UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

x		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2010, OR

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM                      TO

Commission File Number: 1-13595

Mettler-Toledo International Inc.

(Exact name of registrant as specified in its charter)

Delaware		13-3668641
(State or other jurisdiction of incorporation or organization)		(I.R.S Employer Identification No.)

1900 Polaris Parkway
Columbus, Ohio 43240
and
Im Langacher, P.O. Box MT-100
CH 8606 Greifensee, Switzerland

(Address of principal executive offices)

(Zip Code)

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

(Registrant’s telephone number, including area code)

not applicable

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

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes   X      No ___

Indicate by checkmark whether the registrant has submitted electronically and posted on its corporate Web-site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes   X      No ___

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer  X  Accelerated filer __ Non-accelerated filer __ (Do not check if a smaller reporting company) Smaller reporting company __

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

The Registrant had 32,824,634 shares of Common Stock outstanding at September 30, 2010.

METTLER-TOLEDO INTERNATIONAL INC.
INDEX TO QUARTERLY REPORT ON FORM 10-Q

				PAGE
		PART I. FINANCIAL INFORMATION
Item 1.		Financial Statements
		Unaudited Interim Consolidated Financial Statements:
		Interim Consolidated Statements of Operations for the three months ended September 30, 2010 and 2009		3
		Interim Consolidated Statements of Operations for the nine months ended September 30, 2010 and 2009		4
		Interim Consolidated Balance Sheets as of September 30, 2010 and December 31, 2009		5
		Interim Consolidated Statements of Shareholders’ Equity and Comprehensive Income for the nine months ended September 30, 2010 and twelve months ended December 31, 2009		6
		Interim Consolidated Statements of Cash Flows for the nine months ended September 30, 2010 and 2009		7
		Notes to the Interim Consolidated Financial Statements at September 30, 2010		8
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		24
Item 3.		Quantitative and Qualitative Disclosures About Market Risk		35
Item 4.		Controls and Procedures		35
		PART II. OTHER INFORMATION
Item 1.		Legal Proceedings		36
Item 1A.		Risk Factors		36
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds		36
Item 3.		Defaults upon Senior Securities		36
Item 5.		Other Information		36
Item 6.		Exhibits		36
SIGNATURE
EX-31.1
EX-31.2
EX-32
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT
EX-101 DEFINITION LINKBASE DOCUMENT

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

METTLER-TOLEDO INTERNATIONAL INC.

		September 30,				September 30,
		2010				2009
Net sales
Products		$	382,369			$	328,055
Service			107,844				107,595
Total net sales			490,213				435,650
Cost of sales
Products			169,196				145,719
Service			64,962				64,738
Gross profit			256,055				225,193
Research and development			24,992				22,309
Selling, general and administrative			145,303				129,686
Amortization			3,667				3,237
Interest expense			4,792				6,974
Restructuring charges			566				6,064
Other charges (income), net			(127	)			13
Earnings before taxes			76,862				56,910
Provision for taxes			14,781				15,365
Net earnings		$	62,081			$	41,545
Basic earnings per common share:
Net earnings		$	1.87			$	1.23
Weighted average number of common shares			33,171,017				33,728,931
Diluted earnings per common share:
Net earnings		$	1.82			$	1.21
Weighted average number of common and common equivalent shares			34,027,191				34,413,656

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

METTLER-TOLEDO INTERNATIONAL INC.

		September 30,				September 30,
		2010				2009
Net sales
Products		$	1,054,602			$	910,343
Service			320,811				306,828
Total net sales			1,375,413				1,217,171
Cost of sales
Products			458,297				411,112
Service			196,510				186,710
Gross profit			720,606				619,349
Research and development			70,562				65,954
Selling, general and administrative			423,919				366,209
Amortization			10,613				8,734
Interest expense			14,757				18,975
Restructuring charges			2,476				28,398
Other charges (income), net			857				1,149
Earnings before taxes			197,422				129,930
Provision for taxes			46,126				26,775
Net earnings		$	151,296			$	103,155
Basic earnings per common share:
Net earnings		$	4.52			$	3.06
Weighted average number of common shares			33,488,099				33,683,443
Diluted earnings per common share:
Net earnings		$	4.41			$	3.02
Weighted average number of common and common equivalent shares			34,318,582				34,200,834

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

METTLER-TOLEDO INTERNATIONAL INC.

