Mettler-Toledo International (MTD) 5 May 232023 Q1 Earnings call transcript

Good morning, and welcome to the Mettler-Toledo First Quarter 2023 Earnings Conference Call. Today's conference is being recorded. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question and answer session. [Operator Instructions]

would Head turn of I to conference time, Uhlman, Adam Investor this like the to over At Relations. Please go ahead.

Thank you for morning everyone. Good you, joining Angela. us. Thank

Executive is the Officer. Financial Kaltenbach, On me Shawn today with our our call Chief Officer; Chief and Vadala Patrick

performance for US some copy available statements. the that on of that release achievements the on Let meaning the and factors me involve is we different materially webcast of forward-looking at and call will Act expressed to the statements This These forward-looking uncertainties Act risks, Securities presentation may to website. available Exchange matters. press cause US our implied be of administrative cover our today will call statements website This being and XXXX. by those the include is any condition, replay A from Securities our other is refer XXXX mt.com. and also or actual and of financial results, within

of in use website. with law. X-K today's our by report filed on to provided updates required to For a and these as or annual our company except any and reports XX-K current forward-looking obligation statements, measures. on call, or non-GAAP these we is available see A please discussion financial any disclaims and to any the undertaking On quarterly GAAP the is comparable measure SEC. will measures Form financial also non-GAAP recent of The reconciliation most directly the provide uncertainties, and revisions risks

over to Let Patrick. me call now turn the

of I'm to good strong, financials page year night, are our we for started on three have joining you We share details of earnings Last that and outlined our growth. sales off reported results today. Thanks, we presentation. quarter everyone. Adam, good profit The very call appreciate morning our you and with happy first and the our

opportunities attractive [indiscernible] control, across of very markets. currency effectively excellent team a our broad-based the and sales I'm on quarter, prior Our on despite a team with top the identify our also which solid growth as variety this to year, initiatives from in earnings our headwind. pleased results growth margin significant leveraged was again in growth execution of wide resulted strong cost

for outlook markets. we this increased year, provided the year our from unchanged Our and uncertainty have end what there is the largely although economy earlier in is

I'm continue will help our to year. to on However, manage convinced team solid for opportunities with our cost live growth capitalize and results the effectively that us

cover financial now guidance. Let commentary me to the over our outlook. our come with results back And business Shawn then, and I on turn to will Shawn? additional the call the and some

X% Sales currency local morning $XXX.X Thanks, shipping X%. currency increased growth Patrick, US sales increase a million, by in dollar good as a basis, and which quarter to sales of the sales Russia everyone. reduced almost to were X% estimate growth. We represented not that On of headwind X%. of the a impact was

the slide growth currency sales Americas increased X% Asia/Rest of and We QX the in number we growth region. both four, Europe as by in local sales in had On XX% sales in and show World. broad-based

our quarter. Russia, the sales in X%. in X% Excluding China Europe currency growth grew sales increased Local in

number product slide summarize sales five, by currency we On growth local area.

industrial quarter, project in X%, with Food Retail as year XX% significant increased from activity we and up inspection, sales lab product the X%. industrial both quarter, comparisons. the prior For increased grew X%, benefited core in

increase quarter, was increase reflecting XX.X%, $XX.X which of the prior six. an currency cost, Gross activity. increased million is a in offset and X% is move of Let slide mix pricing the on basis me year, now R&D project summarized points, over to currency. to by higher local business in the amounted the as XXX a margin P&L, was which number partially rest

reduced represents $XXX.X amounted an $XXX.X increase which year. a XXX prior growth margin was million points increase increase. a of local the in Adjusted year. amounted XX.X% basis prior Currency over operating approximately profit SG&A profit quarter, X% to the XX% over in Adjusted currency to operating operating the by million, X%.

P&L. couple other A final amounted amounted $XX.X $XX.X Amortization million. was interest $X.X to the of quarter, to in million comments on the expense and million income

this Our the is timing the year. exercises full effective rate items This quarter in to for the rate and option discrete adjusting the tax we rate in stock quarter. was XX.X% of before expect and maintain for

amounted diluted X.X% increase XX% unfavorable quarter the a year $X.XX, decline XX% shares a EPS the to Adjusted quarter, over an the reported from basis was for $X.XX prior a the million prior $X.XX excluding as year. approximately to On is prior Fully was or in EPS compared currency. which in the $XX.X year. increase

EPS purchased in the includes Reported $X.XX amortization restructuring intangible $X.XX of quarter of and costs.

