Item 15. Exhibits and Financial Statement Schedules

(a) Exhibits, Financial Statements, and Schedules:

1. Financial Statements. See Index to Consolidated Financial Statements included on page F-1.

2. Financial Statement Schedule. See Schedule II, which is included on page S-1.

3. List of Exhibits. See Exhibit Index included on page E-1.

SIGNATURES

Pursuant to the requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Mettler-Toledo International Inc.

(Registrant)

Date: February 8, 2018

By:	/s/ Olivier A. Filliol
	Olivier A. Filliol
	President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the registrant as of the date set out above and in the capacities indicated.

Signature		Title
/s/ Olivier A. Filliol		President and Chief Executive Officer
Olivier A. Filliol
/s/ William P. Donnelly		Executive Vice President
William P. Donnelly
/s/ Shawn P. Vadala		Chief Financial Officer
Shawn P. Vadala
/s/ Olivier A. Filliol		Director
Olivier A. Filliol
/s/ Wah-Hui Chu		Director
Wah-Hui Chu
/s/ Francis A. Contino		Director
Francis A. Contino
/s/ Elisha Finney		Director
Elisha Finney
/s/ Richard Francis		Director
Richard Francis
/s/ Connie L. Harvey		Director
Connie L. Harvey
/s/ Michael A. Kelly		Director
Michael A. Kelly
/s/ Hans Ulrich Maerki		Director
Hans Ulrich Maerki
/s/ Thomas P. Salice		Director
Thomas P. Salice
/s/ Robert F. Spoerry		Director
Robert F. Spoerry

EXHIBIT INDEX

Exhibit
No.	Description
3.1	Amended and Restated Certificate of Incorporation of the Company (1)
3.2	Amended By-laws of the Company, effective as of November 3, 2016 (2)
10.1	Credit Agreement among Mettler-Toledo International Inc., certain of its subsidiaries, JPMorgan Chase Bank, N.A., J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, and certain other financial institutions, dated as of December 17, 2015 (3)
10.11	Note Purchase Agreement dated as of October 10, 2012 by and among Mettler-Toledo International Inc., Massachusetts Mutual Life Insurance Company, C.M. Life Insurance Company, MassMutual Asia Limited, The Lincoln National Life Insurance Company, Lincoln Life & Annuity Company of New York and Aviva Life and Annuity Company Royal Neighbors of America (4)
10.12	Note Purchase Supplement dated July 29, 2013 by and among Mettler-Toledo International Inc., Aviva Life and Annuity Company and Teachers Insurance and Annuity Association of America to a Note Purchase Agreement dated October 10, 2012 by and among Mettler-Toledo International Inc., Massachusetts Mutual Life Insurance Company, C.M. Life Insurance Company, MassMutual Asia Limited, The Lincoln National Life Insurance Company, Lincoln Life & Annuity Company of New York and Aviva Life and Annuity Company Royal Neighbors of America (5)
10.13	Note Purchase Agreement dated as of June 27, 2014 by and among Mettler-Toledo International Inc., Babson Capital Management LLC, Cigna Investments, Inc. and Teachers Insurance and Annuity Association of America (6)
10.14	Note Purchase Agreement dated as of March 31, 2015 by and among Mettler-Toledo International Inc., Metropolitan Life Insurance Company, MetLife Insurance Company USA, OMI MLIC Investments Limited and Massachusetts Mutual Life Insurance Company (7)
10.20	Mettler-Toledo International Inc. 2004 Equity Incentive Plan (8)
10.21	Mettler-Toledo International Inc. 2007 Share Plan, effective February 7, 2008 (9)
10.22	Mettler-Toledo International Inc. 2013 Equity Incentive Plan (10)
10.23	Form of Restricted Stock Unit Agreement (11)
10.24	Form of Performance Share Unit Agreement (11)
10.25	Performance Stock Option Agreement (11)
10.26	Form of Stock Option Agreement Directors (11)
10.27	Form of Stock Option Agreement CEO (11)
10.28	Form of Stock Option Agreement NEOs (11)
10.31	Regulations of the POBS PLUS — Incentive Scheme for Senior Management of Mettler Toledo, effective as of November, 2006 (12)
10.32	Regulations of the POBS PLUS — Incentive Scheme for Members of the Group Management of Mettler Toledo, effective as of January, 2009 (12)
10.50*	Employment Agreement between Peter Aggersbjerg and Mettler-Toledo International Inc., dated as of December 15, 2017
10.51	Employment Agreement between Marc de La Guéronnière and Mettler-Toledo International Inc., dated as of January 27, 2011 (13)
10.52	Employment Agreement between William Donnelly and Mettler-Toledo GmbH, dated as of November 10, 1997 (1)
10.53	Employment Agreement between Olivier Filliol and Mettler-Toledo International Inc., dated as of November 1, 2007 (14)
10.54	Employment Agreement between Michael Heidingsfelder and Mettler-Toledo International Inc., dated as of November 30, 2011 (16)
10.55	Employment Agreement between Simon Kirk and Mettler-Toledo International Inc., dated as of November 28, 2011 (16)
10.56	Employment Agreement between Christian Magloth and Mettler-Toledo International Inc., dated as of March 22, 2010 (13)
10.57	Employment Agreement between Waldemar Rauch and Mettler-Toledo International Inc., dated as of June 10, 2011 (15)
10.59	Employment Agreement between Shawn P. Vadala and Mettler-Toledo International Inc., dated as of October 24, 2016 (11)
10.60	Form of Tax Equalization Agreement between Messrs. Caratsch, Filliol, Kirk, Magloth, and Spoerry, and Mettler-Toledo International Inc., dated October 10, 2007 (9)
10.61	Amendment to Employment Agreement between William Donnelly and Mettler-Toledo International, Inc. dated November 3, 2016 (2)
21*	Subsidiaries of the Company
23.1*	Consent of PricewaterhouseCoopers LLP

E- 1

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
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

---

(1)	Incorporated by reference to the Company’s Report on Form 10-K dated March 13, 1998

(2)	Incorporated by reference to the Company’s Report on Form 8-K dated November 8, 2016

(3)	Incorporated by reference to the Company’s Report on Form 8-K dated December 18, 2015

(4)	Incorporated by reference to the Company's Report on Form 8-K dated October 16, 2012

(5)	Incorporated by reference to the Company's Report on Form 8-K dated July 29, 2013

(6)	Incorporated by reference to the Company's Report on Form 8-K dated July 2, 2014

(7)	Incorporated by reference to the Company's Report on Form 8-K dated March 31, 2015

(8)	Incorporated by reference to the Company’s Form DEF 14-A filed March 29, 2004

(9)	Incorporated by reference to the Company’s Report on Form 10-K dated February 15, 2008

(10)	Incorporated by reference to the Company's Registration Statement on Form S-8 dated July 26, 2013 (Reg. No. 333-190181)

(11)	Incorporated by reference to the Company’s Report on Form 10-K dated February 2, 2017

(12)	Incorporated by reference to the Company’s Report on Form 10-K dated February 13, 2009

(13)	Incorporated by reference to the Company's Report on Form 10-K dated February 16, 2011

(14)	Incorporated by reference to the Company’s Report on Form 8-K dated November 1, 2007

(15)	Incorporated by reference to the Company's Report on Form 10-K dated February 13, 2012

(16)	Incorporated by reference to the Company's Report on Form 10-K dated February 8, 2013

*	Filed herewith

E- 2

METTLER-TOLEDO INTERNATIONAL INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Page
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Statements of Operations for the years ended December 31, 2017, 2016, and 2015	F-4
Consolidated Statements of Comprehensive Income for the years ended December 31, 2017, 2016, and 2015	F-5
Consolidated Balance Sheets as of December 31, 2017 and 2016	F-6
Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2017, 2016, and 2015	F-7
Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016, and 2015	F-8
Notes to the Consolidated Financial Statements	F-9

F-1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Mettler-Toledo International Inc.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Mettler-Toledo International Inc. and its subsidiaries as of December 31, 2017 and 2016 and the related consolidated statements of operations, comprehensive income, shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2017, including the related notes and schedule of valuation and qualifying accounts for each of the three years in the period ended December 31, 2017 appearing on page S-1 (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2017 and 2016 and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2017 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017 based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Change in Accounting Principle

As discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it accounts for the excess tax benefits from stock option exercises in 2017.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and

F-2

operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP

Columbus, Ohio

February 8, 2018

We have served as the Company’s auditor since 2005.

F-3

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

For the years ended December 31

(In thousands, except share data)

	2017				2016				2015
Net sales
Products	$	2,135,051			$	1,957,879			$	1,865,884
Service	590,002				550,378				529,563
Total net sales	2,725,053				2,508,257				2,395,447
Cost of sales
Products	833,793				767,753				744,867
Service	317,947				304,917				298,587
Gross profit	1,573,313				1,435,587				1,351,993
Research and development	129,265				119,968				119,076
Selling, general, and administrative	787,464				732,622				700,810
Amortization	42,671				36,052				30,951
Interest expense	32,785				28,026				27,451
Restructuring charges	12,772				6,235				11,148
Other charges (income), net	(5,866		)		8,491				(867		)
Earnings before taxes	574,222				504,193				463,424
Provision for taxes	198,250				119,823				110,604
Net earnings	$	375,972			$	384,370			$	352,820
Basic earnings per common share:
Net earnings	$	14.62			$	14.49			$	12.75
Weighted average number of common shares	25,713,575				26,517,768				27,680,918
Diluted earnings per common share:
Net earnings	$	14.24			$	14.22			$	12.48
Weighted average number of common and common equivalent shares	26,393,783				27,023,905				28,269,615

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

F-4

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the years ended December 31

(In thousands, except share data)

	2017				2016				2015
Net earnings	$	375,972			$	384,370			$	352,820
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment	83,982				(57,928		)		(52,434		)
Unrealized gains (losses) on cash flow hedging arrangements:
Unrealized gains (losses)	1,424				(513		)		13,221
Effective portion of (gains) losses included in net earnings	(273		)		(4,735		)		(8,261		)
Defined benefit pension and post-retirement plans:
Net actuarial gains (losses)	(10,378		)		(47,788		)		(30,759		)
Plan amendments and prior service cost	12,056				—				9,189
Amortization of actuarial (gains) losses and plan amendments and prior service cost	14,873				16,730				9,509
Impact of foreign currency	(12,092		)		5,885				5,835
Total other comprehensive income (loss), net of tax	89,592				(88,349		)		(53,700		)
Comprehensive income	$	465,564			$	296,021			$	299,120

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

F-5

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED BALANCE SHEETS

As of December 31

(In thousands, except share data)

	2017				2016
ASSETS
Current assets:
Cash and cash equivalents	$	148,687			$	158,674
Trade accounts receivable, less allowances of $15,549 in 2017 and $14,234 in 2016	528,615				454,988
Inventories	255,390				222,047
Other current assets and prepaid expenses	74,031				61,075
Total current assets	1,006,723				896,784
Property, plant, and equipment, net	668,271				563,707
Goodwill	539,838				476,378
Other intangible assets, net	226,718				167,055
Deferred tax assets, net	41,425				33,951
Other non-current assets	66,830				28,902
Total assets	$	2,549,805			$	2,166,777
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Trade accounts payable	$	167,627			$	146,593
Accrued and other liabilities	152,834				133,167
Accrued compensation and related items	170,159				140,461
Deferred revenue and customer prepayments	107,166				100,330
Taxes payable	72,210				47,990
Short-term borrowings and current maturities of long-term debt	19,677				18,974
Total current liabilities	689,673				587,515
Long-term debt	960,170				875,056
Deferred tax liabilities, net	51,230				64,306
Other non-current liabilities	301,452				204,957
Total liabilities	2,002,525				1,731,834
Commitments and contingencies (Note 16)
Shareholders’ equity:
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; issued 44,786,011 and 44,786,011 shares, outstanding 25,541,393 and 26,020,234 shares at December 31, 2017 and 2016, respectively	448				448
Additional paid-in capital	747,138				730,556
Treasury stock at cost (19,244,618 and 18,765,777 shares at December 31, 2017 and 2016, respectively)	(3,368,182		)		(3,006,771		)
Retained earnings	3,433,282				3,065,708
Accumulated other comprehensive income (loss)	(265,406		)		(354,998		)
Total shareholders’ equity	547,280				434,943
Total liabilities and shareholders’ equity	$	2,549,805			$	2,166,777

