UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED ~~SEPTEMBER~~JUNE 30, ~~2021,~~2022, OR

☐ 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						(I.R.S Employer Identification No.)
incorporation or organization)

1900 Polaris Parkway

Columbus, OH 43240

and

Im Langacher, P.O. Box MT-100

CH 8606 Greifensee, ~~Swizterland~~Switzerland

1-614-438-4511 and +41-44-944-22-11

(Registrant's telephone number, including area code)

not applicable

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

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $0.01 par value	MTD	New York Stock Exchange

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 ☒ No ☐

Indicate by checkmark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer. ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The Registrant had ~~22,985,655~~22,506,610 shares of Common Stock outstanding at ~~September~~June 30, ~~2021.~~2022.

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 and Comprehensive Income for the three months ended ~~September~~June 30, ~~2021~~2022 and 20202120	3

	Interim Consolidated Statements of Operations and Comprehensive Income for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and 20202120	4

	Interim Consolidated Balance Sheets as of ~~September~~June 30, ~~2021~~2022 and December 31, 20202120	5

	Interim Consolidated Statements of Shareholders’ Equity for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and 20202120	6

	Interim Consolidated Statements of Cash Flows for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and 20202120	7

	Notes to the Interim Consolidated Financial Statements at ~~September~~June 30, ~~202~~20221	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2624

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3533

Item 4.	Controls and Procedures	3533

	PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	3634

Item 1A.	Risk Factors	3634

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3634

Item 3.	Defaults upon Senior Securities	3634

Item 5.	Other Information	3634

Item 6.	Exhibits	3634

SIGNATURE		3836

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

METTLER-TOLEDO INTERNATIONAL INC.

INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

Three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021

(In thousands, except share data)

(unaudited)


		September 30, 2021		September 30, 2020			June 30, 2022		June 30, 2021
Net sales	Net sales					Net sales
Products	Products	$	760,844	$	630,372	Products	$	780,244	$	736,486
Service	Service	191,106		176,985		Service	198,143		187,865
Total net sales	Total net sales	951,950		807,357		Total net sales	978,387		924,351
Cost of sales	Cost of sales					Cost of sales
Products	Products	304,290		254,050		Products	308,019		294,053
Service	Service	91,840		83,699		Service	98,707		93,394
Gross profit	Gross profit	555,820		469,608		Gross profit	571,661		536,904
Research and development	Research and development	42,276		34,656		Research and development	44,023		42,603
Selling, general and administrative	Selling, general and administrative	240,734		204,974		Selling, general and administrative	242,206		239,045
Amortization	Amortization	16,039		14,121		Amortization	16,365		16,218
Interest expense	Interest expense	11,791		9,310		Interest expense	12,765		10,439
Restructuring charges	Restructuring charges	650		4,570		Restructuring charges	1,770		876
Other income, net		(3,257)		(3,832)
Other charges (income), net						Other charges (income), net	(2,160)		(2,661)
Earnings before taxes	Earnings before taxes	247,587		205,809		Earnings before taxes	256,692		230,384
Provision for taxes	Provision for taxes	43,899		44,042		Provision for taxes	44,622		45,621
Net earnings	Net earnings	$	203,688	$	161,767	Net earnings	$	212,070	$	184,763

Basic earnings per common share:	Basic earnings per common share:					Basic earnings per common share:
Net earnings	Net earnings	$	8.83	$	6.76	Net earnings	$	9.39	$	7.97
Weighted average number of common shares	Weighted average number of common shares	23,056,924		23,922,272		Weighted average number of common shares	22,593,375		23,191,155

Diluted earnings per common share:	Diluted earnings per common share:					Diluted earnings per common share:
Net earnings	Net earnings	$	8.71	$	6.68	Net earnings	$	9.29	$	7.85
Weighted average number of common and common equivalent shares	Weighted average number of common and common equivalent shares	23,393,579		24,225,204		Weighted average number of common and common equivalent shares	22,821,666		23,521,793

Comprehensive income, net of tax (Note 10)		$	208,428	$	180,099
Comprehensive income, net of tax (Note 9)						Comprehensive income, net of tax (Note 9)	$	180,579	$	193,915

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 AND COMPREHENSIVE INCOME

~~Nine~~Six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021

(In thousands, except share data)

(unaudited)


		September 30, 2021		September 30, 2020			June 30, 2022		June 30, 2021
Net sales	Net sales					Net sales
Products	Products	$	2,124,245	$	1,656,819	Products	$	1,486,859	$	1,363,401
Service	Service	556,446		490,373		Service	389,319		365,340
Total net sales	Total net sales	2,680,691		2,147,192		Total net sales	1,876,178		1,728,741
Cost of sales	Cost of sales					Cost of sales
Products	Products	843,613		662,681		Products	597,108		539,323
Service	Service	272,658		242,524		Service	187,824		180,818
Gross profit	Gross profit	1,564,420		1,241,987		Gross profit	1,091,246		1,008,600
Research and development	Research and development	124,151		100,236		Research and development	87,051		81,875
Selling, general and administrative	Selling, general and administrative	701,531		593,852		Selling, general and administrative	477,518		460,797
Amortization	Amortization	46,141		42,008		Amortization	32,969		30,102
Interest expense	Interest expense	31,701		29,111		Interest expense	24,103		19,910
Restructuring charges	Restructuring charges	2,719		7,335		Restructuring charges	5,781		2,069
Other income, net		(5,208)		(10,118)
Other charges (income), net						Other charges (income), net	(5,869)		(1,951)
Earnings before taxes	Earnings before taxes	663,385		479,563		Earnings before taxes	469,693		415,798
Provision for taxes	Provision for taxes	125,271		93,119		Provision for taxes	83,622		81,372
Net earnings	Net earnings	$	538,114	$	386,444	Net earnings	$	386,071	$	334,426

Basic earnings per common share:	Basic earnings per common share:					Basic earnings per common share:
Net earnings	Net earnings	$	23.19	$	16.13	Net earnings	$	17.02	$	14.37
Weighted average number of common shares	Weighted average number of common shares	23,203,257		23,963,311		Weighted average number of common shares	22,680,353		23,277,636

Diluted earnings per common share:	Diluted earnings per common share:					Diluted earnings per common share:
Net earnings	Net earnings	$	22.86	$	15.92	Net earnings	$	16.84	$	14.17
Weighted average number of common and common equivalent shares	Weighted average number of common and common equivalent shares	23,536,615		24,272,354		Weighted average number of common and common equivalent shares	22,928,933		23,603,805

Comprehensive income, net of tax (Note 10)		$	575,187	$	382,844
Comprehensive income, net of tax (Note 9)						Comprehensive income, net of tax (Note 9)	$	358,930	$	366,759

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 ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020~~2021

(In thousands, except share data)

(unaudited)


		September 30, 2021		December 31, 2020			June 30, 2022		December 31, 2021
ASSETS	ASSETS					ASSETS
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	183,672	$	94,254	Cash and cash equivalents	$	109,449	$	98,564
Trade accounts receivable, less allowances of $21,055 at September 30, 2021
and $18,625 at December 31, 2020		603,364		593,809
Trade accounts receivable, less allowances of $22,132 at June 30, 2022						Trade accounts receivable, less allowances of $22,132 at June 30, 2022
and $22,176 at December 31, 2021						and $22,176 at December 31, 2021	626,593		647,335
Inventories	Inventories	381,457		297,611		Inventories	463,321		414,543
Other current assets and prepaid expenses	Other current assets and prepaid expenses	77,731		71,230		Other current assets and prepaid expenses	125,338		108,916
Total current assets	Total current assets	1,246,224		1,056,904		Total current assets	1,324,701		1,269,358
Property, plant and equipment, net	Property, plant and equipment, net	783,813		798,868		Property, plant and equipment, net	760,856		799,365
Goodwill	Goodwill	639,184		550,270		Goodwill	643,449		648,622
Other intangible assets, net	Other intangible assets, net	288,593		196,785		Other intangible assets, net	298,362		307,450
Deferred tax assets, net	Deferred tax assets, net	39,272		41,836		Deferred tax assets, net	36,999		39,496
Other non-current assets	Other non-current assets	210,075		169,886		Other non-current assets	272,063		262,507
Total assets	Total assets	$	3,207,161	$	2,814,549	Total assets	$	3,336,430	$	3,326,798
LIABILITIES AND SHAREHOLDERS’ EQUITY	LIABILITIES AND SHAREHOLDERS’ EQUITY					LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:	Current liabilities:					Current liabilities:
Trade accounts payable	Trade accounts payable	$	219,294	$	175,801	Trade accounts payable	$	267,523	$	272,911
Accrued and other liabilities	Accrued and other liabilities	196,520		196,834		Accrued and other liabilities	203,319		208,811
Accrued compensation and related items	Accrued compensation and related items	209,356		179,252		Accrued compensation and related items	163,650		236,265
Deferred revenue and customer prepayments	Deferred revenue and customer prepayments	195,234		149,106		Deferred revenue and customer prepayments	215,133		192,648
Taxes payable	Taxes payable	127,633		89,017		Taxes payable	162,382		134,769
Short-term borrowings and current maturities of long-term debt	Short-term borrowings and current maturities of long-term debt	53,524		50,317		Short-term borrowings and current maturities of long-term debt	106,574		101,134
Total current liabilities	Total current liabilities	1,001,561		840,327		Total current liabilities	1,118,581		1,146,538
Long-term debt	Long-term debt	1,639,583		1,284,174		Long-term debt	1,821,458		1,580,808
Deferred tax liabilities, net	Deferred tax liabilities, net	42,656		34,448		Deferred tax liabilities, net	68,578		62,230
Other non-current liabilities	Other non-current liabilities	364,190		372,925		Other non-current liabilities	320,551		365,801
Total liabilities	Total liabilities	3,047,990		2,531,874		Total liabilities	3,329,168		3,155,377
Commitments and contingencies (Note 16)		0
Commitments and contingencies (Note 14)						Commitments and contingencies (Note 14)	0
Shareholders’ equity:	Shareholders’ equity:					Shareholders’ equity:
Preferred stock, $0.01 par value per share; authorized 10,000,000 shares	Preferred stock, $0.01 par value per share; authorized 10,000,000 shares	—		—		Preferred stock, $0.01 par value per share; authorized 10,000,000 shares	—		—
Common stock, $0.01 par value per share; authorized 125,000,000 shares;	Common stock, $0.01 par value per share; authorized 125,000,000 shares;					Common stock, $0.01 par value per share; authorized 125,000,000 shares;
issued 44,786,011 and 44,786,011 shares; outstanding 22,985,655 and
23,471,841 shares at September 30, 2021 and December 31, 2020, respectively		$	448	448
issued 44,786,011 and 44,786,011 shares; outstanding 22,506,610 and						issued 44,786,011 and 44,786,011 shares; outstanding 22,506,610 and
22,843,103 shares at June 30, 2022 and December 31, 2021, respectively						22,843,103 shares at June 30, 2022 and December 31, 2021, respectively	448		448
Additional paid-in capital	Additional paid-in capital	$	820,272	805,140		Additional paid-in capital	837,690		825,974
Treasury stock at cost (21,800,356 shares at September 30, 2021 and 21,314,170 shares at December 31, 2020)		$	(5,995,662)	(5,283,584)
Treasury stock at cost (22,279,401 shares at June 30, 2022 and 21,942,908 shares at December 31, 2021)						Treasury stock at cost (22,279,401 shares at June 30, 2022 and 21,942,908 shares at December 31, 2021)	(6,791,454)		(6,259,049)
Retained earnings	Retained earnings	$	5,631,965	5,095,596		Retained earnings	6,242,943		5,859,272
Accumulated other comprehensive loss	Accumulated other comprehensive loss	$	(297,852)	(334,925)		Accumulated other comprehensive loss	(282,365)		(255,224)
Total shareholders’ equity	Total shareholders’ equity	159,171		282,675		Total shareholders’ equity	7,262		171,421
Total liabilities and shareholders’ equity	Total liabilities and shareholders’ equity	$	3,207,161	$	2,814,549	Total liabilities and shareholders’ equity	$	3,336,430	$	3,326,798

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

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Table of Contents

METTLER-TOLEDO INTERNATIONAL INC.

INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

~~Nine~~Six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021

(In thousands, except share data)

(unaudited)


					Additional Paid-in Capital									Accumulated Other Comprehensive Income (Loss)												Additional Paid-in Capital										Accumulated Other Comprehensive Income (Loss)
		Common Stock					Treasury Stock			Retained Earnings										Common Stock								Treasury Stock			Retained Earnings
		Shares	Amount								Total		Accumulated Other Comprehensive Income (Loss)
Balance at December 31, 2019		24,125,317	$	448				$	783,871		$	(4,539,154)				$	4,499,288				$	(323,673)
Exercise of stock options and restricted stock units		50,372	—				—			9,355				(2,220)				—
Repurchases of common stock		(268,161)	—		—			(200,000)			—			—				(200,000)
Share-based compensation		—	—		4,395			—			—			—				4,395
Net earnings		—	—		—			—			98,115			—				98,115
Other comprehensive income (loss), net of tax		—	—		—			—			—			(24,028)				(24,028)
Balance at March 31, 2020		23,907,528	$	448	$	788,266		$	(4,729,799)		$	4,595,183		$	(347,701)			$	306,397
Exercise of stock options and restricted stock units		63,737	—		—			11,837			(1,222)			—				10,615
Repurchases of common stock		—	—		—			—			—			—				—
Share-based compensation		—	—		4,423			—			—			—				4,423
Net earnings		—	—		—			—			126,562			—				126,562
Other comprehensive income (loss), net of tax		—	—		—			—			—			2,096				2,096
Balance at June 30, 2020		23,971,265	$	448	$	792,689		$	(4,717,962)		$	4,720,523		$	(345,605)			$	450,093
Exercise of stock options and restricted stock units		30,667	—		2,582			5,865			(3)			—				8,444
Repurchases of common stock		(207,369)	—		—			(199,999)			—			—				(199,999)
Share-based compensation		—	—		4,430			—			—			—				4,430
Net earnings		—	—		—			—			161,767			—				161,767
Other comprehensive income (loss), net of tax		—	—		—			—			—			18,332				18,332
Balance at September 30, 2020		23,794,563	$	448	$	799,701		$	(4,912,096)		$	4,882,287		$	(327,273)			$	443,067
																							Shares	Amount					Additional Paid-in Capital				Treasury Stock			Retained Earnings					Total	Accumulated Other Comprehensive Income (Loss)
Balance at December 31, 2020	Balance at December 31, 2020	23,471,841	$	448	$	805,140		$	(5,283,584)		$	5,095,596		$	(334,925)			$	282,675		Balance at December 31, 2020		23,471,841	$	448						$	(334,925)
Exercise of stock options and restricted stock units	Exercise of stock options and restricted stock units	22,388	—		1,239			4,682			(872)			—				5,049			Exercise of stock options and restricted stock units		22,388	—				4,682					(872)			—
Repurchases of common stock	Repurchases of common stock	(224,808)	—		—			(262,500)			—			—				(262,500)			Repurchases of common stock		(224,808)	—		—					(262,500)				—			—			(262,500)
Share-based compensation	Share-based compensation	—	—		4,575			—			—			—				4,575			Share-based compensation		—	—		4,575			—				—			—			4,575
Net earnings	Net earnings	—	—		—			—			149,663			—				149,663			Net earnings		—	—		—			—				149,663			—			149,663
Other comprehensive income (loss), net of tax	Other comprehensive income (loss), net of tax	—	—		—			—			—			23,181				23,181			Other comprehensive income (loss), net of tax		—	—		—			—				—			23,181			23,181
Balance at March 31, 2021	Balance at March 31, 2021	23,269,421	$	448	$	810,954		$	(5,541,402)		$	5,244,387		$	(311,744)			$	202,643		Balance at March 31, 2021		23,269,421	$	448	$	810,954		$	(5,541,402)			$	5,244,387		$	(311,744)		$	202,643
Exercise of stock options and restricted stock units	Exercise of stock options and restricted stock units	13,248	—		—			2,849			(65)			—				2,784			Exercise of stock options and restricted stock units		13,248	—		—			2,849				(65)			—			2,784
Repurchases of common stock	Repurchases of common stock	(165,730)	—		—			(212,499)			—			—				(212,499)			Repurchases of common stock		(165,730)	—		—			(212,499)				—			—			(212,499)
Share-based compensation	Share-based compensation	—	—		4,581			—			—			—				4,581			Share-based compensation		—	—		4,581			—				—			—			4,581
Net earnings	Net earnings	—	—		—			—			184,763			—				184,763			Net earnings		—	—		—			—				184,763			—			184,763
Other comprehensive income (loss), net of tax	Other comprehensive income (loss), net of tax	—	—		—			—			—			9,152				9,152			Other comprehensive income (loss), net of tax		—	—		—			—				—			9,152			9,152
Balance at June 30, 2021	Balance at June 30, 2021	23,116,939	$	448	$	815,535		$	(5,751,052)		$	5,429,085		$	(302,592)			$	191,424		Balance at June 30, 2021		23,116,939	$	448	$	815,535		$	(5,751,052)			$	5,429,085		$	(302,592)		$	191,424

Balance at December 31, 2021																					Balance at December 31, 2021		22,843,103	$	448	$	825,974		$	(6,259,049)			$	5,859,272		$	(255,224)		$	171,421
Exercise of stock options and restricted stock units	Exercise of stock options and restricted stock units	35,488	—		—			7,889			(808)			—				7,081			Exercise of stock options and restricted stock units		27,795	—		1,020			6,669				(2,400)			—			5,289
Repurchases of common stock	Repurchases of common stock	(166,772)	—		—			(252,499)			—			—				(252,499)			Repurchases of common stock		(190,593)	—		—			(275,000)				—			—			(275,000)
Share-based compensation	Share-based compensation	—	—		4,737			—			—			—				4,737			Share-based compensation		—	—		4,509			—				—			—			4,509
Net earnings	Net earnings	—	—		—			—			203,688			—				203,688			Net earnings		—	—		—			—				174,001			—			174,001
Other comprehensive income (loss), net of tax	Other comprehensive income (loss), net of tax	—	—		—			—			—			4,740				4,740			Other comprehensive income (loss), net of tax		—	—		—			—				—			4,350			4,350
Balance at September 30, 2021		22,985,655	$	448	$	820,272		$	(5,995,662)		$	5,631,965		$	(297,852)			$	159,171
Balance at March 31, 2022																					Balance at March 31, 2022		22,680,305	$	448	$	831,503		$	(6,527,380)			$	6,030,873		$	(250,874)		$	84,570
Exercise of stock options and restricted stock units																					Exercise of stock options and restricted stock units		44,613	—		1,496			10,925				—			—			12,421
Repurchases of common stock																					Repurchases of common stock		(218,308)	—		—			(274,999)				—			—			(274,999)
Share-based compensation																					Share-based compensation		—	—		4,691			—				—			—			4,691
Net earnings																					Net earnings		—	—		—			—				212,070			—			212,070
Other comprehensive income (loss), net of tax																					Other comprehensive income (loss), net of tax		—	—		—			—				—			(31,491)			(31,491)
Balance at June 30, 2022																					Balance at June 30, 2022		22,506,610	$	448	$	837,690		$	(6,791,454)			$	6,242,943		$	(282,365)		$	7,262

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

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Table of Contents

METTLER-TOLEDO INTERNATIONAL INC.

INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

~~Nine~~Six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021

(In thousands)

(unaudited)


		September 30, 2021		September 30, 2020			June 30, 2022		June 30, 2021
Cash flows from operating activities:	Cash flows from operating activities:					Cash flows from operating activities:
Net earnings	Net earnings	$	538,114	$	386,444	Net earnings	$	386,071	$	334,426
Adjustments to reconcile net earnings to net cash provided by operating activities:	Adjustments to reconcile net earnings to net cash provided by operating activities:					Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation	Depreciation	33,440		30,949		Depreciation	23,327		22,261
Amortization	Amortization	46,141		42,008		Amortization	32,969		30,102
Deferred tax benefit	Deferred tax benefit	(6,072)		(6,990)		Deferred tax benefit	(3,237)		(7,423)
Share-based compensation	Share-based compensation	13,893		13,248		Share-based compensation	9,200		9,156
Increase (decrease) in cash resulting from changes in:	Increase (decrease) in cash resulting from changes in:					Increase (decrease) in cash resulting from changes in:
Trade accounts receivable, net	Trade accounts receivable, net	(19,153)		49,084		Trade accounts receivable, net	(4,235)		(9,551)
Inventories	Inventories	(87,568)		(11,421)		Inventories	(70,353)		(52,794)
Other current assets	Other current assets	(3,596)		(8,733)		Other current assets	(15,629)		(3,893)
Trade accounts payable	Trade accounts payable	44,170		(40,874)		Trade accounts payable	4,656		34,045
Taxes payable	Taxes payable	42,474		19,117		Taxes payable	31,390		33,598
Accruals and other	Accruals and other	65,876		998		Accruals and other	(84,166)		14,485
Net cash provided by operating activities	Net cash provided by operating activities	667,719		473,830		Net cash provided by operating activities	309,993		404,412
Cash flows from investing activities:	Cash flows from investing activities:					Cash flows from investing activities:
Proceeds from sale of property, plant and equipment	Proceeds from sale of property, plant and equipment	3,399		3,046		Proceeds from sale of property, plant and equipment	118		3,248
Purchase of property, plant and equipment	Purchase of property, plant and equipment	(69,796)		(57,428)		Purchase of property, plant and equipment	(62,391)		(47,363)
Proceeds from government funding						Proceeds from government funding	25,013		—
Acquisitions	Acquisitions	(193,387)		(6,242)		Acquisitions	(10,765)		(185,534)
Other investing activities	Other investing activities	8,559		(9,421)		Other investing activities	7,372		3,604
Net cash used in investing activities	Net cash used in investing activities	(251,225)		(70,045)		Net cash used in investing activities	(40,653)		(226,045)
Cash flows from financing activities:	Cash flows from financing activities:					Cash flows from financing activities:
Proceeds from borrowings	Proceeds from borrowings	1,638,321		1,148,360		Proceeds from borrowings	1,239,813		1,204,996
Repayments of borrowings	Repayments of borrowings	(1,249,177)		(1,231,191)		Repayments of borrowings	(952,559)		(866,153)
Proceeds from stock option exercises	Proceeds from stock option exercises	14,914		26,194		Proceeds from stock option exercises	17,710		7,833
Repurchases of common stock	Repurchases of common stock	(727,498)		(399,999)		Repurchases of common stock	(549,999)		(474,999)
Acquisition contingent consideration payment						Acquisition contingent consideration payment	(7,912)		—
Other financing activities	Other financing activities	(2,864)		(800)		Other financing activities	(382)		(2,288)
Net cash used in financing activities	Net cash used in financing activities	(326,304)		(457,436)		Net cash used in financing activities	(253,329)		(130,611)
Effect of exchange rate changes on cash and cash equivalents	Effect of exchange rate changes on cash and cash equivalents	(772)		(448)		Effect of exchange rate changes on cash and cash equivalents	(5,126)		242
Net increase (decrease) in cash and cash equivalents	Net increase (decrease) in cash and cash equivalents	89,418		(54,099)		Net increase (decrease) in cash and cash equivalents	10,885		47,998
Cash and cash equivalents:	Cash and cash equivalents:					Cash and cash equivalents:
Beginning of period	Beginning of period	94,254		207,785		Beginning of period	98,564		94,254
End of period	End of period	$	183,672	$	153,686	End of period	$	109,449	$	142,252

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

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Table of Contents

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

1.BASIS OF PRESENTATION

Mettler-Toledo International Inc. ~~("Mettler-Toledo"~~(Mettler-Toledo or the ~~"Company")~~Company) is a leading global supplier of precision instruments and services. The Company manufactures weighing instruments for use in laboratory, industrial, packaging, logistics and food retailing applications. The Company also manufactures several related analytical instruments and provides automated chemistry solutions used in drug and chemical compound discovery and development. In addition, the Company manufactures metal detection and other end-of-line inspection systems used in production and packaging and provides solutions for use in certain process analytics applications. The Company's primary manufacturing facilities are located in China, Germany, Switzerland, the United Kingdom and the United States. The Company's principal executive offices are located in Columbus, Ohio and 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”)~~(U.S. GAAP) and include all entities in which the Company has control, which are its wholly-owned subsidiaries. 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 U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The interim consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021.

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 three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 are not necessarily indicative of the results to be expected for the full year ending December 31, ~~2021.~~2022.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, as well as disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. These financial statements were prepared using information reasonably available as of ~~September~~June 30, ~~2021~~2022 and through the date of this ~~Report.~~report. Actual results may differ from those estimates due to the uncertainty around the global economy, the magnitude and duration of the COVID-19 pandemic, the invasion of Ukraine, as well as other factors.

All intercompany transactions and balances have been eliminated.

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Trade Accounts Receivable

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for expected credit losses represents the Company’s best estimate based on historical information, current information, and reasonable and supportable forecasts of future events and circumstances.

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

Inventories

Inventories are valued at the lower of cost or net realizable value. Cost, which includes direct materials, labor and overhead, is generally determined using the first in, first out (FIFO) method. The estimated net realizable value is based on assumptions for future demand and related pricing. Adjustments to the cost basis of the Company’s inventory are made for excess and obsolete items based on usage, orders and technological obsolescence. If actual market conditions are less favorable than those projected by management, reductions in the value of inventory may be required.

Inventories consisted of the following:


		September 30, 2021		December 31, 2020			June 30, 2022		December 31, 2021
Raw materials and parts	Raw materials and parts	$	158,541	$	132,041	Raw materials and parts	$	220,958	$	184,624
Work-in-progress	Work-in-progress	73,105		55,688		Work-in-progress	79,311		76,019
Finished goods	Finished goods	149,811		109,882		Finished goods	163,052		153,900
		$	381,457	$	297,611		$	463,321	$	414,543

Goodwill and Other Intangible Assets

Goodwill, representing the excess of purchase price over the net asset value of companies acquired, and indefinite-lived intangible assets are not amortized, but are reviewed for impairment annually in the fourth quarter, or more frequently if events or changes in circumstances indicate that an asset might be impaired. The annual evaluation for goodwill and indefinite-lived intangible assets are generally based on an assessment of qualitative factors to determine whether it is more likely than not that the fair value of the asset is less than its carrying amount.

Other intangible assets include indefinite-lived assets and assets subject to amortization. Where applicable, amortization is charged on a straight-line basis over the expected period of benefit. The straight-line method of amortization reflects an appropriate allocation of the cost of the intangible assets to earnings in proportion to the amount of economic benefits obtained by the Company in each reporting period. The Company assesses the initial acquisition of intangible assets in accordance with the provisions of ASC 805 "Business Combinations" and the continued accounting for previously recognized intangible assets and goodwill in accordance with the provisions of ASC 350 "Intangible - Goodwill and Other" and ASC 360 "Property, Plant and Equipment".

Other intangible assets consisted of the following:


		September 30, 2021						December 31, 2020							June 30, 2022						December 31, 2021
		Gross Amount		Accumulated Amortization		Intangibles, Net		Gross Amount		Accumulated Amortization		Intangibles, Net			Gross Amount		Accumulated Amortization		Intangibles, Net		Gross Amount		Accumulated Amortization		Intangibles, Net
Customer relationships	Customer relationships	$	279,380	$	(76,777)	$	202,603	$	201,445	$	(68,319)	$	133,126	Customer relationships	$	284,831	$	(85,934)	$	198,897	$	282,470	$	(79,782)	$	202,688
Proven technology and patents	Proven technology and patents	98,539		(54,858)		43,681		78,312		(52,138)		26,174		Proven technology and patents	111,652		(59,102)		$	52,550	115,680		(56,305)		59,375
Tradenames (finite life)	Tradenames (finite life)	8,176		(3,654)		4,522		4,896		(3,444)		1,452		Tradenames (finite life)	7,421		(3,084)		$	4,337	8,206		(3,731)		4,475
Tradenames (indefinite life)	Tradenames (indefinite life)	35,528		—		35,528		35,595		—		35,595		Tradenames (indefinite life)	35,826		—		$	35,826	35,949		—		35,949
Other	Other	8,048		(5,789)		2,259		5,215		(4,777)		438		Other	13,024		(6,272)		$	6,752	10,641		(5,678)		4,963
		$	429,671	$	(141,078)	$	288,593	$	325,463	$	(128,678)	$	196,785		$	452,754	$	(154,392)	$	298,362	$	452,946	$	(145,496)	$	307,450

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

The Company recognized amortization expense associated with the above intangible assets of ~~$5.7~~$6.6 million and ~~$4.0~~$6.2 million for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~$15.9~~$13.4 million and ~~$11.8~~$10.2 million for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. The annual aggregate amortization expense based on the current balance of other intangible assets is estimated ~~at $21.6 million for 2021, $21.1~~to be $25.8 million for 2022, ~~$20.3~~$25.0 million for 2023, $22.9 million for 2024, $22.0 million for 2025, $19.8 million for ~~2024, $18.9~~2026, and $18.4 million for ~~2025, and $16.7 million for 2026.~~2027. Purchased intangible amortization was ~~$5.5~~$6.4 million, ~~$4.1~~$4.9 million after tax, and ~~$3.8~~$5.9 million, ~~$2.8~~$4.5 million after tax, for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~$15.2~~$13.0 million, ~~$11.5~~$10.1 million after tax, and ~~$11.2~~$9.7 million, ~~$8.5~~$7.3 million after tax, for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively.

In addition to the above amortization, the Company recorded amortization expense associated with capitalized software of ~~$10.3~~$9.7 million and ~~$10.1~~$10.0 million for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~$30.0~~$19.4 million and $19.8 million for ~~both~~ the ~~nine~~six months ended ~~September~~June 30, 2022 and 2021, ~~and 2020.~~respectively.

Revenue Recognition

Product revenue is recognized from contracts with customers when a customer has obtained control of a product. The Company considers control to have transferred based upon shipping terms. To the extent the Company’s arrangements have a separate performance obligation, revenue related to any post-shipment performance obligation is deferred until completed. Shipping and handling costs charged to customers are included in total net sales and the associated expense is a component of cost of sales. Certain products are also sold through indirect distribution channels whereby the distributor assumes any further obligations to the end customer. Revenue is recognized on these distributor arrangements upon transfer of control to the distributor. Contracts do not contain variable pricing arrangements that are retrospective, except for rebate programs. Rebates are estimated based on expected sales volumes and offset against revenue at the time such revenue is recognized. The Company generally maintains the right to accept or reject a product return in its terms and conditions and also maintains appropriate accruals for outstanding credits. The related provisions for estimated returns and rebates are immaterial to the consolidated financial statements.

Certain of the Company’s product arrangements include separate performance obligations, primarily related to installation. Such performance obligations are accounted for separately when the deliverables have stand-alone value and the satisfaction of the undelivered performance obligations is probable and within the Company's control. The allocation of revenue between the performance obligations is based on the observable stand-alone selling prices at the time of the sale in accordance with a number of factors including service technician billing rates, time to install, and geographic location.

Software is generally not considered a distinct performance obligation with the exception of a few small software applications. The Company generally does not sell software products without the related hardware instrument as the software is embedded in the product. The Company’s products typically require no significant production, modification, or customization of the hardware or software that is essential to the functionality of the products.

Service revenue not under contract is recognized upon the completion of the service performed. Revenue from spare parts sold on a stand-alone basis is recognized when control is transferred to the customer, which is generally at the time of shipment or delivery. Revenue from service contracts is recognized ratably over the contract period using a time-based method. These contracts represent an obligation to perform repair and other services including regulatory compliance qualification, calibration, certification, and preventative maintenance on a customer’s pre-defined equipment over the contract period.

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

Employee Termination Benefits

In situations where contractual termination benefits exist, the Company records accruals for employee termination benefits when it is probable that a liability has been incurred and the amount of the liability is reasonably estimable. All other employee termination arrangements are recognized and measured at their fair value at the communication date unless the employee is required to render additional service after the legal notification period, in which case the liability is recognized ratably over the future service period.

Share-Based Compensation

The Company recognizes share-based compensation expense within selling, general and administrative in the consolidated statements of operations and other comprehensive income with a corresponding offset to additional paid-in capital in the consolidated balance sheet. The Company recorded $4.7 million and ~~$13.9~~$9.2 million of share-based compensation expense for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively, compared to ~~$4.4~~$4.6 million and ~~$13.2~~$9.2 million for the corresponding periods in ~~2020.~~

On May 6, 2021, the Company's shareholders approved the adoption of the Company's 2013 Equity Incentive Plan (Amended and Restated), with the effect that approximately 0.9 million additional shares of common stock were added to the 2.1 million shares that remained available under the plan prior to its amendment. In addition, shares subject to options granted under the Company's prior equity incentive plan that terminate or are forfeited without being exercised, are also available for awards under the amended plan. The amended plan expires in 2031.2021.

Research and Development

Research and development costs primarily consist of salaries, consulting and other costs. The Company expenses these costs as incurred.

Business Combinations and Asset Acquisitions

The Company accounts for business acquisitions under the accounting standards for business combinations. The results of each acquisition are included in the Company's consolidated results as of the acquisition date. The purchase price of an acquisition is allocated to tangible and intangible assets and assumed liabilities based on their estimated fair values and any consideration in excess of the net assets acquired is recognized as goodwill. The determination of the values of the acquired assets and assumed liabilities, including goodwill and intangible assets, require significant judgment. Acquisition transaction costs are expensed when incurred.

In circumstances where an acquisition involves a contingent consideration arrangement, the Company recognizes a liability equal to the fair value of the expected contingent payments as of the acquisition date. Subsequent changes in the fair value of the contingent consideration are recorded to other charges (income), net.

Recent Accounting Pronouncements

In March 2020 and January 2021, the FASB issued ASU 2020-04 and ASU 2021-01: Reference Rate Reform which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by the discontinuance of LIBOR or another referenced rate. The guidance may be applied to any applicable contract entered into before December 31, 2022. The Company's interest rate and cross currency swaps, as mentioned in Note 54 to the consolidated financial statements, are governed by International Swaps and Derivatives Association ("ISDA") agreements, and the Company adheres to the ISDA's fallback protocol when LIBOR is discontinued. In addition, the

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~~METTLER-TOLEDO INTERNATIONAL INC.~~

~~NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)~~

~~(In thousands, except share data, unless otherwise stated)~~

Company renewed the LIBOR based credit agreement, as discussed further in Note 8,10 of the Annual Report Form 10-K, which includes a fallback protocol when LIBOR is discontinued. Based on these procedures, when LIBOR is discontinued the interest rate and cross currency swaps will not require de-designation if certain criteria are met. The Company expects the financial impact of the rate change when LIBOR is discontinued to be immaterial to its financial statements.