exercises difference had the our rate of option year. to also We $X.XX due a every that due of quarter the in annual timing normalizes between headwind fourth stock quarterly to the and tax

up me P&L well That covers quarter, receivable to the by trends now incentive XX lower as flow payments. adjusted let X.Xx. $XXX.X on cash helped while million inventory amounted was In better flow. $XX million, cash as comment ITO DSO free accounts the was days and and

off start Let me to remain now remains turn conditions guidance. challenging forecasting dynamic. market To and

the our is assuming guidance market year for full end in second markets. remain and the they there and mentioned, the previously We're As today. are basing quarter conditions our uncertainty economy as

headwind reduced local growth growth X% pipette sales sales This our the reflects second approximately expect business. in challenging the currency in from we level of growth approximately the multiyear second well growth. as sales quarter we X% faced a of comparisons For quarter, as

growth currency. range quarter to to second XX% the of X% X% $X.XX to foreign EPS or to a of rate be excluding adjusted in $XX XX% unfavorable expect representing We

left local of For approximately the full growth year guidance XXXX, unchanged. we have currency X% our sales

approximately foreign of compares adjusted to our in to EPS We expect representing about This $XX.XX. in or XX% of of previous to $XX.XX of excluding of adjusted to the guidance range XX% $XX.XX unfavorable rate EPS a the be -- to $XX.XX full range year XX% to growth approximate XX% currency.

is Total million amortization be is or including from purchased intangible pre-tax on EPS forecast per a Purchased $XX excluded amortization adjusted million. is at and intangible $X.XX basis amortization to estimated share. $XX

to let's flow. cash Now turn

continue cash repurchase $XXX expect expect flow the $X and billion we of approximately of we free XXXX still shares For year. to million in to range our this

it now side Patrick. it turn That's my and from I'll back to

Thanks, Shawn.

year comments in me with on growth operating Lab challenging with which comparisons. good some Let quarter start businesses starting our the prior considering had

the in we others. a portfolio particularly as and across quarter continue also most larger-than-expected growth had of pursues in hot continue sales our our their this will growth and in team lithium-ion work We year. second headwind in down of pipette customers our the believe to inventories. Outside the We business decline second like had sustainable of pipette, among segments strong polymers batteries as half opportunities ease

across products now and demand Turning from this continue we quarter core customer our growth enhance business. for strong industrial productivity. to strong as to solutions our very our We processes had Industrial benefit automate that

Product as inspection while manufacturers we it on from a had in capitalized modest food demand stronger in experienced growth Europe. quarter strong also only the Americas,

results is year. lower headwinds the our start economy the to and expect in as for are expect increased softer pleased the product business and face industrial core year, with customers not from inspection these also of we While the growth good immune the we we remainder

Comparisons project in in activity strong last also delivered Retail sales the this very Europe. favorable robust due declined first quarter year. quarter to Food were and of growth the Americas Finally, as XX%

year. of be Our Food the rates lower expect sales customers' the our remainder and can Retail for on activity project lumpy growth depending would we

quarter. One on in momentum final comment the excellent XX% Service continued sales the to business. show and grew

to very pleased in continue of important probable our and this business. the be We part growth with

in X% impact of well in Sales comments excluding let food stopping business by growth make Sales geography. quarter from a our in industrial in strong the offset or Now quarter growth shipments me to our the decline core as retail in significant growth strong some by pipette. as businesses this benefited increased part Europe from very additional X% Russia.

the by growth the And especially, year the Retail in growth of business. Americas and quarter X% finally in strong rates of with our against prior significant in particular of decline pipette. led was very China most grew with across had Lab. solid Rest another Sales growth World by strong part Asia a good growth strong businesses, the Food offset Lab in

the be more some why we of opportunity substantial insights couldn't the optimistic ahead Now and March speaking our about quite strength excited in traveled China there. I at growth a of our to in are the and about I opportunity China us. end and of long-term team the of on in China like to share business visit I'd operations place our have we few additional

China years. using sales design China track as represents of subsidiaries total overview distribute there China our for have very of the and in an for than First and long products more market. XX local record we wholly owned in XX% we manufacture global a operations

in of market. will source important future growth and believe manufacturing again production the sold representing been our over an into of the company growth. which and markets historically local three is of have China locations of other one-third be we We China emerging our have approximately half global for a this source

strong XX a years more at industries. has where the XXXX in out have shifted our unique over increasingly competitive and China and growth our of a as Our last most solutions seek the to mix has resilient advantage business overall including very go-to-market CAGR faster XX% we XX% Customers growing in China grown business our advanced leverage approaches. in

extremely automated Our ensure -- aims drive solutions to automation compliance. demand portfolio solutions for to the help is productivity well-positioned serve for

developing strategic We segments. other government's also a industry market benefit sciences focus the on broader from and life

are of application to China respond in support development agile market colleagues with Our demand. and needs very to local China-specific local

segments stationary this programs growth positioned unique solutions our provide firsthand this how a substantial to excellently and these massive large to customer solutions are value leveraged industry. and growing saw power sales are cynical batteries like but investments capture in marketing to e-mobility approach battery also lithium-ion our in with and how visited and rapidly I hot We

