Audit finds Mettler-Toledo blameless on interim results
instruments, has reported a healthy 8 per cent hike in sales for
the first half of 2004, helped by favourable currency factors.
Currency effects added five points to the increase, but Mettler Toledo's chief executive Robert Spoerry said he was pleased with the underlying 3 per cent organic growth.
For the six months ended 30 June, the Swiss-American company reported sales of $663 million (€541m), compared with $613 million in the same period of 2003.
The reporting of the final figures had been delayed because of a probe into the corporate governance of the firm after allegations of impropriety were made by an employee.
The company put out a truncated set of figures last month, and now says that the investigation shows these were accurate.
However, Mettler-Toledo's audit committee has recommended that changes be made to the management of the company's finances, to correct the 'tone at the top'.
To that end, William Donnelly, who was chief financial officer at Mettler-Toledo from 1997 to mid-2002, has agreed to return as CFO effective immediately. The company also said it was 'enhancing' its accounting organization, both by adding personnel to that function and by increasing training.
As previously reported, sales for second quarter were $345 million, compared with $321 million in 2003. This represents a 7 per cent increase, comprised of 4 per cent growth in local currency and an incremental 3 per cent benefit from currency.
Net earnings for the quarter were $28 million, or $0.62 per share, up from $26 million or $0.57 per share, an increase of 9 per cent. Operating cash flow for the quarter rose 48 per cent to $46 million.
The company said it expects the total costs of the investigation and related items to be between $4 and $5 million, of which just over $1 million was recorded in the second quarter and the remainder will be recorded in the third quarter.
Spoerry said that the quarter's growth was due to strong results in Mettler-Toledo's laboratory product lines, especially in the drug discovery business. Asia, and particularly China, contributed to the sales growth while the North American business slowly gained momentum, after a difficult period in which spending of its customer base was truncated by the general downturn in the economy.
He added that "strategic initiatives, including continued new product launches, the development of new global marketing programmes and the consolidation of our manufacturing base, remain well on track."
Finally, Mettler-Toledo reduced its net debt position by more than $40 million during the quarter to $144 million.