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

3.REVENUE

The Company disaggregates revenue from contracts with customers by product, service, timing of revenue recognition and geography. A summary of revenue by the Company’s reportable segments for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021 follows:


For the three months ended September 30, 2021		U.S. Operations		Swiss Operations		Western European Operations		Chinese Operations		Other Operations		Total
For the three months ended June 30, 2022														For the three months ended June 30, 2022	U.S. Operations		Swiss Operations		Western European Operations		Chinese Operations		Other Operations		Total
Product Revenue	Product Revenue	$	263,885	$	33,612	$	142,318	$	193,727	$	127,302	$	760,844	Product Revenue	$	279,438	$	33,291	$	136,962	$	213,131	$	117,422	$	780,244
Service Revenue:	Service Revenue:													Service Revenue:
Point in time	Point in time	56,325		6,092		37,524		12,680		30,120		142,741		Point in time	64,589		6,504		31,957		10,708		30,541		144,299
Over time	Over time	16,498		2,146		18,790		4,053		6,878		48,365		Over time	17,118		2,267		21,345		5,970		7,144		53,844
Total	Total	$	336,708	$	41,850	$	198,632	$	210,460	$	164,300	$	951,950	Total	$	361,145	$	42,062	$	190,264	$	229,809	$	155,107	$	978,387


For the three months ended September 30, 2020		U.S. Operations		Swiss Operations		Western European Operations		Chinese Operations		Other Operations		Total
For the three months ended June 30, 2021														For the three months ended June 30, 2021	U.S. Operations		Swiss Operations		Western European Operations		Chinese Operations		Other Operations		Total
Product Revenue	Product Revenue	$	212,607	$	30,507	$	124,073	$	150,879	$	112,306	$	630,372	Product Revenue	$	252,668	$	32,018	$	145,687	$	188,803	$	117,310	$	736,486
Service Revenue:	Service Revenue:													Service Revenue:
Point in time	Point in time	52,000		6,329		34,519		11,414		28,602		132,864		Point in time	54,493		6,534		37,089		12,633		29,711		140,460
Over time	Over time	14,341		2,012		19,038		2,938		5,792		44,121		Over time	16,149		2,284		18,946		4,085		5,941		47,405
Total	Total	$	278,948	$	38,848	$	177,630	$	165,231	$	146,700	$	807,357	Total	$	323,310	$	40,836	$	201,722	$	205,521	$	152,962	$	924,351


For the nine months ended September 30, 2021		U.S. Operations		Swiss Operations		Western European Operations		Chinese Operations		Other Operations		Total
For the six months ended June 30, 2022														For the six months ended June 30, 2022	U.S. Operations		Swiss Operations		Western European Operations		Chinese Operations		Other Operations		Total
Product Revenue	Product Revenue	$	721,744	$	95,797	$	424,904	$	525,855	$	355,945	$	2,124,245	Product Revenue	$	528,245	$	67,201	$	274,971	$	381,120	$	235,322	$	1,486,859
Service Revenue:	Service Revenue:													Service Revenue:
Point in time	Point in time	162,409		19,517		110,243		34,655		87,708		414,532		Point in time	124,743		13,671		68,179		21,035		59,143		286,771
Over time	Over time	47,824		6,653		57,557		11,545		18,335		141,914		Over time	33,978		4,459		39,999		10,360		13,752		102,548
Total	Total	$	931,977	$	121,967	$	592,704	$	572,055	$	461,988	$	2,680,691	Total	$	686,966	$	85,331	$	383,149	$	412,515	$	308,217	$	1,876,178


For the nine months ended September 30, 2020		U.S. Operations		Swiss Operations		Western European Operations		Chinese Operations		Other Operations		Total
For the six months ended June 30, 2021														For the six months ended June 30, 2021	U.S. Operations		Swiss Operations		Western European Operations		Chinese Operations		Other Operations		Total
Product Revenue	Product Revenue	$	578,405	$	76,796	$	334,408	$	369,351	$	297,859	$	1,656,819	Product Revenue	$	457,859	$	62,185	$	282,586	$	332,128	$	228,643	$	1,363,401
Service Revenue:	Service Revenue:													Service Revenue:
Point in time	Point in time	148,577		16,611		93,855		28,304		77,768		365,115		Point in time	106,084		13,425		72,719		21,975		57,588		271,791
Over time	Over time	42,714		6,286		51,743		9,083		15,432		125,258		Over time	31,326		4,507		38,767		7,492		11,457		93,549
Total	Total	$	769,696	$	99,693	$	480,006	$	406,738	$	391,059	$	2,147,192	Total	$	595,269	$	80,117	$	394,072	$	361,595	$	297,688	$	1,728,741

A summary of revenue by major geographic destination for the three and six months ended June 30 follows:


	Three Months Ended				Six Months Ended
	2022		2021		2022		2021
Americas	$	393,707	$	353,415	$	746,396	$	656,754
Europe	242,738		260,190		492,522		501,566
Asia / Rest of World	341,942		310,746		637,260		570,421
Total	$	978,387	$	924,351	$	1,876,178	$	1,728,741

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

~~A summary of revenue by major geographic destination for the three and nine months ended September 30 follows:~~

Three Months Ended Nine Months Ended
2021 2020 2021 2020
Americas $ 367,278 $ 304,963 $ 1,024,033 $ 840,087
Europe 258,925 232,133 760,491 621,126
Asia / Rest of World 325,747 270,261 896,167 685,979
Total $ 951,950 $ 807,357 $ 2,680,691 $ 2,147,192

The Company's global revenue mix by product category is comprised of laboratory (56% of sales), industrial (39% of sales) and retail (5% of sales). The Company's product revenue by reportable segment is proportionately similar to the Company's global mix except the Company's Swiss Operations is largely comprised of laboratory products while the Company's Chinese Operations has a slightly higher percentage of industrial products. A summary of the Company’s revenue by product category for the three and ~~nine~~six months ended ~~September~~June 30 is as follows:


		Three Months Ended				Nine Months Ended					Three Months Ended				Six Months Ended
		2021		2020		2021		2020			2022		2021		2022		2021
Laboratory	Laboratory	$	536,489	$	430,516	$	1,487,222	$	1,147,078	Laboratory	$	545,925	$	506,106	$	1,059,475	$	950,732
Industrial	Industrial	370,505		322,808		1,049,295		863,987		Industrial	384,173		368,013		727,911		678,791
Retail	Retail	44,956		54,033		144,174		136,127		Retail	48,289		50,232		88,792		99,218
Total	Total	$	951,950	$	807,357	$	2,680,691	$	2,147,192	Total	$	978,387	$	924,351	$	1,876,178	$	1,728,741

The payment terms in the Company’s contracts with customers do not exceed one year and therefore contracts do not contain a significant financing component. In most cases, after appropriate credit evaluations, payments are due in arrears and are recognized as receivables. Unbilled revenue is recorded when performance obligations have been satisfied, but not yet billed to the customer. Unbilled revenue as of ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020~~2021 was ~~$37.3~~$35.3 million and ~~$22.6~~$32.1 million, respectively, and is included within accounts receivable. Deferred revenue and customer prepayments are recorded when cash payments are received or due in advance of the performance obligation being satisfied. Deferred revenue primarily includes prepaid service contracts, as well as deferred installation.

Changes in the components of deferred revenue and customer prepayments during the ~~nine~~six month periods ending ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021 are as follows:


		2021		2020			2022		2021
Beginning balances as of January 1	Beginning balances as of January 1	$	149,106	$	122,489	Beginning balances as of January 1	$	192,648	$	149,106
Customer pre-payments/deferred revenue	Customer pre-payments/deferred revenue	496,437		435,952		Customer pre-payments/deferred revenue	377,052		323,654
Revenue recognized	Revenue recognized	(446,775)		(409,391)		Revenue recognized	(345,070)		(278,817)
Foreign currency translation	Foreign currency translation	(3,534)		1,426		Foreign currency translation	(9,497)		(1,744)
Ending balance as of September 30		$	195,234	$	150,476
Ending balance as of June 30						Ending balance as of June 30	$	215,133	$	192,199

The Company generally expenses sales commissions when incurred because the amortization period is one year or less. These costs are recorded within selling, general, and administrative expenses. The Company has not disclosed the value of unsatisfied performance obligations other than customer prepayments and deferred revenue above as most contracts have an expected length of one year or less and amounts greater than one year are immaterial.

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

4. ~~ACQUISITIONS~~

In March 2021, the Company acquired all the membership interests of Mayfair Technology, LLC, ("PendoTECH") a manufacturer and distributor of single-use sensors, transmitters, control systems and software for measuring, monitoring and data collection primarily in bioprocess applications. PendoTECH serves bio-pharmaceutical manufacturers and life science laboratories and is located in the United States. The initial cash payment was $185.0 million and the Company may be required to pay additional consideration of up to $20.0 million and other post-closing amounts. The additional consideration is based upon financial thresholds in 2022 and 2023. The estimated fair value of the contingent consideration obligation at the time of acquisition of $13.5 million was determined using a Monte Carlo simulation based on the Company's forecast of future financial results.

Goodwill recorded in connection with the acquisition totaled $93.1 million, which is deductible for tax purposes. Identified intangible finite-life assets acquired include customer relationships of $78.6 million, technology and patents of $21.7 million, trade name of $3.4 million, and other intangibles of $2.4 million. The Company used variations of the income statement approach in determining the fair value of the intangible assets acquired. Specifically, the multi-period excess earnings method was used to determine the fair value of the customer relationships acquired and the relief from royalty method was used to determine the fair value of the technology and patents. The Company's determination of the fair value of the intangible assets acquired involved the use of significant estimates and assumptions principally related to revenue growth, royalty and customer attrition rates.

The identifiable finite-live intangible assets will be amortized on a straight-line basis over periods of 5 to 20 years and the annual aggregate amortization expense is estimated at $6.9 million. Net tangible assets acquired were $7.4 million and were recorded at fair value in the consolidated financial statements. All of the acquired assets are included in the Company's U.S. Operations segment.

In October 2021, the Company acquired Scale-up Systems Inc., a leading software provider for scale-up and reaction modelling serving the biopharma and chemical markets. The initial cash payment was $22.2 million and the Company may be required to pay additional amounts up to EUR 3.0 million.

5. FINANCIAL INSTRUMENTS

The Company has limited involvement with derivative financial instruments and does not use them for trading purposes. The Company enters into certain interest rate and cross currency swap agreements in order to manage its exposure to changes in interest rates. The amount of the Company's fixed obligation interest payments may change based upon the expiration dates of its interest rate and cross currency swap agreements and the level and composition of its debt. The Company also enters into certain foreign currency forward contracts to limit the Company's exposure to currency fluctuations on the respective hedged items. For additional disclosures on derivative instruments regarding balance sheet location, fair value, and the amounts reclassified into other comprehensive income and the effective portion of the cash flow hedges, also see Note 65 and Note 109 to the interim consolidated financial statements. As also described in Note 8,7, the Company has designated its euro-denominated debt as a hedge of a portion of its net investment in euro-denominated foreign subsidiary.

~~- 14 -~~

~~Table of Contents~~

~~METTLER-TOLEDO INTERNATIONAL INC.~~

~~NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)~~

~~(In thousands, except share data, unless otherwise stated)~~

Cash Flow Hedges

In November 2021, the Company entered into a cross currency swap arrangement designated as a cash flow hedge. The agreement converts $50 million of borrowings under the Company's credit facility into synthetic Swiss franc debt, which allows the Company to effectively change the floating rate LIBOR-based interest payments, excluding the credit spread, to a fixed Swiss franc income of 0.64%. The swap matures in November 2023.

In June 2021, the Company entered into a cross currency swap arrangement designated as a cash flow hedge. The agreement converts $50 million of borrowings under the Company's credit facility into synthetic Swiss franc debt, which allows the Company to effectively change the floating rate LIBOR-based interest payments, excluding the credit spread to a fixed Swiss franc income of 0.57%. The swap matures in June 2025. ~~This cross currency swap replaced a similar $50 million swap entered into in June 2019 which matured in June 2021, which converted floating rate LIBOR to a fixed Swiss franc income of 0.95%.~~

In June 2021, the Company entered into a cross currency swap arrangement designated as a cash flow hedge. The agreement converts $50 million of borrowings under the Company's credit facility into synthetic Swiss franc debt, which allows the Company to effectively change the floating rate LIBOR-based interest payments, excluding the credit spread to a fixed Swiss franc income of 0.66%. The swap matures in June 2024. ~~This cross currency swap replaced a similar $50 million swap entered into in February 2019 which matured in June 2021, which converted floating rate LIBOR to a fixed Swiss franc income of 0.78%.~~

In June 2019, the Company entered into a cross currency swap arrangement designated as a cash flow hedge. The agreement converts $50 million of borrowings under the Company's credit facility into synthetic Swiss franc debt, which allows the Company to effectively change the floating rate LIBOR-based interest payments, excluding the credit spread to a fixed Swiss franc income of 0.82%. The swap matures in June 2023.

In 2015, the Company entered into an interest rate swap agreement designated as a cash flow hedge. The agreement has the effect of changing the floating rate LIBOR-based interest payments associated with $100 million of borrowings under the Company's credit agreement to a fixed obligation of 2.25% beginning in February 2017 and ~~matures~~matured in February 2022.

The Company's cash flow hedges are recorded gross at fair value in the consolidated balance sheet at ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~2021, respectively. A derivative gain of ~~$0.3~~$6.0 million based upon interest rates and foreign currency rates at ~~September~~June 30, ~~2021,~~2022, is expected to be reclassified from other comprehensive income (loss) to earnings in the next twelve months. The cash flow hedges remain effective as of ~~September~~June 30, ~~2021.~~2022.

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

Other Derivatives

The Company enters into foreign currency forward contracts in order to economically hedge short-term trade and non-trade intercompany balances largely denominated in Swiss franc, other major European currencies, and the Chinese Renminbi with its foreign businesses. In accordance with U.S. GAAP, these contracts are considered “derivatives not designated as hedging instruments.” Gains or losses on these instruments are reported in current earnings. The foreign currency forward contracts are recorded at fair value in the consolidated balance sheet at ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~2021, respectively, and disclosed in Note 6.5. The Company recognized in other charges (income) related to these instruments, a net loss of $10.0 million and net gain of ~~$3.3 million and $7.1~~$0.8 million during the three months ended ~~September~~June 30, 2022 and 2021, respectively, and ~~2020, respectively,~~a net loss of $8.5 million and a net gain of ~~$16.5 million and $0.1~~$13.2 million during the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. The gains and losses are primarily offset by the underlying transaction gains and losses on the related intercompany balances. At ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~2021, these contracts had a notional value of ~~$652.0~~$736.8 million and ~~$536.5 million,~~$1.0 billion, respectively.

~~- 15 -~~

~~Table of Contents~~

~~METTLER-TOLEDO INTERNATIONAL INC.~~

~~NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)~~

~~(In thousands, except share data, unless otherwise stated)~~

6.5. FAIR VALUE MEASUREMENTS

At ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~2021, the Company had derivative assets totaling ~~$6.9~~$16.5 million and ~~$2.2~~$6.0 million respectively, and derivative liabilities totaling ~~$5.9~~$14.5 million and ~~$23.3~~$10.3 million, respectively. The Company has limited involvement with derivative financial instruments and therefore does not need to present all the required disclosures in tabular format. The fair values of the interest rate swap agreements, the cross-currency swap agreements and foreign currency forward contracts that economically hedge short-term intercompany balances are estimated based upon inputs from current valuation information obtained from dealer quotes and priced with observable market assumptions and appropriate valuation adjustments for credit risk. The Company has evaluated the valuation methodologies used to develop the fair values by dealers in order to determine whether such valuations are representative of an exit price in the Company’s principal market. In addition, the Company uses an internally developed model to perform testing on the valuations received from brokers. The Company has also considered both its own credit risk and counterparty credit risk in determining fair value and determined these adjustments were insignificant at ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020.~~

The estimated fair value of the contingent consideration obligation of $13.5 million relating to the PendoTECH acquisition was determined using a Monte Carlo simulation based on the Company's forecast of future financial results. The fair value measurements are based on significant inputs not observable in the market and thus represent a Level 3 measurement.2021.

Under U.S. GAAP, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement consists of observable and unobservable inputs that reflect the assumptions that a market participant would use in pricing an asset or liability.

A fair value hierarchy has been established that categorizes these inputs into three levels:

Level 1: Quoted prices in active markets for identical assets and liabilities

Level 2: Observable inputs other than quoted prices in active markets for identical assets and liabilities

Level 3: Unobservable inputs

- 1615 -

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

The following table presents the Company's assets and liabilities, which are all categorized as Level 2, that are measured at fair value on a recurring basis. The Company does not have any assets or liabilities which are categorized as Level 1 or Level 3, with the exception of the PendoTECH contingent consideration described ~~above.~~below.


