METTLER TOLEDO INTERNATIONAL INC

Previous wording

Net sales in U.S. dollars decreased 3% in 2023 and increased 5% in 2022. Excluding the effect of currency exchange rate fluctuations, or in local currencies, net sales decreased 3% in 2023 and increased 11% in 2022. 2023 was a challenging year after very strong sales growth during the previous two years. Net sales in 2023 were also impacted by shipping delays of approximately $58 million with a new external European logistics service provider, which we expect to largely recover in the first quarter of 2024. We estimate local currency net sales decreased approximately 1% in 2023 excluding the impact of the delayed shipments. Market demand declined in our core segments, especially pharma/biopharmaceutical, with a significant drop-off in China during the second half of the year. While market demand declined, we continue to benefit from our strong global leadership positions, diversified customer base, innovative product offering, investment in emerging markets, significant installed base, and the impact of our sophisticated global sales and marketing programs. Examples of these programs include identifying and investing in growth and market penetration opportunities, more effectively pricing our products and services, increasing our sales force effectiveness through improved guidance and redirecting resources to our most promising growth opportunities, increasing the use of digital tools, and continuing to optimize our lead generation and lead nurturing processes.

Current wording

Net sales in U.S. dollars increased 2% in 2024 and decreased 3% in 2023. Excluding the effect of currency exchange rate fluctuations, or in local currencies, net sales increased 3% in 2024 and decreased 3% in 2023. Net sales in 2023 were negatively impacted by approximately $58 million from our previously disclosed shipping delays related to a new external European logistics service provider, which were largely recovered in the first quarter of 2024. We estimate local currency net sales were flat in 2024 and decreased 1% in 2023 excluding the impact of the delayed shipments. Market demand in our core segments was soft in 2024, particularly in China. We continue to benefit from our strong global leadership positions, diversified customer base, innovative product offering, investment in emerging markets, significant installed base, and the impact of our sophisticated global sales and marketing programs. Examples of these programs include identifying and investing in growth and market penetration opportunities, more effectively pricing our products and services, increasing our sales force effectiveness through improved guidance and redirecting resources to our most promising growth opportunities, increasing the use of digital tools, and continuing to optimize our lead generation and lead nurturing processes.

Previous wording

In addition to reduced market demand during 2023, we also continued to experience global inflation, unfavorable foreign currency, and increased interest rates. Our team’s resilience and agility to quickly react to adapt to the changing environment were critical to our ability to mitigate these challenges. In particular, our pricing program and productivity and cost savings initiatives helped offset inflationary pressures and volume declines. Over the past few years, we also accelerated our ability to use advanced analytics to identify and pursue growth opportunities, while increasing the effectiveness of our digital tools to support our global sales organization. We also have continued to increase engagement with our customers with our Go-to-Market and digital approaches. Our market leading solutions and ability to leverage our innovative portfolio have also allowed us to quickly capitalize on our customers demand for automation and digitalization solutions. This is also true for faster growing segments such as lithium-ion batteries, semiconductors and advanced new materials. We are well positioned, and have continued to make investments to further strengthen our portfolio and capture future growth opportunities. Our Service business also delivered very strong results in 2023 as we have been able to support our customers’ ability to maintain uptime, improve productivity, and comply with regulatory requirements.

Current wording

In addition to soft market demand during 2024, we also continued to experience uncertainty in the economic environment, including the risk of recession in many countries, and unfavorable foreign currency. Our team’s resilience and agility, and our productivity and cost savings initiatives, were critical to our ability to mitigate these challenges. Over the past few years, we also accelerated our ability to use advanced analytics to identify and pursue growth opportunities, while increasing the effectiveness of our digital tools to support our global sales organization. We also have continued to increase engagement with our customers with our Go-to-Market and digital approaches. Our market-leading solutions and ability to leverage our innovative portfolio have also allowed us to quickly capitalize on our customers' demand for automation and digitalization solutions and faster growing segments. We are well positioned, and have continued to make investments to further strengthen our portfolio and capture future growth opportunities. Our service business also delivered very strong results in 2024 as we have been able to support our customers’ ability to maintain uptime, improve productivity, and comply with regulatory requirements.

Previous wording

As we enter 2024, we expect to continue to benefit from market trends towards automation and digitalization, as well as customer investments in on/near-shoring activities. However, many of our end markets, including pharma/biopharmaceutical, food, and chemical are challenged after years of very strong growth. In addition, market conditions and challenges remain uncertain relating to the macro environment and global economy, including the impacts of tighter monetary policies and related increase in interest rates to combat inflation, and ongoing developments in Ukraine, the Israel-Hamas war, and increasing geopolitical tensions. Accordingly, we expect demand for our products to be reduced during the first half of 2024 which also reflects difficult prior period comparisons after strong results in both 2023 and 2022, particularly in our laboratory business and in China. Market conditions also may change quickly.