		September 30,				December 31,
		2010				2009
ASSETS
Current assets:
Cash and cash equivalents		$	142,884			$	85,031
Trade accounts receivable, less allowances of $12,806 at September 30, 2010 and $12,399 at December 31, 2009			331,954				312,998
Inventories			215,316				168,042
Current deferred tax assets, net			39,200				34,225
Other current assets and prepaid expenses			57,375				45,811
Total current assets			786,729				646,107
Property, plant and equipment, net			334,803				316,334
Goodwill			448,332				440,950
Other intangible assets, net			106,351				105,284
Non-current deferred tax assets, net			101,776				95,688
Other non-current assets			129,636				114,424
Total assets		$	1,907,627			$	1,718,787
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Trade accounts payable		$	121,339			$	103,160
Accrued and other liabilities			104,007				91,907
Accrued compensation and related items			122,342				96,359
Deferred revenue and customer prepayments			93,783				63,292
Taxes payable			62,016				38,686
Current deferred tax liabilities			13,187				11,303
Short-term borrowings and current maturities of long-term debt			89,350				89,968
Total current liabilities			606,024				494,675
Long-term debt			245,866				203,590
Non-current deferred tax liabilities			119,863				119,791
Other non-current liabilities			180,331				189,593
Total liabilities			1,152,084				1,007,649
Commitments and contingencies (Note 14)
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 32,824,634 and 33,851,124 shares at September 30, 2010 and December 31, 2009, respectively			448				448
Additional paid-in capital			587,459				574,034
Treasury stock at cost (11,961,377 shares at September 30, 2010 and 10,934,887 shares at December 31, 2009)			(985,134	)			(857,130	)
Retained earnings			1,153,015				1,009,995
Accumulated other comprehensive (loss) income			(245	)			(16,209	)
Total shareholders’ equity			755,543				711,138
Total liabilities and shareholders’ equity		$	1,907,627			$	1,718,787

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

METTLER-TOLEDO INTERNATIONAL INC.

																						Accumulated
		Common Stock								Additional												Other
										Paid-in				Treasury				Retained				Comprehensive
		Shares				Amount				Capital				Stock				Earnings				(Loss) Income				Total
Balance at December 31, 2008			33,595,303			$	448			$	559,772			$	(873,601	)		$	848,489			$	(31,861	)		$	503,247
Exercise of stock options and restricted stock units			308,154				-				-				21,998				(10,930	)			-				11,068
Other treasury stock issuances			6,467				-				-				461				(157	)			-				304
Repurchases of common stock			(58,800	)			-				-				(5,988	)			-				-				(5,988	)
Tax benefit resulting from exercise of certain employee stock options			-				-				2,895				-				-				-				2,895
Share-based compensation			-				-				11,367				-				-				-				11,367
Total comprehensive income:
Net earnings			-				-				-				-				172,593				-				172,593
Net unrealized gain on cash flow hedging arrangements, net of tax			-				-				-				-				-				5,401				5,401
Change in currency translation adjustment, net of tax			-				-				-				-				-				15,835				15,835
Pension adjustment, net of tax			-				-				-				-				-				(5,584	)			(5,584	)
Comprehensive income																											188,245
Balance at December 31, 2009			33,851,124			$	448			$	574,034			$	(857,130	)		$	1,009,995			$	(16,209	)		$	711,138
Exercise of stock options and restricted stock units			281,897				-				-				20,607				(8,363	)			-				12,244
Other treasury stock issuances			2,549				-				-				183				87				-				270
Repurchases of common stock			(1,310,936	)			-				-				(148,794	)			-				-				(148,794	)
Tax benefit resulting from exercise of certain employee stock options			-				-				4,374				-				-				-				4,374
Share-based compensation			-				-				9,051				-				-				-				9,051
Total comprehensive income:
Net earnings			-				-				-				-				151,296				-				151,296
Net unrealized loss on cash flow hedging arrangements, net of tax			-				-				-				-				-				(8,117	)			(8,117	)
Change in currency translation adjustment, net of tax			-				-				-				-				-				21,174				21,174
Pension adjustment, net of tax			-				-				-				-				-				2,907				2,907
Comprehensive income (a)																											167,260
Balance at September 30, 2010			32,824,634			$	448			$	587,459			$	(985,134	)		$	1,153,015			$	(245	)		$	755,543

(a) Total comprehensive income for the three months ended September 30, 2010 and 2009 was $107,609 and $55,419, respectively and $132,326 for the nine months ended September 30, 2009.

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

METTLER-TOLEDO INTERNATIONAL INC.

