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
26,
2007,
Mettler-Toledo International Inc. (“Mettler-Toledo”) issued a press release (the
“Release”) setting forth its financial results for the three months ended March
31, 2007. 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 Operating
Income and Free Cash Flow.
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
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 and net cash provided by operating activities,
provide a more complete understanding of factors and trends affecting its
business.
Because
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 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
26,
2007,
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.
METTLER-TOLEDO
INTERNATIONAL INC.
Dated:
April
26,
2007 By: /s/
William P. Donnelly
William
P. Donnelly
Chief
Financial
Officer