Lincoln Electric Reports Third Quarter 2016 Results

EPS of $0.89


Third Quarter 2016 Highlights
 •  Operating income margin of 14.4%
 •  Solid cash flow from operations and cash conversion of net income (1)
 •  Returned $107 million to shareholders through dividends and share repurchases
 

CLEVELAND, Oct. 21, 2016 (GLOBE NEWSWIRE) -- Lincoln Electric Holdings, Inc. (the “Company”) (Nasdaq:LECO) today reported third quarter 2016 net income of $60.0 million, or diluted earnings per share (EPS) of $0.89 which includes a $4.0 million, or $0.06 EPS benefit from a discrete income tax item.  This compares with net losses of $60.5 million, or $(0.82) EPS, in the comparable 2015 period due to after-tax special item charges of $126.7 million, or $1.71 EPS.  On an adjusted basis, net income for third quarter 2015 was $66.2 million, or $0.89 EPS.

Third quarter 2016 sales decreased 12.0% to $567.6 million as a 2.1% benefit from acquisitions was offset by 12.8% lower volumes, a 0.7% decrease in price and a 0.6% unfavorable impact from foreign exchange translation.  Excluding Venezuela from prior year results due to the recent deconsolidation of the operation, sales decreased 7.0%, primarily from 7.8% lower volumes. 

Operating income for the third quarter 2016 was $81.8 million, or 14.4% of sales, reflecting favorable mix and lower costs.  This compares with operating losses of $84.0 million in the comparable 2015 period which included special items related to pension settlement charges, Venezuelan currency remeasurement losses and rationalization and impairment charges.  On an adjusted basis, third quarter 2015 operating income was $97.1 million or 15.1% of sales.

“We are pleased to report solid margin performance in the quarter,” stated Christopher L. Mapes, Chairman, President and Chief Executive Officer. “As we navigate through this challenging portion of the cycle, our year-over-year sales performance continues to improve on easier comparisons and successful commercial initiatives in the equipment product line. While market trends remain mixed, we are focused on cost controls, productivity, and positioning Lincoln Electric for long-term success.”

(1) Cash conversion is defined as Net cash provided by operating activities less Capital expenditures divided by Net income.

Nine Months 2016 Summary

Net income for the nine months ended September 30, 2016 was $145.0 million, or EPS of $2.11, which includes an after-tax special item benefit of $7.2 million, or $0.10 EPS, due to the reversal of an income tax valuation allowance and a $33.3 million charge, or $0.48 EPS, from the deconsolidation of the Venezuelan subsidiary.  This compares with net income of $78.8 million, or EPS of $1.04, in the comparable 2015 period.  Adjusted net income for the nine months ended September 30, 2016 was $171.1 million, or adjusted EPS of $2.49, compared with adjusted net income of $206.4 million, or adjusted EPS of $2.72, in 2015.

Sales decreased 13.1% to $1.7 billion in the nine months ended September 30, 2016 primarily due to unfavorable foreign exchange translation and lower volumes.  This compares with $2.0 billion in sales in the comparable 2015 period.  Excluding Venezuela from prior year results, sales decreased 9.9%, primarily from lower volumes.  Operating income was $205.2 million, or 12.0% of sales, as compared with $103.3 million, or 5.2% of sales, in the comparable 2015 period.  Adjusted operating income was $239.6 million or 14.0% of sales, compared with $285.6 million, or 14.5% of sales in 2015.

Venezuela Deconsolidation

Effective June 30, 2016, the Company deconsolidated the financial results of its Venezuela subsidiary and began reporting its results using the cost method of accounting.  As a result, Venezuela is no longer included in the consolidated financial statements in the current period starting in the third quarter of 2016.  In the third quarter of 2015 Venezuela contributed $34.7 million of Net sales and incurred a $16.8 million loss in Gross profit due to a $22.2 million special item charge in Cost of goods sold related to the remeasurement of the Venezuela currency.  Excluding this charge, Venezuela contributed $5.3 million in Gross profit.