our continued healthy also look QX lithium-ion positive first investments. with investments batteries, multiyear Overall, business like to in reduce outlook customers China our in industry is as investments key in see and improve comparisons. automation despite but during challenging our labor segments productivity strong for the and also pharma-biopharma, remained quarter direct We

with in I new in capabilities segments market healthcare. potential optimistic expanding government better also is R&D e-mobility, would support sentiment long-term of investments support to pharma-biopharma labs that growth investments further to and like anticipation note

the structural these changes highlighting important being I for development, responsible of placed would announced still are the of scientific pace the has this organization limited, accelerating its topic. note but Details on that in government emphasis

we growth business our expect opportunity in of our pace overall we remain faster trends and these at our China, about about to and in China think optimistic than the a the would in region business. business As how long-term impact the grow

the for market China optimistic and are can we while a the been everyone, for historically remind change more to XXXX, long-term and volatile like always short-term. we things in as However, has quickly

In and the unique share culture diversity and China, tremendous financial operational and XXXX. our position us gain rest growth of in very agility we like well market results solid world, the to deliver of strategies, excellence believe

And would Now open we remarks. like to that now call questions. concludes to our prepared the

Your of Waldman Instructions] comes first from the line Cleveland. Josh [Operator question with

and factors for come QX one beyond last for X% then and Morning Shawn, the have the guys. year the how had second you detail, in to year. the they're for Shawn you guide on wanted questions. Thanks full taking local for to thanks assumptions? there your implications for the since cautious and previously Curious quarterly what your guide, for my leaving organic the penciled on cadence growth I more for the all play then guide And quarter? destocking into that compares near-term are Patrick. currency full start One for

Thanks sure. Yeah, Josh.

mentioned the remarks, QX. as think factor in we I a is So in destocking prepared

So decline if about X% quarter in by our that reduces second expect you pipette our in look -- we the specifically growth the at X%.

our growth second multiyear I another thing and would comment think look think the on I headwind, X% comparison. is to that quarter the it's for be excluding to that at So important important

couple of XX% years, three-year the look about last X% with if is growth. the So CAGR we our back

that's and growth. X% the we actually QX year So similar with did to that's what of this a very XX% of CAGR in

of So of perspective last XX% year, top again prior in in to on on put that we the but year. that that grew XX% top was XX% growth

the much on think So about that we us very is weighing as business.

like I of, through our region. and to through typical by maybe then just, business that guidance And area can quickly. go kind walk

growth in single-digit So quarter. when we're business, the course, in is low look at we business. at lab Keep lab mind, of second the with pipette the looking this dealing in headwind

single lab the range headwind the be is that digit estimated it So high QX would for for excluding that. in business, X% probably so a

was And at down of little what business business. about for little then X.X% bit digit expected were that this pipette from headwind now bit for the full before quarter looking a at first that's the because year, than the we the thinking lab from mid-single a when look we're includes and decline more the X% you headwind results in a

Product second low inspection, the looking quarter in we're at and single year. for to the low digit mid-single-digit full then

One we Americas, in the good headlines in but can caution year actually PI regard seeing activity that of is in appreciate the start you as for in lot we're foods. that in a to And a the investment things seeing challenges we maybe some of more there's, and very PI in industry. packaged are had

than a better full be well the what that second resilience were with and basis business the then low-single -- for been expecting. continue executing full there. mid-single little just on We're year, we a the digit how of quarter core bit that's very year and impressed to very For for we've industrial, digit

is activity. retailing, at then, and food digit strong for pipette. better-than-expected at with to for hit looking then year. regions, then, a we're disproportionately this decline full QX project in the very for And for business digit start in low-to-mid-single then looking more headwind we're digit mid-single off and the the digit obviously the in year And the little Americas full with bit got for QX That low-single a high-single

And were with looking mid-single digit digit consistent full time at year a better in high-single then we looking China, the and then, we're year spoke QX for we the strong were looking to the very what what start full the at full low-single-digit time QX. looking for the bit which for Europe, we we're at the spoke. QX and last low-to-mid-single-digit year last for for little given than is we year for

context Patrick, And through Yeah. are appreciate benefits guess I the cadence or the bit Got maybe it. provide quarter the in seeing then, yet. on comments that, not on China. order or could Shawn. book by a I And seeing guys wondered up more whether you show Appreciate I all the you if you're stimulus what the end-market.

as COVID rate cadence had beginning off and was our China, of solid know executed as in we morning started at a quarter have Good organization Josh. X% in Look, QX the Sure. so delivered in the results. very yet China, quarter extremely growth course you strong seen of with we that where the you and really And the at well strong results.

