01—Abstract
Summary
Summary of the 10-K filed February 13, 2009. Cited figures are marked; the original filing is the authoritative source.
Mettler-Toledo International Inc. reported net sales of $1,973.3 milliona for 2008, up 10% in U.S. dollars and 6% in local currencies from $1,793.7 million in 2007.
Net earnings rose to $202.8 millionb, or $5.79 per diluted share, from $178.5 million, or $4.70 per diluted share, in 2007. Gross profit was $993.1 million, or 50.3% of net sales. The company describes itself as a leading global supplier of precision instruments and services, with laboratory instruments accounting for about 44% of 2008 net sales, industrial instruments about 43%, and retail about 13%.
Sales were 43%c from Europe, 35% from North and South America and 22% from Asia and other countries. The filing signals a weakening outlook. Management says global economic conditions weakened in the fourth quarter of 2008, with local-currency sales growth falling to 1% and demand declining in laboratory, industrial and food retail markets.
It expects reduced demand to continue in 2009 and has launched a global cost reduction program targeting about 600 workforce reductions, with charges of $15 to $20 milliond and expected annual personnel savings of about $25 million. The company suspended its share repurchase program in the fourth quarter of 2008. Balance sheet and liquidity remained solid at year-end.
Cash and equivalents were $78.1 million against total debt of $454.1 million, and the company had approximately $666.4 million available under its $950 million credit facility, which matures in August 2013. Cash from operations was $223.8 million, and capital expenditures were $61.0 million.
Shareholders' equity fell to $503.2 million, reflected in a $48.5 million pension adjustment to accumulated other comprehensive loss. The company has never paid common dividends.
02—Key points
Key Highlights
- Net sales rose to $1,973.3 million in 2008 from $1,793.7 million in 2007, up 10% in U.S. dollars and 6% in local currencies.
- Diluted earnings per share were $5.79 in 2008, up from $4.70 in 2007; net earnings were $202.8 million versus $178.5 million.
- Gross margin was 50.3% of net sales in 2008, compared with 50.0% in 2007.
- Fourth-quarter 2008 local-currency sales growth slowed to 1%, and management expects reduced demand to continue into 2009.
- A global cost reduction program targets about 600 workforce reductions, with charges of $15 to $20 million and expected annual personnel savings of about $25 million.
- The share repurchase program was suspended in the fourth quarter of 2008, with $416.6 million of authorization remaining through December 31, 2010.
- Total debt was $454.1 million against cash of $78.1 million, with about $666.4 million available under the $950 million credit facility.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2008filed February 13, 2009Financial Statements
| Revenue | $1.97B |
| Cost of Revenue | $701.64M |
| Gross Profit | $993.08M |
| R&D Expenses | $102.28M |
| SG&A Expenses | $579.81M |
| Interest Expense | $25.39M |
| Net Income | $202.78M |
| EPS (Basic) | $5.92 |
| EPS (Diluted) | $5.79 |
| Shares Outstanding (Basic) | 34.25M |
| Shares Outstanding (Diluted) | 35.05M |
05—Questions
Frequently Asked Questions
How did Mettler-Toledo perform financially in 2008?
Net sales were $1,973.3 million, up 10% in U.S. dollars and 6% in local currencies. Net earnings were $202.8 million, and diluted earnings per share were $5.79, compared with $4.70 in 2007.
What end markets drive the business?
Laboratory instruments accounted for about 44% of 2008 net sales, industrial instruments for about 43%, and retail weighing for about 13%. Principal customers include life science companies, food and beverage producers, food retailers, chemical companies and the transportation and logistics industry.
How is the company exposed to the economic slowdown?
Management says demand weakened in the fourth quarter of 2008 and expects reduced demand in its laboratory, industrial and food retail markets to continue during 2009. Its emerging-market sales growth also slowed, and it has started a cost reduction program in response.
Does the company pay dividends or buy back shares?
The company has historically not paid dividends on its common stock. It repurchased $224.5 million of shares in 2008, but suspended its repurchase program in the fourth quarter of 2008, and it cannot estimate 2009 purchases.
How strong is the company's balance sheet and liquidity?
At December 31, 2008, cash and cash equivalents were $78.1 million and total debt was $454.1 million. Cash from operations was $223.8 million, and about $666.4 million was available under the $950 million credit facility, which matures in August 2013.
06—Continue