Current wording

As we enter 2025, we expect to continue to benefit from market trends toward automation and digitalization, as well as customer investments in on/near-shoring activities. However, many of our end-markets, including pharma/biopharmaceutical, food, and chemical, remain challenged after significant growth during the COVID-19 pandemic. In addition, market conditions and challenges remain uncertain relating to the macro environment and global economy, including the impacts of the ongoing wars in Ukraine and the Middle East and increasing geopolitical tensions. Market conditions also may change quickly.

Previous wording

Our laboratory sales experienced a significant decline in 2023, particularly from life sciences and biotech customers after two years of very strong growth. We expect difficult market conditions during the first half of 2024, but believe we will benefit from favorable biopharma market trends in the future. We also believe we will continue to benefit from increased customer demand for automation, digitalization, and safety; new facility investments; and continued focus on regulatory compliance including data integrity requirements. Overall, we believe we are well positioned to continue to capture growth and gain market share in our laboratory business.

Current wording

Our laboratory sales grew in 2024 despite a decrease in China as the sharp market decline in 2023 continued during 2024. We believe we will benefit from favorable pharma/biopharma market trends in the future. We also believe we will continue to benefit from increased customer demand for automation, digitalization, and safety; new facility investments; and continued focus on regulatory compliance including data integrity requirements. Overall, we believe we are well positioned to continue to capture growth and gain market share in our laboratory business.

Previous wording

Our industrial sales were down slightly in 2023 related to core-industrial which included weak market conditions in China. We expect reduced market demand, especially in China, during the first half of 2024. Our core industrial-related products are also especially sensitive to changes in economic growth. However, we continue to benefit from our strong product offering and focus on the more attractive, faster-growing segments of the market and strong execution of our growth initiatives in each region. We also continue to benefit from market trends in automation and digitalization and also expect to benefit from customer on/near-shoring activities in the future. China and emerging market economies have historically been an important source of growth based upon the expansion of their domestic economies, and we expect this to also be a source of long-term growth. We expect our product inspection end-market to also benefit from our customers’ focus on brand protection, food safety, and productivity. However, product inspection customers in the packaged food industry have been negatively impacted by inflation and many of these customers reduced investments during 2023.

Current wording

Our industrial sales grew modestly in 2024 despite challenging market conditions for core industrial in China. We continue to benefit from our strong product offering and focus on the more attractive, faster-growing segments of the market and strong execution of our growth initiatives in each region. We also continue to benefit from market trends in automation and digitalization and also expect to benefit from customer on/near-shoring activities in the future. Our core industrial-related products are also especially sensitive to changes in economic growth. China and emerging market economies have historically been an important source of growth based upon the expansion of their domestic economies, and we expect this to also be a source of long-term growth. Product inspection experienced solid growth in 2024, and we expect our product inspection end-market to continue to benefit from our customers’ focus on brand protection, food safety, and productivity.

Previous wording

Our food retailing sales increased significantly during 2023 primarily due to strong project activity, especially in the Americas. Traditionally, the spending levels in this sector have experienced more volatility than our other end-markets due to the timing of customer project activity and new regulations.

Current wording

Our food retailing sales decreased significantly during 2024 primarily due to strong project activity in 2023, especially in the Americas. Traditionally, the spending levels in this sector have experienced more volatility than our other end-markets due to the timing of customer project activity and new regulations.

Previous wording

Gaining Market Share. Innovation is essential to gaining market share and is fundamental in all aspects of our business including sales and marketing and technology leadership. Our global sales and marketing initiative, Spinnaker, continues to be an important growth strategy. We aim to gain market share by implementing sophisticated sales and marketing programs, leveraging our extensive customer databases, product offering, and installed base. While this initiative is broad-based, efforts to improve these processes include the use of advanced data analytics to identify, prioritize, and pursue growth opportunities; the implementation of more effective pricing related to value-based selling strategies and processes; improved sales force guidance, training, and effectiveness; cross-selling; increased segment marketing; and leads generation and nurturing activities. We also have added resources to pursue under-penetrated market opportunities and continue to adapt our Go-to-Market approaches with additional inside and telesales resources, while also increasing digital customer interaction. We continue to benefit from digitalization tools to gain efficiencies and increase the effectiveness of our field sales force. In addition, our comprehensive service offerings, and our initiatives to globalize and harmonize these offerings, help us further penetrate developed markets.