Dividend and Share Repurchases
           
The Company’s Board of Directors declared a 9.4% increase in the quarterly cash dividend, from $0.32 per share to $0.35, or $1.40 per share on an annual basis.  The declared quarterly cash dividend of $0.35 per share is payable January 13, 2017 to shareholders of record as of December 31, 2016.

During the third quarter, the Company returned $107.2 million to shareholders through dividends and the repurchase of 1.4 million of the Company’s common shares.  The Company is maintaining its 2016 share repurchase target of $400 million of the Company’s common shares.

Financing Activities
           
On October 20, 2016, the Company issued Senior Unsecured Notes (the "2016 Notes") in the aggregate principal amount of $350 million through a private placement.  The 2016 Notes have maturities ranging from 12 to 25 years with a weighted average effective interest rate of 3.1% and a weighted average term of 18 years.  The proceeds will be used for general corporate purposes.

Webcast Information

A conference call to discuss third quarter 2016 financial results will be webcast live today, October 21, 2016, at 10:00 a.m., Eastern Time.  This webcast is accessible at http://ir.lincolnelectric.com.  Listeners should go to the web site prior to the call to register, download and install any necessary audio software.  A replay of the webcast will be available on the Company's web site.

Investors who are unable to access the webcast may listen to the conference call live by telephone by dialing (877) 344-3899 (domestic) or (315) 625-3087 (international) and use confirmation code 90839034.  Telephone participants are asked to dial in 10-15 minutes prior to the start of the conference call.

Financial results for the third quarter 2016 can also be obtained at http://ir.lincolnelectric.com.

About Lincoln Electric

Lincoln Electric is the world leader in the design, development and manufacture of arc welding products, robotic arc welding systems, plasma and oxy-fuel cutting equipment and has a leading global position in the brazing and soldering alloys market.  Headquartered in Cleveland, Ohio, Lincoln has 48 manufacturing locations, including operations and joint ventures in 19 countries and a worldwide network of distributors and sales offices covering more than 160 countries.  For more information about Lincoln Electric and its products and services, visit the Company’s website at www.lincolnelectric.com.

Non-GAAP Information

Adjusted operating income, Adjusted net income, Adjusted diluted earnings per share and Return on invested capital are non-GAAP financial measures. Management uses non-GAAP measures to assess the Company's operating performance by excluding certain disclosed special items that management believes are not representative of the Company's core business. Management believes that excluding these special items enables them to make better period-over-period comparisons and benchmark the Company's operational performance against other companies in its industry more meaningfully. Furthermore, management believes that non-GAAP financial measures provide investors with meaningful information that provides a more complete understanding of Company operating results and enables investors to analyze financial and business trends more thoroughly.  Non-GAAP financial measures should not be viewed in isolation, are not a substitute for GAAP measures and have limitations including, but not limited to, their usefulness as comparative measures as other companies may define their non-GAAP measures differently.

 

Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share amounts)
(Unaudited)
 
Consolidated Statements of Income Three Months Ended September 30, Fav (Unfav) to Prior Year
  2016 % of Sales 2015 % of Sales $ %
Net sales $567,646  100.0% $645,166  100.0% $(77,520) (12.0%)
Cost of goods sold 367,834  64.8% 446,272  69.2% 78,438  17.6%
Gross profit 199,812  35.2% 198,894  30.8% 918  0.5%
Selling, general & administrative expenses 117,983  20.8% 128,299  19.9% 10,316  8.0%
Rationalization and asset impairment charges     18,285  2.8% 18,285  100.0%
Pension settlement charges     136,331  21.1% 136,331  100.0%
Operating income (loss) 81,829  14.4% (84,021) (13.0%) 165,850  197.4%
Interest income 360  0.1% 692  0.1% (332) (48.0%)
Equity earnings in affiliates 619  0.1% 310    309  99.7%
Other income 1,303  0.2% 296    1,007  340.2%
Interest expense (3,815) (0.7%) (5,803) (0.9%) 1,988  34.3%
Income (loss) before income taxes 80,296  14.1% (88,526) (13.7%) 168,822  190.7%
Income taxes 20,257  3.6% (28,045) (4.3%) (48,302) (172.2%)
Effective tax rate 25.2%   31.7%   6.5%  
Net income (loss) including non-controlling interests 60,039  10.6% (60,481) (9.4%) 120,520  199.3%
Non-controlling interests in subsidiaries’ loss (10)   (15)   5  33.3%
Net income (loss) $60,049  10.6% $(60,466) (9.4%) $120,515  199.3%
             