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

F-6

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

For the years ended December 31

(In thousands, except share data)

	Common Stock							Additional Paid-In Capital				Treasury Stock				Retained Earnings				Accumulated Other Comprehensive Income (Loss)				Total
	Shares			Amount
Balance at December 31, 2014	28,243,007			$	448			$	670,418			$	(2,095,656	)		$	2,357,334			$	(212,949	)		$	719,595
Exercise of stock options and restricted stock units	403,908			—				—				47,393				(17,837		)		—				29,556
Repurchases of common stock	(1,556,797	)		—				—				(494,966		)		—				—				(494,966		)
Tax benefit resulting from exercise of certain employee stock options	—			—				12,929				—				—				—				12,929
Share-based compensation	—			—				14,223				—				—				—				14,223
Net earnings	—			—				—				—				352,820				—				352,820
Other comprehensive income (loss), net of tax	—			—				—				—				—				(53,700		)		(53,700		)
Balance at December 31, 2015	27,090,118			$	448			$	697,570			$	(2,543,229	)		$	2,692,317			$	(266,649	)		$	580,457
Exercise of stock options and restricted stock units	278,623			—				—				36,450				(10,979		)		—				25,471
Repurchases of common stock	(1,348,507	)		—				—				(499,992		)		—				—				(499,992		)
Tax benefit resulting from exercise of certain employee stock options	—			—				17,680				—				—				—				17,680
Share-based compensation	—			—				15,306				—				—				—				15,306
Net earnings	—			—				—				—				384,370				—				384,370
Other comprehensive income (loss), net of tax	—			—				—				—				—				(88,349		)		(88,349		)
Balance at December 31, 2016	26,020,234			$	448			$	730,556			$	(3,006,771	)		$	3,065,708			$	(354,998	)		$	434,943
Exercise of stock options and restricted stock units	270,413			—				—				38,586				(9,937		)		—				28,649
Repurchases of common stock	(749,254	)		—				—				(399,997		)		—				—				(399,997		)
Share-based compensation	—			—				16,582				—								—				16,582
Effect of accounting change (Note 2)	—			—								—				1,539				—				1,539
Net earnings	—			—				—				—				375,972				—				375,972
Other comprehensive income (loss), net of tax	—			—				—				—				—				89,592				89,592
Balance at December 31, 2017	25,541,393			$	448			$	747,138			$	(3,368,182	)		$	3,433,282			$	(265,406	)		$	547,280

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

F-7

METTLER-TOLEDO INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the years ended December 31

(In thousands)

	2017				2016				2015
Cash flows from operating activities:
Net earnings	$	375,972			$	384,370			$	352,820
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation	33,458				32,743				33,087
Amortization	42,671				36,052				30,951
Deferred tax (benefit) provision	(2,745		)		1,878				7,137
Share-based compensation	16,582				15,306				14,223
Provisional one-time charge on US tax reform (see Note 13)	71,982				—				—
Gain on facility sale	(3,394		)		—				—
Non-cash pension settlement charge	—				8,189				—
Other	243				181				155
Increase (decrease) in cash resulting from changes in:
Trade accounts receivable, net	(38,985		)		(52,151		)		1,625
Inventories	(13,680		)		(12,431		)		(18,785		)
Other current assets	(6,251		)		291				(5,119		)
Trade accounts payable	11,885				9,633				1,698
Taxes payable	13,615				(3,072		)		2,879
Accruals and other	14,972				39,769				19,126
Net cash provided by operating activities	516,325				460,758				439,797
Cash flows from investing activities:
Proceeds from sale of property, plant, and equipment	11,973				423				949
Purchase of property, plant, and equipment	(127,426		)		(123,957		)		(82,506		)
Acquisitions	(108,445		)		(111,381		)		(13,779		)
Net hedging settlements on intercompany loans	6,554				3,459				(5,415		)
Net cash used in investing activities	(217,344		)		(231,456		)		(100,751		)
Cash flows from financing activities:
Proceeds from borrowings	1,244,195				905,774				741,864
Repayments of borrowings	(1,185,172		)		(594,178		)		(594,477		)
Proceeds from exercise of stock options	28,649				25,471				29,556
Repurchases of common stock	(399,997		)		(499,992		)		(494,966		)
Acquisition contingent consideration paid	—				(471		)		(572		)
Other financing activities	(7,205		)		(209		)		(1,366		)
Net cash used in financing activities	(319,530		)		(163,605		)		(319,961		)
Effect of exchange rate changes on cash and cash equivalents	10,562				(5,910		)		(5,461		)
Net increase (decrease) in cash and cash equivalents	(9,987		)		59,787				13,624
Cash and cash equivalents:
Beginning of period	158,674				98,887				85,263
End of period	$	148,687			$	158,674			$	98,887
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest	$	33,333			$	28,025			$	27,303
Taxes	$	109,730			$	92,586			$	85,458

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

F-8

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

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

1.	BUSINESS DESCRIPTION AND BASIS OF PRESENTATION

Mettler-Toledo International Inc. (“Mettler-Toledo” or the “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, Switzerland, the United States, Germany, the United Kingdom, and Mexico. The Company’s principal executive offices are located in Columbus, Ohio and Greifensee, Switzerland.

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include all entities in which the Company has control, which are its wholly-owned subsidiaries.

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. Actual results may differ from those estimates.

All intercompany transactions and balances have been eliminated.

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash and Cash Equivalents

Cash and cash equivalents include highly liquid investments with original maturity dates of three months or less. The carrying value of these cash equivalents approximates fair value.

Trade Accounts Receivable

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts represents the Company’s best estimate of probable credit losses in its existing trade accounts receivable. The Company determines the allowance based upon a review of both specific accounts for collection and the age of the accounts receivable portfolio.

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.

F-9

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

Long-Lived Assets

a)	Property, Plant, and Equipment

Property, plant, and equipment are stated at cost less accumulated depreciation. Repair and maintenance costs are charged to expense as incurred. The Company expenses all internal-use software costs incurred in the preliminary project stage and capitalizes certain direct costs associated with the development and purchase of internal-use software within property, plant, and equipment. Capitalized costs are amortized on a straight-line basis over the estimated useful lives of the software, generally not exceeding 10 years.

Depreciation and amortization are charged on a straight-line basis over the estimated useful lives of the assets as follows:

Buildings and improvements	15 to 50 years
Machinery and equipment	3 to 12 years
Computer software	3 to 10 years
Leasehold improvements	Shorter of useful life or lease term

b)	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 evaluations of 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.

If the Company is unable to conclude whether the goodwill asset is not impaired after considering the totality of events and circumstances during its qualitative assessment, the Company performs the first step of the two-step impairment test by estimating the fair value of the goodwill asset and comparing the fair value to the carrying amount of the goodwill asset. If the carrying amount of the goodwill asset exceeds its fair value, then the Company performs the second step of the impairment test to measure the amount of the impairment loss, if any.

If the Company is unable to conclude whether the indefinite-lived intangible asset is not impaired after considering the totality of events and circumstances, the Company performs an impairment test to measure the amount of the impairment loss, if any.

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 to be benefited. 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."

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

Accounting for Impairment of Long-Lived Assets

The Company assesses the need to record impairment losses on long-lived assets with finite lives when events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. An impairment loss would be recognized when future estimated undiscounted cash flows expected to result from use of the asset are less than the asset’s carrying value, with the loss measured as the difference between carrying value and estimated fair value.

Taxation

The Company files tax returns in each jurisdiction in which it operates. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities, their respective tax bases, and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in the respective jurisdictions in which the Company operates. In assessing the ability to realize deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Deferred taxes are not provided on the unremitted earnings of subsidiaries outside of the United States when it is expected that these earnings are permanently reinvested. Such earnings may become taxable upon the sale or liquidation of these subsidiaries or upon the remittance of dividends. Deferred taxes are provided when the Company no longer considers subsidiary earnings to be permanently invested, such as in situations where the Company’s subsidiaries plan to make future dividend distributions.

The Company recognizes accrued amounts of interest and penalties related to its uncertain tax positions as part of income tax expense within its consolidated statement of operations.

Currency Translation and Transactions

The reporting currency for the consolidated financial statements of the Company is the U.S. dollar. The functional currency for the Company’s operations is generally the applicable local currency. Accordingly, the assets and liabilities of companies whose functional currency is other than the U.S. dollar are included in the consolidated financial statements by translating the assets and liabilities into the reporting currency at the exchange rates applicable at the end of the reporting period. The statements of operations and cash flows of such non-U.S. dollar functional currency operations are translated at the monthly average exchange rates during the year. Translation gains or losses are accumulated in other comprehensive income (loss) in the consolidated statements of shareholders’ equity. Transaction gains and losses are included as a component of net earnings or in certain circumstances as a component of other comprehensive income (loss) where the underlying item is considered a hedge of a net investment or intercompany notes that are long-term in nature.

Revenue Recognition

Revenue is recognized when title to a product has transferred and any significant customer obligations have been fulfilled. Standard shipping terms are generally FOB shipping point in most countries and, accordingly, title and risk of loss transfer upon shipment. In countries where title cannot legally transfer before delivery, the Company defers revenue recognition until delivery has occurred. 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. Shipping and handling costs charged to

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

customers are included in total net sales and the associated expense is recorded in cost of sales for all periods presented. Other than a few small software applications, the Company does not sell software products without the related hardware instrument as the software is embedded in the instrument. 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. To the extent the Company’s solutions have a significant post-shipment obligation, revenue is deferred on the undelivered element until the obligation has been completed. The Company defers the installation portion of product revenue when installation is required, unless such installation is deemed perfunctory. The Company also sometimes enters into certain arrangements that require the separate delivery of multiple goods and/or services. These deliverables are accounted for separately if the deliverables have stand-alone value and the performance of undelivered items is probable and within the Company's control. The allocation of revenue between the separate deliverables is typically based on the relative selling price at the time of the sale in accordance with a number of factors including service technician billing rates, time to install, and geographic location.

Certain products are also sold through indirect distribution channels whereby the distributor assumes any further obligations to the customer upon title transfer. Revenue is recognized on these products upon transfer of title and risk of loss to distributors. Distributor discounts are offset against revenue at the time such revenue is recognized.

Service revenue not under contract is recognized upon the completion of the service performed. Spare parts sold on a stand-alone basis are recognized upon title and risk of loss transfer which are generally at the time of shipment. Revenues from service contracts are recognized ratably over the contract period. 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. Service contracts are separately priced and payment is typically received from the customer at the beginning of the contract period.

Research and Development

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

Warranty

The Company generally offers one-year warranties on most of its products. Product warranties are recorded at the time revenue is recognized. While the Company engages in extensive product quality programs and processes, its warranty obligations are affected by product failure rates, material usage, and service costs incurred in correcting a product failure.

