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Second Quarter Results
Olivier Filliol, President and Chief Executive Officer, stated, "Sales growth in the quarter was better than expected with strong results in most product lines and geographies. We were particularly pleased with the solid performance in all regions. Strong operating leverage drove further gross margin expansion and we are pleased with our excellent growth in operating profit and EPS."
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EPS was $1.49, compared with the prior-year amount of $0.81. Adjusted EPS was $1.55, an increase of 32% over the prior-year amount of $1.17.
Sales were $468.5 million, a 16% increase in local currency sales, compared with $407.4 million in the prior year. Reported sales growth was 15%, which included a negative 1% currency impact. By region, local currency sales increased 10% in Europe, 15% in the Americas and 27% in Asia / Rest of the World. Adjusted operating income amounted to $79.9 million, a 30% increase from the prior-year amount of $61.7 million. Adjusted operating income is a non-GAAP measure, and a reconciliation to earnings before taxes is provided in the attached schedules.
Cash flow from operations was $74.8 million, compared with $74.0 million in 2009.
Six-Month Results
EPS was $2.59, compared with the prior-year amount of $1.81. Adjusted EPS was $2.68, a 26% increase over the prior-year amount of $2.12.
Sales were $885.2 million, an 11% increase in local currency sales, compared with $781.5 million in the prior year. Reported sales growth was 13%, which included a 2% currency benefit. By region, local currency sales increased 4% in Europe, 13% in the Americas and 21% in Asia / Rest of the World. Adjusted operating income amounted to $140.4 million, a 23% increase from the prior-year amount of $114.0 million. Adjusted operating income is a non-GAAP measure, and a reconciliation to earnings before taxes is provided in the attached schedules.
Cash flow from operations was $119.3 million, compared with $108.9 million in 2009.
Outlook
Based on today's assessment, management anticipates that local currency sales growth in 2010 will be in the range of 8% to 9% and Adjusted EPS will be in the range of $6.35 to $6.45, an increase of 14% to 16%. This compares with previous guidance of Adjusted EPS in the range of $6.26 to $6.36. Adjusted EPS excludes purchased intangible amortization, discrete tax items, restructuring charges and other one-time items.
For the third quarter 2010, the Company anticipates local currency sales growth to be in the range of 8% to 10% and Adjusted EPS in the range of $1.52 to $1.57, an increase of 12% to 15%.
While the Company has provided an outlook for Adjusted EPS, it has not provided an outlook for EPS. EPS guidance would require an estimate of non-recurring items, which are not yet known.
Conclusion
Filliol concluded, "We are encouraged by the further improvement in business momentum during the second quarter. Our sales growth is clearly benefiting from the investments in marketing programs, product development and emerging markets distribution that we continued to make during the downturn. Although our current outlook for the third quarter is solid, we remain cautious given the uncertainty in the global economy."
Other Matters
The Company will host a conference call to discuss its second quarter results today (Thursday, July 22) at 4:30 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 is a leading global supplier of precision instruments and services. The Company is the world's largest manufacturer and marketer of weighing instruments for use in laboratory, industrial and food retailing applications. The Company also holds top-three market positions in several related analytical instruments and is a leading provider of automated chemistry systems used in drug and chemical compound discovery and development. In addition, the Company is the world's largest supplier of metal detection and other end-of-line inspection systems used in production and packaging and holds a leading position in certain process analytics applications. Additional information about METTLER TOLEDO can be found at "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 8-K to which this release has been furnished as an exhibit. All of the forward-looking statements are qualified in their entirety by reference to the factors discussed under the caption "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.
-- Sales in local currency increased by 16% in the quarter compared with the prior year. Reported sales growth increased 15%, which includes a negative 1% currency impact.
SOURCE Mettler-Toledo International Inc.