Current wording

Gaining Market Share. Innovation is essential to gaining market share and is fundamental in all aspects of our business including sales and marketing and technology leadership. Our global sales and marketing initiative, Spinnaker, continues to be an important growth strategy. We aim to gain market share by implementing sophisticated sales and marketing programs, leveraging our extensive customer databases, product offering, and installed base. While this initiative is broad-based, efforts to improve these processes include the use of advanced data analytics to identify, prioritize, and pursue growth opportunities; the implementation of more effective pricing related to value-based selling strategies and processes; improved sales force guidance, training, and effectiveness; cross-selling; increased segment marketing; and leads generation and nurturing activities. We also have added resources to pursue under-penetrated market opportunities and continue to adapt our Go-to-Market approaches with additional inside and telesales resources, while also increasing digital customer interaction. We continue to benefit from digitalization tools to gain efficiencies and increase the effectiveness of our field sales force.

Previous wording

We estimate that we have the largest installed base of weighing instruments in the world, and we continue to leverage advanced data analytics and invest in sales and marketing activities to increase the proportion of our installed base that is under service contract, or sell new products that replace old products in our installed base. In addition to traditional repair and maintenance, our service offerings continue to expand into value-added services for a range of market needs, including regulatory compliance. We have also made adjustments to our service model to incorporate remote service, depot drop-off/pickup, and other approaches.

Current wording

In addition, our comprehensive service offerings, and our initiatives to globalize and harmonize these offerings, help us further penetrate developed markets. We estimate that we have the largest installed base of weighing instruments in the world, and we continue to leverage advanced data analytics and invest in sales and marketing activities to increase the proportion of our installed base that is under service contract, or sell new products that replace old products in our installed base. In addition to traditional repair and maintenance, our service offerings continue to expand into value-added services for a range of market needs, including regulatory compliance. We have also improved our service model to incorporate remote service, depot drop-off/pickup, and other approaches.

Previous wording

Faster-Growing Markets. Emerging markets, comprising Asia (excluding Japan), Eastern Europe, Latin America, the Middle East, and Africa, account for approximately 35% of our total net sales. We have a two-pronged strategy in emerging markets: first, to capitalize on long-term growth opportunities in these markets, and second, to leverage our low-cost manufacturing operations in China. We have a 35-year track record in China, and our sales in Asia have grown more than 12% on a compound annual growth basis in local currencies since 1999. Over the years, we also have broadened our product offering to the Asian markets. India has also been a source of emerging market sales growth in past years due to increased life science research activities. Overall, versus the prior year, we experienced a 5% decrease in emerging market local currency sales by destination during 2023, which included a 10% local currency sales decline in China. Following particularly strong growth in 2022 and 2021, market conditions in China declined significantly during the second half of 2023, especially in our laboratory business, and we expect reduced sales during the first half of 2024. Going forward, we continue to redeploy resources and sales and marketing efforts to pharma, food manufacturing, chemical, and new energy. We believe the long-term growth of these segments will be favorably impacted by the Chinese government’s emphasis on science, high-value industries, product quality, and food safety. We expect our laboratory and product inspection businesses will particularly benefit from our focus on these segments. We also continue to pursue growth in under-penetrated emerging markets. However, emerging market sales can be volatile as we experienced in China during 2023. China has historically been volatile and market conditions may change unfavorably due to various factors. In addition to China and emerging markets, we also pursue other faster-growth vertical markets. While rather small, these markets present outsized growth potential. Segments include lithium-ion batteries, semiconductors, advanced materials, and plant-based food. The components of these faster-growing segments will change as various markets develop and we will continue to leverage the breadth and scope of our product offering as new opportunities emerge.

Current wording

China declined significantly during the second half of 2023, and challenging market conditions persisted in 2024. Going forward, we continue to redeploy resources and sales and marketing efforts to pharma, food manufacturing, chemical, and new energy. We believe the long-term growth of these segments will be favorably impacted by the Chinese government’s emphasis on science, high-value industries, product quality, and food safety. We expect our laboratory and product inspection businesses will particularly benefit from our focus on these segments. We also continue to pursue growth in under-penetrated emerging markets. However, emerging market sales can be volatile as we experienced in China over the past several years. China has historically been volatile, and market conditions may change unfavorably due to various factors. In addition to China and emerging markets, we also pursue other faster-growth vertical markets. While rather small, these markets present outsized growth potential. Segments include semiconductors, advanced materials, and new energy. The components of these faster-growing segments will change as various markets develop, and we will continue to leverage the breadth and scope of our product offering as new opportunities emerge.