Basic earnings (loss) per share $0.90    $(0.82)   $1.72  209.8%
Diluted earnings (loss) per share $0.89    $(0.82)   $1.71  208.5%
Weighted average shares (basic) 66,477    73,754       
Weighted average shares (diluted) 67,182    73,754       
  Nine Months Ended September 30, Fav (Unfav) to Prior Year
  2016 % of Sales 2015 % of Sales $ %
Net sales $1,710,786  100.0% $1,967,806  100.0% $(257,020) (13.1%)
Cost of goods sold 1,118,945  65.4% 1,322,741  67.2% 203,796  15.4%
Gross profit 591,841  34.6% 645,065  32.8% (53,224) (8.3%)
Selling, general & administrative expenses 352,290  20.6% 385,945  19.6% 33,655  8.7%
Rationalization and asset impairment charges     19,524  1.0% 19,524  100.0%
Pension settlement charges     136,331  6.9% 136,331  100.0%
Loss on deconsolidation of Venezuelan subsidiary 34,348  2.0%     (34,348) (100.0%)
Operating income (loss) 205,203  12.0% 103,265  5.2% 101,938  98.7%
Interest income 1,225  0.1% 2,023  0.1% (798) (39.4%)
Equity earnings in affiliates 2,084  0.1% 2,138  0.1% (54) (2.5%)
Other income 2,552  0.1% 3,223  0.2% (671) (20.8%)
Interest expense (11,828) (0.7%) (12,034) (0.6%) 206  1.7%
Income (loss) before income taxes 199,236  11.6% 98,615  5.0% 100,621  102.0%
Income taxes 54,264  3.2% 19,902  1.0% (34,362) (172.7%)
Effective tax rate 27.2%   20.2%   (7.0%)  
Net income (loss) including non-controlling interests 144,972  8.5% 78,713  4.0% 66,259  84.2%
Non-controlling interests in subsidiaries’ loss (32)   (73)   41  56.2%
Net income (loss) $145,004  8.5% $78,786  4.0% $66,218  84.0%
             
Basic earnings (loss) per share $2.13    $1.05    $1.08  102.9%
Diluted earnings (loss) per share $2.11    $1.04    $1.07  102.9%
Weighted average shares (basic) 68,081    74,999       
Weighted average shares (diluted) 68,784    75,764       

 

Lincoln Electric Holdings, Inc. 
Financial Highlights 
(In thousands) 
(Unaudited) 
  
Balance Sheet Highlights 
  
Selected Consolidated Balance Sheet Data September 30, 2016 December 31, 2015 
Cash and cash equivalents $256,928  $304,183  
Total current assets 920,478  935,995  
Property, plant and equipment, net 384,817  411,323  
Total assets 1,833,821  1,784,171  
Total current liabilities 596,059  370,122  
Short-term debt (1) 183,827  4,278  
Long-term debt, less current portion 359,831  350,347  
Total equity 752,917  932,448  
     
Operating Working Capital September 30, 2016 December 31, 2015 
Accounts receivable $281,039  $264,715  
Inventory 285,199  275,930  
Trade accounts payable 164,783  152,620  
Operating working capital $401,455  $388,025  
      
Operating working capital to net sales (2) 17.7% 17.1% 
     
Invested Capital September 30, 2016 December 31, 2015 
Short-term debt (1) $183,827  $4,278  
Long-term debt, less current portion 359,831  350,347  
Total debt 543,658  354,625  
Total equity 752,917  932,448  
Invested capital $1,296,575  $1,287,073  
      
Total debt / invested capital 41.9% 27.6% 
        


(1) Includes current portion of long-term debt.
(2) Operating working capital to net sales is defined as operating working capital divided by annualized rolling three months of net sales.           



Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share amounts)
(Unaudited)
 
Non-GAAP Financial Measures
 
  Three Months Ended September 30, Nine Months Ended September 30,
  2016 2015 2016 2015
Operating income (loss) as reported $81,829  $(84,021) $205,203  $103,265 
Special items (pre-tax):        
Rationalization and asset impairment charges (1)   18,285    19,524 
Loss on deconsolidation of Venezuelan subsidiary (2)     34,348   
Venezuela foreign exchange losses (3)   26,506    26,506 
Pension settlement charges (4)   136,331    136,331 
Adjusted operating income (loss) (6) $81,829  $97,101  $239,551  $285,626 
As a percent of total sales 14.4% 15.1% 14.0% 14.5%
         
Net income (loss) as reported $60,049  $(60,466) $145,004  $78,786 
Special items (after-tax):        
Rationalization and asset impairment charges (1)   16,832    17,732 
Loss on deconsolidation of Venezuelan subsidiary (2)     33,251   
Venezuela foreign exchange losses (3)   26,506    26,506 
Pension settlement charges (4)   83,341    83,341 
Income tax valuation reversals (5)     (7,196)  
Adjusted net income (6) $60,049  $66,213  $171,059  $206,365 
         
Diluted earnings (loss) per share as reported $0.89  $(0.82) $2.11  $1.04 
Special items   1.71  0.38  1.68 
Adjusted diluted earnings per share (6) $0.89  $0.89  $2.49  $2.72 
         
Weighted average shares (diluted) 67,182  74,460  68,784  75,764 
         


 (1 )The three and nine months ended September 30, 2015 include net charges primarily related to severance and other related costs and charges related to the impairment of long-lived assets and goodwill.
 (2)The nine months ended September 30, 2016 reflect a charge (non-cash charge of $34.1 million pretax and $33.0 million after-tax) related to the deconsolidation of the Company's Venezuelan subsidiary in the second quarter 2016.
 (3)The three and nine months ended September 30, 2015 represent the impact of Venezuelan remeasurement losses related to the adoption of new foreign exchange mechanisms.
 (4)The three and nine months ended September 30, 2015 include pension settlement charges primarily related to the purchase of a group annuity contract.
 (5)The nine months ended September 30, 2016 reflect reduced income tax expense related to the reversal of an income tax valuation allowance as a result of a legal entity change to realign the Company’s tax structure.
 (6)Adjusted operating income, Adjusted net income and Adjusted diluted earnings per share are non-GAAP financial measures.  Management uses non-GAAP measures to assess the Company's operating performance by excluding certain disclosed special items that management believes are not representative of the Company's core business.  Management believes that excluding these special items enables them to make better period-over-period comparisons and benchmark the Company's operational performance against other companies in its industry more meaningfully.  Furthermore, management believe that non-GAAP financial measures provide investors with meaningful information that provides a more complete understanding of Company operating results and enables investors to analyze financial and business trends more thoroughly.  Non-GAAP financial measures should not be viewed in isolation, are not a substitute for GAAP measures and have limitations including, but not limited to, their usefulness as comparative measures as other companies may define their non-GAAP measures differently.

 

Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share amounts)
(Unaudited)
 
Non-GAAP Financial Measures
 
  Twelve Months Ended September 30,
Return on Invested Capital 2016 2015
Net income as reported $193,696  $153,998 
Rationalization and asset impairment charges (gains), net of tax of ($16) and $1,791 in 2016 and 2015, respectively 450  17,899 
Loss on deconsolidation of Venezuelan subsidiary, net of tax of $1,097 33,251   
Income tax valuation reversals (7,196)  
Pension settlement charges, net of tax of $2,438 and $52,990 in 2016 and 2015, respectively 3,969  83,341 
Venezuela currency devaluation 708  26,506 
Adjusted net income (1) $224,878  $281,744 
Plus: Interest expense, net of tax of $6,816 and $7,174 in 2016 and 2015, respectively 13,342  11,564 
Less: Interest income, net of tax of $596 and $1,015 in 2016 and 2015, respectively 1,182  1,636 
Adjusted net income before tax effected interest $237,038  $291,672 
     
