METTLER TOLEDO INTERNATIONAL INC/ - 10-Q Quarterly Report

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q


[X]				QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2003


[ ]				TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _____________ TO ___________

Commission File Number 1-13595

Mettler-Toledo International Inc.

(Exact name of registrant as specified in its charter)


Delaware		13-3668641

(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Im Langacher, P.O. Box MT-100
CH 8606 Greifensee, Switzerland

(Address of principal executive offices)
(Zip Code)

+41-1-944-22-11

(Registrant's telephone number, including area code)

not applicable

(Former name, former address and former fiscal year, if changed since last report.)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ____

The Registrant had 44,434,612 shares of Common Stock outstanding at June 30, 2003.

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12 b-2 of the Exchange Act). Yes X No ____

METTLER-TOLEDO INTERNATIONAL INC.
INDEX TO QUARTERLY REPORT ON FORM 10-Q

		PAGE
	PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements
	Unaudited Interim Consolidated Financial Statements:
	Interim Consolidated Statements of Operations for the six months ended June 30, 2003 and 2002	3
	Interim Consolidated Statements of Operations for the three months ended June 30, 2003 and 2002	4
	Interim Consolidated Balance Sheets as of June 30, 2003 and December 31, 2002	5
	Interim Consolidated Statements of Shareholders' Equity and Comprehensive Income (Loss) for the six months ended June 30, 2003 and 2002	6
	Interim Consolidated Statements of Cash Flows for the six months ended June 30, 2003 and 2002	7
	Notes to the Interim Consolidated Financial Statements at June 30, 2003	8

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22
Item 4.	Controls and Procedures	22

	PART 2. OTHER INFORMATION

Item 1.	Legal Proceedings	23
Item 2.	Changes in Securities and Use of Proceeds	23
Item 3.	Defaults upon Senior Securities	23
Item 4.	Submission of Matters to a Vote of Security Holders	23
Item 5.	Other Information	23
Item 6.	Exhibits and Reports on Form 8-K	24

SIGNATURE		25

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

METTLER-TOLEDO INTERNATIONAL INC.
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
Six months ended June 30, 2003 and 2002
(In thousands, except share data)


		June 30,		June 30,
		2003		2002

		(unaudited)		(unaudited)

Net sales		$	613,171	$	569,411
Cost of sales			323,102		303,192

	Gross profit		290,069		266,219

Research and development			37,808		34,461
Selling, general and administrative			178,813		158,179
Amortization			5,667		3,675
Interest expense			7,576		8,746
Other charges (income), net (see Note 5)			4,899		28,269

	Earnings before taxes		55,306		32,889
Provision (benefit) for taxes (see Note 6)			16,591		(13,263)

	Net earnings	$	38,715	$	46,152


Basic earnings per common share:
	Net earnings		$0.87		$1.04
	Weighted average number of common shares		44,413,962		44,191,062

Diluted earnings per common share:
	Net earnings		$0.85		$1.02
	Weighted average number of common shares		45,377,964		45,463,374

The accompanying notes are an integral part of these interim consolidated financial statements.

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METTLER-TOLEDO INTERNATIONAL INC.
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended June 30, 2003 and 2002
(In thousands, except share data)


		June 30,		June 30,
		2003		2002

		(unaudited)		(unaudited)

Net sales		$	321,363	$	296,454
Cost of sales			164,952		155,372

	Gross profit		156,411		141,082

Research and development			19,338		17,704
Selling, general and administrative			94,008		82,355
Amortization			2,840		1,901
Interest expense			3,671		4,355
Other charges (income), net (see Note 5)			(276)		28,555

	Earnings before taxes		36,830		6,212
Provision (benefit) for taxes (see Note 6)			11,050		(21,266)

	Net earnings	$	25,780	$	27,478


Basic earnings per common share:
	Net earnings		$0.58		$0.62
	Weighted average number of common shares		44,434,612		44,208,274

Diluted earnings per common share:
	Net earnings		$0.57		$0.61
	Weighted average number of common shares		45,467,106		45,409,690

The accompanying notes are an integral part of these interim consolidated financial statements.

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METTLER-TOLEDO INTERNATIONAL INC.
INTERIM CONSOLIDATED BALANCE SHEETS
As of June 30, 2003 and December 31, 2002
(In thousands, except share data)


					June 30,		December 31,
					2003		2002

					(unaudited)
				ASSETS
Current assets:
	Cash and cash equivalents				$	35,150	$	31,427
	Trade accounts receivable, net					225,410		231,673
	Inventories, net					166,313		150,441
	Current deferred tax assets, net					34,289		33,583
	Other current assets and prepaid expenses					37,807		28,603

			Total current assets			498,969		475,727
Property, plant and equipment, net						219,356		217,754
Goodwill, net						413,978		408,351
Other intangible assets, net						127,743		129,441
Other non-current assets						74,271		72,120

			Total assets		$	1,334,317	$	1,303,393

		LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
	Trade accounts payable				$	64,265	$	73,072
	Accrued and other liabilities					141,942		130,490
	Accrued compensation and related items					41,825		47,013
	Taxes payable					63,712		66,511
	Short-term borrowings and current maturities of long-term debt					289,910		50,578

			Total current liabilities			601,654		367,664
Long-term debt						1,435		262,093
Non-current deferred taxes						38,386		37,650
Other non-current liabilities						139,228		133,600

			Total liabilities			780,703		801,007

Shareholders' equity:
	Preferred stock, $0.01 par value per share; authorized 10,000,000 shares; issued 0					-		-
	Common stock, $0.01 par value per share; authorized 125,000,000 shares;
			issued 44,434,612 and 44,384,820 shares at June 30, 2003 and December 31, 2002			444		444
	Additional paid-in capital					460,389		459,213
	Retained earnings					143,093		104,378
	Accumulated other comprehensive loss					(50,312)		(61,649)

			Total shareholders' equity			553,614		502,386

Commitments and contingencies						-		-

			Total liabilities and shareholders' equity		$	1,334,317	$	1,303,393

The accompanying notes are an integral part of these interim consolidated financial statements.