Previous wording

Extending Our Technology Lead. We continue to focus on product innovation. In the last three years, we spent approximately 5% of net sales on research and development. We seek to improve our product offerings and their capabilities with additional integrated technologies and software, which we believe supports our pricing differentiation and accelerates product replacement cycles. In addition, we aim to create value for our customers by having thorough knowledge of their processes via our significant installed product base.

Current wording

Extending Our Technology Lead. We continue to focus on product innovation. In the last three years, we spent approximately 5% of net sales on research and development, reflecting a total of $551 million. We seek to improve our product offerings and their capabilities with additional integrated technologies and software, which we believe supports our pricing differentiation and accelerates product replacement cycles. In addition, we aim to create value for our customers by having thorough knowledge of their processes via our significant installed product base.

Previous wording

Expanding Our Margins. We continue to strive to improve our margins by enhancing our value proposition via innovation, more effectively pricing our products and services, optimizing our cost structure, and improving our mix in higher-margin businesses such as service. For example, sophisticated data analytic tools provide us new insights to further refine our price strategies and processes. We also have implemented productivity and cost savings initiatives to mitigate our reduced 2023 volume, while also focusing on reallocating resources to better align our cost structure to support our investments in market penetration initiatives, higher-growth/profitable areas, and opportunities for margin improvement.

Current wording

Expanding Our Margins. We continue to strive to improve our margins by enhancing our value proposition via innovation, more effectively pricing our products and services, optimizing our cost structure, and improving our mix in higher-margin businesses such as service. For example, sophisticated data analytic tools provide us new insights to further refine our price strategies and processes. We have also implemented productivity and cost savings initiatives over the past two years to mitigate our reduced volume, while also focusing on reallocating resources to better align our cost structure to support our investments in market penetration initiatives, higher-growth/profitable areas, and opportunities for margin improvement.

Previous wording

Pursuing Strategic Acquisitions. We seek to pursue "bolt-on" acquisitions that may leverage our global sales and service network, respected brand, extensive distribution channels, and technological leadership. We have identified life sciences and process analytics as key areas for acquisitions. For example, in 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 biopharmaceutical manufacturers and life science laboratories and is located in the United States. The initial cash payment was $185.0 million and we made other post-closing payments of $7.4 million. We also paid an additional $10.0 million per year related to an earn-out provision in the agreement both in 2022 and 2023. In 2021, we also acquired Scale-up Systems Inc., a leading software provider for scale-up and reaction modeling serving the biopharma and chemical markets. The initial cash payment was $20.2 million and we have paid additional consideration of EUR 2.0 million in 2023 and EUR 0.6 million in 2022.

Current wording

Pursuing Strategic Acquisitions. We seek to pursue "bolt-on" acquisitions that may leverage our global sales and service network, respected brand, extensive distribution channels, and technological leadership. We have identified life sciences and process analytics as key areas for acquisitions. For example, in 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 biopharmaceutical manufacturers and life science laboratories and is located in the United States. In 2021, we also acquired Scale-up Systems Inc., a leading software provider for scale-up and reaction modeling serving the biopharma and chemical markets.

Previous wording

Net sales were $3.8 billion for the year ended December 31, 2023, compared to $3.9 billion in 2022 and $3.7 billion in 2021. This represents a decrease of 3% in 2023 and an increase of 5% in 2022 in U.S. dollars and a decrease of 3% in 2023 and an increase of 11% in 2022 in local currencies. In 2023, we experienced reduced market demand, particularly in China and our laboratory business. Net sales in 2023 were also impacted by shipping delays of approximately $58 million with a new external European logistics service provider, which we expect to largely recover in the first quarter of 2024. We estimate local currency net sales decreased approximately 1% in 2023 excluding the impact of the delayed shipments. We continue to benefit from the execution of our global sales and marketing programs, our innovative product portfolio, and investments in our field organization, particularly surrounding digital tools and techniques. However, there continues to be uncertainty in our end-markets and the economic environment, including the risk of recession in some countries, and market conditions may change quickly.