		September 30, 2021		December 31, 2020		Balance Sheet Classification		June 30, 2022		December 31, 2021		Balance Sheet Classification
Foreign currency forward contracts not designated as hedging instruments	Foreign currency forward contracts not designated as hedging instruments	$	2,971	$	2,227	Other current assets and prepaid expenses	Foreign currency forward contracts not designated as hedging instruments	$	5,503	$	3,927	Other current assets and prepaid expenses
Cash Flow Hedges:	Cash Flow Hedges:						Cash Flow Hedges:
Cross currency swap agreement	Cross currency swap agreement	3,932		—		Other non-current assets	Cross currency swap agreement	11,022		2,119		Other non-current assets
Total derivative assets	Total derivative assets	$	6,903	$	2,227		Total derivative assets	$	16,525	$	6,046

Foreign currency forward contracts not designated as hedging instruments	Foreign currency forward contracts not designated as hedging instruments	$	1,637	$	1,399	Accrued and other liabilities	Foreign currency forward contracts not designated as hedging instruments	$	12,787	$	4,510	Accrued and other liabilities
Cash Flow Hedges:	Cash Flow Hedges:						Cash Flow Hedges:
Interest rate swap agreements	Interest rate swap agreements	901		—		Accrued and other liabilities	Interest rate swap agreements	—		352		Accrued and other liabilities
Cross currency swap agreement	Cross currency swap agreement	—		13,093		Accrued and other liabilities	Cross currency swap agreement	1,687		—		Accrued and other liabilities
Interest rate swap agreements		—		2,502		Other non-current liabilities
Cross currency swap agreement	Cross currency swap agreement	3,312		6,297		Other non-current liabilities	Cross currency swap agreement	—		5,482		Other non-current liabilities
Total derivative liabilities	Total derivative liabilities	$	5,850	$	23,291		Total derivative liabilities	$	14,474	$	10,344

The Company had ~~$25.6~~$19.2 million and ~~$14.3~~$18.5 million of cash equivalents at ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~2021, respectively, the fair value of which is determined using Level 2 inputs, through quoted and corroborated prices in active markets. The fair value of cash equivalents approximates cost.

The fair value of the Company's debt exceeds the carrying value by approximately ~~$30.2~~$149.5 million as of ~~September~~June 30, ~~2021.~~2022. The fair value of the Company's fixed interest rate debt was estimated using Level 2 inputs, primarily discounted cash flow models, based on estimated current rates offered for similar debt under current market conditions for the Company.

During the three months ended June 30, 2022, $10.0 million of contingent consideration was paid relating to the PendoTECH acquisition of which $7.9 million is included in financing activities for the amount accrued at the acquisition date and $2.1 million is included in operating activities for the amount not accrued at the acquisition date on the Consolidated Statement of Cash Flows in accordance with U.S. GAAP. The estimated fair value of the remaining contingent consideration obligation of $10.0 million is based upon actual results and future financial projections as of June 30, 2022. The fair value measurements are based on significant inputs not observable in the market and thus represent a Level 3 measurement.

6. INCOME TAXES

The Company's reported tax rate was ~~17.7%~~17.4% and ~~21.4%~~19.8% during the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively and ~~18.9%~~17.8% and ~~19.4%~~19.6% during the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. The provision for taxes is based upon using the Company's projected annual effective tax rate of ~~19.5%~~19.0% and ~~20.5%~~19.5% before non-recurring discrete tax items during ~~2021~~2022 and ~~2020,~~2021, respectively. The difference between the Company's projected annual effective tax rate and the reported tax rate is primarily related to the timing of excess tax benefits associated with stock option exercises.

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

8.7. DEBT

Debt consisted of the following at ~~September~~June 30, ~~2021:~~2022:


		U.S. Dollar		Other Principal Trading Currencies		Total			U.S. Dollar		Other Principal Trading Currencies		Total
3.67% $50 million ten-year Senior Notes due December 17, 2022	3.67% $50 million ten-year Senior Notes due December 17, 2022	$	50,000	$	—	$	50,000	3.67% $50 million ten-year Senior Notes due December 17, 2022	$	50,000	$	—	$	50,000
4.10% $50 million ten-year Senior Notes due September 19, 2023	4.10% $50 million ten-year Senior Notes due September 19, 2023	50,000		—		50,000		4.10% $50 million ten-year Senior Notes due September 19, 2023	50,000		—		50,000
3.84% $125 million ten-year Senior Notes due September 19, 2024	3.84% $125 million ten-year Senior Notes due September 19, 2024	125,000		—		125,000		3.84% $125 million ten-year Senior Notes due September 19, 2024	125,000		—		125,000
4.24% $125 million ten-year Senior Notes due June 25, 2025	4.24% $125 million ten-year Senior Notes due June 25, 2025	125,000		—		125,000		4.24% $125 million ten-year Senior Notes due June 25, 2025	125,000		—		125,000
3.91% $75 million ten-year Senior Notes due June 25, 2029	3.91% $75 million ten-year Senior Notes due June 25, 2029	75,000		—		75,000		3.91% $75 million ten-year Senior Notes due June 25, 2029	75,000		—		75,000
2.83% $125 million twelve-year Senior Notes due July 22, 2033								2.83% $125 million twelve-year Senior Notes due July 22, 2033	125,000		—		125,000
3.19% $50 million fifteen-year Senior Notes due January 24, 2035	3.19% $50 million fifteen-year Senior Notes due January 24, 2035	50,000		—		50,000		3.19% $50 million fifteen-year Senior Notes due January 24, 2035	50,000		—		50,000
2.83% $125 million twelve-year Senior Notes due July 22, 2033		125,000		—		125,000
2.81% $150 million fifteen-year Senior Note due March 17, 2037								2.81% $150 million fifteen-year Senior Note due March 17, 2037	150,000		—		150,000
1.47% Euro 125 million fifteen-year Senior Notes due June 17, 2030	1.47% Euro 125 million fifteen-year Senior Notes due June 17, 2030	—		146,056		146,056		1.47% Euro 125 million fifteen-year Senior Notes due June 17, 2030	—		131,933		131,933
1.30% Euro 135 million fifteen-year Senior Notes due November 6, 2034	1.30% Euro 135 million fifteen-year Senior Notes due November 6, 2034	—		157,740		157,740		1.30% Euro 135 million fifteen-year Senior Notes due November 6, 2034	—		142,487		142,487
1.06% Euro 125 million fifteen-year Senior Notes due March 19, 2036	1.06% Euro 125 million fifteen-year Senior Notes due March 19, 2036	—		146,056		146,056		1.06% Euro 125 million fifteen-year Senior Notes due March 19, 2036	—		131,933		131,933
Debt issuance costs, net	Debt issuance costs, net	(1,519)		(1,600)		(3,119)		Debt issuance costs, net	(2,334)		(1,553)		(3,887)
Total Senior Notes	Total Senior Notes	598,481		448,252		1,046,733		Total Senior Notes	747,666		404,800		1,152,466
$1.25 billion Credit Agreement, interest at LIBOR plus 87.5 basis points	$1.25 billion Credit Agreement, interest at LIBOR plus 87.5 basis points	412,473		177,092		589,565		$1.25 billion Credit Agreement, interest at LIBOR plus 87.5 basis points	514,491		201,509		716,000
Other local arrangements	Other local arrangements	3,494		53,315		56,809		Other local arrangements	3,229		56,337		59,566
Total debt	Total debt	1,014,448		678,659		1,693,107		Total debt	1,265,386		662,646		1,928,032
Less: current portion	Less: current portion	(351)		(53,173)		(53,524)		Less: current portion	(50,358)		(56,216)		(106,574)
Total long-term debt	Total long-term debt	$	1,014,097	$	625,486	$	1,639,583	Total long-term debt	$	1,215,028	$	606,430	$	1,821,458

~~Credit Agreement~~

On June 25, 2021, the Company entered into a $1.25 billion Credit Agreement ("the Credit Agreement"), which amended its $1.1 billion Amended and Restated Credit Agreement (the "Prior Credit Agreement"). As of ~~September~~June 30, ~~2021,~~2022, the Company had ~~$654.2~~$528.0 million of additional borrowings available under its Credit Agreement, and the Company maintained ~~$183.7~~$109.4 million of cash and cash equivalents.

The Credit Agreement is provided by a group of financial institutions (similar to the Company's Prior Credit Agreement) and has a maturity date of June 25, 2026. It is a revolving credit facility and is not subject to any scheduled principal payments prior to maturity. The obligations under the Credit Agreement are unsecured.

Borrowings under the Credit Agreement bear interest at current market rates plus a margin based on the Company’s consolidated leverage ratio. The Company must also pay facility fees that are tied to its leverage ratio. The Credit Agreement contains covenants that are similar as those contained in the prior Credit Agreement, with which the Company was in compliance as of September 30, 2021. The Company is required to maintain (i) a ratio of net funded indebtedness to EBITDA of 3.5 to 1.0 or less except that the required maximum ratio may increase to 4.0 to 1.0 for the four consecutive fiscal quarter period commencing with the fiscal quarter in which an acquisition having total consideration (including, without limitation, all cash payments, assumed indebtedness, issued equity interests and earn outs in connection with such acquisition) greater than $250 million and (ii) an interest coverage ratio of 3.0 to 1.0 or greater. The Credit Agreement also places certain limitations on the Company, including limiting the ability to incur liens or indebtedness at a subsidiary level. In ~~addition, the Credit Agreement has several events of~~

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~~METTLER-TOLEDO INTERNATIONAL INC.~~

~~NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)~~

~~(In thousands, except share data, unless otherwise stated)~~

default. The Company incurred approximately $0.2 million of debt extinguishment costs during 2021 related to the Prior Credit Agreement. The Company capitalized $2.0 million in financing fees during 2021 associated with the Credit Agreement which will be amortized to interest expense through 2026.

~~Senior Notes~~

~~In May~~December 2021, the Company entered into an agreement to issue and sell ~~$125~~$300 million ~~twelve-year~~15-year Senior Notes in a private placement. The Company issued $150 million with a fixed interest rate of ~~2.83%.~~2.81% (2.81% Senior Notes) in March 2022 and will issue $150 million with a fixed interest rate of 2.91% (2.91% Senior Notes) in September 2022. The Senior Notes ~~were issued~~will be senior unsecured obligations of the Company. The 2.81% Senior Notes mature in ~~July 2021~~March 2037 and the 2.91% Senior Notes mature in September 2037. Interest on the 2.81% and 2.91% Senior Notes will ~~mature July 2033.~~be payable semi-annually in March and September each year. Interest on the 2.81% Senior Notes will begin in September 2022 and interest on the 2.91% will begin in March 2023. The terms of the Senior Notes are consistent with the previous Senior Notes as described ~~above.~~in the Company's Annual Report Form 10-K. The Company ~~used~~will use the proceeds from the sale of the notes to refinance existing indebtedness and for other general corporate purposes.

In December 2020, the Company entered into an agreement to issue and sell EUR 125.0 million of 15-year 1.06% Euro Senior Notes ("1.06% Euro Senior Notes"). The terms of the Euro Senior Notes are consistent with the previous Euro Senior Notes as described in the Company's Annual Report on Form 10-K for the year ended December 31, 2020. The Company also entered into a forward contract to receive $152.1 million at the time of issuing the 1.06% Euro Senior Notes in March 2021. The Company issued the 1.06% Euro Senior Notes with a fixed interest rate of 1.06% in March 2021. The 1.06% Euro Senior Notes are unsecured obligations of the Company and will mature on March 19, 2036. Interest on the 1.06% Euro Senior Notes is payable semi-annually in March and September of each year. The Company was in compliance with its debt covenants at September 30, 2021.

The Company has designated the EUR 125 million 1.47% Euro Senior Notes, the EUR 135 million 1.30% Euro Senior Notes, and the EUR 125 million 1.06% Euro Senior Notes as a hedge of a portion of its net investment in euro-denominated foreign subsidiaries to reduce foreign currency risk associated with the net investment. Changes in the carrying value of this debt resulting from fluctuations in the euro to U.S. dollar exchange rate are recorded as foreign currency translation adjustments within other comprehensive income (loss). The Company recorded in other comprehensive income (loss) related to this net investment hedge an unrealized gain of ~~$9.4~~$19.1 million and an unrealized loss of ~~$11.2~~$5.8 million for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and an unrealized gain of ~~$21.2~~$30.4 million and an unrealized loss of ~~$11.3~~$11.8 million for the ~~nine~~six month periods ended ~~September~~June 30, 2022 and 2021, ~~and 2020,~~ respectively.

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

The Company has a ~~loss~~gain of ~~$7.6~~$35.9 million recorded in accumulated other comprehensive income (loss) as of ~~September~~June 30, ~~2021.~~2022.

Other Local Arrangements

In April 2018, two of the Company's non-U.S. pension plans issued loans totaling $39.6 million (Swiss franc 38 million) to a wholly owned subsidiary of the Company. The loans have the same terms and conditions, which include an interest rate of ~~Swiss franc LIBOR~~SARON plus 87.5 basis points. The loans were renewed for one year in April ~~2021.~~2022.

9.8. SHARE REPURCHASE PROGRAM AND TREASURY STOCK

~~In November 2020, the Company's Board~~The Company has $1.5 billion of ~~Directors authorized an additional $2.5 billion to be added to~~remaining availability for its share repurchase program ~~which has $2.3 billion of remaining availability~~ as of ~~September~~June 30, ~~2021.~~2022. The share repurchases are expected to be funded from cash generated from operating activities, borrowings, and cash balances. Repurchases will be made through open market transactions, and the amount and timing of p~~urchases~~purchases will depend on business and market conditions, the stock price, trading restrictions, the level of acquisition activity, and other factors.

The Company has purchased ~~30.0~~30.6 million shares since the inception of the program in 2004 through ~~September~~June 30, ~~2021.~~2022. During the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, the Company spent ~~$727.5~~$550.0 million and ~~$400.0~~$475.0 million on the repurchase of ~~557,310~~408,901 shares and ~~475,530~~390,538 shares at an average price per share of ~~$1,305.35~~$1,345.05 and ~~$841.14,~~$1,216.25, respectively. The Company also reissued ~~71,124~~72,408 shares and 35,636 shares held in treasury upon the exercise of stock options and vesting of restricted stock units during the six months ended June 30, 2022 and 2021, respectively.

9. ACCUMULATED OTHER COMPREHENSIVE INCOME

Comprehensive income (loss), net of tax consisted of the following as of June 30:


	Three Months Ended				Six Months Ended
	2022		2021		2022		2021
Net earnings	$	212,070	$	184,763	$	386,071	$	334,426
Other comprehensive income (loss), net of tax	(31,491)		9,152		(27,141)		32,333
Comprehensive income, net of tax	$	180,579	$	193,915	$	358,930	$	366,759

The following table presents changes in accumulated other comprehensive income by component for the six months ended June 30, 2022 and 2021:

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)


	Currency Translation Adjustment, Net of Tax		Net Unrealized Gain (Loss) on Cash Flow Hedging Arrangements, Net of Tax		Pension and Post-Retirement Benefit Related Items, Net of Tax		Total
Balance at December 31, 2021	$	(19,566)	$	2	$	(235,660)	$	(255,224)
Other comprehensive income (loss), net of tax:
Unrealized gains (losses) cash flow hedging arrangements	—		11,343		—		11,343
Foreign currency translation adjustment	(46,982)		—		10,003		(36,979)
Amounts recognized from accumulated other comprehensive income (loss), net of tax	—		(8,268)		6,763		(1,505)
Net change in other comprehensive income (loss), net of tax	(46,982)		3,075		16,766		(27,141)
Balance at June 30, 2022	$	(66,548)	$	3,077	$	(218,894)	$	(282,365)


	Currency Translation Adjustment, Net of Tax		Net Unrealized Gain (Loss) on Cash Flow Hedging Arrangements, Net of Tax		Pension and Post-Retirement Benefit Related Items, Net of Tax		Total
Balance at December 31, 2020	$	(31,101)	$	(1,479)	$	(302,345)	$	(334,925)
Other comprehensive income (loss), net of tax:
Unrealized gains (losses) cash flow hedging arrangements	—		5,934		—		5,934
Foreign currency translation adjustment	11,717		—		9,147		20,864
Amounts recognized from accumulated other comprehensive income (loss), net of tax	—		(4,732)		10,267		5,535
Net change in other comprehensive income (loss), net of tax	11,717		1,202		19,414		32,333
Balance at June 30, 2021	$	(19,384)	$	(277)	$	(282,931)	$	(302,592)

The following table presents amounts recognized from accumulated other comprehensive income (loss) for the three and six month periods ended June 30:


	Three Months Ended
	June 30,
	2022		2021		Location of Amounts Recognized in Earnings
Effective portion of (gains) / losses on cash flow hedging arrangements:
Interest rate swap agreements	$	—	$	543	Interest expense
Cross currency swap agreement	(5,735)		2,876		(a)
Total before taxes	(5,735)		3,419
Provision for taxes	(1,090)		684		Provision for taxes
Total, net of taxes	$	(4,645)	$	2,735

Recognition of defined benefit pension and post-retirement items:
Recognition of actuarial losses and prior service cost, before taxes	$	4,222	$	6,482	(b)
Provision for taxes	908		1,367		Provision for taxes
Total, net of taxes	$	3,314	$	5,115

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

~~and 144,776 shares held in treasury upon the exercise of stock options and vesting of restricted stock units during the nine months ended September 30, 2021 and 2020, respectively.~~