		September 30,				September 30,
		2010				2009
Cash flows from operating activities:
Net earnings		$	151,296			$	103,155
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation			22,261				21,926
Amortization			10,613				8,734
Deferred tax provision			(7,392	)			(15,773	)
Excess tax benefits from share-based payment arrangements			(3,410	)			(609	)
Share-based compensation			9,051				8,267
Other			146				218
Increase (decrease) in cash resulting from changes in:
Trade accounts receivable, net			(17,401	)			65,707
Inventories			(41,614	)			10,318
Other current assets			(9,259	)			(6,796	)
Trade accounts payable			15,108				(19,856	)
Taxes payable			20,280				8,092
Accruals and other			55,591				5,092
Net cash provided by operating activities			205,270				188,475
Cash flows from investing activities:
Proceeds from sale of property, plant and equipment			157				1,979
Purchase of property, plant and equipment			(38,564	)			(36,646	)
Acquisitions			(12,557	)			(170	)
Net cash used in investing activities			(50,964	)			(34,837	)
Cash flows from financing activities:
Proceeds from borrowings			93,697				198,072
Repayments of borrowings			(52,115	)			(323,948	)
Debt issuance costs			-				(620	)
Debt extinguishment costs			-				(1,316	)
Proceeds from stock option exercises			12,244				6,073
Repurchases of common stock			(148,794	)			-
Excess tax benefits from share-based payment arrangements			3,410				609
Other financing activities			(6,941	)			(984	)
Net cash used in financing activities			(98,499	)			(122,114	)
Effect of exchange rate changes on cash and cash equivalents			2,046				4,351
Net increase in cash and cash equivalents			57,853				35,875
Cash and cash equivalents:
Beginning of period			85,031				78,073
End of period		$	142,884			$	113,948

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

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited
(In thousands, except share data, unless otherwise stated)

1.

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, Germany, Switzerland, the United Kingdom and the United States. The Company’s principal executive offices are located in Columbus, Ohio and Greifensee, Switzerland.

          The accompanying interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include all entities in which the Company has control, which are its wholly-owned subsidiaries. The interim consolidated financial statements have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The interim consolidated financial statements as of September 30, 2010 and for the three and nine month periods ended September 30, 2010 and 2009 should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009.

          The accompanying interim consolidated financial statements reflect all adjustments which, in the opinion of management, are necessary for a fair statement of the results of the interim periods presented. Operating results for the three and nine months ended September 30, 2010 are not necessarily indicative of the results to be expected for the full year ending December 31, 2010.

          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. A discussion of the Company’s critical accounting policies is included in Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009.

          All intercompany transactions and balances have been eliminated.

          Certain reclassifications have been made to prior year amounts to conform to the current year presentation.

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Trade Accounts Receivable

          Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for 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 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.

          Inventory consisted of the following:

		September 30,				December 31,
		2010				2009
Raw materials and parts		$	98,123			$	80,150
Work-in-progress			37,055				29,695
Finished goods			80,138				58,197
		$	215,316			$	168,042

Other Intangible Assets

          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 “Intangibles – Goodwill and Other” and ASC 360 “Property, Plant and Equipment.”

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

          Other intangible assets consisted of the following:

		September 30, 2010								December 31, 2009
		Gross				Accumulated				Gross				Accumulated
		Amount				Amortization				Amount				Amortization
Customer relationships		$	84,231			$	(17,705	)		$	80,357			$	(15,622	)
Proven technology and patents			36,629				(23,063	)			38,242				(23,011	)
Tradename (finite life)			3,212				(1,020	)			1,993				(909	)
Tradename (indefinite life)			23,634				-				23,634				-
Other			510				(77	)			600				-
		$	148,216			$	(41,865	)		$	144,826			$	(39,542	)

          The annual aggregate amortization expense based on the current balance of other intangible assets is estimated at $6.1 million for 2010, $5.9 million for 2011, $5.6 million for 2012, $4.2 million for 2013 and $3.8 million for 2014. The Company recognized amortization expense associated with the above intangible assets of $1.5 million and $1.3 million for the three months ended September 30, 2010 and 2009, respectively and $4.6 million and $3.6 million for the nine months ended September 30, 2010 and 2009, respectively. Purchased intangible amortization, net of tax was $0.9 million and $0.7 million for the three months ended September 30, 2010 and 2009, respectively and $2.7 million and $2.0 million for the nine months ended September 30, 2010 and 2009, respectively.

          In addition to the above amortization, the Company recorded amortization expense associated with capitalized software of $2.1 million and $1.9 million for the three months ended September 30, 2010 and 2009, respectively and of $6.0 million and $5.1 million for the nine months ended September 30, 2010 and 2009, respectively.