Current wording

Net sales were $3.9 billion for the year ended December 31, 2024, compared to $3.8 billion in 2023 and $3.9 billion in 2022. This represents an increase of 2% in 2024 and a decrease of 3% in 2023 in U.S. dollars and an increase of 3% in 2024 and a decrease of 3% in 2023 in local currencies. Net sales in 2023 were negatively impacted by approximately $58 million from our previously disclosed shipping delays related to a new external European logistics service provider, which were largely recovered in the first quarter of 2024. We estimate local currency net sales were flat in 2024 and decreased approximately 1% in 2023 excluding the impact of the delayed shipments. In 2024, we experienced soft market demand, particularly in China. We continue to benefit from the execution of our global sales and marketing programs, our innovative product portfolio, and investments in our field organization, particularly surrounding digital tools and techniques. However, there continues to be uncertainty in our end-markets, the economic environment and geopolitics, and market conditions may change quickly.

Previous wording

In 2023, our net sales by geographic destination decreased in U.S. dollars compared to 2022 by 1% in the Americas, 9% in Asia/Rest of World, and were flat in Europe. In local currencies, our net sales by geographic destination decreased in 2023 by 1% in the Americas, 2% in Europe, and 5% in Asia/Rest of World, with a 10% decline in China. A discussion of sales by operating segment is included below.

Current wording

In 2024, our net sales by geographic destination increased in U.S. dollars compared to 2023 by 8% in Europe, 2% in the Americas, and decreased by 3% in Asia/Rest of World. In local currencies, our net sales by geographic destination increased in 2024 by 8% in Europe, 3% in the Americas, and decreased by 1% in Asia/Rest of World, with an 11% decline in China. A discussion of sales by operating segment is included below.

Previous wording

Net sales of products decreased 7% in U.S. dollars and 6% in local currencies during 2023 and increased 5% in U.S. dollars and 10% in local currencies in 2022. Service revenue (including spare parts) increased 10% in both U.S. dollars and local currencies in 2023 and increased 6% in U.S. dollars and 12% in local currencies in 2022.

Current wording

Net sales of products increased 1% in both U.S. dollars and local currencies during 2024 and decreased 7% in U.S. dollars and 6% in local currencies in 2023. Service revenue (including spare parts) increased 7% in both U.S. dollars and local currencies in 2024 and increased 10% in both U.S. dollars and local currencies in 2023.

Previous wording

Net sales of our laboratory products and services, which represented approximately 55% of our total net sales in 2023, decreased 7% in both U.S. dollars and local currencies during 2023. The local currency decrease in net sales of our laboratory-related products during 2023 includes a decline in most product categories related to reduced market demand after two years of particularly strong growth.

Current wording

Net sales of our laboratory products and services, which represented approximately 56% of our total net sales in 2024, increased 6% in both U.S. dollars and local currencies during 2024. Laboratory net sales in 2024 benefited approximately 4% and were reduced by 2% in 2023 from the previously disclosed shipping delays. The local currency increase in net sales of our laboratory-related products during 2024 includes an increase in most product categories, especially analytical instruments. Laboratory results were also negatively impacted by a decline in China.

Previous wording

Net sales of our industrial products and services, which represented approximately 39% of our total net sales in 2023, decreased 1% in both U.S. dollars and local currencies during 2023. The local currency decrease in net sales of our industrial-related products during 2023 includes a decline in most product categories with weak market conditions in China.

Current wording

Net sales of our industrial products and services, which represented approximately 39% of our total net sales in 2024, were flat in U.S. dollars and increased 1% in local currencies during 2024. Industrial net sales in 2024 benefited approximately 1% and were reduced by 1% in 2023 from the previously disclosed shipping delays. The local currency increase in net sales of our industrial-related products during 2024 includes solid growth in product inspection, offset in part by a decline in core-industrial products, especially in China.

Previous wording

Net sales of our food retailing products and services, which represented approximately 6% of our total net sales in 2023, increased 28% in U.S. dollars and 27% in local currencies during 2023. The local currency increase in net sales of our food retailing products during 2023 includes strong project activity, especially in the Americas.

Current wording

Net sales of our food retailing products and services, which represented approximately 5% of our total net sales in 2024, decreased 14% in both U.S. dollars and local currencies during 2024. Retail net sales in 2024 benefited approximately 3% and were reduced by 2% in 2023 from previously disclosed shipping delays. The local currency decrease in net sales of our food retailing products during 2024 related to particularly strong project activity in 2023, especially in the Americas.

Previous wording

Gross profit as a percentage of net sales was 59.2% for 2023, 58.9% for 2022 and 58.4% for 2021.

Current wording

Gross profit as a percentage of net sales was 60.1% for 2024, 59.2% for 2023, and 58.9% for 2022.