~~10. ACCUMULATED OTHER COMPREHENSIVE INCOME~~

~~Comprehensive income (loss), net of tax consisted of the following as of September 30:~~

Three Months Ended Nine Months Ended
2021 2020 2021 2020
Net earnings $ 203,688 $ 161,767 $ 538,114 $ 386,444
Other comprehensive income (loss), net of tax 4,740 18,332 37,073 (3,600)
Comprehensive income, net of tax $ 208,428 $ 180,099 $ 575,187 $ 382,844

~~The following table presents changes in accumulated other comprehensive income by component for the nine months ended September 30, 2021 and 2020:~~

Currency Translation Adjustment, Net of Tax Net Unrealized
Gain (Loss) on
Cash Flow Hedging Arrangements,
Net of Tax Pension and Post-Retirement Benefit Related Items,
Net of Tax Total
Balance at December 31, 2020 $ (31,101) $ (1,479) $ (302,345) $ (334,925)
Other comprehensive income (loss), net of tax:
Unrealized gains (losses) cash flow hedging arrangements — 7,327 — 7,327
Foreign currency translation adjustment 8,102 — 12,062 20,164
Amounts recognized from accumulated other comprehensive income (loss), net of tax — (5,773) 15,355 9,582
Net change in other comprehensive income (loss), net of tax 8,102 1,554 27,417 37,073
Balance at September 30, 2021 $ (22,999) $ 75 $ (274,928) $ (297,852)

Currency Translation Adjustment, Net of Tax Net Unrealized
Gain (Loss) on
Cash Flow Hedging Arrangements,
Net of Tax Pension and Post-Retirement Benefit Related Items,
Net of Tax Total
Balance at December 31, 2019 $ (61,015) $ (1,222) $ (261,436) $ (323,673)
Other comprehensive income (loss), net of tax:
Unrealized gains (losses) cash flow hedging arrangements — (7,689) — (7,689)
Foreign currency translation adjustment (571) — (11,662) (12,233)
Amounts recognized from accumulated other comprehensive income (loss), net of tax — 5,524 10,798 16,322
Net change in other comprehensive income (loss), net of tax (571) (2,165) (864) (3,600)
Balance at September 30, 2020 $ (61,586) $ (3,387) $ (262,300) $ (327,273)

~~- 20 -~~

~~Table of Contents~~

~~METTLER-TOLEDO INTERNATIONAL INC.~~

~~NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)~~

~~(In thousands, except share data, unless otherwise stated)~~

~~The following table presents amounts recognized from accumulated other comprehensive income (loss) for the three and nine month periods ended September 30:~~

Three Months Ended
September 30,
2021 2020 Location of Amounts Recognized in Earnings
Effective portion of (gains) / losses on cash flow hedging arrangements:
Interest rate swap agreements $ 551 $ 833 Interest expense
Cross currency swap agreement (1,793) 2,936 (a)
Total before taxes (1,242) 3,769
Provision for taxes (201) 440 Provision for taxes
Total, net of taxes $ (1,041) $ 3,329
Recognition of defined benefit pension and post-retirement items:
Recognition of actuarial losses and prior service cost, before taxes $ 6,449 $ 4,746 (b)
Provision for taxes 1,361 1,047 Provision for taxes
Total, net of taxes $ 5,088 $ 3,699

(a) The cross currency swap reflects an unrealized gain of ~~$1.5~~$5.0 million for the three months ended ~~September~~June 30, ~~2021~~2022 recorded in other charges (income) that was offset by the underlying unrealized loss on the hedged debt. The cross currency swap also reflects a realized gain of ~~$0.3~~$0.7 million recorded in interest expense for the three months ended ~~September~~June 30, ~~2021.~~2022.

(b) These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension and post-retirement cost. See Note 1211 for additional details for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020.~~2021.


		Nine Months Ended						Six Months Ended
		September 30,						June 30,
		2021		2020		Location of Amounts Recognized in Earnings		2022		2021		Location of Amounts Recognized in Earnings
Effective portion of (gains) / losses on cash flow hedging arrangements:	Effective portion of (gains) / losses on cash flow hedging arrangements:						Effective portion of (gains) / losses on cash flow hedging arrangements:
Interest rate swap agreements	Interest rate swap agreements	$	1,625	$	1,774	Interest expense	Interest rate swap agreements	$	352	$	1,074	Interest expense
Cross currency swap agreement	Cross currency swap agreement	(8,625)		4,555		(a)	Cross currency swap agreement	(10,531)		(6,832)		(a)
Total before taxes	Total before taxes	(7,000)		6,329			Total before taxes	(10,179)		(5,758)
Provision for taxes	Provision for taxes	(1,227)		805		Provision for taxes	Provision for taxes	(1,911)		(1,026)		Provision for taxes
Total, net of taxes	Total, net of taxes	$	(5,773)	$	5,524		Total, net of taxes	$	(8,268)	$	(4,732)

Recognition of defined benefit pension and post-retirement items:	Recognition of defined benefit pension and post-retirement items:						Recognition of defined benefit pension and post-retirement items:
Recognition of actuarial losses and prior service cost, before taxes	Recognition of actuarial losses and prior service cost, before taxes	$	19,460	$	13,835	(b)	Recognition of actuarial losses and prior service cost, before taxes	$	8,615	$	13,011	(b)
Provision for taxes	Provision for taxes	4,105		3,037		Provision for taxes	Provision for taxes	1,852		2,744		Provision for taxes
Total, net of taxes	Total, net of taxes	$	15,355	$	10,798		Total, net of taxes	$	6,763	$	10,267

(a) The cross currency swap reflects an unrealized gain of ~~$7.5~~$9.4 million for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 recorded in other charges (income) that was offset by the underlying unrealized loss on the hedged debt. The cross currency swap also reflects a realized gain of $1.1 million recorded in interest expense for the ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022.

(b) These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension and post-retirement cost. See Note 1211 for additional details for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020.~~2021.

~~- 21 -~~

~~Table of Contents~~

~~METTLER-TOLEDO INTERNATIONAL INC.~~

~~NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)~~

~~(In thousands, except share data, unless otherwise stated)~~

~~11.~~10. EARNINGS PER COMMON SHARE

In accordance with the treasury stock method, the Company has included the following common equivalent shares in the calculation of diluted weighted average number of common shares outstanding for the three and ~~nine~~six months ended ~~September~~June 30, relating to outstanding stock options and restricted stock units:


		2021	2020		2022	2021
Three months ended	Three months ended	336,655	302,932	Three months ended	228,291	330,638
Nine months ended		333,358	309,044
Six months ended				Six months ended	248,580	326,169

Outstanding options and restricted stock units to purchase or receive ~~3,692~~39,156 shares of common stock for the three month period ended ~~September~~June 30, ~~2021~~2022 have been excluded from the calculation of diluted weighted average number of common and common equivalent shares as such options and restricted stock units would be anti-dilutive. For the three months ended ~~September~~June 30, ~~2020,~~2021, there were no-anti-dilutive outstanding options or restricted stock units. Options and restricted stock units to purchase or receive ~~20,384~~38,465 and ~~56,371~~23,620 shares for the ~~nine~~six month period ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, have been excluded from the calculation of diluted weighted average of common and common equivalent shares as such options and restricted stock units would be anti-dilutive.

- 20 -

~~12.~~

Table of Contents

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

11. NET PERIODIC PENSION COST

Net periodic pension cost for the Company’s defined benefit pension plans and U.S. post-retirement medical plan includes the following components for the three months ended ~~September~~June 30:


		U.S. Pension Benefits				Non-U.S. Pension Benefits				Other U.S. Post-retirement Benefits				Total					U.S. Pension Benefits				Non-U.S. Pension Benefits				Other U.S. Post-retirement Benefits				Total
		2021		2020		2021		2020		2021		2020		2021		2020			2022		2021		2022		2021		2022		2021		2022		2021
Service cost, net	Service cost, net	$	374	$	326	$	4,858	$	4,750	$	—	$	—	$	5,232	$	5,076	Service cost, net	$	416	$	374	$	4,775	$	4,907	$	—	$	—	$	5,191	$	5,281
Interest cost on projected benefit obligations	Interest cost on projected benefit obligations	546		889		843		1,208		2		5		1,391		2,102		Interest cost on projected benefit obligations	674		549		1,492		858		3		2		2,169		1,409
Expected return on plan assets	Expected return on plan assets	(1,494)		(1,523)		(8,851)		(8,426)		—		—		(10,345)		(9,949)		Expected return on plan assets	(1,547)		(1,494)		(9,023)		(8,904)		—		—		(10,570)		(10,398)
Recognition of prior service cost	Recognition of prior service cost	—		—		(462)		(1,819)		(18)		(18)		(480)		(1,837)		Recognition of prior service cost	—		—		(1,045)		(465)		(19)		(19)		(1,064)		(484)
Recognition of actuarial losses/(gains)	Recognition of actuarial losses/(gains)	728		643		6,211		5,947		(10)		(7)		6,929		6,583		Recognition of actuarial losses/(gains)	585		729		4,709		6,246		(8)		(9)		5,286		6,966
Net periodic pension cost/(credit)	Net periodic pension cost/(credit)	$	154	$	335	$	2,599	$	1,660	$	(26)	$	(20)	$	2,727	$	1,975	Net periodic pension cost/(credit)	$	128	$	158	$	908	$	2,642	$	(24)	$	(26)	$	1,012	$	2,774

Net periodic pension cost for the Company’s defined benefit pension plans and U.S. post-retirement medical plan includes the following components for the ~~nine~~six months ended ~~September~~June 30:


		U.S. Pension Benefits				Non-U.S. Pension Benefits				Other U.S. Post-retirement Benefits				Total					U.S. Pension Benefits				Non-U.S. Pension Benefits				Other U.S. Post-retirement Benefits				Total
		2021		2020		2021		2020		2021		2020		2021		2020			2022		2021		2022		2021		2022		2021		2022		2021
Service cost, net	Service cost, net	$	1,122	$	978	$	14,710	$	13,795	$	—	$	—	$	15,832	$	14,773	Service cost, net	$	832	$	748	$	9,765	$	9,852	$	—	$	—	$	10,597	$	10,600
Interest cost on projected benefit obligations	Interest cost on projected benefit obligations	1,644		2,667		2,551		3,541		6		19		4,201		6,227		Interest cost on projected benefit obligations	1,348		1,098		3,051		1,708		6		4		4,405		2,810
Expected return on plan assets	Expected return on plan assets	(4,482)		(4,571)		(26,726)		(24,530)		—		—		(31,208)		(29,101)		Expected return on plan assets	(3,094)		(2,988)		(18,447)		(17,875)		—		—		(21,541)		(20,863)
Recognition of prior service cost	Recognition of prior service cost	—		—		(1,398)		(5,279)		(56)		(56)		(1,454)		(5,335)		Recognition of prior service cost	—		—		(2,141)		(936)		(37)		(38)		(2,178)		(974)
Recognition of actuarial losses/(gains)	Recognition of actuarial losses/(gains)	2,186		1,933		18,756		17,258		(28)		(21)		20,914		19,170		Recognition of actuarial losses/(gains)	1,169		1,458		9,639		12,545		(15)		(18)		10,793		13,985
Net periodic pension cost/(credit)	Net periodic pension cost/(credit)	$	470	$	1,007	$	7,893	$	4,785	$	(78)	$	(58)	$	8,285	$	5,734	Net periodic pension cost/(credit)	$	255	$	316	$	1,867	$	5,294	$	(46)	$	(52)	$	2,076	$	5,558

~~- 22 -~~

~~Table of Contents~~

~~METTLER-TOLEDO INTERNATIONAL INC.~~

~~NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)~~

~~(In thousands, except share data, unless otherwise stated)~~

As previously disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2020,~~2021, the Company expects to make employer contributions of approximately ~~$27.9~~$28.2 million to its non-U.S. pension plans and employer contributions of approximately ~~$0.2~~$0.1 million to its U.S. post-retirement medical plan during the year ended December 31, ~~2021.~~2022. These estimates may change based upon several factors, including fluctuations in currency exchange rates, actual returns on plan assets and changes in legal requirements.

~~13. RESTRUCTURING CHARGES~~

For the three and nine months ended September 30, 2021, the Company has incurred $0.7 million and $2.7 million of restructuring expenses, respectively, which primarily relates to employee related costs. Liabilities related to restructuring activities are included in accrued and other liabilities in the consolidated balance sheet. A roll forward of the Company’s accrual for restructuring activities for the nine months ended September 30, 2021 is as follows:


	~~Total~~
~~Balance at December 31, 2020~~	$	~~9,184~~
~~Restructuring charges~~	~~2,719~~
~~Cash payments and utilization~~	~~(7,422)~~
~~Impact of foreign currency~~	~~(319)~~
~~Balance at September 30, 2021~~	$	~~4,162~~

~~14.~~12. OTHER CHARGES (INCOME), NET

Other charges (income), net includes non-service pension costs (benefits), (gains) losses from foreign currency transactions and related hedging activities, interest income and other items. Non-service pension benefits for the three months ended ~~September~~June 30, 2022 and 2021 ~~and 2020~~ were ~~$2.5~~$4.2 million and ~~$3.1~~$2.5 million, respectively, and ~~$7.5~~$8.5 million and ~~$9.0~~$5.0 million for the ~~nine~~six months ended ~~September~~June 30, 2022 and 2021, ~~and 2020,~~ respectively. Other charges (income), net also included $0.5 million and $2.8 million of acquisition costs for the ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022 and 2021, respectively.

- 21 -

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METTLER-TOLEDO INTERNATIONAL INC.

~~15.~~NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)

13. SEGMENT REPORTING

As disclosed in Note 1918 to the Company's consolidated financial statements for the year ended December 31, ~~2020,~~2021, the Company has determined there are five reportable segments: U.S. Operations, Swiss Operations, Western European Operations, Chinese Operations and Other.

The Company evaluates segment performance based on Segment Profit (gross profit less research and development and selling, general and administrative expenses, before amortization, interest expense, restructuring charges, other charges (income), net and taxes).

~~- 23 -~~

~~Table of Contents~~

~~METTLER-TOLEDO INTERNATIONAL INC.~~

~~NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)~~

~~(In thousands, except share data, unless otherwise stated)~~

The following tables show the operations of the Company’s operating segments:


		Net Sales to		Net Sales to						As of September 30,			Net Sales to		Net Sales to						As of June 30,
For the three months ended	For the three months ended	External		Other		Total Net		Segment		2021		For the three months ended	External		Other		Total Net		Segment		2022
September 30, 2021		Customers		Segments		Sales		Profit		Goodwill
June 30, 2022												June 30, 2022	Customers		Segments		Sales		Profit		Goodwill
U.S. Operations	U.S. Operations	$	336,708	$	36,895	$	373,603	$	72,638	$	508,942	U.S. Operations	$	361,145	$	40,314	$	401,459	$	92,796	$	514,057
Swiss Operations	Swiss Operations	41,850		208,411		250,261		78,454		23,319		Swiss Operations	42,062		210,449		252,511		72,012		22,634
Western European Operations	Western European Operations	198,632		52,259		250,891		40,288		91,228		Western European Operations	190,264		47,474		237,738		35,233		92,215
Chinese Operations	Chinese Operations	210,460		79,001		289,461		108,636		696		Chinese Operations	229,809		75,123		304,932		105,456		665
Other (a)	Other (a)	164,300		835		165,135		24,381		14,999		Other (a)	155,107		709		155,816		22,243		13,878
Eliminations and Corporate (b)	Eliminations and Corporate (b)	—		(377,401)		(377,401)		(51,587)		—		Eliminations and Corporate (b)	—		(374,069)		(374,069)		(42,308)		—
Total	Total	$	951,950	$	—	$	951,950	$	272,810	$	639,184	Total	$	978,387	$	—	$	978,387	$	285,432	$	643,449


		Net Sales to		Net Sales to							Net Sales to		Net Sales to
For the nine months ended		External		Other		Total Net		Segment
September 30, 2021		Customers		Segments		Sales		Profit
For the six months ended										For the six months ended	External		Other		Total Net		Segment
June 30, 2022										June 30, 2022	Customers		Segments		Sales		Profit
U.S. Operations	U.S. Operations	$	931,977	$	112,186	$	1,044,163	$	215,581	U.S. Operations	$	686,966	$	79,887	$	766,854	$	167,982
Swiss Operations	Swiss Operations	121,967		594,057		716,024		212,849		Swiss Operations	85,331		404,284		489,615		143,334
Western European Operations	Western European Operations	592,704		160,386		753,090		116,630		Western European Operations	383,149		97,601		480,751		74,013
Chinese Operations	Chinese Operations	572,055		220,608		792,663		275,323		Chinese Operations	412,515		155,562		568,077		190,424
Other (a)	Other (a)	461,988		3,207		465,195		65,967		Other (a)	308,217		1,673		309,888		42,695
Eliminations and Corporate (b)	Eliminations and Corporate (b)	—		(1,090,444)		(1,090,444)		(147,612)		Eliminations and Corporate (b)	—		(739,007)		(739,007)		(91,771)
Total	Total	$	2,680,691	$	—	$	2,680,691	$	738,738	Total	$	1,876,178	$	—	$	1,876,178	$	526,677

(a)Other includes reporting units in Eastern Europe, Latin America, Southeast Asia and other countries.