Invested Capital September 30, 2016 September 30, 2015
Short-term debt $183,827  $2,453 
Long-term debt, less current portion 359,831  350,899 
Total debt 543,658  353,352 
Total equity 752,917  1,011,969 
Invested capital $1,296,575  $1,365,321 
     
Return on invested capital (1)(2) 18.3% 21.4%
     


 (1)Adjusted net income and Return on invested capital are non-GAAP financial measures.  Management uses non-GAAP measures to assess the Company's operating performance by excluding certain disclosed special items that management believes are not representative of the Company's core business.  Management believes that excluding these special items enables them to make better period-over-period comparisons and benchmark the Company's operational performance against other companies in its industry more meaningfully.  Furthermore, management believe that non-GAAP financial measures provide investors with meaningful information that provides a more complete understanding of Company operating results and enables investors to analyze financial and business trends more thoroughly.  Non-GAAP financial measures should not be viewed in isolation, are not a substitute for GAAP measures and have limitations including, but not limited to, their usefulness as comparative measures as other companies may define their non-GAAP measures differently.
 (2)Return on invested capital is defined as rolling 12 months of Adjusted net income excluding tax-effected interest income and expense divided by invested capital.



Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share amounts)
(Unaudited)
 
Condensed Consolidated Statements of Cash Flows
 
  Three Months Ended September 30,
  2016 2015
OPERATING ACTIVITIES:    
Net income (loss) $60,049  $(60,466)
Non-controlling interests in subsidiaries’ loss (10) (15)
Net income (loss) including non-controlling interests 60,039  (60,481)
Adjustments to reconcile Net income including non-controlling interests to Net cash provided by operating activities:    
Rationalization and asset impairment charges   6,090 
Depreciation and amortization 16,263  16,179 
Equity (earnings) loss in affiliates, net (6) 236 
Pension expense and settlement charges 3,216  141,244 
Pension contributions and payments (582) (4,416)
Other non-cash items, net (1,742) (46,517)
Changes in operating assets and liabilities, net of effects from acquisitions:    
Decrease in accounts receivable 10,437  28,343 
Decrease in inventories 7,819  26,284 
Decrease in trade accounts payable (8,306) (3,412)
Net change in other current assets and liabilities 22,417  3,197 
Net change in other long-term assets and liabilities 1,854  (1,381)
NET CASH PROVIDED BY OPERATING ACTIVITIES 111,409  105,366 
     
INVESTING ACTIVITIES:    
Capital expenditures (14,598) (10,970)
Acquisition of businesses, net of cash acquired   (33,882)
Proceeds from sale of property, plant and equipment 257  752 
Other investing activities   (2,103)
NET CASH USED BY INVESTING ACTIVITIES (14,341) (46,203)
     
FINANCING ACTIVITIES:    
Net change in borrowings 23,989  170,371 
Proceeds from exercise of stock options 4,703  564 
Excess tax benefits from stock-based compensation 1,892  194 
Purchase of shares for treasury (85,661) (139,337)
Cash dividends paid to shareholders (21,533) (21,694)
Other financing activities   (44)
NET CASH (USED BY) PROVIDED BY FINANCING ACTIVITIES (76,610) 10,054 
     
Effect of exchange rate changes on Cash and cash equivalents (549) (17,609)
INCREASE IN CASH AND CASH EQUIVALENTS 19,909  51,608 
Cash and cash equivalents at beginning of period 237,019  312,737 
Cash and cash equivalents at end of period $256,928  $364,345 
     
Cash dividends paid per share $0.32  $0.29 

 

 

Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share amounts)
(Unaudited)
 