Previous wording

Gross profit as a percentage of net sales for products was 60.6% for 2023, compared to 60.6% for 2022, and 60.1% for 2021. Gross profit as a percentage of net sales for services (including spare parts) was 54.3% for 2023, compared to 52.0% for 2022 and 51.8% for 2021.

Current wording

Gross profit as a percentage of net sales for products was 62.1% for 2024, compared to 60.6% for both 2023 and 2022. Gross profit as a percentage of net sales for services (including spare parts) was 53.7% for 2024, compared to 54.3% for 2023 and 52.0% for 2022.

Previous wording

The gross profit as a percentage of net sales for 2023 primarily reflects favorable price realization that benefits from our innovative product portfolio, and results from our cost savings initiatives, partially offset by lower sales volume, unfavorable mix, and foreign currency.

Current wording

The gross profit as a percentage of net sales for 2024 primarily reflects favorable price realization that benefits from our innovative product portfolio, benefits from our productivity, and cost savings initiatives and business mix, offset in part by investments in our service organization.

Previous wording

Research and development expenses as a percentage of net sales were 4.9% for 2023, 4.5% for 2022, and 4.6% for 2021. Research and development expenses in U.S. dollars increased 5% in 2023 and 4% in 2022, and in local currencies increased 3% in 2023 and 9% in 2022. The increase during 2023 relates to increased project activity.

Current wording

Research and development expenses as a percentage of net sales were 4.9% for 2024, compared to 4.9% for 2023, and 4.5% for 2022. Research and development expenses in U.S. dollars increased 2% in 2024 and 5% in 2023, and in local currencies increased 2% in 2024 and 3% in 2023.

Previous wording

Selling, general, and administrative expenses as a percentage of net sales were 23.9% for 2023, compared to 23.9% for 2022 and 25.4% for 2021. Selling, general, and administrative expenses decreased 4% in both U.S. dollars and local currencies in 2023 and decreased 1% in U.S. dollars and increased 4% in local currencies in 2022. The decrease during 2023 primarily includes benefits from our cost savings initiatives and reduced variable compensation.

Current wording

Selling, general, and administrative expenses as a percentage of net sales were 24.2% for 2024, compared to 23.9% for both 2023 and 2022. Selling, general, and administrative expenses increased 4% in both U.S. dollars and local currencies in 2024 and decreased 4% in both U.S. dollars and local currencies in 2023. The increase during 2024 primarily includes higher variable compensation, offset in part by benefits from our cost savings initiatives.

Previous wording

Amortization expense was $72.2 million in 2023, compared to $66.2 million and $63.1 million in 2022 and 2021, respectively. The increase in amortization expense during 2023 relates to our investments in information technology, primarily from our Blue Ocean program.

Current wording

Amortization expense was $72.9 million in 2024, compared to $72.2 million and $66.2 million in 2023 and 2022, respectively. The increase in amortization expense during 2024 relates to our investments in information technology, primarily from our Blue Ocean program.

Previous wording

During the past few years, we initiated various cost reduction measures. Restructuring charges were $32.7 million in 2023, compared to $9.6 million and $5.2 million in 2022 and 2021, respectively. Restructuring expenses are primarily comprised of employee-related costs.

Current wording

During the past few years, we initiated various cost reduction measures. Restructuring charges were $19.8 million in 2024, compared to $32.7 million and $9.6 million in 2023 and 2022, respectively. Restructuring expenses are primarily comprised of employee-related costs.

Previous wording

Other charges (income), net consisted of net income of $4.1 million, $9.3 million, and $3.1 million in 2023, 2022, and 2021, respectively. 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 were $7.6 million, $16.9 million, and $11.4 million in 2023, 2022, and 2021, respectively. Other charges (income), net also includes acquisition costs, for which there was $0.9 million for the year ended December 31, 2022. For the year ended December 31, 2021, $3.4 million of acquisition costs, as well as a $6.8 million charge to increase the PendoTECH acquisition contingent consideration and related obligations to the sellers, were included in other charges (income), net.

Current wording

Other charges (income), net consisted of net income of $4.6 million, $4.1 million, and $9.3 million in 2024, 2023, and 2022, respectively. 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 were $7.7 million, $7.6 million, and $16.9 million in 2024, 2023, and 2022, respectively. Other charges (income), net also includes acquisition costs, for which there were $0.3 million in 2024 and $0.9 million in 2022.

Previous wording

Interest expense was $77.4 million for 2023, compared to $55.4 million for 2022 and $43.2 million for 2021. The increase in interest expense is primarily related to higher variable interest rates and increased debt.