for the at year, course mentioned, growth right QX and high schedule of that of compares, As and Shawn on plan China now strong then for still the have we QX very based for is mid-single-digit fact for full single-digit we also that China growth. the have

terms kind of that's in the So of growth. outline

again, business. we Now, strong what there, seeing the we have Lab are for very seen growth

us and Specifically for analytical really is segments. from the hot instruments, well the for performing also analytical business benefits

really difficult XXXX. over has industrial almost in industry a in moderated in and against XX% commented comparisons. QX growth XX% reminder, we business grew the XXXX QX Again, made the on Shawn a

of for those also QX So compares account will forward. moving course

break behind car. does where still see the segments growth we beyond emphasis how of we the the opportunities industry in like, a growth lot come manufacturing down really example, in is When for it's building putting battery impressive interest it the say from hot out China solid

power cetera. place large start up and plants night two long grid at energy the producing also And power take mentioned next that back at and solar it modules to it will I keep how grids, et excess they power

in the continued So with investment investment. automation that be industry. goes we across there solutions I And Lab think see will overall that along

aging are fact facing the will an they to China and workforce moving enough productivity for look have not that gains. workforces forward. They continues

and really in So really plays comes they're confidence business where well, productivity from. looking China proactively that's again where for automation solutions our overall portfolio the our

follow-up development government China We well health growth all that team on five-year are in wants research whether that longer into have. with China long-term stronger we the drive we in confident it's a whether positioned plan the our and extremely And plays growth the and trends and them are portfolio. well to invest it's very care, the

all detail for guys. Thanks Yeah. the

you. Thank

of with comes Meehan question Nephron from the next You line Jack Research.

I full Thank quarter? could how all? at your how you. contributed was pricing if you for in update the And changed morning. us wondering year Good that much is on expectation

Jack. Thanks

So, pricing came in pretty much expected the as range. in a of we X% kind

of expected took last inflation. given We good when off to actions kind that different we the get were a to year we start this all mitigating year

And as the growth. growth year looking we to X% we're specifically year. look full as And the to we're still at for look X% about QX we full expecting

be so place actions of would the the last of we is lower put QX timing And because some the reason year. of than QX why in

Shawn much to destocking Just bit you Great. And the you clear elaborate to you on more the just of do have second little and related pipette think a do COVID or into in half year? either that how Patrick you're be can seeing? much specifically is just improvement the visibility how of like this

industry I can testing the really last in not effects testing, you take to honest. be also the that this biopharma pharma when it. appreciate Look markets others COVID only and year destocking also I demand the customers there market I the was down. everybody who's related huge should mean a mean market inventory still the suffering now from in is I that actually have working they're because and I the talk shortage inventory pipette industry up there when fact some to was quite using they whole whole loaded the that I think say

we the to reduced in be this as expect said second do half. We

a still topic more it will in for definitely second volumes QX. the to we So, normal back be will get but half

Thank you.

the line Arias question Dan Your with comes Stifel. of next from

you of here where implied that's around. pricing following question volume you the macro question. periods growth? year a you or X% for the to And volume just on here as prior Can most true? you factors maybe with on that likely a that's we about this what through of there. How Thanks did moving year flattish guide makes prior be had some year think often kind see guys. end context years the in market the put move Morning or Shawn

much just before years of like terms last in our out an longer Dan -- mentioned I year is Well, growth. mean what stands I the of think I we're unprecedented term off our is the for algorithm. of than for ourselves the that CAGRs CAGR this envision we how period XX% higher coming three

So, always during this some we've of some see moderation expected point to level at year.

hard It's historical precedent to maybe in like reversed second came kind course and the a of the to to that it of compare the start to it we year but had when COVID a in volumes during year. XXXX half of then slower

while think for out, but It's see I in time think have we we've it -- comparisons how environment we've very of -- core quite has well also business weak been plays which resilient, XX. industrial So, resilient to I been below we're susceptible hard not PMIs been we're historically executing specific economy the to our particularly with while now right? a more macro in some we'll kind the and

a on our come companies that markets whether headlines And are to our mind facing some in we the of or or do challenges companies that particular as food out little with biopharma, be like end well. so chemical manufacturing industries end it bit have continue other of as our markets in

Yes.

portion Thanks you obviously emerging then of add the you likely that's Okay. of as would to how spending getting a your of just much. attention anything your call kind this that the there? is ton evolve exposure sensitivity days. biotech a What And year? can small to these to on and describe And then And follow-up you would maybe base? just conversation customer by

to our overall Yes, biotech I small is small. think relatively exposure

affects that it's of course that a business generally Of small pipette of in bit part is a little our rein but very business.

particular in nothing would out. call I that So,

question please. Operator, next

with Donnelly comes Your next question Citi. Patrick from

of the guess I there for question talk was just comp follow-up Jack's side. this give that second normalization about the back the to to a just into conversations what the gives the wanted on level it want visibility sector? normalization some good make feel about in have to customer dynamic? on chatter confidence the of Thanks a just Is that the I Patrick, half across you given questions. sure half? as guys can Is think you confidence I pipette run. -- taking guys. we a in market I it on you just Hey, it the terms

it's course, true both, we right? volumes part come from. the and course, quarter put Yes. customers data, destocking will are in But of of should to and it it's Look, I more the we think also, at and another inventory conversations have -- normal growth way. We, look the they rates we historical have QX back with get signals clear that of that then be levels,

would rate that you volumes expect, to volume three, growth would QX. get last to was QX expect then market overall gains normalize for the have. underlying back that we market again, of will the and the we back would get It's is share And our if anticipated over growth that okay, that calculation we we what saying, the mix years and a what four