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METTLER-TOLEDO INTERNATIONAL INC.
INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY AND
COMPREHENSIVE INCOME (LOSS)
Six months ended June 30, 2003 and 2002
(In thousands, except share data)
(unaudited)


										Accumulated
		Common Stock				Additional				Other
						Paid-in		Retained		Comprehensive
		Shares		Amount		Capital		Earnings		Income (Loss)		Total

Balance at December 31, 2002			44,384,820	$	444	$	459,213	$	104,378	$	(61,649)	$	502,386
Exercise of stock options			49,792		-		1,176		-		-		1,176
Comprehensive income:
	Net earnings		-		-		-		38,715		-		38,715
	Unrealized gain on cash-flow hedging instruments		-		-		-		-		2,185		2,185
	Change in currency translation adjustment		-		-		-		-		9,152		9,152

	Comprehensive income												50,052

Balance at June 30, 2003			44,434,612	$	444	$	460,389	$	143,093	$	(50,312)	$	553,614


Balance at December 31, 2001			44,145,742	$	441	$	455,684	$	3,957	$	(71,898)	$	388,184
Exercise of stock options			62,532		1		1,263		-		-		1,264
Comprehensive income:
	Net earnings		-		-		-		46,152		-		46,152
	Unrealized loss on cash-flow hedging instruments		-		-		-		-		(2,097)		(2,097)
	Change in currency translation adjustment		-		-		-		-		17,655		17,655

	Comprehensive income												61,710

Balance at June 30, 2002			44,208,274	$	442	$	456,947	$	50,109	$	(56,340)	$	451,158

The accompanying notes are an integral part of these interim consolidated financial statements.

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METTLER-TOLEDO INTERNATIONAL INC.
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
Six months ended June 30, 2003 and 2002
(In thousands)


				June 30,		June 30,
				2003		2002

				(unaudited)		(unaudited)

Cash flow from operating activities:
	Net earnings			$	38,715	$	46,152
	Adjustments to reconcile net earnings to net cash provided by operating activities:
		Depreciation			12,689		12,188
		Amortization			5,667		3,675
		Other			172		67
	Increase (decrease) in cash resulting from changes in:
		Trade accounts receivable, net			15,227		8,279
		Inventories			(12,526)		304
		Other current assets			(8,397)		(4,436)
		Trade accounts payable			(10,089)		(11,984)
		Taxes payable			(4,102)		(23,890)
		Accruals and other liabilities, net (a)			2,035		14,124

			Net cash provided by operating activities		39,391		44,479


Cash flows from investing activities:
	Proceeds from sale of property, plant and equipment				604		225
	Purchase of property, plant and equipment				(10,602)		(17,778)
	Acquisitions				(1,972)		(19,272)

			Net cash used in investing activities		(11,970)		(36,825)


Cash flows from from financing activities:
	Proceeds from borrowings				37,301		37,882
	Repayments of borrowings				(62,690)		(49,482)
	Proceeds from issuance of common stock				1,176		1,264

			Net cash used in financing activities		(24,213)		(10,336)


Effect of exchange rate changes on cash and cash equivalents					515		(1,164)

Net increase (decrease) in cash and cash equivalents					3,723		(3,846)

Cash and cash equivalents:
	Beginning of period				31,427		27,721

	End of period			$	35,150	$	23,875

(a) Changes in accruals and other liabilities include payments for restructuring and certain acquisition integration activities of $8.5 million in 2003 and $4.1 million in 2002.

The accompanying notes are an integral part of these interim consolidated financial statements.

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METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
AT JUNE 30, 2003 - Unaudited
(In thousands unless otherwise stated)

1. BASIS OF PRESENTATION

Mettler-Toledo International Inc. ("Mettler-Toledo" or the "Company") is a leading global supplier of precision instruments and services. The Company is the world's largest manufacturer of weighing instruments for use in laboratory, process analytics, industrial, packaging and food retailing applications. The Company also holds top-three market positions in several related analytical instruments, and is a leading provider of automated chemistry solutions used in drug and chemical compound discovery and development. In addition, the Company is the world's largest manufacturer and marketer of metal detection and other end-of-line inspection systems used in production and packaging. The Company's primary manufacturing facilities are located in Switzerland, the United States, Germany, the United Kingdom and China. The Company's principal executive offices are located in Greifensee, Switzerland.

The accompanying interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S.GAAP"). The interim consolidated financial statements have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The interim consolidated financial statements as of June 30, 2003 and for the six and three month periods ended June 30, 2003 and 2002 should be read in conjunction with the December 31, 2002 and 2001 consolidated financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2002.

The accompanying interim consolidated financial statements reflect all adjustments which, in the opinion of management, are necessary for a fair statement of the results of the interim periods presented. Operating results for the six and three months ended June 30, 2003 are not necessarily indicative of the results to be ex