Current wording

Interest expense was $74.6 million in 2024, compared to $77.4 million in 2023 and $55.4 million in 2022. The decrease in interest expense is primarily related to lower debt levels throughout the year.

Previous wording

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 18 to our consolidated financial statements.

Current wording

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 Operations. A more detailed description of these segments is outlined in Note 18 to our consolidated financial statements.

Previous wording

Segment profit increased $7.3 million in our U.S. Operations segment during 2023, compared to an increase of $55.6 million during 2022. The segment profit increase in 2023 is driven by our margin expansion and cost saving initiatives, offset in part by a decline in net sales volume.

Current wording

Segment profit increased $28.0 million in our U.S. Operations segment during 2024, compared to an increase of $7.3 million during 2023. The segment profit increase in 2024 is primarily due to improved business mix, and benefits from our margin expansion and cost saving initiatives.

Previous wording

Total net sales in U.S. dollars decreased 7% in 2023 and increased 2% in 2022, and in local currencies decreased 12% in 2023 and increased 6% in 2022. Net sales to external customers in U.S. dollars increased 7% in 2023 and increased 3% in 2022, and in local currencies increased 3% in 2023 and increased 6% in 2022. Local currency net sales to external customers during 2023 includes particularly strong growth in food retailing and industrial-related products, offset in part by a decline in laboratory-related products.

Current wording

Total net sales in U.S. dollars increased 7% in 2024 and decreased 7% in 2023, and in local currencies increased 5% in 2024 and decreased 12% in 2023. Net sales to external customers in U.S. dollars increased 16% in 2024 and 7% in 2023, and in local currencies increased 14% in 2024 and increased 3% in 2023. Net sales to external customers benefited approximately 7% in 2024 and were reduced by approximately 3% in 2023 from the previously disclosed shipping delays. Local currency net sales to external customers during 2024 includes strong growth in most product categories, offset in part by a significant decline in food retailing related to strong project activity in the prior year.

Previous wording

Segment profit decreased $28.4 million in our Swiss Operations segment during 2023, compared to an increase of $8.7 million during 2022. The segment profit decrease in 2023 includes lower net sales volume to intercompany segments and unfavorable foreign currency translation, offset in part by cost savings initiatives.

Current wording

Segment profit decreased $0.8 million in our Swiss Operations segment during 2024, compared to a decrease of $28.4 million during 2023. The segment profit decrease in 2024 includes unfavorable foreign currency translation and inter-segment pricing, offset in part by higher sales volume, favorable business mix, as well as benefits from our margin expansion and cost savings initiatives.

Previous wording

Total net sales in U.S. dollars decreased 2% in 2023 and 4% in 2022, and in local currencies decreased 3% in 2023 and increased 8% in 2022. Net sales to external customers in U.S. dollars decreased 1% in 2023 and 4% in 2022, and in local currencies decreased 3% in 2023 and increased 9% in 2022. Local currency net sales to external customers during 2023 includes a decline in most product categories, especially food retailing.

Current wording

Total net sales in U.S. dollars increased 6% in 2024 and decreased 2% in 2023, and in local currencies increased 6% in 2024 and decreased 3% in 2023. Net sales to external customers in U.S. dollars increased 8% in 2024 and decreased 1% in 2023, and in local currencies increased 8% in 2024 and decreased 3% in 2023. Net sales to external customers benefited approximately 5% in 2024 and were reduced by approximately 3% in 2023 from the previously disclosed shipping delays in 2023. Local currency net sales to external customers during 2024 reflects growth in most product categories, especially laboratory products.

Previous wording

Segment profit increased $4.3 million in our Western European Operations segment during 2023, compared to an increase of $2.1 million in 2022. The segment profit increase in 2023 is primarily due to the benefits from our margin expansion initiatives and cost savings initiatives and favorable currency translation.

Current wording

Segment profit increased $27.6 million in our Western European Operations segment during 2024, compared to an increase of $4.3 million in 2023. The segment profit increase in 2024 is primarily due to increased sales volume and benefits from our margin expansion and cost savings initiatives.

Previous wording

Total net sales in U.S. dollars decreased 13% in 2023 and increased 8% in 2022, and in local currencies decreased 9% in 2023 and increased 13% in 2022. Net sales by origin to external customers in U.S. dollars decreased 15% in 2023 and increased 9% in 2022, and in local currencies decreased 11% in 2023 and increased 13% in 2022. The decrease in local currency net sales to external customers during 2023 reflects a significant decline in market demand during the second half of 2023, especially in laboratory products following very strong growth in the previous two years. Market demand in China has significantly deteriorated, and we expect reduced sales during the first half of 2024 as compared to 2023. Uncertainties have increased, and market conditions may change quickly.