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 transfers upon shipment. In countries where title cannot legally transfer before delivery, the Company defers revenue recognition until delivery has occurred. 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 post-shipment obligation, such as customer acceptance, revenue is deferred until the obligation has been completed. In addition, the Company defers revenue where installation is required, unless such installation is deemed perfunctory. 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. Further, 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 title transfer and risk of loss to our distributors. Distributor discounts are offset against revenue at the time such revenue is recognized.

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

Shipping and handling costs charged to customers are included in total net sales and the associated expense is recorded in cost of sales for all periods presented.

          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 is 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.

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 obligation is affected by product failure rates, material usage and service costs incurred in correcting a product failure.

          The Company’s accrual for product warranties is included in accrued and other liabilities in the consolidated balance sheets. Changes to the Company’s accrual for product warranties for the nine months ended September 30 are as follows:

		September 30,				September 30,
		2010				2009
Balance at beginning of period		$	15,856			$	12,822
Accruals for warranties			11,712				13,492
Foreign currency translation			(196	)			392
Payments / utilizations			(11,984	)			(12,164	)
Balance at end of period		$	15,388			$	14,542

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.

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

Share-Based Compensation

          The Company recognizes share-based compensation expense within selling, general and administrative in the consolidated statement of operations with a corresponding offset to additional paid-in capital in the consolidated balance sheet. The Company recorded $3.1 million and $9.1 million of share-based compensation expense for the three and nine months ended September 30, 2010, respectively, compared to $2.8 million and $8.3 million for the corresponding periods in 2009.

Research and Development

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

3.

ACQUISITIONS

          In January 2010, the Company acquired a pipette distributor located in the United Kingdom for an aggregate purchase price of approximately $12.5 million. The Company may be required to pay additional cash consideration up to a maximum amount of approximately $1.2 million related to an earn-out period. Goodwill recorded in connection with the acquisition totaled approximately $7.4 million, which is included in the Company’s Western European Operations segment. The Company also recorded $4.5 million of identified intangibles pertaining to a tradename and customer relationships.

4.

FINANCIAL INSTRUMENTS

          As more fully described below, the Company enters into certain interest rate swap agreements in order to manage its exposure to changes in interest rates. The amount of the Company’s fixed obligation interest payments may change based upon the expiration dates of its interest rate swap agreements and the level and composition of its debt. The Company also enters into certain foreign currency forward contracts to limit the Company’s exposure to currency fluctuations on the respective hedged items. The Company does not use derivative financial instruments for trading purposes. For additional disclosures on the fair value of financial instruments, see Note 5 to the interim consolidated financial statements.

          Cash Flow Hedges

          The Company has two interest rate swap agreements, designated as cash flow hedges. The first agreement changes the floating rate LIBOR-based interest payments associated with $40 million outstanding under the Company’s credit facility to a fixed obligation of 2.70%.

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

          The second agreement is a forward-starting swap which changes the floating rate LIBOR-based interest payments associated with $100 million in forecasted borrowings under the Company’s credit facility to a fixed obligation of 3.24% beginning in October 2010. During the nine months ended September 30, 2010, the Company settled $100 million of its original $200 million arrangement, resulting in an expense of $0.6 million being reclassified from other comprehensive income to interest expense.

          The Company has also entered into a foreign currency forward contract (with a notional amount of $25.3 million), designated as a cash flow hedge, to hedge forecasted intercompany sales denominated in U.S. dollars with its foreign businesses. The Company records the effective portion of the cash flow derivative hedging gains and losses in accumulated other comprehensive (loss) income, net of tax and reclassifies these amounts into earnings in the period in which the transaction affects earnings. Gains or losses on the derivatives representing hedge ineffectiveness, if any, are recognized in current earnings. Through September 30, 2010, no hedge ineffectiveness has occurred in relation to these cash flow hedges.

          The fair value of these derivative instruments at September 30, 2010 and December 31, 2009 are as follows:

				Fair Value		Fair Value
		Balance Sheet Location		September 30, 2010		December 31, 2009
Derivatives designated as hedging instruments:
Cash flow hedges:
Interest rate swap agreement		Current liabilities		$(65)		$(733)
Interest rate forward-starting swap agreement		Other non-current (liabilities)/assets		$(8,815)		$3,419
Foreign currency forward contract		Current assets		$350		$1,566

          The effects of these derivative instruments on the consolidated statement of operations before taxes for the three and nine month periods ended September 30, 2010 are as follows:

				Three months ended September 30, 2010				Nine months ended September 30, 2010
		Location of				Gain/(Loss)				Gain/(Loss)
		Derivative				Reclassified from				Reclassified from
		Gain/(Loss)		Derivative		AOCI into		Derivative		AOCI into
		Recognized in		Gain/(Loss)		Earnings (Effective		Gain/(Loss)		Earnings (Effective
		Earnings		Recognized in OCI		Portion)		Recognized in OCI		Portion)
Derivatives designated as hedging instruments:
Cash flow hedges:
Interest rate swaps		Interest expense		$(3,244)		$(221)		$(11,566)		$(1,237)
Foreign currency forward contract		Net sales		$(28)		$237		$(1,216)		$913

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

          The effects of these derivative instruments on the consolidated statement of operations before taxes for the three and nine month periods ended September 30, 2009 were as follows:

				Three months ended September 30, 2009				Nine months ended September 30, 2009
		Location of				Gain/(Loss)				Gain/(Loss)
		Derivative				Reclassified from				Reclassified from
		Gain/(Loss)		Derivative		AOCI into		Derivative		AOCI into
		Recognized in		Gain/(Loss)		Earnings (Effective		Gain/(Loss)		Earnings (Effective
		Earnings		Recognized in OCI		Portion)		Recognized in OCI		Portion)
Derivatives designated as hedging instruments:
Cash flow hedges:
Interest rate swaps		Interest expense		$(2,755)		$(2,036)		$3,399		$(3,700)
Foreign currency forward contract		Net sales		$(1,404)		$714		$2,033		$1,041

          A net after tax derivative loss of $1.5 million based upon interest rates and foreign currency exchange rates at September 30, 2010 is expected to be recognized in earnings in the next twelve months.

          Fair Value Hedges and Other Derivatives

          The Company has a $30 million interest rate swap agreement, designated as a fair value hedge, in connection with its 4.85% $75 million seven-year Senior Notes. Under the swap the Company will receive a fixed rate of 4.85% (i.e. the same rate as the 4.85% Senior Notes) and will pay interest at a rate of LIBOR plus 0.22%. The Company records the gain or loss on the derivative as well as the offsetting gain or loss on the hedged item in earnings under interest expense.

          The Company enters into foreign currency forward contracts in order to economically hedge short-term intercompany balances largely denominated in Swiss franc and other major European currencies with its foreign businesses. In accordance with U.S. GAAP, these contracts are considered “derivatives not designated as hedging instruments” and are categorized as “other derivatives” in the table below. Gains or losses on these instruments are reported in current earnings. At September 30, 2010 and December 31, 2009, these contracts had a notional value of $137.0 million and $128.7 million, respectively.

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

          The fair value of these derivative instruments and their effects on the consolidated balance sheet at September 30, 2010 and December 31, 2009 were as follows:

				Fair Value		Fair Value
		Balance Sheet Location		September 30, 2010		December 31, 2009
Derivatives designated as hedging instruments:
Fair value hedges:
Interest rate swap agreement		Other non-current assets		$152		$846
Derivatives not designated as hedging instruments:
Other derivatives:
Foreign currency forward contracts - liabilities		Accrued and other liabilities		$(359)		$(344)
Foreign currency forward contracts - assets		Other current assets		$1,713		$453

          The fair value of these derivative instruments and their effects on the consolidated statement of operations before taxes for the three and nine month periods ended September 30, 2010 are as follows:

				Derivative Gain/(Loss)		Derivative Gain/(Loss)
		Location of Derivative		Recognized in Earnings for		Recognized in Earnings for
		Gain/(Loss) Recognized in		the three months ended		the nine months ended
		Earnings		September 30, 2010		September 30, 2010
Derivatives designated as hedging instruments:
Fair value hedges:
Interest rate swap agreement		Interest Expense		$256		$694
Derivatives not designated as hedging instruments:
Other derivatives:
Foreign currency forward contracts - liabilities
		Other charges (income), net		$2,074		$(2,539)
Foreign currency forward contracts - assets

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

          The fair value of these derivative instruments and their effects on the consolidated statement of operations before taxes for the three and nine month periods ended September 30, 2009 were as follows:

Derivative Gain/(Loss)

Derivative Gain/(Loss)

Location of Derivative

Recognized in Earnings for

Recognized in Earnings for

Gain/(Loss) Recognized in

the three months ended

the nine months ended

Earnings

September 30, 2009

September 30, 2009

Derivatives designated as hedging instruments:

Fair value hedges:

Interest rate swap agreement

Interest Expense

$55

$

466

Derivatives not designated as hedging instruments:

Other derivatives:

Foreign currency forward contracts - liabilities

Other charges (income), net

$736

$

304

Foreign currency forward contracts - assets

5.