And into yes, QX share, factors again more pipette then We but that and back portfolio very a will all we in in account then again. growth these we we very basically QX say, business look headwind see strong uranium market take QX normal to have to if picture in strong getting the US. rates a in at you but even especially also unique has pipette

Okay. on pricing one the following Understood. And Shawn maybe up piece.

ramp in can half, the helpful. the on in moving pieces On that talk margins would Obviously, the then little a you of came light side, that the be expectations the for Street similar just where the second just earnings was. about to the And XQ? margin

Yes, sure.

points in quarter. Actually, of grew at the in I the to So, if was gross keep we're XXX think excluding mind things it that, looking margin, we of is I think currency kind excluding XXX points, currency. basis our about one basis

we wasn't currency-neutral much guiding. a on what basis that that to So were different

had an clearly impact. currency So

between different We unfavorable a quarter in mix bit little also had the businesses. of the

kind the other Of of course, is pipette and on is side business more retail a profitable of that.

of improvement. And of currency-neutral towards the in basis As full the quarter, exclude the points currency-neutral that we then we're from be slightly and about if for basis second looking currency point a XX margin would XXX gross basis spoke. be rest for improvement year, improvement, XX XXX% like down is we're about our the you and year, XX a at would looking a that's about which that kind basis, basis point guidance on again we on at just like basis about improvement point the last time look

of And basis second then, We're to XXX the strong the we're a XXX then to about improvement, that were full on at up quarter. but And on at at we time improvement, point off basis the point what's to operating that year, would little be currency-neutral margins, start about currency-neutral different so still very is good And as about bit kind similar looking in basis again, -- start about we is XX a on a to looking improvement again, looking points. the we're year another year. number basis we for basis point last basis got a a expected. which very XXX a

a gotten lot that's So better.

color. Understood. the Thanks for

Thanks.

ISI. Evercore from Vijay next with question Kumar comes Your

guys. my Hey, for here. Maybe question. first taking one Patrick Thanks my

cautious more made but change. did I not your outlook a It comments I think like tone some this macro call, on on you've industrial the see bit environment. seems

is guidance for more cautious change can macro from us at specific say, -- look you when tone, about a macro should So how the have industrial perhaps the regions taking some when so change all but a the is where or because think you I Labs, end markets, this would came give expected of we you commentary? perhaps sense

Sure. Very question, Vijay. good

things So, and highlight macro if a end to markets, economy to you of the couple you. I want look at the

probably also historically really soft. that be down. might continue an as that's And First, to slow industry business the been you indicator very for watch has us PMIs the

fortunately, fully we us yet it's at because hinting strong are a low. We pretty have PMIs a concern not but that stayed portfolio, the for

more, would We packaged negative problem. I said is We have headlines, QX in already also market. example, a the food Europe for in seen that say,

also Now, not their their the as down are in that be. to also results of too headlines are as and are we're not customers Those promising. investments hearing the slowing also good they some used actually US

made biotech, in end overall biotech, broadly in pictures is well. in about as about of And exposed there's but factored why total as concerns And not market, they're then, was biotech. of commented the terms it who out already macroeconomic comment still, our we, There that there. course,

When forward. outlined Shawn the first in performed I think, it really mean you strong, expected It moving Europe at cautious Ukraine in the war but our look the prospect. impact the regions, and economy before, was what quarter than better from still of we're about might it the for

still And we to need you the quite overall. be think, -- US cautious ahead, also then, with also again, it's bit keep our you potential US So, in the for outlook about moderate. forecast there the I a recession we

know, large. one And follow-up pretty it's serve, Patrick. you helpful, base I That's the -- here that on customer

items pipettes do like you survey back gotten feedback a customer -- back kind this in you at customer run that rate on pick have your rates order guide? So your might gives the confidence of and did what half order up. I'm thought base curious rates, of assumptions the when you when in about half daily look XQ when on you you

second the half in be we in think year. terms We easier the course quarter. why in number see all of us very certainly the That's of this second to a I had compares will last mainly refer decline I for rate. one, if year growth stronger here strong growth

to, are, areas, of their from talk really we second overstocking customers use we pipettes intensely. from be of less can good And issues customers terms indications some that that them in then, issue half. in And pharma, research of lot the them actually -- biopharma of will quite a the an get of in

Understood. Thanks, guys.

