Item 2.02 Results of Operations and
Financial Condition
The
following information is furnished pursuant to Item 2.02, “Results of Operations
and Financial Condition.” The information furnished in this Form 8-K
and the Exhibit attached hereto shall not be treated as filed for purposes of
the Securities Exchange Act of 1934, nor shall it be deemed incorporated by
reference in any filing under the Securities Act of 1933, except as shall be
expressly set forth by specific reference in such filing.
On April 24, 2008, Mettler-Toledo
International Inc. (“Mettler-Toledo”) issued a press release (the “Release”)
setting forth its financial results for the three months ended March 31,
2008. A copy of the Release is furnished hereto as Exhibit 99.1 to
this report.
Non-GAAP Financial
Measures
Mettler-Toledo
supplements its U.S. GAAP results with non-GAAP financial
measures. The principal non-GAAP financial measures Mettler-Toledo
uses are Adjusted Earnings per Share, Adjusted Operating Income and Free Cash
Flow.
Adjusted
Earnings per Share
Mettler-Toledo
defines Adjusted Earnings per Share as diluted earnings per common share
excluding certain one-time discrete tax items and amortization of purchased
intangible assets, net of tax. The most directly comparable U.S. GAAP
financial measure is diluted earnings per common share.
Mettler-Toledo
believes that Adjusted Earnings per Share is important supplemental information
for investors. Mettler-Toledo uses this measure because it excludes
certain one-time discrete tax items and amortization of purchased intangibles,
net of tax, which management believes is not directly related to current and
ongoing operations thereby providing investors with information that helps to
compare ongoing operating performance.
Adjusted
Earnings per Share is used in addition to and in conjunction with results
presented in accordance with U.S. GAAP. Adjusted Earnings per Share
is not intended to represent diluted earnings per common share under U.S. GAAP
and should not be considered as an alternative to diluted earnings per common
share as an indicator of Mettler-Toledo’s performance because of the following
limitations.
Limitations
of Mettler-Toledo’s non-GAAP measure, Adjusted Earnings per Share
Mettler-Toledo’s
non-GAAP measure, Adjusted Earnings per Share, has certain material limitations
as follows:
It does
not include certain one-time discrete tax items and amortization expense of
purchased intangibles, net of tax. Because one-time discrete tax
items and amortization of purchased intangibles are components of diluted
earnings per share under U.S. GAAP, any measure that excludes one-time discrete
tax items and amortization of purchased intangibles has material
limitations.
Adjusted
Operating Income
Mettler-Toledo
defines Adjusted Operating Income as gross profit less research and development,
selling, general and administrative expenses and restructuring charges, before
amortization, interest, other income, net and taxes. The most
directly comparable U.S. GAAP financial measure is earnings before
taxes.
Mettler-Toledo
believes that Adjusted Operating Income is important supplemental information
for investors. Adjusted Operating Income is used internally as the
principal profit measurement by its segments in their reporting to
management. Mettler-Toledo uses this measure because it excludes
amortization, interest, other income, net and taxes, which are not allocated to
the segments.
On a
consolidated basis, Mettler-Toledo also believes Adjusted Operating Income is an
important supplemental method of measuring profitability. It is used
internally by senior management for measuring profitability and setting
performance targets for managers, and has historically been used as one of the
means of publicly providing guidance on possible future
results. Mettler-Toledo also believes that Adjusted Operating Income
is an important performance measure because it provides a measure of
comparability to other companies with different capital or legal structures,
which accordingly may be subject to disparate interest rates and effective tax
rates, and to companies which may incur different amortization expenses or
impairment charges related to intangible assets.
Adjusted
Operating Income is used in addition to and in conjunction with results
presented in accordance with U.S. GAAP. Adjusted Operating Income is
not intended to represent operating income under U.S. GAAP and should not be
considered as an alternative to earnings before taxes as an indicator of
Mettler-Toledo’s performance because of the following limitations.
Limitations
of Mettler-Toledo’s non-GAAP measure, Adjusted Operating Income
Mettler-Toledo’s
non-GAAP measure, Adjusted Operating Income, has certain material limitations as
follows:
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It
does not include interest expense. Because Mettler-Toledo has borrowed
money to finance some of its operations, interest is a necessary and
ongoing part of its costs and has assisted Mettler-Toledo in generating
revenue. Therefore any measure that excludes interest expense has material
limitations.
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It
excludes amortization expense and other income, net. Because these items
are recurring, any measure that excludes them has material
limitations.
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Free Cash Flow
Mettler-Toledo
defines Free Cash Flow as net cash provided by operating activities less capital
expenditures and refinancing fees, before restructuring payments, excess tax
benefits from share-based payment arrangements and proceeds from the sale of
property, plant and equipment. The most directly
comparable U.S. GAAP financial measure is net cash provided by operating
activities.
Mettler-Toledo
believes Free Cash Flow is important supplemental information for
investors. It is used internally by senior management for measuring
operating cash flow generation and setting performance targets for managers, and
has historically been used as one of the means of providing guidance on possible
future cash flows.
Free Cash
Flow is used in addition to and in conjunction with results presented in
accordance with U.S. GAAP. Free Cash Flow is not intended to
represent net cash provided by operating activities recorded under U.S. GAAP and
should not be considered as an alternative to net cash provided by operating
activities as an indicator of Mettler-Toledo’s performance because of the
following limitations.
Limitations
of Mettler-Toledo’s non-GAAP measure, Free Cash Flow
Mettler-Toledo’s
non-GAAP measure, Free Cash Flow, has certain material limitations as
follows:
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It
includes purchases of property, plant and equipment and refinancing
fees, which
are not considered to be components of net cash provided by operating
activities under U.S. GAAP. Therefore any measure that includes purchases
of property, plant and equipment and refinancing fees has
material limitations.
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It
excludes restructuring payments, excess tax benefits from share-based
payment arrangements and proceeds from the sale of property, plant and
equipment, which are considered to be a component of net cash provided by
operating activities under U.S. GAAP. Therefore any measure that excludes
these items has material
limitations.
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Adjusted
Earnings per Share, Adjusted Operating Income and Free Cash Flow should not be
relied upon to the exclusion of U.S. GAAP financial measures, but reflect
additional measures of comparability and means of viewing aspects of
Mettler-Toledo’s operations that, when viewed together with its U.S. GAAP
results and the accompanying reconciliations to net earnings, net cash provided
by operating activities and diluted earnings per share, provide a more complete
understanding of factors and trends affecting its business.
Because
Adjusted Earnings per Share, Adjusted Operating Income and Free Cash Flow are
not standardized, it may not be possible to compare with other companies’
non-GAAP financial measures having the same or similar names. We
strongly encourage investors to review our financial statements and publicly
filed reports in their entirety and not to rely on any single financial
measure.
The
Release provides a reconciliation of Adjusted Earnings per Share, Adjusted
Operating Income and Free Cash Flow to the most comparable financial measures
recorded under U.S. GAAP.
Item 9.01 Financial Statements and
Exhibits
Exhibit No. Description
99.1 Press
release, dated April 24,
2008, issued
by Mettler-Toledo International
Inc.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
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METTLER-TOLEDO
INTERNATIONAL INC. |
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Dated:
April 24, 2008
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By:
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/s/ William
P. Donnelly |
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William P. Donnelly |
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Chief
Financial Officer |
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