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Mettler-Toledo (MTD) Q1 Earnings & Sales Beat, Increase Y/Y

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Mettler-Toledo International, Inc. (MTD - Free Report) reported first-quarter 2022 adjusted earnings of $7.87 per share, which beat the Zacks Consensus Estimate by 7.5%. The bottom line also improved 20% on a year-over-year basis.

Net sales of $897.8 million were up 12% on a reported basis and 14% on a currency-neutral basis from the year-ago quarter. The figure surpassed the Zacks Consensus Estimate of $871.5 million.

Solid momentum across the Laboratory and Industrial segments in the reported quarter drove top-line growth. The strong performance delivered by the company across all geographies remained a major positive.

However, the company witnessed sluggishness in its Food Retail segment.

Headwinds related to the pandemic remain concerning for Mettler-Toledo in the days ahead. However, portfolio strength, cost-cutting efforts, margin and productivity initiatives, and robust sales and marketing strategies are expected to remain tailwinds.

MettlerToledo International, Inc. Price, Consensus and EPS Surprise

 

MettlerToledo International, Inc. Price, Consensus and EPS Surprise

MettlerToledo International, Inc. price-consensus-eps-surprise-chart | MettlerToledo International, Inc. Quote

Top Line in Detail

By Segments: The company reports revenues under three segments, namely Laboratory Instruments, Industrial Instruments and Food Retail, which accounted for 57%, 38% and 5% of net sales in the first quarter, respectively. The Laboratory and Industrial segments witnessed year-over-year growth of 18% and 12%, respectively, in the quarter under review.

The Food Retail business was down 14% on a year-over-year basis.

By Geography: The company reports total sales from the Americas, Europe and Asia/Rest of the World, contributing 39%, 28% and 33% to net sales in the first quarter, respectively. Sales in the Americas, Europe and Asia/Rest of the World went up 16%, 10% and 15%, respectively, on a year-over-year basis.

Operating Results

The gross margin was 57.9%, contracting 70 basis points (bps) year over year.

Research & development (R&D) expenses were $43.03 million, up 9.6% from the year-ago quarter’s level. Selling, general & administrative (SG&A) expenses increased 6.1% year over year to $235.3 million.

As a percentage of sales, R&D expenses contracted 10 bps year over year to 4.8%. SG&A expenses contracted 140 bps year over year to 26.2%.

The adjusted operating margin was 26.9%, which expanded 70 bps from the prior-year quarter’s level.

Balance Sheet & Cash Flow

As of Mar 31, 2022, the company’s cash and cash equivalent balance was $116.9 million, up from $98.6 million as of Dec 31, 2021.

Long-term debt was $1.8 billion at the end of the first quarter, increasing from $1.6 billion at the end of the fourth quarter.

Mettler-Toledo generated $90.8 million in cash from operating activities in the reported quarter, down from $241.1 million in the previous quarter. Free cash flow was $75.4 million in the reported quarter.

Guidance

For second-quarter 2022, Mettler-Toledo projects year-over-year sales growth of 7% in local currency. The Zacks Consensus Estimate for sales is pegged at $944.02 million.

Adjusted second-quarter earnings are anticipated to be $8.70-$8.80 per share, implying a 7-9% rise from the year-ago quarter’s reported figure. The Zacks Consensus Estimate for earnings is pegged at $8.78 per share.

For 2022, the company hiked its guidance for year-over-year sales growth in local currency from 7% to 8%. The Zacks Consensus Estimate for the same is pegged at $3.95 billion.

Mettler-Toledo also revised the guidance for adjusted 2022 earnings from $38.15-$38.50 per share to $38.20-$38.50, suggesting growth of 12-13% from the year-ago reported number. The Zacks Consensus Estimate for the same is pegged at $38.36.

Zacks Rank & Stocks to Consider

Currently, Mettler-Toledo has a Zacks Rank #3 (Hold).

Investors interested in the broader technology sector can consider stocks like Jabil (JBL - Free Report) , Jack Henry & Associates (JKHY - Free Report) , and Broadcom (AVGO - Free Report) . While Jabil currently sports a Zacks Rank #1 (Strong Buy), Jack Henry & Associates and Broadcom carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Jabil has gained 5.5% over a year. The long-term earnings growth rate for JBL is currently projected at 12%.

Jack Henry & Associates has gained 16.9% over a year. The long-term earnings growth rate for JKHY is currently projected at 17%.

Broadcom has gained 20% over a year. The long-term earnings growth rate for AVGO is currently projected at 14.5%.