question next Fargo. Wells of Daley Tim comes from line Your the with

you. Great. Thank

with us lot lab I of on Just for underlying you help guidance year growth can lab. but just to that the the are quickly, a up rolling within here, know talk regional forecasts that guys

look I Hey, the single-digit Europe. we're as kind division. had we I And as think, single-digit think Yes, sure. for low like Americas of so range kind low a growth we looking for at and that in like lab QX, of

-- Europe going impacted pipette. to most is Again, region the mean, in be by decline I this Americas

versus see ones. of probably will in China softer there. in to the the high-single we'll of kind be the growth that probably a mid then, digit region range So And kind other

lot we first you a if of of think quarter had in an that And double-digit -- product categories. I seeing lot It's example, in we rest look And headwind of topic other as the important segments. at we lab in we the talked we it's as still growth most also kind like business the too, about actually of hot the this then multi-year that growth enter the of comps pipette good are these year. a and these with the just

to help And much don't you're right. just, earnings call into All grow the think us about kind you service for just of, services And how wanted the line. the in I touched the quarter. Great. understand dig on general that consumables commentary. today. in contract did, growth then, guess, value-add that and thinking we I service How versus year? Can

story. We XX% Yes. year mean, a good good service We really and question. really XX% got at of off grew to this kind it on No, call. growth. we our with year great start is I last last featured

terms when dollars our the we when of serve. you put of opportunity. to installed here kind very mean And to in opportunity a that overall what it could great see business, base look to kind service you of continue We at significant it's that

ability accuracy helping and results And lot the good whether at in the a well go have resonating terms very program do or And embedding our also value point with and have big And these penetrate iBase and of processes. here really of better by kind validating with into value the traction as we that their like with in propositions that to very we a opportunities opportunity. of are and those this value-added after -- how very uptime strong compliance we activities selling capture certifying reducing We sale can and service process. data waste. analytics we proposition marketplace. We've seen our of companies [ph] quotation these gotten of very at

they Promoter high one comment services final Net continue to Scores like maybe and were then like have highs all-time before. be on our other at already And

out. just it in positive year around executes the I well it as for rest QX. here. world. range you continue full plays if team we're And our year how the of for And again be the we surprised be XX% shows then the the to so we kind And how see look wouldn't we'll towards of

the Great. it. Thank Appreciate time. you for

Thank Yes. you.

America. Your next of De the comes Bank from Derik with question Bruin of line

Good morning. Hi.

Hey, Derik.

QX year I for Apologies you Hey. if missed are this, the and in impact revenue can us Has FX updated? been assumptions full your remind the but for what that now?

Yes.

second. a Just

-- So okay.

just the under QX that it's on then full neutral full X%. detriment. FX maybe year, is So for a for about the And would be up And year so then modestly.

EPS. perspective my bigger one the make think is on you just sure Derik one got I from this FX the impact to

EPS And we I about like than a that's and full was in a to it's the our X.X% it that's mentioned guidance. year. so headwind worse release press for the prior think like X% In headwind a previous QX guidance for X%

can And the of differentials Yes. split Got and versus just the remind Lab Industrial. industrial PI and also that. core you in us margin like sort between

trying the sort year? about like the back activity once the -- to think of progression for margin margin again Just

Yes.

bit our is and bit terms in So of of industrial is about little industrial a be don't of then as And think split business the we exposure terms about kind but it's range. the than in core math, PI and XX%. of a -- It the of exact in margin XX% that our differentials. XX% more less kind might little know probably the about a XX%. I yes, than

Our does higher than business. Lab business And a the that higher-margin within rest course is pipettes have business. the of of margins then

of just still in or all people -- buying, relatively build And a PH Great. of and backlog. of short cancellations? hesitation seen But know have cycle does in any guess buyback the you cancellations business meters any seen have mean, any your buying sort sort your are not of I I Right. quarters healthy? you particularly is looking at I are instruments more things

actually good. QX Not was seeing any quite cancellations.

types all like if to those not but talk about that. or think out see not hesitant Of we'll play course seeing of of hard anything cancellations terms I there things in

final percentage one just then of quarter? the was one. analytics What actual price first in growth and And the pipette in

high business you for of down Analytics process? our So the was pipettes is And over XX% question? other of was teens and just pipettes our what part business.

Process analytics. Yes.

very good Analytics Process quarter. had a actually

of holding bioprocessing is insight QX. look double-digit of business lot of – into were if trying actually for a they the you're that get like A to think is kind because well. And there, I if business quite like you the bioprocessing. up on lot up in

area we that and part Of comps we course, single-use is with in vaccine much that seen to in is of But smaller there sensors a and that one of our business. deal where but weakness some have production the business have – portfolio. course are

question. that – exact exactly where process I and that’s that is was Yes, analytics with going

Thanks, Derik

Thank next Absolutely. Sure. you you very week. much. See

See Take right. you Derik. All care.

Schulte comes from of Catherine the line Your question with next Baird.

