01—Abstract
Summary
Summary of the 10-K filed February 13, 2012. Cited figures are marked; the original filing is the authoritative source.
Mettler-Toledo International Inc. reported net sales of $2,309.3 milliona for fiscal 2011, up from $1,968.2 million in 2010 and $1,728.9 million in 2009, with growth of 17% in U.S. dollars and 13% in local currencies.
Gross profit as a percentage of net sales was 52.8%, and net earnings rose to $269.5 millionb, or $8.21 per diluted share, from $232.1 million ($6.80 per diluted share) in 2010. Growth was broad-based, led by Chinese Operations (net sales up 27% in U.S. dollars) and emerging markets, which grew 21% in local currencies. Management expects local currency sales growth to slow in 2012 due to slowing global economic forecasts and more difficult comparisons.
The balance sheet remained solid, with cash and cash equivalents of $235.6 millionc and total debt of $505.0 million at year-end. The company repurchased $204.6 million of its shares during 2011 and had $716 million of remaining authorization under its $2.25 billion share repurchase program. Operating cash flow was $280.9 million, while capital expenditures were $98.5 million, including roughly $55.7 million tied to the Blue Ocean ERP program.
The company historically has not paid dividends on its common stock. Key risks highlighted in the filing include exposure to the European debt crisis, currency fluctuations (particularly the Swiss franc against the euro), competition from emerging market rivals, and the multi-year Blue Ocean system implementation. The company also disclosed a new $870 milliond revolving Credit Agreement entered into on December 20, 2011, maturing in 2016, and stated it was not party to any legal proceeding expected to have a material adverse effect.
02—Key points
Key Highlights
- Net sales rose to $2,309.3 million in 2011, up 17% in U.S. dollars and 13% in local currencies, with acquisitions/divestitures contributing approximately 1%.
- Net earnings increased to $269.5 million, or $8.21 per diluted share, compared with $232.1 million, or $6.80 per diluted share, in 2010.
- Chinese Operations net sales increased 27% in U.S. dollars to $515.1 million, and segment profit rose to $120.9 million.
- Gross profit as a percentage of net sales was 52.8% in 2011, compared with 52.7% in 2010.
- Cash flow from operations was $280.9 million, and cash and cash equivalents ended the year at $235.6 million.
- The company repurchased $204.6 million of common stock in 2011, leaving $716 million of authorization under its $2.25 billion program.
- A new $870 million revolving Credit Agreement, maturing December 20, 2016, replaced the $950 million prior facility, with $376.7 million borrowed at year-end.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2011filed February 13, 2012Financial Statements
FY2011 against FY2010
| Line item | FY2011FY2010 | Change |
|---|---|---|
| Revenue | $2.31B$1.97B | +17.3% |
| Cost of Revenue | $798.68M$662.31M | +20.6% |
| Gross Profit | $1.22B$1.04B | +17.5% |
| R&D Expenses | $116.14M$97.03M | +19.7% |
| SG&A Expenses | $703.63M$588.73M | +19.5% |
| Interest Expense | $23.23M$20.06M | +15.8% |
| Net Income | $269.49M$232.15M | +16.1% |
| EPS (Basic) | $8.45$6.98 | +21.1% |
| EPS (Diluted) | $8.21$6.80 | +20.7% |
| Shares Outstanding (Basic) | 31.90M33.28M | −4.2% |
| Shares Outstanding (Diluted) | 32.84M34.14M | −3.8% |
05—Questions
Frequently Asked Questions
How much did Mettler-Toledo's sales and earnings grow in 2011?
Net sales were $2,309.3 million, up 17% in U.S. dollars and 13% in local currencies from $1,968.2 million in 2010. Net earnings were $269.5 million, up from $232.1 million, and diluted earnings per share were $8.21 versus $6.80 in 2010.
Which segments and regions drove growth?
Chinese Operations had the strongest growth, with net sales up 27% in U.S. dollars. Swiss Operations net sales grew 22% in U.S. dollars, and Western European Operations grew 16%. Emerging markets sales increased 21% in local currencies, and the company cited strength across most product categories.
What is the outlook for 2012?
Management expects local currency organic sales growth to slow in 2012 as global economic forecasts indicate slower growth and the company faces more difficult comparisons. It stated that a global recession could cause a year-over-year sales decline, and it anticipates that sales will continue to increase relative to 2011 absent a deterioration in global economic conditions.
How is the company returning capital to shareholders and funding growth?
The company repurchased 1,285,827 shares for $204.6 million in 2011 and had $716 million of remaining authorization under its $2.25 billion program. It has historically not paid dividends, and it will evaluate that policy periodically. Capital expenditures were $98.5 million, and the company stated that it continues to explore acquisitions.
What are the main risks to the business?
The filing highlights the European debt crisis and potential euro instability, currency fluctuations (especially the Swiss franc against the euro), competition from lower-cost emerging market rivals, reliance on the multi-year Blue Ocean ERP implementation, and dependence on developed-market economic conditions. It also notes that its total debt was $505.0 million at year-end, with covenant compliance reported.
06—Continue