Current wording

Total net sales in U.S. dollars decreased 5% in 2024 and 13% in 2023, and in local currencies decreased 3% in 2024 and 9% in 2023. Net sales by origin to external customers in U.S. dollars decreased 13% in 2024 and 15% in 2023, and in local currencies decreased 11% in both 2024 and 2023. Net sales to external customers benefited approximately 1% in 2024 and were reduced by approximately 1% in 2023 from the previously disclosed shipping delays in 2023. The decrease in local currency net sales to external customers during 2024 reflects a significant decline in market demand for most product categories. Uncertainties continue to exist and market conditions may change quickly.

Previous wording

Segment profit decreased $57.1 million in our Chinese Operations segment during 2023, compared to an increase of $54.3 million in 2022. The decrease in segment profit during 2023 primarily reflects lower sales volume and unfavorable currency translation, offset partially by benefits from our margin expansion and cost savings initiatives.

Current wording

Segment profit decreased $21.3 million in our Chinese Operations segment during 2024, compared to a decrease of $57.1 million in 2023. The decrease in segment profit during 2024 primarily reflects lower sales volume and unfavorable foreign currency translation, partially offset by benefits from our margin expansion and cost savings initiatives.

Previous wording

Other includes reporting units in Southeast Asia, Latin America, Eastern Europe, and other countries. Total net sales in U.S. dollars increased 6% in 2023 and were flat in 2022, and in local currencies increased 7% in 2023 and 8% in 2022. Net sales to external customers in U.S. dollars increased 4% in 2023 and were flat in 2022, and in local currencies increased 5% in 2023 and 8% in 2022. The increase in local currency growth in net sales to external customers during 2023 includes solid growth in most product categories.

Current wording

Other Operations includes reporting units in Southeast Asia, Latin America, Eastern Europe, and other countries. Total net sales in U.S. dollars increased 8% in 2024 and 6% in 2023, and in local currencies increased 10% in 2024 and 7% in 2023. Net sales to external customers in U.S. dollars increased 8% in 2024 and 4% in 2023, and in local currencies increased 10% in 2024 and 5% in 2023. Net sales to external customers benefited approximately 4% in 2024 and were reduced by approximately 2% in 2023 from the previously disclosed shipping delays in 2023. The increase in local currency growth in net sales to external customers during 2024 includes strong growth in most product categories.

Previous wording

Segment profit increased $15.9 million in our Other segment during 2023, compared to a decrease of $9.7 million during 2022. The increase in segment profit during 2023 primarily relates to increased sales volume and our margin expansion initiatives.

Current wording

Segment profit increased $17.9 million in our Other Operations segment during 2024, compared to an increase of $15.9 million during 2023. The increase in segment profit during 2024 primarily relates to increased sales volume and our margin expansion initiatives, offset in part by unfavorable foreign currency translation.

Previous wording

Cash provided by operating activities totaled $965.9 million in 2023, compared to $859.1 million in 2022 and $908.8 million in 2021. The increase in 2023 is primarily related to favorable working capital, the timing of tax payments, and lower cash incentive payments of $20 million.

Current wording

Cash provided by operating activities totaled $968.3 million in 2024, compared to $965.9 million in 2023 and $859.1 million in 2022. The increase in 2024 is primarily related to favorable working capital, including lower cash incentive payments of $35 million.

Previous wording

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 $105.3 million in 2023, $121.2 million in 2022, and $107.6 million in 2021. Capital expenditures in 2024 are expected to be relatively consistent with 2023 subject to business and economic conditions.

Current wording

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 $103.9 million in 2024, $105.3 million in 2023, and $121.2 million in 2022. Capital expenditures in 2025 are expected to be relatively consistent with previous years subject to business and economic conditions.

Previous wording

In September 2021, the Company entered into an agreement with the U.S. Department of Defense to increase domestic production capacity of pipette tips and enhance manufacturing automation and logistics. As of December 31, 2023, we have received the maximum allowable funding of $35.8 million related to the agreement, which offset associated capital expenditures.

Current wording

In September 2021, the Company entered into an agreement with the U.S. Department of Defense to increase domestic production capacity of pipette tips and enhance manufacturing automation and logistics. We received the maximum allowable funding of $35.8 million related to the agreement during prior years, which offset associated capital expenditures.