Thanks question. Hey, guys. for the

You talked did pipette in both XX% and perform overall consumables the excluding then quarter. about services growing How tips?

Yes.

question. good So

So our me sure number the right I here. let – get make just

we down the business almost was decline saw consumable our So was due to that entirely in and XX% that pipette. about

categories. had I in think we consumable all our of growth other

And And order just better trends trending coming Okay. raise what we're macro to seeing of any seeing? you of some like you're to core confidence the that sounds the despite talk commentary there? you into it gives is you full year industrial than that that expected year. Can book then weakness kind

with an healthy solutions And interest we to Catherine. Look, industry portfolio a very and compete portfolio that help Yes, and think product down to still our our new for the we doing also about well. us and released I talked product really at the business Especially, OEM well. very products successful year think Investor the it a Day, overall Industry also is that and in investment morning. with customers again Good the we we extremely last automate I comes processes. XXX, I'll see take

demand. We see strong

out again play in think lot significant still in a part segment. the building a there's And interest supplier automated around a this I we as solutions. of world,

low forward it's affected as badly we a not because confidence will but also single-digit besides So will the be are pointing that trend us as QX very industry growth compares. negative again, tough in to moving that quite PMI gives some PMI looks

looking forget at Don't are tough we super compares really here for on a industry. three-year basis

industry. over to quite growth course, years in the put massive the the this means last good growth it China US. in additional have investments compares positive of three in in Europe very something. We had And We in

Thank Great. you.

Your Sykes Sachs. question from comes Matt next with Goldman

morning. Great. maybe question. one for taking Patrick, Good you. Thanks for my the first

year were longer-term to I'm of obviously, quarter, at at correct of if at maybe if Just could growth longer and it's wrong through Lab this the so at? business, that that a make rate as bit you've meaning normalization difficulty overall we're contribution on the little sort the but without the Mettler, growing growth if growth in rate and on going then then the help on are services, me to group percent, we understand the pretty can normalization, last services that your a could the looking business this algorithm historical comp comments CAGR particularly and the significant this algorithm, for understand algorithm continue just more you the us the services the please to growing actually change services essentially could grow XX-ish or three-year has higher that that post actually and shown services rest it's

I numbers in this the forward on of him. because he you Yes. Shawn front has growth question to Actually

Thanks, Yes. Matt.

we've CAGR. hey, And mentioned of with pleased the I a XX%, kind a in we're maybe a So we last service. we with year we opportunity. growth but the see mean X% – that started I CAGR in as at seeing kind good we If how as were of exited And look course, of very before, year, been it's really QX. three-year like

which the than -- corporate well forward above year. don't front -- overall characterize business we're pleased as year think to a I we're going at of me. how want benefits upside it digit. and going to the should thought nothing single I I to full about have average this would and I would But of our with imply the But forward, So will But certainly as have organization going characterize it number that, would and just historically I just moment. high certainly executing do this challenge we're other we've over time. differently double-digit well in highlight wouldn't it And than to kind although algorithm have very

for Thanks automation that. it. just then Got space. that And on

is of you Is automation You other that different markets. sort players European and China regions. against similar, or guys you I'm Is that? different are of typically sell type facing a other larger competitive thinking just as automation, into you within find Japanese that guys landscape compete. in going or are from compete ways the fragmented or it to of to automation any players

and And like let a jump Patrick system in. selling But of I'll our integrators. automation different. it's Think maybe lot the we're start

has easy area that a well. of to competitive and advantage And business are we with an that into whole how solutions all to their that's integrate of lot stuff kind model have there's where so but do you quality not only so and as a

and easy very in about our mean, we that strong I plug with that and our how the think I environment terminals end the agree, a system system very portfolio I into overall have but resonates portfolio and the integrators. user also software and the very it's there up-to-date sensors well both has

Thank you.

question Liza with comes from next UBS. Your Garcia

Hey, guys. question. a Thank Thanks lot you. taking for

I just a qualitatively? the on talk of seeing in pharma a more questions about even sensors. So if know like customer little you even and more there's pharma growth on you talking think what there But environment you're earlier if I broadly trends of kind bit spoke could the the I more just broadly, the lot guess -- types on pharma just about broadly. you

pro yes. have the other diverse to well. business strong there serve Yeah. when should you I it the that, the manufacturing then when you in scale first with in industry Autocam But business broad start and we whole look pharma analytics And we bio-processing you biopharma our in thing is industry. portfolio with exposure And that portfolio so comes portfolio as plastic with pipette. when appreciate given downstream go can was broad-based customers R&D with also is pharma to downstream solutions pretty up at

are think Shawn for there broad-based single-use we with the a base What really But that example we on have to also saw anyway of exposure. a that But some biopharma. R&D into we as QA/QC exposure slowdown and was saw slowdown that PendoTECH and we demand related and of there long-term manufacturing huge see we investment see continued side think sensors side healthy acupressure we think really in of well. the is Yes, pharma I a course installed seeing I on I with So still [indiscernible] also investment we saw biopharma -- there's in in healthy for this referred -- there. a out biopharma used we serve. are process instruments investment

at see in broader And actually slowdown sales our moment of QX, scale. I no it in similar. QX say, there's in a portfolio looks China Regionally, into continuous We had pharma quite also addressed segment. replacement on but business good US that we we in in the a pharma addresses on that the the big sales would biopharma

that what positioned which look on pressure. China are the at means growth opportunities. portfolio the we be very change to will well think have, whether capture that be a more it segments moving But forward, could biopharma, given there broad again, one we could of in the I Now, in a you