(b)Eliminations and Corporate includes the elimination of inter-segment transactions and certain corporate expenses and intercompany investments, which are not included in the Company’s operating segments.

Net Sales to Net Sales to As of September 30,
For the three months ended External Other Total Net Segment 2020
September 30, 2020 Customers Segments Sales Profit Goodwill
U.S. Operations $ 278,948 $ 30,857 $ 309,805 $ 65,493 $ 414,370
Swiss Operations 38,848 167,335 206,183 61,902 23,353
Western European Operations 177,630 42,130 219,760 36,954 88,292
Chinese Operations 165,231 54,314 219,545 81,055 651
Other (a) 146,700 1,509 148,209 23,554 15,056
Eliminations and Corporate (b) — (296,145) (296,145) (38,980) —
Total $ 807,357 $ — $ 807,357 $ 229,978 $ 541,722

- 2422 -

Table of Contents

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(In thousands, except share data, unless otherwise stated)


		Net Sales to		Net Sales to							Net Sales to		Net Sales to						As of June 30,
For the nine months ended		External		Other		Total Net		Segment
September 30, 2020		Customers		Segments		Sales		Profit
For the three months ended										For the three months ended	External		Other		Total Net		Segment		2021
June 30, 2021										June 30, 2021	Customers		Segments		Sales		Profit		Goodwill
U.S. Operations	U.S. Operations	$	769,696	$	84,761	$	854,457	$	163,012	U.S. Operations	$	323,310	$	38,507	$	361,817	$	79,272	$	509,600
Swiss Operations	Swiss Operations	99,693		462,671		562,364		164,060		Swiss Operations	40,836		201,182		242,018		69,516		23,553
Western European Operations	Western European Operations	480,006		123,543		603,549		91,406		Western European Operations	201,722		55,873		257,595		38,476		93,133
Chinese Operations	Chinese Operations	406,738		148,794		555,532		190,560		Chinese Operations	205,521		72,529		278,050		94,663		697
Other (a)	Other (a)	391,059		3,281		394,340		47,702		Other (a)	152,962		1,275		154,237		21,414		15,203
Eliminations and Corporate (b)	Eliminations and Corporate (b)	—		(823,050)		(823,050)		(108,841)		Eliminations and Corporate (b)	—		(369,366)		(369,366)		(48,085)		—
Total	Total	$	2,147,192	$	—	$	2,147,192	$	547,899	Total	$	924,351	$	—	$	924,351	$	255,256	$	642,186


	Net Sales to		Net Sales to
For the six months ended	External		Other		Total Net		Segment
June 30, 2021	Customers		Segments		Sales		Profit
U.S. Operations	$	595,269	$	75,292	$	670,561	$	142,943
Swiss Operations	80,117		385,647		465,764		134,395
Western European Operations	394,072		108,128		502,200		76,342
Chinese Operations	361,595		141,607		503,202		166,687
Other (a)	297,688		2,371		300,059		41,586
Eliminations and Corporate (b)	—		(713,045)		(713,045)		(96,025)
Total	$	1,728,741	$	—	$	1,728,741	$	465,928

(a)Other includes reporting units in Eastern Europe, Latin America, Southeast Asia and other countries.

A reconciliation of earnings before taxes to segment profit for the three and ~~nine~~six month periods ended ~~September~~June 30 follows:


		Three Months Ended				Nine Months Ended					Three Months Ended				Six Months Ended
		2021		2020		2021		2020			2022		2021		2022		2021
Earnings before taxes	Earnings before taxes	$	247,587	$	205,809	$	663,385	$	479,563	Earnings before taxes	$	256,692	$	230,384	$	469,693	$	415,798
Amortization	Amortization	16,039		14,121		46,141		42,008		Amortization	16,365		16,218		32,969		30,102
Interest expense	Interest expense	11,791		9,310		31,701		29,111		Interest expense	12,765		10,439		24,103		19,910
Restructuring charges	Restructuring charges	650		4,570		2,719		7,335		Restructuring charges	1,770		876		5,781		2,069
Other income, net	Other income, net	(3,257)		(3,832)		(5,208)		(10,118)		Other income, net	(2,160)		(2,661)		(5,869)		(1,951)
Segment profit	Segment profit	$	272,810	$	229,978	$	738,738	$	547,899	Segment profit	$	285,432	$	255,256	$	526,677	$	465,928

During the three months ended September 30, 2021, restructuring charges of $0.7 million were recognized, of which $0.3 million, $0.1 million, and $0.3 million, related to the Company’s U.S., Swiss, and Western European Operations, respectively. Restructuring charges of $4.6 million were recognized during the three months ended September 30, 2020, of which $2.3 million, $0.1 million, $1.8 million, and $0.4 million related to the Company’s U.S., Swiss, Western European, and Other Operations, respectively. Restructuring charges of $2.7 million were recognized during the nine months ended September 30, 2021, of which $0.7 million, $0.4 million, $1.3 million, and $0.3 million related to the Company’s U.S., Swiss, Western European, and Other Operations, respectively. Restructuring charges of $7.3 million were recognized during the nine months ended September 30, 2020, of which $2.9 million, $0.8 million, $2.9 million, $0.1 million, and $0.6 million and related to the Company’s U.S., Swiss, Western European, Chinese, and Other Operations, respectively.

~~16.~~14. CONTINGENCIES

The Company is party to various legal proceedings, including certain environmental matters, incidental to the normal course of business. Management does not expect that any of such proceedings, either individually or in the aggregate, will have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

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Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the Unaudited Interim Consolidated Financial Statements included herein.

General

Our interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. Operating results for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 are not necessarily indicative of the results to be expected for the full year ending December 31, ~~2021.~~2022.

Changes in local currency exclude the effect of currency exchange rate fluctuations. Local currency amounts are determined by translating current and previous year consolidated financial information at an index utilizing historical currency exchange rates. We believe local currency information provides a helpful assessment of business performance and a useful measure of results between periods. We do not, nor do we suggest that investors should, consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. We present non-GAAP financial measures in reporting our financial results to provide investors with an additional analytical tool to evaluate our operating results.

We also include in the discussion below disclosures of immaterial qualitative factors that are not quantified. Although the impact of such factors is not considered material, we believe these disclosures can be useful in evaluating our operating results.

COVID-19

~~The ongoing~~Since late 2019, the coronavirus ~~("COVID-19")~~ pandemic (COVID-19) has ~~resulted in millions of confirmed cases throughout the world and~~spread globally in all countries where we conduct business. The ~~outbreak caused many governments~~COVID-19 pandemic is evolving and has led to ~~implement~~the implementation of various responses, including government-imposed quarantines, stay-at-home orders ~~quarantines,~~ and ~~significant~~lockdowns, travel restrictions, ~~on travel. During the course of the ongoing pandemic, several governments implemented work restrictions that prohibited many employees from going to their customary work locations~~vaccination and ~~that required these employees to work remotely when possible.~~testing requirements, and other public health safety measures. These restrictions continue to change as ~~the~~ COVID-19 ~~situation~~ evolves, variants and subvariants are discovered, and vaccinations and booster doses are distributed in each country and ~~region, considering local circumstances related~~region. The emergence of the Omicron variant of COVID-19 in late 2021 and, more recently, the emergence of additional subvariants have presented particular challenges to ~~vaccine availability, population vaccination rates,~~the global economy given the high level of transmissibility, which can cause many people to be affected at the same time or over a short period of time. For example, China has instituted lockdowns in certain cities, such as Shanghai in the second quarter where we conduct a certain portion of our business (including manufacturing), as part of the government's response to rising COVID-19 outbreaks. The location and ~~emerging variant strains~~length of potential future lockdowns will determine the extent to which any lockdowns impact our business and supply chain, as well as the global economy.We continue to monitor and comply with all global restrictions and requirements relating to COVID-19.

The health and safety of our employees and business partners have been our highest priority throughout the COVID-19 pandemic, and we have implemented several preventative and protective measures. We also have ~~also~~ continued to support our customers with their essential businesses, such as life sciences, food manufacturing, chemicals (e.g., sanitizers, disinfectants, soaps, etc.), food retail, and transportation and logistics.

Our production and logistics facilities are currently operational, and our ~~office-based~~ employees continue to adhere to any applicable jurisdictional lockdowns and stay-at-home orders. Our supply chain is currently facing wide-ranging global challenges, although we have been able to meet delivery requirements of our customers with some interruption. We continue to closely monitor risks associated with our supply chain, including the ongoing and potentially future lockdowns in China, availability of certain components, material shortages, supplier delays, potential transportation delays, and higher transportation and material costs, which could significantly adversely affect sales and/or profitability in future quarters. We also continue to leverage our digital and remote sales

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capabilities, and our service organization continues to provide on-site and remote customer support to facilitate uptime, productivity, and regulatory compliance.

COVID-19 presents several risks to our business as further described in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021. Uncertainties related to COVID-19 and the resulting impact to the global economy continue in most regions of the world

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and market conditions can change quickly. The longer-term effects on our business will be impacted by the global economy and any ~~economic~~recession implications in different regions of the world.

Recent Developments in Ukraine

In 2021, approximately 1% of our net sales were in Russia and Ukraine, and we have an immaterial amount of assets and liabilities in both countries as of June 30, 2022. We also do not have manufacturing in Russia or Ukraine.

We remain in constant contact with our employees in Ukraine and have provided financial assistance and supplies as they seek safety. We also have suspended all shipments to Russia since the beginning of the invasion of Ukraine in February 2022. In addition, the U.S., the European Union, and certain other countries imposed economic sanctions on Russian financial institutions, businesses in Russia, and on Russian interests and individuals, and the Russian government is implementing sanctions and regulations in response.

While it is difficult to estimate the impact of the ongoing invasion on the global economy, including increased inflation, higher energy and transportation costs and potential energy shortages, the invasion of Ukraine could adversely impact our financial results and presents several risks to our business as further described in Part II, Item 1A, “Risk Factors” of this Quarterly Report. Uncertainties related to this conflict and the resulting impact to the global economy and market conditions can change quickly.

Results of Operations – Consolidated

The following tables set forth certain items from our interim consolidated statements of operations for the three and ~~nine~~six month periods ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021 (amounts in thousands).


		Three months ended September 30,						Nine months ended September 30,							Three months ended June 30,						Six months ended June 30,
		2021			2020			2021			2020				2022			2021			2022			2021
		(unaudited)		%	(unaudited)		%	(unaudited)		%	(unaudited)		%		(unaudited)		%	(unaudited)		%	(unaudited)		%	(unaudited)		%
Net sales	Net sales	$	951,950	100.0	$	807,357	100.0	$	2,680,691	100.0	$	2,147,192	100.0	Net sales	$	978,387	100.0	$	924,351	100.0	$	1,876,178	100.0	$	1,728,741	100.0
Cost of sales	Cost of sales	396,130		41.6	337,749		41.8	1,116,271		41.6	905,205		42.2	Cost of sales	406,726		41.6	387,447		41.9	784,932		41.8	720,141		41.7
Gross profit	Gross profit	555,820		58.4	469,608		58.2	1,564,420		58.4	1,241,987		57.8	Gross profit	571,661		58.4	536,904		58.1	1,091,246		58.2	1,008,600		58.3
Research and development	Research and development	42,276		4.4	34,656		4.3	124,151		4.6	100,236		4.7	Research and development	44,023		4.5	42,603		4.6	87,051		4.6	81,875		4.7
Selling, general and administrative	Selling, general and administrative	240,734		25.3	204,974		25.4	701,531		26.2	593,852		27.7	Selling, general and administrative	242,206		24.8	239,045		25.9	477,518		25.5	460,797		26.7
Amortization	Amortization	16,039		1.7	14,121		1.7	46,141		1.7	42,008		2.0	Amortization	16,365		1.6	16,218		1.8	32,969		1.8	30,102		1.7
Interest expense	Interest expense	11,791		1.2	9,310		1.2	31,701		1.2	29,111		1.3	Interest expense	12,765		1.3	10,439		1.1	24,103		1.3	19,910		1.2
Restructuring charges	Restructuring charges	650		0.1	4,570		0.6	2,719		0.1	7,335		0.3	Restructuring charges	1,770		0.2	876		0.1	5,781		0.3	2,069		0.1
Other income, net		(3,257)		(0.3)	(3,832)		(0.5)	(5,208)		(0.2)	(10,118)		(0.5)
Other charges (income), net														Other charges (income), net	(2,160)		(0.2)	(2,661)		(0.3)	(5,869)		(0.3)	(1,951)		(0.1)
Earnings before taxes	Earnings before taxes	247,587		26.0	205,809		25.5	663,385		24.8	479,563		22.3	Earnings before taxes	256,692		26.2	230,384		24.9	469,693		25.0	415,798		24.0
Provision for taxes	Provision for taxes	43,899		4.6	44,042		5.5	125,271		4.7	93,119		4.3	Provision for taxes	44,622		4.5	45,621		4.9	83,622		4.4	81,372		4.7
Net earnings	Net earnings	$	203,688	21.4	$	161,767	20.0	$	538,114	20.1	$	386,444	18.0	Net earnings	$	212,070	21.7	$	184,763	20.0	$	386,071	20.6	$	334,426	19.3

Net sales

Net sales were ~~$952.0~~$978.4 million and ~~$807.4~~$924.4 million for the three months ended ~~September~~June 30, ~~2021,~~2022, and ~~2020~~,2021, respectively, and ~~$2.7~~$1.9 billion and ~~$2.1~~$1.7 billion for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. This represents an increase of ~~18%~~6% and ~~25%~~9% in U.S. dollars for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively. Excluding the effect of currency exchange rate fluctuations, or in local currencies, net sales increased ~~16%~~10% and ~~20%~~12% for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively. Net sales benefited approximately 1% from the PendoTECH

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acquisition for the ~~three and nine~~six months ended ~~September~~June 30, ~~2021.~~2022. We experienced broad-based growth with robust customer demand in most businesses and regions and ~~strong execution of~~excellent execution. We continue to benefit from our best-in-class sales and marketing ~~programs. Growth~~programs, innovative product portfolio, and investments in our field service organization. However, uncertainties exist in the macro environment and global economy including the impact of COVID-19, related lockdowns in China, ~~also continued to be particularly strong. However, uncertainty relating to COVID-19 continues~~and the impact from the invasion of Ukraine. Furthermore, we face continuing challenges in the global supply chain and inflationary cost increases, and market conditions may change quickly.

Net sales by geographic destination for the three months ended ~~September~~June 30, ~~2021~~2022 in U.S. dollars increased ~~20%~~11% in the Americas ~~12% in Europe,~~ and ~~21%~~10% in Asia/Rest of ~~World.~~World and decreased 7% in Europe. In local currencies, our net sales by geographic destination increased ~~20%~~12% in the Americas, ~~10%~~4% in Europe, and ~~16%~~14% in Asia/Rest of World. Our net sales by geographic destination for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 in U.S. dollars increased ~~22%~~14% in the Americas and ~~in Europe, and 31%~~12% in Asia/Rest of ~~World.~~World and decreased 2% in Europe. Net sales by geographic destination for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 in local currencies increased ~~21%~~14% in the Americas, ~~15%~~7% in Europe, and ~~23%~~15% in Asia/Rest of World. Net sales in the Americas ~~benefited approximately 3%~~ and ~~2% from the PendoTECH acquisition for the three and nine months ended September 30, 2021, respectively, and net sales~~ in Europe both benefited approximately 1% from the PendoTECH acquisition for ~~both~~ the ~~three and nine~~six months ended ~~September~~June 30, ~~2021.~~2022. Net sales growth in Asia/Rest of World in local currency includes ~~19%~~14% and ~~31%~~15% growth in China during the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively. A discussion of sales by operating segment is included below.

As described in Note 1918 to our consolidated financial statements for the year ended December 31, ~~2020~~,2021, our net sales comprise product sales of precision instruments and related services. Service revenues are primarily derived from repair and other services, including regulatory compliance qualification, calibration, certification, preventative maintenance and spare parts.

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Net sales of products increased ~~21%~~6% in U.S. dollars and ~~18%~~10% in local currencies for the three months ended ~~September~~June 30, ~~2021~~2022 and increased ~~28%~~ 9% in U.S. dollars and ~~24%~~12% in local currencies for the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, compared to the corresponding periods in ~~2020.~~ 2021. Net sales of products benefited approximately 1% from the PendoTECH acquisition for the ~~three and nine~~six months ended ~~September~~June 30, ~~2021, respectively.~~2022. Service revenue (including spare parts) increased by 8%6% in U.S. dollars and 6%11% in local currencies for the three months ended ~~September~~June 30, ~~2021~~2022 and increased ~~13%~~7% in U.S. dollars and 9%11% in local currencies for the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, compared to the corresponding periods in ~~2020.~~2021.

Net sales of our laboratory products and services, which represented approximately 56% of our total net sales, increased ~~25%~~8% in U.S. dollars and ~~23%~~13% in local currencies for the three months ended ~~September~~June 30, ~~2021,~~2022, and increased ~~30%~~11% in U.S. dollars and ~~26%~~15% in local currencies for the ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022. The local currency increase in net sales of our laboratory-related products for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 includes very strong growth in most product categories. ~~Net sales during the nine months ended September 30, 2021 also included especially strong growth in pipettes.~~ Net sales of our laboratory products also benefited approximately ~~3% and 2%~~1% from the PendoTECH acquisition for the ~~three and nine~~six months ended ~~September~~June 30, ~~2021, respectively.~~2022.