FAIR VALUE MEASUREMENTS

          At September 30, 2010 and December 31, 2009, the Company had derivative assets totaling $2.2 million and $6.3 million, respectively and derivative liabilities totaling $9.2 million and $1.1 million, respectively. The fair values of the interest rate swap agreements and foreign currency forward contracts that economically hedge short-term intercompany balances are estimated based upon inputs from current valuation information obtained from dealer quotes and priced with observable market assumptions and appropriate valuation adjustments for credit risk. The Company has evaluated the valuation methodologies used to develop the fair values by dealers in order to determine whether such valuations are representative of an exit price in the Company’s principal market. In addition, the Company uses an internally developed model to perform testing on the valuations received from brokers. The fair value of the foreign currency forward contract hedging forecasted intercompany sales is priced with observable market assumptions with appropriate valuations for credit risk. The Company has also considered both its own credit risk and counterparty credit risk in determining fair value and determined these adjustments were insignificant at September 30, 2010 and December 31, 2009.

          At September 30, 2010 and December 31, 2009, the Company had $16.3 million and $11.1 million of cash equivalents, respectively, the fair value of which is determined through corroborated prices in active markets. The fair value of cash equivalents approximates cost.

          The difference between the fair value and carrying value of the Company’s long-term debt is not material.

          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

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

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 September 30, 2010 and December 31, 2009:

		September 30, 2010																December 31, 2009
		Total				Level 1				Level 2				Level 3				Total				Level 1				Level 2				Level 3
Assets:
Foreign currency forward contracts		$	2,063			$	-			$	2,063			$	-			$	2,019			$	-			$	2,019			$	-
Interest rate swap agreement			152				-				152				-				4,265				-				4,265				-
Cash equivalents			16,305				-				16,305				-				11,080				-				11,080				-
Total		$	18,520			$	-			$	18,520			$	-			$	17,364			$	-			$	17,364			$	-
Liabilities:
Foreign currency forward contracts		$	359			$	-			$	359			$	-			$	344			$	-			$	344			$	-
Interest rate swap agreements			8,880				-				8,880				-				733				-				733				-
Total		$	9,239			$	-			$	9,239			$	-			$	1,077			$	-			$	1,077			$	-

6.

INCOME TAXES

          The provision for taxes is based upon the Company’s projected annual effective rate of 26% for the three and nine month periods ended September 30, 2010. During the third quarter of 2010, the Company recorded discrete tax items resulting in a net tax benefit of $5.2 million primarily related to the favorable resolution of certain prior year tax matters. The impact of these items decreased the effective tax rate to 19% and 23% for the three and nine month periods ended September 30, 2010, respectively.

          During the first quarter of 2009, the Company recorded a discrete tax benefit of $8.3 million, primarily related to the favorable resolution of certain prior year tax matters. The impact of this item decreased the effective tax rate to 21% for the nine month period ended September 30, 2009.

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

7.

DEBT

          Debt consisted of the following at September 30, 2010:

		September 30, 2010
						Other Principal
						Trading
		U.S. Dollar				Currencies				Total
4.85% $75 million Senior Notes (net of unamortized discount)		$	75,150			$	-			$	75,150
6.30% $100 million Senior Notes			100,000				-				100,000
Credit facility			117,697				14,918				132,615
Other local arrangements			-				27,451				27,451
Total debt			292,847				42,369				335,216
Less: current portion			(75,150	)			(14,200	)			(89,350	)
Total long-term debt		$	217,697			$	28,169			$	245,866

          As of September 30, 2010, the Company had $812.2 million of availability remaining under the credit facility.

          Tender Offer

          On May 6, 2009, the Company commenced a cash tender offer to purchase any and all of its outstanding 4.85% Senior Notes due November 15, 2010. The tender offer, which expired May 12, 2009, resulted in the repurchase of $75 million of the principal balance of the 4.85% Senior Notes. In connection with the tender, the Company recorded a charge of $1.5 million, during the second quarter of 2009, which included a premium of $0.9 million, unamortized discount and debt issuance fees of $0.2 million and certain third party costs of $0.4 million. These charges were recorded in interest expense in the consolidated statement of operations.

          Issuance of 6.30% Senior Notes

          On June 25, 2009, the Company issued and sold, in a private placement, $100 million aggregate principal amount of its 6.30% Series 2009-A Senior Notes due June 25, 2015 (“6.30% Senior Notes”) under a Note Purchase Agreement among the Company and the accredited institutional investors named therein (the “Agreement”). The 6.30% Senior Notes are senior unsecured obligations of the Company.