Just US was to excluding clarify his pipette comment on the

pipette the Excluding

talked about. We

And -- be think kind a you outlook know a about we the growth that think how a But how about the there? and many lithium-ions, bit sustainable in business longer-term of you then -- you Okay. a I Helpful. talk about how question about And and just talked smaller. how there? it can polymers about you like, should runway of of, think bit may

that polymers, on lot lot there's is a lab investment Again, of lot a on new and research a it area of mean, in a with area business. sustainable portfolio. serve of absolutely. Look that Yes, of I we broader and in the the going materials

looking to the at see are characterization they look that with material you you for. we what there and customers portfolio, working our – demand, very If understand our closely workflows the solutions are and

we the solutions trend, for of demand would and with terms up materials of say, example, innings. standard opportunities I sustainable a it's to I forward. lot plastic are market Given still also moving where in to and think the early come There's overall in more

are we be that us. segment So, for while, confident it's will still small a

a workflows, in the for course we we what and hot early segments batteries It's research, solutions, enough in to as -- later leader that that and see example, with provide the to we That's what be out on in similar are what manufacturing one can participating lithium-ion these pipette them right seen if of to right of we growth they we see and continue also [ph]. customers with have battery done with have there and build the segment.

are now both all We three what on have with been understand, and opportunities, the the areas. their the in terms needs R&D are customers now participating two of, also but or side manufacturing to we on really these growth very in nicely early

so Thanks much, Pat.

Thank you.

with comes next Couillard Jefferies. from Your question Brandon

in. squeezing for Thanks morning. good Hi, me

on first for And care on there update one Shawn. two for in forecast competition subsegments Patrick, business year. out to quarter? Lab the local call in any Just dynamics split the China we for or out? the then ground you change versus those industrial you the any Do the in And that

then. question that of part first the take I'll Brandon, Good. Okay.

good our China, of example, lot instrument batteries, in is in We business. In a been just growth smaller pipette of from a saw of their really with the for also like So of -- lot have have of like we that these mid-teens. Lab they lot headwind, good start were a our portfolio We a QX, business. about felt benefiting but had throughout to we businesses a it's really strong a year lithium-ion part Lab up we segments talking the analytical a were very business the which other business. hot in exception the we also a in our actually growth

and low think in industrial context, then the I side, And on put in grew that with we digit quarter the to single comparison. our that's important

in of year the that's QX top XX% So top growth in on growth that. but of year, of before XX% on about last

in single-digit of kind the comparisons in at in also for given the China improve. their the business. better expecting in So comparisons look comps looking QX towards second first we're quarter, the of is industrial of very, as like very year and the for year some half challenging second again the low lapping we Industrial the of rest QX challenging results as but kind And we're half

for were is is of year So probably to low before. we thinking thinking how which business kind still of to full similar mid that the

the or a some strong a And of in some single-digit Maybe especially, basis in given to but full of also QX. Lab still growth high the multiyear topics because then comp have QX. the mid range, might kind in year, on it's moderation for start mid optimistic more

thinking still that on the So Lab for double-digit side. year full the

think it's they the the like a there kind in that for the through what just that especially the out. rest I that other we'll COVID of how topic the of went but is year. how with plays regions, reopening that a fact going investment like lot China -- of see they've had in And looking to all be to given

Look situation say it's competitive about market. China Great. there's you in market, competitive with but the my a Brandon change. asked from significant Thanks. no. the would a maybe very side I

we in remind players want as to a have strong you have well I you have history local to there China. but We -- really

strong a have R&D base We there. and manufacturing

lot of the product in approach We those after sales helps That the marketing applications opportunities portfolio to cynical us and locally go the really sales manufacture in some market. effectively China growth the of uses to products team the -- as the and compete China local identify marketing and same we our remarks with in needs. the very tailor market also I my and said a really to

I and to been those. about example very segment mentioned successful battery the that they do have

but changed market I say dramatically would for the is hasn't yes, So, it competitive, us.

to to also that market. of compete made we have investments a well-positioned effectively we is compete make Our in and the lot to team from right the continue to portfolio my perspective sure good

you. Thank helpful. Very

conclude for you Thank your conference. we questions, will further With participation. no today's

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