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 beyond the legal notification period, in which case the liability is recognized ratably over the future service period.

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

Earnings per Common Share

In accordance with the treasury stock method, the Company has included 680,208, 506,137, and 588,697 common equivalent shares in the calculation of diluted weighted average number of common shares for the years ended December 31, 2017, 2016, and 2015, respectively, relating to outstanding stock options and restricted stock units. The determination of the common share equivalents for 2017 includes the effect of the adoption of guidance ASU 2016-09 as described in Note 2.

Outstanding options and restricted stock units to purchase or receive 9,824, 102,017, and 112,562 shares of common stock for the years ended December 31, 2017, 2016, and 2015, respectively, 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.

Equity-Based Compensation

The Company applies the fair value methodology in accounting for its equity-based compensation plan.

Derivative Financial Instruments

The Company has limited involvement with derivative financial instruments and does not use them for trading purposes. As described more fully in Note 5, the Company enters into foreign currency forward exchange contracts to economically hedge certain short-term intercompany balances involving its international businesses. Such contracts limit the Company’s exposure to currency fluctuations on the items they hedge. These contracts are adjusted to fair market value as of each balance sheet date, with the resulting changes in fair value being recognized in other charges (income), consistent with the underlying hedged item.

The Company also enters into interest rate swap agreements and cross currency swaps in order to manage its exposure to changes in interest rates. The differential paid or received on interest rate swap agreements is recognized in interest expense over the life of the agreements as incurred. Floating to fixed interest rate swap agreements are accounted for as cash flow hedges. Changes in fair value of outstanding interest rate swap agreements that are effective as cash flow hedges are recognized in other comprehensive income as incurred.

Fair Value Measurements

The Company measures or monitors certain assets and liabilities on a fair value basis. Fair value is used on a recurring basis for assets and liabilities in which fair value is the primary basis of accounting, mainly derivative instruments. 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. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability. The Company applies the fair value hierarchy established under U.S. GAAP and when possible looks to active and observable markets to price identical assets and liabilities. If identical assets and liabilities are not traded in active markets, the Company looks to observable market data for similar assets and liabilities.

F-13

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

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. 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 January 2017, the Company adopted ASU 2016-09 to ASC 718 "Compensation - Stock Compensation." The primary impact of adoption was the recognition of excess tax benefits from stock option exercises within the provision for taxes rather than within shareholder's equity and a change in the determination of diluted earnings per common share. The Company adopted the guidance on a prospective basis, and the impact reduced the annual tax rate by 2% in 2017. In addition, the Company recognized additional deferred net tax assets of $1.5 million as a cumulative adjustment within shareholder's equity. The Company also classified on a retrospective basis the excess tax benefits from stock option exercises of $17.7 million and $12.9 million as operating activities in the prior period Statements of Cash Flows. For additional disclosure, see Note 13 to the consolidated financial statements.

In 2014, the FASB issued ASC 606 "Revenue from Contracts with Customers." ASC 606 provides authoritative guidance clarifying the principles for recognizing revenue under U.S. GAAP. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled, in exchange for those goods and services. The Company has completed its assessment of the new standard and expects the impact on its consolidated financial statements to be immaterial. Most of the Company's performance obligations are satisfied at the time the customer takes title, control, and risk of loss of the asset, which is generally upon shipment. The Company does not have variable pricing arrangements that are retrospective (except for rebate programs) or represent a material right to its customers. For transactions with multiple performance obligations, the new standard will not change the timing of revenue recognition or the allocation of the transaction price as the related goods and services are also sold separately and as such have standalone selling prices. Service contracts are recognized ratably over the contract period, which does not exceed a year. The guidance becomes effective for the year beginning January 1, 2018 and the Company will adopt the guidance using the modified retrospective approach.

In March 2017, the FASB issued ASU 2017-7 to ASC 715 "Compensation - Retirement Benefits," which will require the Company to report the non-service cost components of net periodic benefit cost in other charges (income), net. The new guidance must be applied retrospectively and becomes effective for the year beginning January 1, 2018. The non-service costs in 2017 and 2016 were a net benefit of $4.1 million and $9.8 million, respectively. The Company will reclass these amounts from selling, general, and administrative and cost of sales to other charges (income), net in the consolidated statement of operations.

In February 2016, the FASB issued ASU 2016-02 to ASC 842 "Leases." The accounting guidance primarily requires lessees to recognize most leases on their balance sheet as a right to use asset and a lease

F-14

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

liability, with the exception of short-term leases. A lessee will continue to recognize lease expense on a straight-line basis for leases classified as operating leases. The guidance will be adopted in 2019 and the Company is evaluating the adoption method it will elect upon implementation. The Company is in the process of reviewing all the current lease data and evaluating the impact of the adoption on the financial statements.

In August 2017, the FASB issued ASU 2017-12 to ASC 815 "Derivatives and Hedging," which modifies hedge accounting by making more hedge strategies eligible for hedge accounting, amending presentation and disclosure requirements, and changing how companies assess effectiveness. The intent is to simplify the application of hedge accounting and increase transparency of information about an entity’s risk management activities. The amended guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company early adopted the guidance which did not have an impact on the Company's consolidated results of operations and financial position.

3. ACQUISITIONS

In September 2017, the Company acquired all of the shares of Biotix, Inc., a manufacturer and distributor of plastic consumables associated with pipettes, including tips, tubes, and reagent reservoirs used in the life sciences market, based in the United States. The initial cash payment was $105 million and the Company may be required to pay additional cash consideration up to a maximum amount of $65 million based upon earnings thresholds in 2018 and 2019. The estimated fair value of the contingent consideration obligation at the acquisition date of $30.7 million relating to the Biotix acquisition was determined using a Monte Carlo simulation based on the Company's forecast of future results. Goodwill recorded in connection with the acquisition totaled $51.7 million, which is included in the Company's U.S. Operations segment. Identified intangible finite-life assets acquired include customer relationships of $49.5 million, technology and patents of $8.0 million, indefinite life tradenames of $7.1 million, and other intangibles of $0.6 million. The identifiable finite-life intangible assets will be amortized on a straight-line basis over periods ranging from 5 to 18 years and the annual aggregate amortization expense is estimated at $3.7 million. Net tangible assets acquired were $18.8 million and recorded at fair value in the consolidated financial statements.

In 2017, the Company also incurred additional acquisition payments totaling $3.8 million. Goodwill recorded in connection with these acquisitions totaled $0.3 million. The Company recorded $3.1 million of identified intangibles primarily pertaining to technology and patents in connection with these acquisitions, which will be amortized on a straight-line basis over 12 years.

In 2016, the Company acquired substantially all of the assets of Henry Troemner, LLC (Troemner), a supplier of lab equipment, weights, and weight calibration based in the United States for an aggregate purchase price of $95.8 million, which has been included into the Company's laboratory instrument offering. Goodwill recorded in connection with the acquisition totaled $33.8 million, which is included in the Company's U.S. Operations segment. The Company identified intangible assets which included customer relationships of $43.9 million, a tradename of $3.4 million, technology and patents of $2.9 million, and other intangibles of $0.5 million. The identifiable intangible assets will be amortized on a straight-line basis over periods ranging from 3 to 25 years and the annual aggregate amortization expense is estimated at $2.7 million. Net tangible assets acquired were $11.3 million and were recorded at estimated fair value in the consolidated financial statements at the acquisition date.

F-15

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

In 2016, the Company also incurred additional acquisition payments totaling $15.6 million. Goodwill recorded in connection with these acquisitions totaled $7.5 million. The Company also recorded $9.4 million of identified intangibles primarily pertaining to customer relationships in connection with these acquisitions, which will be amortized on a straight-line basis over 10 to 15 years.

4. INVENTORIES

Inventory consisted of the following at December 31:

	2017				2016
Raw materials and parts	$	118,790			$	100,408
Work-in-progress	43,035				41,454
Finished goods	93,565				80,185
Total inventory	$	255,390			$	222,047

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 swap agreements in order to manage its exposure to changes in interest rates. At December 31, 2017, the interest payments associated with 77% of the Company's debt are fixed obligations. The amount of the Company's fixed obligation interest payments may change based upon the expiration dates of its interest rate swap agreement 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. As also mentioned in Note 9, the Company has designated its euro-denominated debt as a hedge of a portion of its net investment in a euro-denominated foreign subsidiary. For additional disclosures on the fair value of financial instruments, see Note 6.

Cash Flow Hedges

In June 2017, the Company entered into a cross currency swap arrangement designated as a cash flow hedge. The agreement converts $100 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 payment to a fixed Swiss franc income of 0.01%. The swap began in June 2017 and matures in June 2019.

The Company has an interest rate swap agreement designated as a cash flow hedge. The agreement is a swap which has the effect of changing the floating rate LIBOR-based interest payments associated with $50 million in borrowings under the Company's credit agreement to a fixed obligation of 2.52% beginning in October 2015 and matures in October 2020.

In March 2015, the Company entered into a forward-starting interest rate swap agreement. The

agreement changes the floating rate LIBOR-based interest payments associated with $100 million in

borrowings under the Company's credit agreement to a fixed obligation of 2.25% beginning in

February 2017 and matures in February 2022.

The Company's cash flow hedges are recorded gross at fair value in the consolidated balance sheet at December 31, 2017 and 2016 and disclosed in Note 6 to the consolidated financial statements. Amounts reclassified into other comprehensive income and the effective portions of the cash flow hedges are further disclosed in Note 10 to the consolidated financial statements. A derivative gain of $2.0 million

F-16

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

based upon interest rates at December 31, 2017 is expected to be reclassified from other comprehensive income (loss) to earnings in the next 12 months. Through December 31, 2017, no hedge ineffectiveness has occurred in relation to these cash flow hedges.

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 December 31, 2017 and 2016, as disclosed in Note 6 to the consolidated financial statements. The Company recognized in other charges (income), a net gain of $9.4 million and a net loss of $3.3 million during the years ended December 31, 2017 and 2016, respectively, which offset the related transaction gains (losses) associated with these contracts. At December 31, 2017 and 2016, these contracts had a notional value of $394.8 million and $353.0 million, respectively.

The Company may be exposed to credit losses in the event of nonperformance by the counterparties to its derivative financial instrument contracts. Counterparties are established banks and financial institutions with high credit ratings. The Company believes that such counterparties will be able to fully satisfy their obligations under these contracts.

6. FAIR VALUE MEASUREMENTS

At December 31, 2017 and 2016, the Company had derivative assets totaling $1.9 million and $0.8 million, respectively, and derivative liabilities totaling $2.4 million and $5.8 million, respectively. The fair values of the interest rate swap agreements, the cross currency swap agreement, 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 for the years ended December 31, 2017 and 2016.

The Company had $5.6 million and $21.5 million of cash equivalents at December 31, 2017 and 2016, respectively, the fair value of which is determined through quoted and corroborated prices in active markets. The fair value of cash equivalents approximates cost.

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. The fair value of the Company's fixed interest rate debt exceeds the carrying value by approximately $6.6 million and $4.2 million as of December 31, 2017 and December 31, 2016, respectively.

F-17

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

The fair value of the contingent consideration obligation of $30.9 million relating to the Biotix acquisition as of December 31, 2017 is based on the Company's forecast of future results. The fair value measurements are based on significant inputs not observable in the market and thus represent a Level 3 measurement.