Net sales of our industrial products and services, which represented approximately 39% of our total net sales, increased ~~15%~~4% in U.S. dollars and ~~12%~~9% in local currencies for the three months ended ~~September~~June 30, ~~2021,~~2022, and increased ~~21%~~7% in U.S. dollars and ~~16%~~10% in local currencies for the ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022. The local currency increase in net sales of our industrial-related products for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 includes very strong growth in ~~product inspection and~~our core industrial ~~products. Net sales of our industrial-related products for the nine months ended September 30, 2021 includes particularly strong growth~~business with particular strength in ~~core industrial, especially~~ China.

Net sales in our food retailing products and services, which represented approximately 5% of our total net sales, decreased ~~18%~~4% in U.S. dollars and ~~19%~~increased 3% in local currencies for the three months ended ~~September~~June 30, ~~2021,~~2022, and ~~increased 4%~~decreased 11% in U.S. dollars and ~~decreased 1%~~6% in local currencies for the ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022. Food retailing ~~declined significantly~~ for the three months ended ~~September~~June 30, ~~2021 due to timing of project activity~~2022 increased in the Americas and ~~the negative impact of manufacturing component shortages.~~Europe, offset in part by reduced sales in China. The local currency decrease in net sales in our food retailing products for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 was ~~also~~ negatively impacted by ~~a decline~~weak market dynamics, especially in ~~the Americas,~~China, offset in part by ~~strong~~ growth in ~~Europe.~~the Americas.

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Gross profit

Gross profit as a percentage of net sales was 58.4% and ~~58.2%~~58.1% for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~58.4%~~58.2% and ~~57.8%~~58.3% for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively.

Gross profit as a percentage of net sales for products was ~~60.0%~~60.5% and ~~59.7%~~60.1% for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~60.3%~~59.8% and ~~60.0%~~60.4% for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020.~~2021.

Gross profit as a percentage of net sales for services (including spare parts) was ~~51.9%~~50.2% and ~~52.7%~~50.3% for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~51.0%~~51.8% and 50.5% for the ~~nine~~six months ended ~~September~~June 30, 2022 and 2021, ~~and 2020,~~ respectively.

The increase in gross profit as a percentage of net sales for the three ~~and nine~~ months ended ~~September~~June 30, ~~2021~~2022 primarily reflects favorable price realization and increased sales volume, ~~and favorable price realization, partially~~ offset in part by ~~temporary cost savings in the prior year and~~ higher ~~transportation and~~ material costs.

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~~Table~~ Gross profit as a percentage of ~~Contents~~

sales for the six months ended June 30, 2022 was negatively impacted by increased material and transportation costs.

Research and development and selling, general and administrative expenses

Research and development expenses as a percentage of net sales was ~~4.4%~~4.5% and ~~4.3%~~4.6% for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and was 4.6% and 4.7% for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. Research and development expenses increased ~~22%~~3% in U.S. dollars and ~~19%~~8% in local currencies for the three months ended ~~September~~June 30, ~~2021,~~2022, and increased ~~24%~~6% in U.S. dollars and ~~18%~~9% in local currencies for the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively, compared to the corresponding periods in ~~2020.~~2021. The local currency increase primarily relates to increased project ~~activity and temporary savings in the prior year.~~activity.

Selling, general and administrative expenses as a percentage of net sales were ~~25.3%~~24.8% and ~~25.4%~~25.9% for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and were ~~26.2%~~25.5% and ~~27.7%~~26.7% for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. Selling, general and administrative expenses increased ~~17%~~1% in U.S. dollars and ~~16%~~6% in local currencies for the three months ended ~~September~~June 30, ~~2021,~~2022, and increased ~~18%~~4% in U.S. dollars and ~~14%~~7% in local currencies for the ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022. The local currency increase ~~primarily~~ includes ~~higher cash incentive~~investments in sales and marketing.

Amortization, interest expense, restructuring charges, other charges (income), net and ~~temporary savings in the prior year.~~taxes

Amortization expense was ~~$16.0~~$16.4 million a~~nd $14.1~~and $16.2 million for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~$46.1~~$33.0 million and ~~$42.0~~$30.1 million for the ~~nine~~six months ended ~~September~~June 30, 2022 and 2021, ~~and 2020,~~ respectively.

Interest expense was ~~$11.8~~$12.8 million and ~~$9.3~~$10.4 million for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~$31.7~~$24.1 million and ~~$29.1~~$19.9 million for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively.

Restructuring charges were $1.8 million and $0.9 million for the three months ended June 30, 2022 and 2021, respectively, and $5.8 million and $2.1 million for the six months ended June 30, 2022. Restructuring expenses are primarily comprised of employee-related costs.

Other charges (income), net includes non-service pension costs (benefits), net (gains) losses from foreign currency transactions and hedging activities, interest income and other items. Non-service pension benefits waswere $4.2 million and $2.5 ~~million~~ ~~and $3.1~~ million for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~$7.5~~$8.5 million and ~~$9.0~~$5.0 million and for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. Other charges (income), net also included $0.5 million and $2.8 million of acquisition costs for the ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022 and 2021, respectively.

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Our reported tax rate was ~~17.7%~~17.4% and ~~21.4%~~19.8% during the three months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~18.9%~~17.8% and ~~19.4%~~19.6% during the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. The provision for taxes is based upon using our projected annual effective tax rate of ~~19.5%~~19% and ~~20.5%~~19.5% before non-recurring discrete tax items for the periods ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. The difference between our projected annual effective tax rate and the reported tax rate is related to the timing of excess tax benefits associated with stock option exercises.

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Results of Operations – by Operating Segment

The following is a discussion of the financial results of our operating segments. We currently have five reportable segments: U.S. Operations, Swiss Operations, Western European Operations, Chinese Operations and Other. A more detailed description of these segments is outlined in Note 1918 to our consolidated financial statements for the year ended December 31, ~~2020.~~2021.

U.S. Operations (amounts in thousands)


		Three months ended September 30,					Nine months ended September 30,						Three months ended June 30,					Six months ended June 30,
		2021		2020		%	2021		2020		%		2022		2021		%	2022		2021		%
Total net sales	Total net sales	$	373,603	$	309,805	21%	$	1,044,163	$	854,457	22%	Total net sales	$	401,459	$	361,817	11%	$	766,854	$	670,561	14%
Net sales to external customers	Net sales to external customers	$	336,708	$	278,948	21%	$	931,977	$	769,696	21%	Net sales to external customers	$	361,145	$	323,310	12%	$	686,966	$	595,269	15%
Segment profit	Segment profit	$	72,638	$	65,493	11%	$	215,581	$	163,012	32%	Segment profit	$	92,796	$	79,272	17%	$	167,982	$	142,943	18%

Total net sales increased ~~21%~~11% and ~~22%~~14% for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively, compared with the corresponding periods in 2021. Net sales to external customers increased 12% for the three months and 15% for the six months ended June 30, 2022, compared with the corresponding period in ~~2020. Net sales to external customers increased 21% for both the three and nine months ended September 30, 2021, respectively, compared with the corresponding period in 2020.~~ 2021. Net sales to external customers for the three and six months ended ~~September~~June 30, ~~2021~~2022 includes very strong growth in most laboratory products and core industrial. The increases are partially offset by a significant decline in food retailing that was negatively impacted by the timing of customer project activity and manufacturing component shortages. Net sales during the nine months ended September 30, 2021 also included particularly strong results in pipettes.product categories. Net sales to external customers in our U.S. Operations also benefited approximately ~~4% and 3%~~2% from the PendoTECH acquisition for the ~~three and nine~~six months ended ~~September~~June 30, ~~2021, respectively.~~2022.

Segment profit increased ~~$7.1~~$13.5 million and ~~$52.6~~$25.0 million for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively, compared to the corresponding periods in ~~2020.~~2021. Segment profit during the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 includes higher net sales volume and benefits from our margin expansion initiatives, offset in part by higher material and transportation ~~and material costs and temporary cost savings in the prior year.~~costs.

Swiss Operations (amounts in thousands)


		Three months ended September 30,					Nine months ended September 30,						Three months ended June 30,					Six months ended June 30,
		2021		2020		%1)	2021		2020		%1)		2022		2021		%1)	2022		2021		%1)
Total net sales	Total net sales	$	250,261	$	206,183	21%	$	716,024	$	562,364	27%	Total net sales	$	252,511	$	242,018	4%	$	489,615	$	465,764	5%
Net sales to external customers	Net sales to external customers	$	41,850	$	38,848	8%	$	121,967	$	99,693	22%	Net sales to external customers	$	42,062	$	40,836	3%	$	85,331	$	80,117	7%
Segment profit	Segment profit	$	78,454	$	61,902	27%	$	212,849	$	164,060	30%	Segment profit	$	72,012	$	69,516	4%	$	143,334	$	134,395	7%

1)Represents U.S. dollar growth (decline) for net sales and segment profit.

Total net sales increased ~~21%~~4% in ~~both~~ U.S. dollars and 10% in local currency for the three months ended ~~September~~June 30, ~~2021,~~2022, and increased ~~27%~~5% in U.S. dollars and ~~23%~~9% in local currency for the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively, compared to the corresponding periods in ~~2020.~~2021. Net sales to ~~external cust~~exo~~mers~~ternal customers increased ~~8% in both~~3% in U.S. dollars and 7% in local currency for the three months ended ~~September~~June 30, ~~2021~~ 2022 and increased ~~22%~~7% in U.S. dollars and ~~19%~~9% in local currency for the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, compared to the corresponding periods in ~~2020.~~2021. The increase in local currency net sales to external customers for the three and six months ended ~~September~~June 30, ~~2021~~2022 includes strong growth in ~~product inspection and laboratory~~laboratory-related products. ~~Net sales during the nine months ended September 30, 2021 included strong results in most product categories.~~

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Segment profit increased ~~$16.6~~$2.5 million and ~~$48.8~~$8.9 million the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, compared to the corresponding periods in ~~2020.~~2021. Segment profit during the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 includes higher net sales volume and benefits offrom our ~~productivity~~margin expansion initiatives, ~~and favorable foreign currency translation,~~ offset in part by higher transportation and material costs and ~~temporary cost savings in the prior year.~~unfavorable foreign currency translation.

Western European Operations (amounts in thousands)


		Three months ended September 30,					Nine months ended September 30,						Three months ended June 30,					Six months ended June 30,
		2021		2020		%1)	2021		2020		%1)		2022		2021		%1)	2022		2021		%1)
Total net sales	Total net sales	$	250,891	$	219,760	14%	$	753,090	$	603,549	25%	Total net sales	$	237,738	$	257,595	(8)%	$	480,751	$	502,200	(4)%
Net sales to external customers	Net sales to external customers	$	198,632	$	177,630	12%	$	592,704	$	480,006	23%	Net sales to external customers	$	190,264	$	201,722	(6)%	$	383,149	$	394,072	(3)%
Segment profit	Segment profit	$	40,288	$	36,954	9%	$	116,630	$	91,406	28%	Segment profit	$	35,233	$	38,476	(8)%	$	74,013	$	76,342	(3)%

1)Represents U.S. dollar growth (decline) for net sales and segment profit.

Total net sales ~~increased 14%~~decreased 8% in U.S. dollars and ~~12%~~increased 4% in local currencies for the three months ended ~~September~~June 30, ~~2021~~2022 and ~~increased 25%~~decreased 4% in U.S. dollars and ~~16%~~increased 5% in local currencies for the ~~nine~~six months en~~ded September~~ended June 30, ~~2021,~~2022, compared to the corresponding periods in ~~2020.~~2021. Net sales to ~~external~~external customers ~~increased 12%~~decreased 6% in U.S. dollars and ~~10%~~increased 7% in local currencies for the three months ended ~~September~~June 30, ~~2021,~~2022, and ~~increased 23%~~decreased 3% in U.S. dollars and ~~15%~~increased 7% in local currencies for the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, compared to the corresponding periods in ~~2020. Net~~2021. The increase in local currency net sales to external customers for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 includes ~~very strong~~solid growth in most product ~~categories.~~categories, with particularly strong growth in laboratory products. Net sales to external customers for the ~~three~~six months ended ~~September~~June 30, ~~2021 is partially offset with~~2022 includes a decline in food retailing.

Segment profit ~~increased $3.3~~decreased $3.2 million and ~~$25.2~~$2.3 million for the three and ~~nine~~six month periods ended ~~September~~June 30, ~~2021,~~2022, respectively, compared to the corresponding periods in ~~2020.~~2021. Segment profit ~~increased~~decreased during the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 primarily due to unfavorable currency translation and higher transportation and material costs, offset in part by higher sales volume and benefits offrom our margin expansion initiatives, offset in part by higher transportation and material costs and temporary cost savings in the prior year. Segment profit for the nine months ended September 30, 2021 also includes favorable currency translation.initiatives.

Chinese Operations (amounts in thousands)


		Three months ended September 30,					Nine months ended September 30,						Three months ended June 30,					Six months ended June 30,
		2021		2020		%1)	2021		2020		%1)		2022		2021		%1)	2022		2021		%1)
Total net sales	Total net sales	$	289,461	$	219,545	32%	$	792,663	$	555,532	43%	Total net sales	$	304,932	$	278,050	10%	$	568,077	$	503,202	13%
Net sales to external customers	Net sales to external customers	$	210,460	$	165,231	27%	$	572,055	$	406,738	41%	Net sales to external customers	$	229,809	$	205,521	12%	$	412,515	$	361,595	14%
Segment profit	Segment profit	$	108,636	$	81,055	34%	$	275,323	$	190,560	44%	Segment profit	$	105,456	$	94,663	11%	$	190,424	$	166,687	14%

1)Represents U.S. dollar growth for net sales and segment profit.

Total net sales increased ~~32%~~10% in U.S. dollars and ~~23%~~12% in local currency for the three months ended ~~September~~June 30, ~~2021~~2022 and increased ~~43%~~13% in both U.S. dollars and ~~32%~~ in local currency for the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, compared to the corresponding periods in ~~2020.~~2021. Net sales to external customers increased ~~27%~~12% in U.S. dollars and ~~19%~~14% in local currency by origin for the three months ended ~~September~~June 30, ~~2021~~2022 and increased ~~41%~~14% in both U.S. dollars and ~~31%~~ in local currency during the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, compared to the corresponding periods in ~~2020.~~2021. Net sales to external customers during the three and six months ended ~~September~~June 30, ~~2021~~2022 includes especially strong growth in laboratory ~~products~~ and ~~good growth in our~~core industrial ~~business,~~products, offset in part by a significant decline in food retailing. ~~The increase in local currency net sales~~However, uncertainties exist, especially relating to ~~external customers during the nine months ended September 30, 2021 reflects particularly strong growth in both laboratory~~potential additional COVID-19 lockdowns, and ~~industrial products. However,~~ market conditions may change ~~quickly~~quickly.

Segment profit increased $10.8 million and ~~we will face difficult prior period comparisons during~~$23.7 million for the ~~remainder of~~three and six month periods ended June 30, 2022, respectively, compared to the corresponding periods in 2021. The increase in segment profit for the three and six months ended June 30, 2022 primarily reflects

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Segment profit increased $27.6 million and $84.8 million for the three and nine month periods ended September 30, 2021, respectively, compared to the corresponding periods in 2020. The increase in segment profit for the three and nine months ended September 30, 2021 ~~primarily reflects~~ increased sales volume and ~~favorable foreign currency translation,~~benefits from our margin expansion initiatives, offset in part by higher transportation and material costs and ~~temporary cost savings in the prior year.~~unfavorable currency translation.

Other (amounts in thousands)


		Three months ended September 30,					Nine months ended September 30,						Three months ended June 30,					Six months ended June 30,
		2021		2020		%1)	2021		2020		%1)		2022		2021		%1)	2022		2021		%1)
Total net sales	Total net sales	$	165,135	$	148,209	11%	$	465,195	$	394,340	18%	Total net sales	$	155,816	$	154,237	1%	$	309,888	$	300,059	3%
Net sales to external customers	Net sales to external customers	$	164,300	$	146,700	12%	$	461,988	$	391,059	18%	Net sales to external customers	$	155,107	$	152,962	1%	$	308,217	$	297,688	4%
Segment profit	Segment profit	$	24,381	$	23,554	4%	$	65,967	$	47,702	38%	Segment profit	$	22,243	$	21,414	4%	$	42,695	$	41,586	3%

1)Represents U.S. dollar growth for net sales and segment profit.

Net sales to external customers increased ~~12%~~1% in U.S. dollars and ~~11%~~9% in local currencies for the three months ended June 30, 2022 and increased 4% in U.S. dollars and 10% in local currencies for the ~~three~~six months ended ~~September~~June 30, ~~2021 and increased 18%~~ ~~in U.S. dollars and 14% in local currencies for the nine months ended September 30, 2021,~~2022, compared to the corresponding periods in ~~2020.~~2021. The increase in net sales to external customers for the three and six months ended June 30, 2022 includes strong growth in most product categories.

Segment profit increased $0.8 million and ~~$18.3~~$1.1 million for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively, compared to the corresponding periods in ~~2020.~~2021. The increase in segment profit for the ~~nine~~three and six months ended ~~September~~June 30, ~~2021~~2022 is primarily related to increased sales volume, ~~and favorable~~offset by unfavorable foreign currency ~~translation.~~translation and higher transportation and material costs.