          The 6.30% Senior Notes mature on June 25, 2015. Interest is payable semi-annually in June and December. The Company may at any time prepay the 6.30% Senior Notes, in whole or in part (but in an amount not less than 10% of the original aggregate principal amount), at a price equal to 100% of the principal amount thereof plus accrued and unpaid interest, plus a “make-whole” prepayment premium. In the event of a change in control (as defined in the Agreement) of the Company, the Company may be required to offer to prepay the 6.30% Senior Notes in whole at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest.

          The Agreement contains customary affirmative and negative covenants for agreements of this type including, among others, limitations on the Company and its subsidiaries with respect to

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

incurrence of liens and priority indebtedness, disposition of assets, mergers, and transactions with affiliates. The 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 Agreement contains customary events of default with customary grace periods, as applicable. The Company was in compliance with these covenants at September 30, 2010.

          Under the terms of the offering, the Company may sell additional Senior Notes at its discretion in an aggregate amount not to exceed $600 million. Such additional Senior Notes would rank equally with the Company’s unsecured indebtedness.

          Issuance costs approximating $0.7 million will be amortized to interest expense over the six-year term of the 6.30% Senior Notes.

8.

SHARE REPURCHASE PROGRAM AND TREASURY STOCK

          As of September 30, 2010, the Company had $261.8 million of remaining availability under the Company’s share repurchase program. In November 2010, the Board of Directors authorized the Company to buy back an additional $750 million of common shares. The Company expects that the new authorization will be utilized over the next several years. 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, stock price, trading restrictions, the level of acquisition activity and other factors. The Company has purchased 16.6 million shares since the inception of the program through September 30, 2010.

          The Company’s share repurchase program was suspended in October 2008 and re-started in December 2009. During the nine months ended September 30, 2010, the Company spent $148.8 million on the repurchase of 1,310,936 shares at an average price per share of $113.48. The Company reissued 281,897 shares and 149,278 shares held in treasury for the exercise of stock options and restricted stock units during the nine months ended September 30, 2010 and 2009, respectively. The Company also reissued 2,549 shares and 6,467 shares held in treasury during the nine months ended September 30, 2010 and 2009, respectively, pursuant to its 2007 Share Plan which extends certain eligible employees the option to receive a percentage of their annual bonus in shares of the Company’s stock.

9.

EARNINGS PER COMMON SHARE

          In accordance with the treasury stock method, the Company has included the following common equivalent shares in the calculation of diluted weighted average number of common shares

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

outstanding for the three and nine month periods ended September 30, solely relating to outstanding stock options and restricted stock units:

		2010				2009
Three months ended			856,174				684,725
Nine months ended			830,483				517,391

          Outstanding options and restricted stock units to purchase or receive 515,828 and 884,128 shares of common stock for the three month periods ended September 30, 2010 and 2009, respectively, and options and restricted stock units to purchase or receive 585,426 and 1,141,013 shares of common stock for the nine month periods ended September 30, 2010 and 2009, 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.

10.

NET PERIODIC BENEFIT COST

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

																		Other U.S.
		U.S. Pension Benefits								Non-U.S. Pension Benefits								Post-retirement Benefits
		2010				2009				2010				2009				2010				2009
Service cost, net		$	66			$	45			$	3,055			$	3,988			$	74			$	96
Interest cost on projected benefit obligations			1,610				1,695				5,592				5,477				189				280
Expected return on plan assets			(1,727	)			(1,711	)			(7,379	)			(6,825	)			-				-
Net amortization and deferral			-				-				(324	)			(258	)			(168	)			(240	)
Recognition of actuarial losses/(gains)			1,324				1,165				266				147				(184	)			(83	)
Recognition of settlement/curtailment losses, net			-				-				-				(239	)			-				-
Net periodic pension cost/(credit)		$	1,273			$	1,194			$	1,210			$	2,290			$	(89	)		$	53

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

																		Other U.S.
		U.S. Pension Benefits								Non-U.S. Pension Benefits								Post-retirement Benefits
		2010				2009				2010				2009				2010				2009
Service cost, net		$	198			$	137			$	9,323			$	11,825			$	221			$	286
Interest cost on projected benefit obligations			4,829				5,087				16,563				15,896				568				840
Expected return on plan assets			(5,180	)			(5,131	)			(21,588	)			(19,782	)			-				-
Net amortization and deferral			-				-				(932	)			(737	)			(503	)			(718	)
Recognition of actuarial losses/(gains)			3,973				3,495				796				507				(552	)			(247	)
Recognition of settlement/curtailment losses, net			-				-				58				(138	)			-				-
Net periodic pension cost/(credit)		$	3,820			$	3,588			$	4,220			$	7,571			$	(266	)		$	161

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

          As previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009, the Company expects to make employer contributions of approximately $17.6 million to its non-U.S. pension plans and employer contributions of approximately $1.5 million to its U.S. post-retirement medical plan during the year ended December 31, 2010. These estimates may change based upon several factors, including fluctuations in currency exchange rates, actual returns on plan assets and changes in legal requirements.