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

The following table presents, for each of these hierarchy levels, the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2017 and 2016:

	December 31, 2017																December 31, 2016
	Total				Level 1				Level 2				Level 3				Total				Level 1				Level 2				Level 3
Assets:
Cash equivalents	$	5,616			$	—			$	5,616			$	—			$	21,513			$	—			$	21,513			$	—
Foreign currency forward contracts not designated as hedging instruments	1,912				—				1,912				—				791				—				791				—
Total	$	7,528			$	—			$	7,528			$	—			$	22,304			$	—			$	22,304			$	—
Liabilities:
Interest rate swap agreements	$	1,292			$	—			$	1,292			$	—			$	3,630			$	—			$	3,630			$	—
Cross currency swap agreement	106				—				106				—				—				—				—				—
Foreign currency forward contracts not designated as hedging instruments	986				—				986				—				2,123				—				2,123				—
Total	$	2,384			$	—			$	2,384			$	—			$	5,753			$	—			$	5,753			$	—

7. PROPERTY, PLANT, AND EQUIPMENT, NET

Property, plant, and equipment, net consisted of the following at December 31:

	2017				2016
Land	$	58,046			$	55,885
Building and leasehold improvements	300,850				247,883
Machinery and equipment	382,233				347,344
Computer software	436,249				372,065
Property, plant, and equipment, gross	1,177,378				1,023,177
Less accumulated depreciation and amortization	(509,107		)		(459,470		)
Property, plant, and equipment, net	$	668,271			$	563,707

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

8. GOODWILL AND OTHER INTANGIBLE ASSETS

The following table shows the changes in the carrying amount of goodwill for the years ended December 31:

	2017				2016
Balance at beginning of year	$	476,378			$	446,284
Goodwill acquired	52,229				41,308
Foreign currency translation	11,231				(11,214		)
Balance at year end	$	539,838			$	476,378

Goodwill and indefinite-lived assets are reviewed for impairment on an annual basis in the fourth quarter. The Company completed its impairment review and determined that, through December 31, 2017, there had been no impairment of these assets.

The components of other intangible assets as of December 31 are as follows:

	2017												2016
	Gross Amount				Accumulated Amortization				Intangibles, Net				Gross Amount				Accumulated Amortization				Intangibles, Net
Customer relationships	$	198,527			$	(41,794	)		$	156,733			$	147,466			$	(34,672	)		$	112,794
Proven technology and patents	70,311				(38,890		)		31,421				58,394				(35,128		)		23,266
Tradenames (finite life)	4,518				(2,807		)		1,711				4,182				(2,514		)		1,668
Tradenames (indefinite life)	35,562				—				35,562				28,272				—				28,272
Other	3,490				(2,199		)		1,291				2,871				(1,816		)		1,055
	$	312,408			$	(85,690	)		$	226,718			$	241,185			$	(74,130	)		$	167,055

The Company recognized amortization expense associated with the above intangible assets of $11.5 million, $8.3 million, and $6.3 million for the years ended December 31, 2017, 2016, and 2015, respectively. The annual aggregate amortization expense based on the current balance of other intangible assets is estimated at $13.9 million for 2018, $13.4 million for 2019, $13.0 million for 2020, $12.4 million for 2021, and $11.9 million for 2022. The finite-lived intangible assets are amortized on a straight-line basis over periods ranging from 3 to 45 years. 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. Purchased intangibles amortization was $10.9 million, $7.1 million after tax, $7.4 million, $5.0 million after tax, and $5.7 million, $3.9 million after tax, for the years ended December 31, 2017, 2016, and 2015, respectively.

In addition to the above amortization, the Company recorded amortization expense associated with capitalized software of $31.0 million, $27.5 million, and $24.4 million for the years ended December 31, 2017, 2016, and 2015, respectively.

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METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

9. DEBT

Debt consisted of the following at December 31:

	2017				2016
3.67% $50 million Senior Notes due December 17, 2022	$	50,000			$	50,000
4.10% $50 million Senior Notes due September 19, 2023	50,000				50,000
3.84% $125 million Senior Notes due September 19, 2024	125,000				125,000
4.24% $125 million Senior Notes due June 25, 2025	125,000				125,000
1.47% EUR 125 million Senior Notes due June 17, 2030	149,736				131,507
Debt issuance costs, net	(1,438		)		(1,642		)
Total Senior Notes	498,298				479,865
$800 million Credit Agreement, interest at LIBOR plus 97.5 basis points(1)	461,872				395,191
Other local arrangements	19,677				18,974
Total debt	979,847				894,030
Less: current portion	(19,677		)		(18,974		)
Total long-term debt	$	960,170			$	875,056

(1) See Note 5 for additional disclosures on the financial instruments associated with the Credit Agreement.

3.67% Senior Notes

In 2012, the Company issued and sold $50 million of 3.67% Senior Notes due December 17, 2022 in a private placement. The 3.67% Senior Notes are senior unsecured obligations of the Company. Interest is payable semi-annually in June and December.

The 3.67% Senior Notes contain customary affirmative and negative covenants including, among others, limitations on the Company and its subsidiaries with respect to incurrence of liens and priority indebtedness, disposition of assets, mergers, and transactions with affiliates. The note purchase agreement also requires the Company to maintain a consolidated interest coverage ratio of not less than 3.5 to 1.0 and a consolidated leverage ratio of not more than 3.5 to 1.0. The 3.67% Senior Notes also contain customary events of default with customary grace periods, as applicable. The Company was in compliance with its covenants at December 31, 2017.

Issuance costs approximating $0.4 million are being amortized to interest expense over the ten-year term of the 3.67% Senior Notes.

4.10% Senior Notes

In 2013, the Company issued and sold $50 million of 4.10% Senior Notes due September 19, 2023 in a private placement. The 4.10% Senior Notes are senior unsecured obligations of the Company. Interest on the 4.10% Senior Notes is payable semi-annually in March and September each year.

The 4.10% Senior Notes contain customary affirmative and negative covenants, change in control, and prepayment provisions, that are substantially similar to those contained in the previously issued debt of the Company as described above. The 4.10% Senior Notes also contain customary events of default with customary grace periods, as applicable. The Company was in compliance with its covenants at December 31, 2017.

Issuance costs approximating $0.4 million are being amortized to interest expense over the ten-year term of the 4.10% Senior Notes.

F-20

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

3.84% Senior Notes and 4.24% Senior Notes

In 2014, the Company entered into an agreement to issue and sell $250 million of ten-year Senior Notes in a private placement. The Company issued $125 million with a fixed interest rate of 3.84% ("3.84% Senior Notes") in September 2014 and issued $125 million with a fixed interest rate of 4.24% ("4.24% Senior Notes") in June 2015. The Senior Notes are senior unsecured obligations of the Company. Interest on the 3.84% Senior Notes is payable semi-annually in March and September each year, beginning in March 2015. Interest on the 4.24% Senior Notes is payable semi-annually in June and December of each year, beginning in December 2015. The 4.24% Senior Notes were used to repay $100 million of 6.3% Senior Notes which were due June 25, 2015.

The 3.84% Senior Notes and 4.24% Senior Notes contain customary affirmative and negative covenants, change in control, and prepayment provisions, that are substantially similar to those contained in the previously issued debt of the Company as described above. The 3.84% Senior Notes and 4.24% Senior Notes also contain customary events of default with customary grace periods, as applicable. The Company was in compliance with its covenants at December 31, 2017.

Issuance costs approximating $0.9 million are being amortized to interest expense over the ten-year term of the Senior Notes.

1.47% Euro Senior Notes

In 2015, the Company issued in a private placement Euro 125 million with a fixed interest rate of 1.47% fifteen-year Senior Notes ("1.47% Euro Senior Notes"). The Euro Senior Notes are senior unsecured obligations of the Company. The Company has designated the 1.47% Euro Senior Notes as a hedge of a portion of its net investment in a euro denominated foreign subsidiary to reduce foreign currency risk associated with this 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 loss of $18.2 million and an unrealized gain of $5.1 million for the years ended December 31, 2017 and 2016, respectively.

Interest on the 1.47% Senior Notes is payable in June and December each year. The 1.47% Senior Notes contain customary affirmative and negative covenants, change in control, and prepayment provisions, that are substantially similar to those contained in the previously issued debt of the Company as described above. The 1.47% Senior Notes also contain customary events of default with customary grace periods, as applicable. The Company was in compliance with its covenants at December 31, 2017.

Issuance costs approximating $0.4 million are being amortized to interest expense over the fifteen-year term of the Euro Senior Notes.

Credit Agreement

In 2015, the Company entered into an $800 million Credit Agreement (the "Credit Agreement"), which amended its $800 million Amended and Restated Credit Agreement (the "Prior Credit Agreement"). 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 December 17, 2020. 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.

F-21

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

Borrowings under the Credit Agreement bear interest at current market rates plus a margin based on the Company’s consolidated leverage ratio, which was set at LIBOR plus 97.5 basis points as of December 31, 2017. The Company must also pay facility fees that are tied to its leverage ratio. The Credit Agreement contains covenants that are substantially similar to those contained in the previously issued debt of the Company as described above, with which the Company was in compliance as of December 31, 2017. 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 default. The Company incurred approximately $0.1 million of debt extinguishment costs during 2015 related to the Prior Credit Agreement. The Company capitalized $1.1 million in financing fees during 2015 associated with the Credit Agreement which will be amortized to interest expense through 2020. During 2017, the Company increased its borrowing under the Credit Agreement by $66.7 million, which primarily was used to fund the Biotix acquisition as described in Note 3. As of December 31, 2017, approximately $332.6 million was available under the facility.

The Company’s weighted average interest rate was 3.3% and 3.7% for the years ended December 31, 2017 and 2016, respectively.

10. SHAREHOLDERS’ EQUITY

Common Stock

The number of authorized shares of the Company’s common stock is 125,000,000 shares with a par value of $0.01 per share. Holders of the Company’s common stock are entitled to one vote per share. At December 31, 2017, 3,436,176 shares of the Company’s common stock were reserved for issuance pursuant to the Company’s stock option plans.

Preferred Stock

The Board of Directors, without further shareholder authorization, is authorized to issue up to 10,000,000 shares of preferred stock, par value $0.01 per share in one or more series and to determine and fix the rights, preferences, and privileges of each series, including dividend rights and preferences over dividends on the common stock and one or more series of the preferred stock, conversion rights, voting rights (in addition to those provided by law), redemption rights, and the terms of any sinking fund therefore, and rights upon liquidation, dissolution, or winding up, including preferences over the common stock and one or more series of the preferred stock. The issuance of shares of preferred stock, or the issuance of rights to purchase such shares, may have the effect of delaying, deferring, or preventing a change in control of the Company or an unsolicited acquisition proposal.

Share Repurchase Program

The Company has a share repurchase program of which there was $583.4 million common shares remaining to be repurchased under the program as of December 31, 2017. The share repurchases are expected to be funded from cash balances, borrowings, and cash generated from operating activities. Repurchases will be made through open market transactions, and the amount and timing of 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 26.7 million common shares since the inception of the program in 2004 through December 31, 2017, at a total cost of $3.9 billion. During the years ended December 31, 2017 and 2016, the Company spent $400 million and $500 million on the repurchase of 749,254 shares and

F-22

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

1,348,507 shares at an average price per share of $533.84 and $370.75, respectively. The Company reissued 270,413 shares and 278,623 shares held in treasury for the exercise of stock options and restricted stock units during 2017 and 2016, respectively.