Liquidity and Capital Resources

Liquidity is our ability to generate sufficient cash flows from operating activities to meet our obligations and commitments. ~~Sources of~~In addition, liquidity includes ~~cash flows from operating activities,~~ available borrowings under our Credit Agreement, the ability to obtain appropriate financing and our cash and cash equivalent balances. Currently, our ~~financing requirements~~liquidity needs are primarily driven by working capital requirements, capital expenditures, share repurchases and acquisitions. Global market conditions can be uncertain, and our ability to generate cash flow could be reduced by a deterioration in global markets.

We currently believe that cash flows from operating activities, together with liquidity available under our Credit Agreement, local working capital facilities, and cash balances, will be sufficient to fund currently anticipated working capital needs and spending requirements for at least the foreseeable future.

Cash provided by operating activities ~~totaled $667.7~~totaled $310.0 million during the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, compared to ~~$473.8~~$404.4 million in the corresponding period in ~~2020.~~ 2021. The ~~increase~~ decrease for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 is primarily ~~due~~related to higher ~~net earnings.~~cash incentive payments related to our strong previous year performance, as well as increased inventory levels.

Capital expenditures are made primarily for investments in information systems and technology, machinery, equipment and the purchase and expansion of facilities. Our capital expenditures totaled ~~$69.8~~$62.4 million for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 compared to ~~$57.4~~$47.4 million in the corresponding period in ~~2020.~~2021.

In September 2021, ~~the Company~~we entered into an agreement with the USU.S. Department of Defense to increase domestic production capacity of pipette tips and enhance manufacturing automation and logistics. ~~The Company will receive grant funding~~As of June 30, 2022, we have obtained $25.0 million of the $35.8 million ~~over the next two years,~~of total funding to be received through 2023, which will offset ~~future~~associated capital expenditures. During the six months ended June 30, 2022, we incurred approximately $24.9 million of capital expenditures relating to this funding agreement.

We continue to explore potential acquisitions. In connection with any acquisition, we may incur additional indebtedness. During the six months ended June 30, 2022, $10.0 million of contingent consideration was paid relating to the PendoTECH acquisition of which $7.9 million is

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included in financing activities for the amount accrued at the acquisition date and $2.1 million is included in operating activities for the amount not accrued at the acquisition date on the Consolidated Statement of Cash Flows in accordance with U.S. GAAP.

Cash flows used in financing activities are primarily comprised of share repurchases. In accordance with our share repurchase program, we spent $550.0 million and $475.0 million on the repurchase of 408,901 shares and 390,538 shares, during the six months ended June 30, 2022 and 2021, respectively.

Senior Notes and Credit Facility Agreement

Our debt consisted of the following at ~~September~~June 30, ~~2021:~~2022:

U.S. Dollar Other Principal Trading Currencies Total
3.67% $50 million ten-year Senior Notes due December 17, 2022 $ 50,000 $ — $ 50,000
4.10% $50 million ten-year Senior Notes due September 19, 2023 50,000 — 50,000
3.84% $125 million ten-year Senior Notes due September 19, 2024 125,000 — 125,000
4.24% $125 million ten-year Senior Notes due June 25, 2025 125,000 — 125,000
3.91% $75 million ten-year Senior Notes due June 25, 2029 75,000 — 75,000
3.19% $50 million fifteen-year Senior Notes due January 24, 2035 50,000 — 50,000
2.83% $125 million twelve-year Senior Notes due July 22, 2033 125,000 — 125,000
1.47% Euro 125 million fifteen-year Senior Notes due June 17, 2030 — 146,056 146,056
1.30% Euro 135 million fifteen-year Senior Notes due November 6, 2034 — 157,740 157,740
1.06% Euro 125 million fifteen-year Senior Notes due March 19, 2036 — 146,056 146,056
Debt issuance costs, net (1,519) (1,600) (3,119)
Total Senior Notes 598,481 448,252 1,046,733
$1.25 billion Credit Agreement, interest at LIBOR plus 87.5 basis points 412,473 177,092 589,565
Other local arrangements 3,494 53,315 56,809
Total debt 1,014,448 678,659 1,693,107
Less: current portion (351) (53,173) (53,524)
Total long-term debt $ 1,014,097 $ 625,486 $ 1,639,583

On June 25, 2021, we entered into a $1.25 billion Credit Agreement ("the Credit Agreement"), which amended our $1.1 billion Amended and Restated Credit Agreement (the "Prior Credit Agreement"), that is further described in Note 8 of our consolidated financial statements.

In May 2021, we entered into an agreement to issue and sell $125 million twelve-year Senior Notes with a fixed interest rate of 2.83%. The Senior Notes were issued in July 2021 and will mature July 2033. The terms of the Senior Notes are consistent with the previous Senior Notes as described above. We used the proceeds from the sale of the notes to refinance existing indebtedness and for other general corporate purposes.


	U.S. Dollar		Other Principal Trading Currencies		Total
3.67% $50 million ten-year Senior Notes due December 17, 2022	$	50,000	$	—	$	50,000
4.10% $50 million ten-year Senior Notes due September 19, 2023	50,000		—		50,000
3.84% $125 million ten-year Senior Notes due September 19, 2024	125,000		—		125,000
4.24% $125 million ten-year Senior Notes due June 25, 2025	125,000		—		125,000
3.91% $75 million ten-year Senior Notes due June 25, 2029	75,000		—		75,000
2.83% $125 million twelve-year Senior Notes due July 22, 2033	125,000		—		125,000
3.19% $50 million fifteen-year Senior Notes due January 24, 2035	50,000		—		50,000
2.81% $150 million fifteen-year Senior Note due March 17, 2037	150,000		—		150,000
1.47% Euro 125 million fifteen-year Senior Notes due June 17, 2030	—		131,933		131,933
1.30% Euro 135 million fifteen-year Senior Notes due November 6, 2034	—		142,487		142,487
1.06% Euro 125 million fifteen-year Senior Notes due March 19, 2036	—		131,933		131,933
Debt issuance costs, net	(2,334)		(1,553)		(3,887)
Total Senior Notes	747,666		404,800		1,152,466
$1.25 billion Credit Agreement, interest at LIBOR plus 87.5 basis points	514,491		201,509		716,000
Other local arrangements	3,229		56,337		59,566
Total debt	1,265,386		662,646		1,928,032
Less: current portion	(50,358)		(56,216)		(106,574)
Total long-term debt	$	1,215,028	$	606,430	$	1,821,458

As of ~~September~~June 30, ~~2021,~~2022, approximately ~~$654.2~~$528.0 million of additional borrowings was available under our Credit Agreement, and we maintained ~~$183.7~~$109.4 million of cash and cash equivalents. ~~During the nine months ended September 30, 2021, the Company increased its long-term debt primarily due to the funding of the PendoTECH acquisition as described in Note 4.~~

Changes in exchange rates between the currencies in which we generate cash flows and the currencies in which our borrowings are denominated affect our liquidity. In addition, because we borrow in a variety of currencies, our debt balances fluctuate due to changes in exchange rates. Further, we do not have any downgrade triggers ~~related~~relating to ratings from rating agencies that would accelerate the maturity dates of our debt.

We ~~currently believe that cash flow from operating activities, together~~were in compliance with ~~liquidity available under~~ our Credit Agreement and local working capital facilities and our cash balances, will be sufficient to fund currently anticipated working capital needs and capital spending requirements for the foreseeable future.debt covenants as of June 30, 2022.

In December ~~2020, the Company~~2021, we entered into an agreement to issue and sell ~~EUR 125.0~~$300 million of 15-year ~~1.06% Euro~~ Senior Notes ~~("1.06% Euro~~in a private placement. We issued $150 million with a fixed interest rate of 2.81% (2.81% Senior ~~Notes"). The terms~~Notes) in March 2022, which will mature in March 2037, and we will issue $150 million with a fixed interest rate of 2.91% (2.91% Senior Notes) in September 2022, which will mature in September 2037. We will use the proceeds from the sale of the ~~Euro Senior Notes are consistent with the previous Euro Senior Notes as described in the Company's~~notes to refinance existing indebtedness and for other general corporate purposes.

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Annual Report on Form 10-K for the year ended December 31, 2020. The Company also entered into a forward contract to receive $152.1 million at the time of issuing the 1.06% Euro Senior Notes in March 2021. The Company issued the 1.06% Euro Senior Notes with a fixed interest rate of 1.06% in March 2021. The 1.06% Euro Senior Notes are unsecured obligations of the Company and will mature on March 19, 2036. Interest on the 1.06% Euro Senior Notes is payable semi-annually in March and September of each year.Other Local Arrangements

In April 2018, two of our non-U.S. pension plans issued loans totaling $39.6 million (Swiss franc 38 million) to a wholly owned subsidiary of the Company. The loans have the same terms and conditions which include an interest rate of ~~Swiss franc LIBOR~~SARON plus 87.5 basis points. The loans were renewed for one year in April ~~2021.~~

We continue to explore potential acquisitions. In connection with any acquisition, we may incur additional indebtedness. In March 2021, we acquired all the membership interests of Mayfair Technology, LLC, ("PendoTECH") a manufacturer and distributor of single-use sensors, transmitters, control systems and software for measuring, monitoring and data collection primarily in bioprocess applications. PendoTECH serves bio-pharmaceutical manufacturers and life science laboratories and is located in the United States. The initial cash payment was $185.0 million and we may be required to pay additional consideration of up to $20.0 million and other post-closing amounts. In October 2021, the Company acquired Scale-up Systems Inc., a leading software provider for scale-up and reaction modelling serving the biopharma and chemical markets. The initial cash payment was $22.2 million and the Company may be required to pay additional amounts up to EUR 3.0 million. For additional information related to these acquisitions, refer to Note 4 to the interim consolidated financial statements.2022.

Share Repurchase Program

~~In November 2020, the Company's Board~~We have $1.5 billion of ~~Directors authorized an additional $2.5 billion to be added to~~remaining availability for our share repurchase program ~~which has $2.3 billion of remaining availability~~ as of ~~September~~June 30, ~~2021.~~2022. The share repurchases are expected to be funded from cash generated from operating activities, borrowings, and ~~existing~~ cash balances. Repurchases will be made through open market transactions, and the amount and ~~timin~~gtiming of purchases will depend on business and market conditions, the stock price, trading restrictions, the level of acquisition activity, and other factors.

We have purchased ~~30.0~~30.6 million shares since the inception of the program through ~~September~~June 30, ~~2021.~~2022. During the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, we spent ~~$727.5~~$550.0 million and ~~$400.0~~$475.0 million on the repurchase of ~~557,310~~408,901 and ~~475,530~~390,538 shares at an average price per share of ~~$1,305.35~~$1,345.05 and ~~$841.14,~~$1,216.25, respectively. We also reissued ~~71,124~~72,408 shares and ~~144,776~~35,636 shares held in treasury upon the exercise of stock options and vesting of restricted stock units during the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively.

Effect of Currency on Results of Operations

Our earnings are affected by changes in exchange rates. We are most sensitive to changes in the exchange rates between the Swiss franc, euro, Chinese renminbi, and U.S. dollar. We have more Swiss franc expenses than we do Swiss franc sales because we develop and manufacture products in Switzerland that we sell globally, and have a number of corporate functions located in Switzerland. When the Swiss franc strengthens against our other trading currencies, particularly the U.S. dollar and euro, our earnings decrease. We also have significantly more sales in the euro than we do expenses. When the euro weakens against the U.S. dollar and Swiss franc, our earnings also decrease. We estimate a 1% strengthening of the Swiss franc against the euro would reduce our earnings before tax by ~~approximately $1.8~~approximately $1.9 million to ~~$2.0~~$2.1 million annually.

We also conduct business in many geographies throughout the world, including Asia Pacific, the United Kingdom, Eastern Europe, Latin America, and Canada. Fluctuations in these currency exchange rates against the U.S. dollar can also affect our operating results. The most significant of these currency exposures is the Chinese renminbi. The impact on our earnings before

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tax of the Chinese renminbi weakening 1% against the U.S. dollar is a reduction of approximately ~~$2.6~~$3.3 million to ~~$2.8~~$3.5 million ~~annually.~~annually.

In addition to the effects of exchange rate movements on operating profits, our debt levels can fluctuate due to changes in exchange rates, particularly between the U.S. dollar, the Swiss franc and the ~~Swiss franc.~~euro. Based on our outstanding debt at ~~September~~June 30, ~~2021,~~2022, we estimate that a 5% weakening of the U.S. dollar against the currencies in which our debt is denominated would result in an increase of approximately ~~$35.8~~$35.0 million in the reported U.S. dollar value of our debt.

Forward-Looking Statements Disclaimer

You should not rely on forward-looking statements to predict our actual results. Our actual results or performance may be materially different than reflected in forward-looking statements because of various risks and uncertainties, including statements about expected revenue growth and long-term impacts of the COVID-19 ~~pandemic.~~pandemic and recent developments in Ukraine. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential” or “continue.”

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We make forward-looking statements about future events or our future financial performance, including earnings and sales growth, earnings per share, strategic plans and contingency plans, growth opportunities or economic downturns, our ability to respond to changes in market conditions, customer demand, our competitive position, pricing, our supply chain, adequacy of our facilities, access to and the costs of raw materials, shipping and supplier costs, gross margins, planned research and development efforts and product introductions, capital expenditures, cash flow, tax-related matters, the impact of foreign currencies, compliance with laws, effects of acquisitions, and the impact of the COVID-19 pandemic and recent developments in Ukraine on our businesses.

Our forward-looking statements may not be accurate or complete, and we do not intend to update or revise them in light of actual results. New risks also periodically arise. Please consider the risks and factors that could cause our results to differ materially from what is described in our forward-looking statements, including the uncertain duration and severity of the COVID-19 ~~pandemic.~~pandemic and recent developments in Ukraine. See in particular “Factors Affecting Our Future Operating Results” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 and other reports filed with the SEC from time to time.

Item 3.Quantitative and Qualitative Disclosures About Market Risk

As of ~~September~~June 30, ~~2021,~~2022, there was no material change in the information provided under Item 7A in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021.

Item 4.Controls and Procedures

Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rule 13a-15(b) as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer, have concluded that these disclosure controls and procedures are effective. There were no changes in our internal control over financial reporting during the quarter ended ~~September~~June 30, ~~2021~~2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1.Legal Proceedings. None

Item 1A.Risk Factors.

For the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 there were no material changes from risk factors disclosed in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021, and as updated in the Company's Form 10-Q for the period ended March 31, 2022.

Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.

Issuer Purchases of Equity Securities

(a) (b) (c) (d)
Total Number of
Shares Purchased Average Price Paid
per Share Total Number of
Shares Purchased as Part of Publicly Announced Program Approximate Dollar
Value (in thousands) of Shares that may yet be Purchased under the Program
July 1 to July 31, 2021 46,649 $ 1,438.80 46,649 $ 2,516,308
August 1 to August 31, 2021 64,519 $ 1,525.25 64,519 $ 2,417,900
September 1 to September 30, 2021 55,604 $ 1,564.10 55,604 $ 2,330,928
Total 166,772 $ 1,514.02 166,772 $ 2,330,928


	(a)	(b)		(c)	(d)
	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Program	Approximate Dollar Value (in thousands) of Shares that may yet be Purchased under the Program


April 1 to April 30, 2022	64,183	$	1,329.13	64,183	$	1,698,120
May 1 to May 31, 2022	79,492	$	1,252.33	79,492	$	1,598,568
June 1 to June 30, 2022	74,633	$	1,207.74	74,633	$	1,508,429
Total	218,308	$	1,259.67	218,308	$	1,508,429

~~In November 2020, the Company's Board of Directors authorized an additional $2.5 billion to the share repurchase program, which~~

The Company has ~~$2.3~~$1.5 billion of remaining availability for its share repurchase program as of ~~September~~June 30, ~~2021.~~2022. We have purchased ~~30.0~~30.6 million shares since the inception of the program through ~~September~~June 30, ~~2021.~~2022.

During the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, we spent ~~$727.5~~$550.0 million and ~~$400.0~~$475.0 million on the repurchase of ~~557,310~~408,901 and ~~475,530~~390,538 shares at an average price per share of ~~$1,305.35~~$1,345.05 and ~~$841.14,~~$1,216.25, respectively. We also reissued ~~71,124~~72,408 shares and ~~144,776~~35,636 shares held in treasury upon the exercise of stock options and vesting of restricted stock units during the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively.

Item 3.Defaults Upon Senior Securities. None

Item 5. Other information. None

Item 6. Exhibits. See Exhibit ~~Index below.~~Index.

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EXHIBIT INDEX


Exhibit No.		Description

	31.1*	Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes — Oxley Act of 2002

	31.2*	Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes — Oxley Act of 2002

	32*	Certification Pursuant to Section 906 of the Sarbanes — Oxley Act of 2002

	101.INS*	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

	101.SCH*	XBRL Taxonomy Extension Schema Document

	101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document

	101.LAB*	XBRL Taxonomy Extension Label Linkbase Document

	101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document

	101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document

_______________________

* Filed herewith

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SIGNATURE

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.

Date:

~~November 5, 2021~~July 29, 2022

By:

/s/ Shawn P. Vadala

Shawn P. Vadala

Chief Financial Officer

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