, have resources now? we and constantly would who on Access the take us logistical the screened other a product again, supply. productivity the say have in market opportunities and dedicated challenges productivity a terms comes gains slides we for look make best the all shipping who challenges [Indiscernible] place right suppliers components, focused of Almost when etc. dedicated given for sometimes, team to driving chain efficiency. significant in I Behalf to see to it like lock we a

redesign pleased very alternatives well. we crisis not in I working drive. think and retail often to it in a have we this big has I also think winded would we case been shortages, I with think products is with closely, that not But having use teams are far so very also came But this it's for except why I products. team through stern of well, effective the and probably component working but mentioned. internal very finding alternative also we overall answer, the long use with lot engineering issues semiconductors, was extremely mean, a we

fun these with I of driving constant capture in have who process still think major of a slides this mindset. dedicated again, be And it's opportunities. way, they all teams improvement, lot our

Matt Sykes

Thanks very Great. very much, helpful.

Operator

the to turn over call this like Mary questions in to and there queue, for no remarks. At I are time, would now closing back further

Mary Finnegan

everyone thank us and this you, you Thank for joining evening.

Bye-bye. As don't care. out. questions any reach always, please if you or Take have hesitate follow-ups, to

Operator

concludes today's conference for call. you This Thank participating.

You may now disconnect.

Mettler-Toledo International (MTD) 5 Nov 212021 Q3 Earnings call transcript