Accumulated Other Comprehensive Income (Loss)

The following table presents changes in accumulated other comprehensive income by component for the period ended December 31, 2017 and 2016:

	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, 2015	$	(57,394	)		$	3,016			$	(212,271	)		$	(266,649	)
Other comprehensive income (loss), net of tax:
Net unrealized actuarial gains (loss), prior service costs, and plan amendments	—				—				(47,788		)		(47,788		)
Net unrealized gains (loss) on cash flow hedging arrangements	—				(513		)		—				(513		)
Foreign currency translation adjustment	(57,928		)		—				5,885				(52,043		)
Amounts recognized from accumulated other comprehensive income (loss), net of tax	—				(4,735		)		16,730				11,995
Net change in other comprehensive income (loss), net of tax	(57,928		)		(5,248		)		(25,173		)		(88,349		)
Balance at December 31, 2016	$	(115,322	)		$	(2,232	)		$	(237,444	)		$	(354,998	)
Other comprehensive income (loss), net of tax:
Net unrealized actuarial gains (loss), prior service costs, and plan amendments	—				—				1,678				1,678
Net unrealized gains (loss) on cash flow hedging arrangements	—				1,424				—				1,424
Foreign currency translation adjustment	83,982				—				(12,092		)		71,890
Amounts recognized from accumulated other comprehensive income (loss), net of tax	—				(273		)		14,873				14,600
Net change in other comprehensive income (loss), net of tax	83,982				1,151				4,459				89,592
Balance at December 31, 2017	$	(31,340	)		$	(1,081	)		$	(232,985	)		$	(265,406	)

F-23

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

The following table presents amounts recognized from accumulated other comprehensive income (loss) for the twelve month period ended December 31, 2017 and 2016:

		2017				2016				Location of Amounts Recognized in Earnings
Effective portion of losses (gains) on cash flow hedging arrangements:
Interest rate swap agreements		$	1,679			$	1,034			Interest expense
Cross currency swap		(1,416		)		—				(a)
Foreign currency forward contracts		—				(6,756		)		Cost of sales - products
Total before taxes		263				(5,722		)
Provision for taxes		536				(987		)		Provision for taxes
Total, net of taxes		$	(273	)		$	(4,735	)
Recognition of defined benefit pension and post-retirement items:
Recognition of actuarial losses, plan amendments, prior service cost, and settlement charge before taxes		$	20,137			$	23,925			(b)
Provision for taxes		5,264				7,195				Provision for taxes
Total, net of taxes		$	14,873			$	16,730

(a)	The cross currency swap reflects an unrealized gain of $0.2 million recorded in other charges (income) that was offset by underlying unrealized loss on the hedged debt. The cross currency swap also reflects a realized gain of $1.2 million recorded in interest expense.

(b)	These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension and post-retirement cost. See Note 12 for additional details for the year ended December 31, 2017.

11. EQUITY INCENTIVE PLAN

The Company’s equity incentive plan provides employees and directors of the Company additional incentives to join and/or remain in the service of the Company as well as to maintain and enhance the long-term performance and profitability of the Company. The Company’s 2013 equity incentive plan was approved by shareholders on May 2, 2013 and provides that 2 million shares of common stock, plus any shares that remained available for grant under the Company's prior equity incentive plan as well as options outstanding that terminate without being exercised, may be the subject of awards. The plan provides for the grant of options, restricted stock units, and other equity-based awards. The exercise price of options granted shall not be less than the fair market value of the common stock on the date of the award. Options primarily vest equally over a five-year period from the date of grant and have a maximum term of up to ten years and six months. Restricted units primarily vest equally over a five-year period from the date of grant. Performance share units generally vest after a three-year period from the date of the grant based upon satisfaction of the performance condition. The compensation committee of the Board of Directors has generally granted restricted share units to participating managers and non-qualified stock options and performance share units to executive officers.

All share-based compensation arrangements granted to employees, including stock option grants, are recognized in the consolidated statement of operations based on the grant-date fair value of the award over the period during which an employee is required to provide service in exchange for the award. Share-based compensation expense is recorded within selling, general, and administrative in the consolidated

F-24

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

statement of operations with a corresponding offset to additional paid-in capital in the consolidated balance sheet.

The fair values of stock options granted were calculated using the Black-Scholes pricing model. The aggregate intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. The following table summarizes all stock option activity from December 31, 2016 through December 31, 2017:

	Number of Options			Weighted Average Exercise Price		Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2016	1,215,481			$192.63		$274.6
Granted	46,877			671.60
Exercised	(245,562	)		116.67
Forfeited	(8,320	)		241.83
Outstanding at December 31, 2017	1,008,476			$232.99		$392.2
Options exercisable at December 31, 2017	755,407			$180.66		$331.5

The following table details the weighted average remaining contractual life of options outstanding at December 31, 2017 by range of exercise prices:

Number of Options Outstanding			Weighted Average Exercise Price				Remaining Contractual Life of Options Outstanding		Options Exercisable
102,357			$	89.23			1.7		102,357
124,585			$	133.00			2.8		124,585
298,180			$	159.96			4.4		298,180
125,523			$	244.99			5.9		100,716
357,831			$	365.57			8.0		129,569
1,008,476							5.4		755,407

As of the date granted, the weighted average grant-date fair value of the options granted during the years ended December 31, 2017, 2016, and 2015 was $206.56, $118.31, and $92.81, respectively.

Such weighted average grant-date fair value was determined using the following assumptions:

	2017			2016			2015
Risk-free interest rate	2.00	%		1.26	%		1.65	%
Expected life in years	5.8			5.7			5.7
Expected volatility	28	%		29	%		28	%
Expected dividend yield	—			—			—

The total intrinsic value of options exercised during the years ended December 31, 2017, 2016, and 2015 was approximately $105.6 million, $69.5 million, and $90.7 million, respectively.

The total fair value of options vested during the years ended December 31, 2017, 2016, and 2015 was approximately $8.3 million, $7.4 million, and $8.6 million, respectively.

During the fourth quarter of 2016, the Company granted 12,678 performance-based options, with a grant-date fair value of $1.5 million. Compensation expense is recognized over the five-year vesting provisions based upon the probability of the performance condition being met.

F-25

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

The following table summarizes all restricted stock unit and performance share unit activity from December 31, 2016 through December 31, 2017:

	Number of Restricted Stock Units			Aggregate Intrinsic Value (in millions)				Number of Performance Share Units			Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2016	70,547			$	29.5			4,532			$	1.9
Granted	13,202							3,518
Vested	(24,851	)						—
Forfeited	(2,509	)						—
Outstanding at December 31, 2017	56,389			$	34.9			8,050			$	5.0

The weighted average grant-date fair value of the restricted stock units granted during years ended 2017 and 2016 was $671.60 and $397.95 per unit, respectively, and the restricted units vest ratably primarily over a five-year period. The total fair value of the restricted stock units on the date of grant of $8.7 million for 2017 and $8.3 million for 2016 will be recorded as compensation expense on a straight-line basis over the vesting period. The total fair value of restricted stock units vested during the years ended December 31, 2017, 2016, and 2015 was approximately $6.8 million, $6.3 million, and $6.0 million, respectively. Approximately $6.5 million and $6.4 million of compensation expense was recognized during the years ended December 31, 2017 and 2016, respectively.

The Company granted performance share units with a market condition. Grantees of performance share units will be eligible to receive shares of the Company's common stock depending upon the Company's total shareholder return relative to the performance of companies in the S&P 500 Healthcare and S&P 500 Industrials over a three-year period. The awards actually earned will range from zero to 200% of the targeted number of performance share units for the three-year performance period and will be paid, to the extent earned, in the fiscal quarter following the end of the applicable three-year performance period. These awards were valued using a monte carlo simulation based on the following assumptions:

	2017			2016
Risk-free interest rate	1.73	%		0.98	%
Expected life in years	3.0			3.0
Expected volatility	28	%		29	%
Expected dividend yield	—			—

As of the date granted, the fair value of the performance share units granted was $844.39 for 2017 and $470.17 for 2016, respectively. The total fair value of the performance share units on the date of the grant was $3.0 million for 2017 and $2.1 million for 2016 and will be recorded as compensation expense on a straight-line basis over the 3-year period.

At December 31, 2017, a total of 2,230,063 shares of common stock were available for grant in the form of stock options, restricted stock units, or performance share units.

As of December 31, 2017, the unrecorded deferred share-based compensation balance related to stock options, restricted stock units, and performance share units was $53.0 million and will be recognized using a straight-line method over an estimated weighted average amortization period of 2.3 years.

F-26

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

12. BENEFIT PLANS

The Company maintains a number of retirement and other post-retirement employee benefit plans.

Certain subsidiaries sponsor defined contribution plans. Benefits are determined and funded annually based upon the terms of the plans. Amounts recognized as cost under these plans amounted to $17.2 million, $15.4 million, and $16 million for the years ended December 31, 2017, 2016, and 2015, respectively.

Certain subsidiaries sponsor defined benefit plans. Benefits are provided to employees primarily based upon years of service and employees’ compensation for certain periods during the last years of employment. Prior to 2002, the Company’s U.S. operations also provided post-retirement medical benefits to their employees. Contributions for medical benefits are related to employee years of service.

The following tables set forth the change in benefit obligation, the change in plan assets, the funded status, and amounts recognized in the consolidated financial statements for the Company’s defined benefit plans and post-retirement plan at December 31, 2017 and 2016:

	U.S. Pension Benefits								Non-U.S. Pension Benefits								Other Benefits								Total
	2017				2016				2017				2016				2017				2016				2017				2016
Change in benefit obligation:
Benefit obligation at beginning of year	$	138,155			$	154,415			$	838,277			$	818,269			$	2,985			$	3,272			$	979,417			$	975,956
Service cost, gross	565				432				29,600				29,936				—				—				30,165				30,368
Interest cost	4,374				4,428				8,511				10,664				70				76				12,955				15,168
Actuarial losses (gains)	6,979				845				33,036				42,786				18				318				40,033				43,949
Plan amendments and other	—				—				(15,153		)		—				137				150				(15,016		)		150
Benefits paid	(7,502		)		(21,965		)		(30,356		)		(33,977		)		(537		)		(831		)		(38,395		)		(56,773		)
Impact of foreign currency	—				—				54,563				(29,401		)		—				—				54,563				(29,401		)
Benefit obligation at end of year	$	142,571			$	138,155			$	918,478			$	838,277			$	2,673			$	2,985			$	1,063,722			$	979,417
Change in plan assets:
Fair value of plan assets at beginning of year	$	104,103			$	119,118			$	716,169			$	725,597			$	—			$	—			$	820,272			$	844,715
Actual return on plan assets	14,869				6,876				49,055				15,927				—				—				63,924				22,803
Employer contributions	97				74				22,961				22,291				400				681				23,458				23,046
Plan participants’ contributions	—				—				13,503				13,277				137				150				13,640				13,427
Benefits paid	(7,502		)		(21,965		)		(30,356		)		(33,977		)		(537		)		(831		)		(38,395		)		(56,773		)
Impact of foreign currency and other	—				—				36,883				(26,946		)		—				—				36,883				(26,946		)
Fair value of plan assets at end of year	$	111,567			$	104,103			$	808,215			$	716,169			$	—			$	—			$	919,782			$	820,272
Funded status	$	(31,004	)		$	(34,052	)		$	(110,263	)		$	(122,108	)		$	(2,673	)		$	(2,985	)		$	(143,940	)		$	(159,145	)

F-27

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

Amounts recognized in the consolidated balance sheets consist of:

	U.S. Pension Benefits								Non-U.S. Pension Benefits								Other Benefits								Total
	2017				2016				2017				2016				2017				2016				2017				2016
Other non-current assets	$	—			$	—			$	40,493			$	10,530			$	—			$	—			$	40,493			$	10,530
Accrued and other liabilities	(88		)		(92		)		(4,990		)		(4,293		)		(411		)		(467		)		(5,489		)		(4,852		)
Pension and other post-retirement liabilities	(30,916		)		(33,960		)		(145,766		)		(128,345		)		(2,262		)		(2,518		)		(178,944		)		(164,823		)
Accumulated other comprehensive loss (income)	61,819				69,528				254,870				255,855				(2,365		)		(5,057		)		314,324				320,326
Total	$	30,815			$	35,476			$	144,607			$	133,747			$	(5,038	)		$	(8,042	)		$	170,384			$	161,181

The following amounts have been recognized in accumulated other comprehensive income (loss), before taxes, at December 31, 2017 and have not yet been recognized as a component of net periodic pension cost:

	U.S. Pension Benefits				Non-U.S. Pension Benefits				Other Benefits				Total				Total, After Tax
Plan amendments and prior service cost	$	—			$	(30,698	)		$	(372	)		$	(31,070	)		$	(24,289	)
Actuarial losses (gains)	61,819				285,568				(1,993		)		345,394				257,274
Total	$	61,819			$	254,870			$	(2,365	)		$	314,324			$	232,985

The following changes in plan assets and benefit obligations were recognized in other comprehensive income (loss), before taxes, for the year ended December 31, 2017:

	U.S. Pension Benefits				Non-U.S. Pension Benefits				Other Benefits				Total				Total, After Tax
Net actuarial losses (gains)	$	(1,153	)		$	14,330			$	18			$	13,195			$	10,378
Plan amendment	—				(15,153		)		—				(15,153		)		(12,056		)
Amortization of:
Actuarial (losses) gains	(6,556		)		(23,144		)		1,895				(27,805		)		(20,821		)
Plan amendments and prior service cost	—				6,897				779				7,676				5,948
Impact of foreign currency	—				16,085				—				16,085				12,092
Total	$	(7,709	)		$	(985	)		$	2,692			$	(6,002	)		$	(4,459	)

The accumulated benefit obligations at December 31, 2017 and 2016 were $142.6 million and $138.2 million, respectively, for the U.S. defined benefit pension plan and $785.7 million and $818.9 million, respectively, for all non-U.S. plans. Certain of the plans included within non-U.S. pension benefits have accumulated benefit obligations which exceed the fair value of plan assets. The projected benefit obligation, the accumulated benefit obligation, and fair value of assets of these plans as of December 31, 2017 were $202.3 million, $192.0 million, and $50.0 million, respectively.

F-28

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

The assumed discount rates and rates of increase in future compensation levels used in calculating the projected benefit obligations vary according to the economic conditions of the country in which the retirement plans are situated. The weighted average rates used for the purposes of the Company’s plans are as follows:

	U.S.						Non-U.S.
	2017			2016			2017			2016
Discount rate	3.49	%		3.97	%		0.97	%		0.98	%
Compensation increase rate	n/a			n/a			0.87	%		0.85	%
Expected long-term rate of return on plan assets	6.50	%		6.75	%		3.86	%		4.09	%

The assumed discount rates, rates of increase in future compensation levels, and the long-term rate of return used in calculating the net periodic pension cost vary according to the economic conditions of the country in which the retirement plans are situated. The weighted average rates used for the purposes of the Company’s plans are as follows:

	U.S.									Non-U.S.
	2017			2016			2015			2017			2016			2015
Discount rate	3.97	%		4.27	%		4.00	%		0.98	%		1.31	%		1.65	%
Compensation increase rate	n/a			n/a			n/a			0.85	%		1.03	%		1.61	%
Expected long-term rate of return on plan assets	6.75	%		7.25	%		7.50	%		4.09	%		4.58	%		4.82	%

Net periodic pension cost and net periodic post-retirement benefit for the defined benefit plans and U.S. post-retirement plan include the following components for the years ended December 31:

	U.S.												Non-U.S.												Other Benefits												Total
2017				2016				2015				2017				2016				2015				2017				2016				2015				2017				2016				2015
Service cost, net	$	565			$	432			$	837			$	16,341			$	16,804			$	18,664			$	—			$	—			$	—			$	16,906			$	17,236			$	19,501
Interest cost on projected benefit obligations	4,374				4,428				6,431				8,511				10,664				14,071				70				76				139				12,955				15,168				20,641
Expected return on plan assets	(6,737		)		(7,781		)		(9,575		)		(30,349		)		(33,168		)		(36,832		)		—				—				—				(37,086		)		(40,949		)		(46,407		)
Recognition of actuarial losses/(gains) and prior service costs	6,556				7,606				7,626				16,247				12,923				10,639				(2,674		)		(4,567		)		(5,247		)		20,129				15,962				13,018
Settlement charge	—				7,963				—				—				—				—				—				—				—				—				7,963				—
Net periodic pension cost / (benefit)	$	4,758			$	12,648			$	5,319			$	10,750			$	7,223			$	6,542			$	(2,604	)		$	(4,491	)		$	(5,108	)		$	12,904			$	15,380			$	6,753

The amounts remaining in accumulated other comprehensive income (loss) that are expected to be recognized as a component of net periodic pension cost during 2018 are as follows:

	U.S. Pension Benefits				Non-U.S. Pension Benefits				Other Benefits				Total
Plan amendments and prior service costs	$	—			$	(6,966	)		$	(372	)		$	(7,338	)
Actuarial losses (gains)	5,804				21,620				(1,250		)		26,174
Total	$	5,804			$	14,654			$	(1,622	)		$	18,836

The projected post-retirement benefit obligation was principally determined using discount rates of 2.55% in 2017 and 3.41% in 2016. Net periodic post-retirement benefit cost was principally determined using discount rates of 3.41% in 2017, 3.54% in 2016, and 4.00% in 2015. The health care cost trend rate was 7.0% in 2017, 7.5% in 2016, and 8.00% in 2015, decreasing to 5.00% in 2022. A one-percentage-point change in health care cost trend rates would have an immaterial impact on total service and interest cost components and the post-retirement benefit obligation.

F-29

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

The Company’s overall asset investment strategy is to achieve long-term growth while minimizing volatility by widely diversifying among asset types and strategies. Target asset allocations and investment return criteria are established by the pension committee or designated officers of each plan. Target asset allocation ranges for the U.S. pension plan include 35-55% in equity securities, 18-28% in fixed income securities, and 20-40% in other types of investments. International plan assets relate primarily to the Company’s Swiss plan with target allocations of 24-45% in equities, 35-55% in fixed income securities, and 15-25% in other types of investments. Actual results are monitored against targets and the trustees are required to report to the members of each plan, including an analysis of investment performance on an annual basis at a minimum. Day-to-day asset management is typically performed by third-party asset managers, reporting to the pension committees or designated officers.

The long-term rate of return on plan asset assumptions used to determine pension expense under U.S. GAAP is generally based on estimated future returns for the target investment mix determined by the trustees as well as historical investment performance.

The following table presents the fair value measurement of the Company’s plan assets by hierarchy level:

	December 31, 2017																December 31, 2016
	Quoted Prices in Active Markets for Identical Assets (Level 1)				Observable Inputs for Identical Assets (Level 2)				Unobservable Inputs (Level 3)				Total				Quoted Prices in Active Markets for Identical Assets (Level 1)				Observable Inputs for Identical Assets (Level 2)				Unobservable Inputs (Level 3)				Total
Asset Category:
Cash and Cash Equivalents	$	154,751			$	—			$	—			$	154,751			$	131,468			$	—			$	—			$	131,468
Equity Securities:
Mettler-Toledo Stock	3,154				—				—				3,154				2,846				—				—				2,846
Equity Mutual Funds:
U.S.(1)	6,011				27,984				—				33,995				5,860				24,257				—				30,117
International(2)	80,836				61,341				—				142,177				54,760				52,404				—				107,164
Emerging Markets(3)	100,346				1,096				—				101,442				78,999				793				—				79,792
Fixed Income Securities:
Corporate/Government Bonds(4)	72,334				—				—				72,334				69,578				—				—				69,578
Fixed Income Mutual Funds:
Insurance Contracts(5)	—				23,421				1,514				24,935				—				19,955				1,300				21,255
Core Bond(6)	136,157				57,499				—				193,656				121,884				52,955				—				174,839
Real Asset Mutual Funds:
Real Estate(7)	79,218				8,836				—				88,054				69,284				—				—				69,284
Commodities(8)	37,302				—				—				37,302				22,964				—				5,594				28,558
Other Types of Investments:
Global Allocation Funds(9)	11,781				12,545				—				24,326				11,981				11,285				—				23,266
Insurance Linked Securities(10)	12,147				—				—				12,147				—				—				—				—
Total assets in fair value hierarchy	$	694,037			$	192,722			$	1,514			$	888,273			$	569,624			$	161,649			$	6,894			$	738,167
Investments measured at net asset value:
Emerging Markets (3)													5,950																4,407
Multi-Strategy Fund of Hedge Funds (11)													25,559																77,698
Total pension assets at fair value													$	919,782															$	820,272

---

F-30

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

(1)	Represents primarily large capitalization equity mutual funds tracking the S&P 500 Index.

(2)	Represents all capitalization core and value equity mutual funds located primarily in Switzerland, the United Kingdom, and Canada.

(3)	Represents core and growth mutual funds and funds of mutual funds invested in emerging markets primarily in Eastern Europe, Latin America, and Asia.

(4)	Represents investments in high-grade corporate and government bonds located in Switzerland and the European Union.

(5)	Represents fixed and variable rate annuity contracts provided by insurance companies.

(6)	Represents fixed income mutual funds invested in the U.S., the United Kingdom, Switzerland, and European government bonds, high-grade corporate bonds, mortgage-backed securities, and collateralized mortgage obligations.

(7)	Represents mutual funds invested in real estate located primarily in Switzerland.

(8)	Represents commodity funds invested across a broad range of sectors.

(9)	Represents mutual funds invested globally in both equities and fixed income securities.

(10)	Represents a broadly diversified portfolio of assets that carry exposure to insurance risks, particularly insurance linked securities.

(11)

Represents investments in underlying globally diversified hedge funds. Investments that are measured using the net asset value (NAV) per share practical expedient have not been categorized in the fair value hierarchy. The amounts presented above are intended to permit reconciliation of the fair value hierarchy to the fair value of total plan assets in order to determine the amounts included in the consolidated balance sheet.

The fair value of the Company’s stock and corporate and government bonds are valued at the year-end closing price as reported on the securities exchange on which they are traded. Mutual funds are valued at the exchange-listed year end closing price or at the net asset value of shares held by the fund at the end of the year. Insurance contracts are valued by discounting the related cash flows using a current year end market rate or at cash surrender value, which is presumed to equal fair value. Funds of hedge funds are valued at the net asset value of shares held by the fund at the end of the year.

The following table presents a roll-forward of activity for the years ended December 31, 2017 and 2016 for Level 3 asset categories:

	Commodities				Insurance Contract				Total
Balance at December 31, 2015	$	33,505			$	1,367			$	34,872
Actual return on plan assets:
Related to assets held at end of year	—				25				25
Related to assets sold during the year	(2,857		)		—				(2,857		)
Sales	(21,278		)		(38		)		(21,316		)
Impact of foreign currency	(3,776		)		(54		)		(3,830		)
Balance at December 31, 2016	$	5,594			$	1,300			$	6,894
Actual return on plan assets:
Related to assets held at end of year	—				21				21
Related to assets sold during the year	—				—				—
Sales	(5,711		)		(98		)		(5,809		)
Purchases	—				108				108
Impact of foreign currency	117				183				300
Balance at December 31, 2017	$	—			$	1,514			$	1,514

There were no transfers between any asset levels during the years ended December 31, 2017 and 2016.