11.

RESTRUCTURING CHARGES

          During the fourth quarter of 2008, the Company initiated a global cost reduction program which has substantially been completed. Through September 30, 2010 total charges recognized were $40.3 million, of which $2.5 million and $28.4 million were recorded during the nine month periods ended September 30, 2010 and 2009, respectively. Under the program, the Company reduced its workforce (including employees and temporary personnel) by approximately 1,000.

          A rollforward of the Company’s accrual for restructuring activities for the nine months ended September 30, 2010 is as follows:

		Employee				Lease
		Related				Termination				Other				Total
Balance at December 31, 2009		$	14,122			$	669			$	15			$	14,806
Restructuring charges			1,728				26				722				2,476
Cash payments			(7,768	)			(380	)			(735	)			(8,883	)
Impact of foreign currency			(636	)			-				-				(636	)
Balance at September 30, 2010		$	7,446			$	315			$	2			$	7,763

12.

OTHER CHARGES (INCOME), NET

          Other charges (income), net consists primarily of interest income, (gains) losses from foreign currency transactions and other items.

13.

SEGMENT REPORTING

          As disclosed in Note 17 to the Company’s consolidated financial statements for the year ending December 31, 2009, the Company has determined there are five reportable segments: U.S. Operations, Swiss Operations, Western European Operations, Chinese Operations and Other.

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

METTLER-TOLEDO INTERNATIONAL INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
At September 30, 2010 – Unaudited (Continued)
(In thousands, except share data, unless otherwise stated)

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

		Net Sales to				Net Sales to
For the three months ended		External				Other				Total Net				Segment
September 30, 2010		Customers				Segments				Sales				Profit				Goodwill (c)
U.S. Operations		$	160,560			$	13,856			$	174,416			$	31,322			$	319,145
Swiss Operations			27,147				85,000				112,147				23,296				19,732
Western European Operations			138,670				23,444				162,114				17,001				95,137
Chinese Operations			81,211				30,238				111,449				26,333				666
Other (a)			82,625				1,278				83,903				8,879				13,652
Eliminations and Corporate (b)			-				(153,816	)			(153,816	)			(21,071	)			-
Total		$	490,213			$	-			$	490,213			$	85,760			$	448,332
		Net Sales to				Net Sales to
For the nine months ended		External				Other				Total Net				Segment
September 30, 2010		Customers				Segments				Sales				Profit
U.S. Operations		$	452,983			$	42,800			$	495,783			$	87,051
Swiss Operations			76,270				237,409				313,679				62,266
Western European Operations			414,738				65,098				479,836				51,633
Chinese Operations			208,809				77,060				285,869				65,086
Other (a)			222,613				2,955				225,568				18,254
Eliminations and Corporate (b)			-				(425,322	)			(425,322	)			(58,165	)
Total		$	1,375,413			$	-			$	1,375,413			$	226,125
		Net Sales to				Net Sales to
For the three months ended		External				Other				Total Net				Segment
September 30, 2009		Customers				Segments				Sales				Profit				Goodwill
U.S. Operations		$	140,665			$	11,689			$	152,354			$	28,312			$	309,201
Swiss Operations			27,606				72,341				99,947				20,623				18,754
Western European Operations			138,377				20,255				158,632				17,815				90,154
Chinese Operations			62,589				18,990				81,579				19,579				649
Other (a)			66,413				1,246				67,659				6,432				12,832
Eliminations and Corporate (b)			-				(124,521	)			(124,521	)			(19,563	)			-
Total		$	435,650			$	-			$	435,650			$	73,198			$	431,590
		Net Sales to				Net Sales to
For the nine months ended		External				Other				Total Net				Segment
September 30, 2009		Customers				Segments				Sales				Profit
U.S. Operations		$	399,851			$	32,754			$	432,605			$	73,868
Swiss Operations			74,295				198,076				272,371				52,533
Western European Operations			398,868				53,362				452,230				42,645
Chinese Operations			162,418				49,589				212,007				44,670
Other (a)			181,739				2,379				184,118				12,969
Eliminations and Corporate (b)			-				(336,160	)			(336,160	)			(39,499	)
Total		$	1,217,171			$	-			$	1,217,171			$	187,186