F-31

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

The following benefit payments, which reflect expected future service as appropriate, are expected to be paid:

	U.S. Pension Benefits				Non-U.S. Pension Benefits				Other Benefits Net of Subsidy				Total
2018	$	7,972			$	45,118			$	411			$	53,501
2019	8,140				43,125				400				51,665
2020	8,344				45,352				265				53,961
2021	8,453				42,561				249				51,263
2022	8,641				43,990				227				52,858
2023-2028	43,855				219,011				769				263,635

In 2018, the Company expects to make employer pension contributions of approximately $25.9 million to its non-U.S. pension plan and employer contributions of approximately $0.4 million to its U.S. post-retirement medical plan.

In February 2016, the Company offered former employees a one-time option to receive a lump sum distribution of their vested pension plan benefits. Based upon the eligible participant acceptance, $14.6 million was paid from plan assets to these former employees in the second quarter of 2016 with a corresponding decrease in the benefit obligation. The Company incurred a one-time non-cash settlement charge recorded in other charges (income), net during the second quarter of 2016 of approximately $8.2 million, of which $8.0 million, $4.9 million after tax, was reclassified from accumulated other comprehensive income.

13. TAXES

The sources of the Company’s earnings before taxes were as follows for the years ended December 31:

	2017				2016				2015
United States	$	45,105			$	37,363			$	20,992
Non-United States	529,117				466,830				442,432
Earnings before taxes	$	574,222			$	504,193			$	463,424

F-32

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

The provisions for taxes consist of:

	Current				Deferred				Total
Year ended December 31, 2017:
United States federal	$	55,660			$	10,173			$	65,833
State and local	361				3,471				3,832
Non-United States	144,974				(16,389		)		128,585
Total	$	200,995			$	(2,745	)		$	198,250
Year ended December 31, 2016:
United States federal	$	20,116			$	(4,817	)		$	15,299
State and local	2,947				1,149				4,096
Non-United States	94,882				5,546				100,428
Total	$	117,945			$	1,878			$	119,823
Year ended December 31, 2015:
United States federal	$	11,071			$	3,029			$	14,100
State and local	2,164				617				2,781
Non-United States	90,232				3,491				93,723
Total	$	103,467			$	7,137			$	110,604

The provisions for tax expense for the years ended December 31, 2017, 2016, and 2015 differed from the amounts computed by applying the United States federal income tax rate of 35% to the earnings before taxes as a result of the following:

	2017				2016				2015
Expected tax	$	200,978			$	176,467			$	162,198
United States state and local income taxes, net of federal income tax benefit	376				3,064				2,551
Change in valuation allowance (excluding U.S. tax reform)	—				—				(1,098		)
Net effect of U.S. tax reform (see below)	71,982				—				—
Non-United States income taxes at other than a 35% rate	(43,691		)		(65,917		)		(54,798		)
Excess tax benefits from stock option exercises	(35,171		)		—				—
Other, net	3,776				6,209				1,751
Total provision for taxes	$	198,250			$	119,823			$	110,604

As discussed further below, the 2017 provision for income taxes includes a provisional one-time charge of $72 million. Our annual effective tax rate in 2017 was 22% excluding this one-time charge. The reduction in the Company's annual effective tax rate from 24% in 2016 and 2015 to 22% (excluding the one-time charge) in 2017 is primarily related to the Company's adoption of ASU 2016-09 pertaining to excess tax benefits associated with stock option exercises.

F-33

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

On December 22, 2017, the Tax Cuts and Jobs Act ("the Act") significantly revised U.S. corporate income tax law. The Act includes, among other things, a reduction in the U.S. federal corporate income tax rate from 35% to 21% effective for taxable years beginning after December 31, 2017, and the implementation of a modified territorial tax system that includes a one-time transition tax on deemed repatriated earnings of foreign subsidiaries ("Transition Tax") that is payable over a period of up to eight years.

The Company has recorded a provisional one-time charge of $72 million relating to the Act during the fourth quarter of 2017. Of this amount, $59 million is expected to be payable over a period of up to 8 years of which $48 million is included as a component of other non-current liabilities, $7 million is included in deferred tax liabilities and $4 million is included in taxes payable. The components of the Company's provisional one-time charge include:

•

A one-time cash charge of $59 million for un-repatriated foreign earnings due to the estimated Transition Tax of $52 million, and $7 million of foreign withholding taxes, and U.S. federal, state, and local taxes related to the reassessment of planned repatriation of certain foreign earnings that were previously determined to be permanently reinvested. All other undistributed earnings are considered permanently reinvested.

•	A one-time non-cash charge of $13 million primarily related to changes in the current year treatment of certain deferred tax items and other non-cash items. The effect of remeasuring the U.S. net deferred tax balances resulting from the reduction of the U.S. income tax rate from 35% to 21% was immaterial.

Shortly after the Act was enacted, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”) which provides guidance on accounting for the Act’s impact. SAB 118 provides a measurement period, which in no case should extend beyond one year from the Act enactment, during which a company acting in good faith may complete the accounting for the impacts of the Act. In accordance with SAB 118, the Company will reflect the income tax effects of the Act in the reporting period in which the accounting is complete.

The Company's accounting for the above items is based upon reasonable estimates of the tax effects of the Act; however, its estimates may change upon the finalization of its implementation and additional interpretive guidance from regulatory authorities. Among other things, the Company needs to complete its analysis of historical foreign earnings and related taxes paid and its analysis of foreign cash equivalents. In addition, the Company needs to complete its analysis of deemed repatriation of deferred foreign income and related state tax effects.

The Company will complete its accounting for the above tax effects of the Act during 2018 as provided in SAB 118 and will reflect any adjustments to its provisional amounts as an adjustment to the provision for taxes in the reporting period in which the amounts are finally determined.

Additionally, certain provisions of the Act are not effective until 2018. The Company is in the process of evaluating the impact of these provisions and has not yet recorded any impact in the financial statements, nor have we made any accounting policy elections with respect to these items.

F-34

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below at December 31:

	2017				2016
Deferred tax assets:
Inventory	$	13,779			$	17,612
Accrued and other liabilities	62,175				93,379
Accrued post-retirement benefit and pension costs	55,545				72,004
Net operating loss and tax credit carryforwards	32,247				15,844
Other	12,099				10,326
Total deferred tax assets	175,845				209,165
Less valuation allowance	(12,857		)		(10,730		)
Total deferred tax assets less valuation allowance	162,988				198,435
Deferred tax liabilities:
Inventory	4,730				3,741
Property, plant, and equipment	50,440				56,718
Acquired intangibles amortization	66,755				77,295
Prepaid post-retirement benefit and pension costs	27,747				36,741
International earnings	23,121				19,575
Unrealized currency gains	—				34,720
Total deferred tax liabilities	172,793				228,790
Net deferred tax (liability) asset	$	(9,805	)		$	(30,355	)

The increase in the valuation allowance during 2017 is primarily attributable to increases in valuation allowances against the Company's state net operating losses. Upon adoption of ASU 2016-09 in the first quarter of 2017, the Company recorded $69 million in additional deferred tax assets related primarily to U.S. tax credit carryforwards which arose directly from tax deductions for share-based compensation arrangements, against which a full valuation allowance was recorded in the first quarter and subsequently released in the fourth quarter, along with $11 million of other pre-existing valuation allowances, in connection with the determination of the Transition Tax related to the Act as described above.

The Company continues to record valuation allowances related to certain of its deferred income tax assets due to the uncertainty of the ultimate realization of future benefits from such assets. The potential decrease or increase of the valuation allowance in the near term is dependent on the future ability of the Company to realize the deferred tax assets that are affected by the future profitability of operations in various worldwide jurisdictions.

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:

	2017				2016
Unrecognized tax benefits at beginning of year	$	20,240			$	15,259
Increases related to current tax positions	2,484				7,824
Increases (decreases) related to prior year tax positions	1,434				(885		)
Decreases relating to taxing authority settlements	(856		)		(794		)
Decreases resulting from a lapse of the applicable statute of limitations	(186		)		(896		)
Other, net	974				(268		)
Unrecognized tax benefits at end of year	$	24,090			$	20,240

F-35

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

Included in the balance of unrecognized tax benefits at December 31, 2017 and 2016 were $24.1 million and $16.6 million, respectively, of tax benefits that if recognized would reduce the Company’s effective tax rate. The Company recognizes accrued amounts of interest and penalties related to its uncertain tax positions as part of its income tax expense within its consolidated statement of operations. The amount of accrued interest and penalties included within other non-current liabilities within the Company’s consolidated balance sheet as of December 31, 2017 and 2016 was $2.8 million and $2.2 million, respectively.

The Company believes that it is reasonably possible that the unrecognized tax benefit balance could change over the next twelve months, primarily related to potential disputes raised by the taxing authorities over income and expense recognition. The Company does not expect a change would have a material impact on its financial position, results of operations, or cash flows.

The Company plans to repatriate earnings from China, Switzerland, Germany, the United Kingdom, and certain other countries in future years and believes that there will be no additional cost associated with the repatriation of such foreign earnings other than withholding taxes for which a deferred tax liability has been recorded. All other undistributed earnings not subject to the Transition Tax, or any additional outside basis difference inherent in these entities, are considered to be permanently reinvested on which no U.S. deferred income taxes or foreign withholding taxes have been provided. It is not practicable to estimate the amount of deferred tax liability related to these undistributed earnings and additional outside basis differences in these entities due to the complexity of the calculation and the uncertainty regarding assumptions necessary to compute the tax.

As of December 31, 2017, the major jurisdictions for which the Company is subject to examinations are Germany for years after 2012, the United States after 2013, France after 2016, Switzerland after 2014, the United Kingdom after 2014, and China after 2013. Additionally, the Company is currently under examination in various taxing jurisdictions in which it conducts business operations. While the Company has not yet received any material assessments from these taxing authorities, the Company believes that adequate amounts of taxes and related interest and penalties have been provided for any adverse adjustments as a result of these examinations and that the ultimate outcome of these examinations will not result in a material impact on the Company’s consolidated results of operations or financial position.

14. RESTRUCTURING CHARGES

During the past few years, we initiated cost reduction measures. For the years ended December 31, 2017 and 2016, we have incurred $12.8 million and $6.2 million, respectively, of restructuring expenses which primarily comprise employee related costs. Liabilities related to restructuring activities are included in accrued and other liabilities in the consolidated balance sheet.

F-36

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

A roll-forward of the Company’s accrual for restructuring activities for the years ended December 31, 2017 and 2016 is as follows:

		Total
Balance at December 31, 2015		$	12,211
Restructuring charges		6,235
Cash payments / utilization		(8,376		)
Impact of foreign currency		(539		)
Balance at December 31, 2016		$	9,531
Restructuring charges		12,772
Cash payments / utilization		(12,663		)
Impact of foreign currency		980
Balance at December 31, 2017		$	10,620

15. OTHER CHARGES (INCOME), NET

Other charges (income), net consisted of net income of $5.9 million in 2017, compared to net charges of $8.5 million and net income of $0.9 million in 2016 and 2015, respectively. Other charges (income), net includes $1.7 million and $1.1 million of acquisition costs for 2017 and 2016, respectively. Other charges (income), net for 2017 also includes a one-time gain of $3.4 million relating to the sale of a facility in Switzerland in connection with the Company's initiative to consolidate certain Swiss operations into a new facility. Other charges in 2016 includes a one-time non-cash pension settlement charge of $8.2 million related to a lump sum offering to former employees of the Company's U.S. pension plan. Other charges (income), net also includes net (gains) losses from foreign currency transactions and hedging activities, interest income, and other items.

16. COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company leases certain of its facilities and equipment under operating leases. The future minimum lease payments under non-cancelable operating leases are as follows at December 31, 2017:

2018	$	33,939
2019	25,292
2020	17,132
2021	11,729
2022	9,745
Thereafter	11,289
Total	$	109,126

Rent expense for operating leases amounted to $36.9 million, $34.9 million, and $33.2 million for the years ended December 31, 2017, 2016, and 2015, respectively.

F-37

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

Legal

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 will have a material adverse effect on the Company’s financial condition, results of operations, or cash flows.

17. SEGMENT REPORTING

The Company has five reportable segments: U.S. Operations, Swiss Operations, Western European Operations, Chinese Operations, and Other. U.S. Operations represent certain of the Company’s marketing and producing organizations located in the United States. Western European Operations include the Company’s marketing and producing organizations in Western Europe, excluding operations located in Switzerland. Swiss Operations include marketing and producing organizations located in Switzerland as well as extensive R&D operations that are responsible for the development, production, and marketing of precision instruments, including weighing, analytical, and measurement technologies for use in a variety of laboratory and industrial applications. Chinese Operations represent the Company’s marketing and producing organizations located in China. The Company’s market organizations are geographically focused and are responsible for all aspects of the Company’s sales and service. Operations that exist outside these reportable segments are included in Other.

The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies. The Company evaluates performance based on segment profit for segment reporting (gross profit less research and development and selling, general, and administrative expenses, before amortization, interest expense, restructuring charges, other charges (income), net, and taxes). Inter-segment sales and transfers are priced to reflect consideration of market conditions and the regulations of the countries in which the transferring entities are located.

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

For the Year Ended December 31, 2017		Net Sales to External Customers				Net Sales to Other Segments				Total Net Sales				Segment Profit				Depreciation				Total Assets				Purchase of Property, Plant, and Equipment				Goodwill
U.S. Operations		$	944,825			$	99,117			$	1,043,942			$	177,705			$	7,659			$	1,937,688			$	(38,969	)		$	409,520
Swiss Operations		133,925				563,083				697,008				174,447				5,551				1,374,150				(19,589		)		22,171
Western European Operations		673,776				170,820				844,596				117,324				4,052				1,805,294				(7,094		)		91,927
Chinese Operations		452,617				232,882				685,499				231,860				7,168				1,068,811				(13,246		)		690
Other(a)		519,910				7,934				527,844				72,744				3,474				310,667				(4,131		)		15,530
Eliminations and Corporate(b)		—				(1,073,836		)		(1,073,836		)		(117,496		)		5,554				(3,946,805		)		(44,397		)		—
Total		$	2,725,053			$	—			$	2,725,053			$	656,584			$	33,458			$	2,549,805			$	(127,426	)		$	539,838

F-38

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

For the Year Ended December 31, 2016		Net Sales to External Customers				Net Sales to Other Segments				Total Net Sales				Segment Profit				Depreciation				Total Assets				Purchase of Property, Plant, and Equipment				Goodwill
U.S. Operations		$	867,962			$	90,580			$	958,542			$	161,539			$	6,094			$	1,747,338			$	(52,255	)		$	357,785
Swiss Operations		130,674				524,983				655,657				163,663				6,199				1,212,637				(7,260		)		21,239
Western European Operations		640,558				176,501				817,059				123,507				4,048				1,120,751				(6,857		)		82,500
Chinese Operations		386,541				219,766				606,307				187,924				6,879				702,571				(16,288		)		636
Other(a)		482,522				7,709				490,231				64,060				3,461				277,476				(4,540		)		14,218
Eliminations and Corporate(b)		—				(1,019,539		)		(1,019,539		)		(117,696		)		6,062				(2,893,996		)		(36,757		)		—
Total		$	2,508,257			$	—			$	2,508,257			$	582,997			$	32,743			$	2,166,777			$	(123,957	)		$	476,378

For the Year Ended December 31, 2015		Net Sales to External Customers				Net Sales to Other Segments				Total Net Sales				Segment Profit				Depreciation				Total Assets				Purchase of Property, Plant, and Equipment				Goodwill
U.S. Operations		$	826,354			$	87,488			$	913,842			$	147,491			$	6,153			$	1,487,422			$	(7,113	)		$	317,856
Swiss Operations		133,684				498,642				632,326				160,763				6,488				1,134,648				(6,650		)		21,841
Western European Operations		620,128				165,532				785,660				107,424				4,076				1,010,639				(5,940		)		92,389
Chinese Operations		376,291				214,887				591,178				165,532				7,086				506,390				(14,770		)		692
Other(a)		438,990				8,087				447,077				50,821				2,883				260,276				(4,306		)		13,506
Eliminations and Corporate(b)		—				(974,636		)		(974,636		)		(99,924		)		6,401				(2,440,040		)		(43,727		)		—
Total		$	2,395,447			$	—			$	2,395,447			$	532,107			$	33,087			$	1,959,335			$	(82,506	)		$	446,284

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

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

A reconciliation of earnings before taxes to segment profit follows:

	2017				2016				2015
Earnings before taxes	$	574,222			$	504,193			$	463,424
Amortization	42,671				36,052				30,951
Interest expense	32,785				28,026				27,451
Restructuring charges	12,772				6,235				11,148
Other charges (income), net	(5,866		)		8,491				(867		)
Segment profit	$	656,584			$	582,997			$	532,107

During 2017, restructuring charges of $12.8 million were recognized, of which $6.2 million, $1.8 million, $3.0 million, $0.8 million, and $1.0 million relate to the Company’s U.S., Swiss, Western European, Chinese, and Other Operations, respectively. Restructuring charges of $6.2 million were recognized in 2016, of which $2.0 million, $1.5 million, $2.4 million, $0.2 million, and $0.2 million relate to the Company's U.S., Swiss, Western European, Chinese, and Other Operations, respectively.

The Company sells precision instruments, including weighing instruments and certain analytical and measurement technologies, and related services to a variety of customers and industries. None of these end-customers account for more than 1% of net sales. Service revenues are primarily derived from repair and other services including regulatory compliance qualification, calibration, certification, and preventative maintenance.

F-39

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

A breakdown of the Company's sales by product category for the years ended December 31 follows:

	2017				2016				2015
Laboratory	$	1,358,493			$	1,225,000			$	1,154,905
Industrial	1,158,335				1,067,858				1,034,310
Retail	208,225				215,399				206,232
Total net sales	$	2,725,053			$	2,508,257			$	2,395,447

In certain circumstances, our operating segments sell directly into other geographies. A breakdown of net sales to external customers by geographic customer destination and property, plant, and equipment, net for the years ended December 31 follows:

	Net Sales												Property, Plant, and Equipment, Net
	2017				2016				2015				2017				2016
United States	$	888,241			$	815,153			$	768,815			$	220,401			$	168,494
Other Americas	162,672				153,607				157,962				3,406				3,833
Total Americas	1,050,913				968,760				926,777				223,807				172,327
Germany	192,126				182,644				176,491				49,376				28,393
France	130,427				118,681				110,477				6,386				5,009
United Kingdom	64,361				61,513				71,679				19,617				12,631
Switzerland	63,090				62,115				64,622				259,007				246,312
Other Europe	399,923				374,008				349,178				8,050				6,511
Total Europe	849,927				798,961				772,447				342,436				298,856
China	439,373				374,996				362,950				92,269				83,713
Rest of World	384,840				365,540				333,273				9,759				8,811
Total Asia/Rest of World	824,213				740,536				696,223				102,028				92,524
Total	$	2,725,053			$	2,508,257			$	2,395,447			$	668,271			$	563,707

F-40

METTLER-TOLEDO INTERNATIONAL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

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

18. QUARTERLY FINANCIAL DATA (UNAUDITED)

Quarterly financial data for the years ended December 31, 2017 and 2016 are as follows:

	First Quarter				Second Quarter				Third Quarter				Fourth Quarter
2017
Net sales	$	594,567			$	653,656			$	698,799			$	778,031
Gross profit	$	342,900			$	374,917			$	400,277			$	455,219
Net earnings(1)	$	92,466			$	101,580			$	104,950			$	76,976
Basic earnings per common share:
Net earnings	$	3.57			$	3.94			$	4.10			$	3.01
Weighted average number of common shares	25,932,112				25,751,374				25,613,433				25,562,542
Diluted earnings per common share:
Net earnings	$	3.48			$	3.84			$	3.99			$	2.93
Weighted average number of common and common equivalent shares	26,586,061				26,439,529				26,303,529				26,229,052
Market price per share:
High	$	486.90			$	601.16			$	635.17			$	689.11
Low	$	414.52			$	473.87			$	571.25			$	606.80
(1) Provision for taxes for 2017 includes a provisional one-time charge of $72 million for the implementation of the Tax Cuts and Jobs Act. Of this amount, $59 million is expected to be paid over a period of up to eight years. The estimated charge may change with the finalization of implementation.
2016
Net sales	$	539,674			$	608,286			$	650,598			$	709,699
Gross profit	$	299,907			$	347,576			$	369,494			$	418,610
Net earnings	$	65,674			$	79,588			$	101,332			$	137,776
Basic earnings per common share:
Net earnings	$	2.44			$	2.99			$	3.84			$	5.27
Weighted average number of common shares	26,931,293				26,631,015				26,375,468				26,139,024
Diluted earnings per common share:
Net earnings	$	2.40			$	2.93			$	3.77			$	5.17
Weighted average number of common and common equivalent shares	27,421,019				27,143,284				26,888,810				26,631,269
Market price per share:
High	$	347.09			$	385.50			$	419.83			$	429.91
Low	$	298.14			$	347.76			$	363.19			$	397.73

F-41

Schedule II — Valuation and Qualifying Accounts (in thousands)

Column A		Column B				Column C								Column D				Column E
						Additions
						(1)				(2)
		Balance at the Beginning of Period				Charged to Costs and Expenses				Charged to Other Accounts								Balance at End of Period
Description					-Deductions-
										Note (A)				Note (B)
Accounts receivable — allowance for doubtful accounts:
Year ended December 31, 2017		$	14,234			$	1,403			$	1,005			$	1,093			$	15,549
Year ended December 31, 2016		$	14,435			$	1,087			$	(760	)		$	528			$	14,234
Year ended December 31, 2015		$	15,961			$	883			$	(2,302	)		$	107			$	14,435
Deferred tax valuation allowance:
Year ended December 31, 2017		$	10,730			$	9,513			$	72,170			$	79,556			$	12,857
Year ended December 31, 2016		$	25,435			$	—			$	—			$	14,705			$	10,730
Year ended December 31, 2015		$	36,263			$	—			$	—			$	10,828			$	25,435

---

Note (A)

For accounts receivable, amounts comprise currency translation adjustments.

For deferred tax valuation allowance in 2017, 2016, and 2015, amounts relate primarily to changes in foreign tax credit carryforwards and R&D credit carryforwards.

Note (B)

For accounts receivable, amounts represent excess of uncollectible balances written off over recoveries of accounts previously written off.

For deferred tax valuation allowance, the decrease in 2017, 2016, and 2015 relates primarily to decreases in foreign tax credit and R&D credit carryforwards.

S- 1