Condensed Consolidated Statements of Cash Flows Nine Months Ended September 30,
  2016 2015
OPERATING ACTIVITIES:    
Net income $145,004  $78,786 
Non-controlling interests in subsidiaries’ loss (32) (73)
Net income including non-controlling interests 144,972  78,713 
Adjustments to reconcile Net income including non-controlling interests to Net cash
  provided by operating activities:
    
Rationalization and asset impairment charges   6,120 
Loss on deconsolidation of Venezuelan subsidiary 34,348   
Depreciation and amortization 48,495  47,897 
Equity earnings in affiliates, net (64) (252)
Pension expense and settlement charges 12,472  151,848 
Pension contributions and payments (22,159) (52,121)
Other non-cash items, net (7,137) (52,307)
Changes in operating assets and liabilities, net of effects from acquisitions:    
(Increase) decrease in accounts receivable (11,956) 14,661 
(Increase) decrease in inventories (7,673) 27,824 
Increase (decrease) in trade accounts payable 13,922  (34,629)
Net change in other current assets and liabilities 30,424  47,032 
Net change in other long-term assets and liabilities 1,122  650 
NET CASH PROVIDED BY OPERATING ACTIVITIES 236,766  235,436 
     
INVESTING ACTIVITIES:    
Capital expenditures (39,377) (40,187)
Acquisition of businesses, net of cash acquired (71,567) (33,882)
Proceeds from sale of property, plant and equipment 936  2,173 
Other investing activities (283) (79)
NET CASH USED BY INVESTING ACTIVITIES (110,291) (71,975)
     
FINANCING ACTIVITIES:    
Net change in borrowings 183,259  314,420 
Proceeds from exercise of stock options 10,418  4,600 
Excess tax benefits from stock-based compensation 3,414  1,487 
Purchase of shares for treasury (288,594) (297,804)
Cash dividends paid to shareholders (66,180) (65,942)
Other financing activities (18,244) (8,040)
NET CASH USED BY FINANCING ACTIVITIES (175,927) (51,279)
     
Effect of exchange rate changes on Cash and cash equivalents 2,197  (26,216)
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (47,255) 85,966 
Cash and cash equivalents at beginning of period 304,183  278,379 
Cash and cash equivalents at end of period $256,928  $364,345 
     
Cash dividends paid per share $0.96  $0.87 

 

 

 

Lincoln Electric Holdings, Inc.
Segment Highlights (1)
(In thousands)
(Unaudited)
 
  Americas
Welding
 International
Welding
 The Harris
Products
Group
 Corporate /
Eliminations
 Consolidated
Three months ended September 30, 2016        
Net sales $377,520  $119,564  $70,562  $  $567,646 
Inter-segment sales 22,386  3,688  1,856  (27,930)  
Total $399,906  $123,252  $72,418  $(27,930) $567,646 
           
EBIT (2) $68,285  $5,796  $8,757  $913  $83,751 
As a percent of total sales 17.1% 4.7% 12.1%   14.8%
Special items charge (3)          
Adjusted EBIT (4) $68,285  $5,796  $8,757  $913  $83,751 
As a percent of total sales 17.1% 4.7% 12.1%   14.8%
Three months ended September 30, 2015        
Net sales $454,172  $128,072  $62,922  $  $645,166 
Inter-segment sales 25,571  5,400  2,307  (33,278)  
Total $479,743  $133,472  $65,229  $(33,278) $645,166 
           
EBIT (2) $(83,413) $(5,676) $6,422  $(748) $(83,415)
As a percent of total sales (17.4%) (4.3%) 9.8%   (12.9%)
Special items charge (3) 166,178  14,944      181,122 
Adjusted EBIT (4) $82,765  $9,268  $6,422  $(748) $97,707 
As a percent of total sales 17.3% 6.9% 9.8%   15.1%
Nine months ended September 30, 2016        
Net sales $1,124,900  $376,684  $209,202  $  $1,710,786 
Inter-segment sales 69,673  11,955  6,983  (88,611)  
Total $1,194,573  $388,639  $216,185  $(88,611) $1,710,786 
           
EBIT (2) $194,924  $21,699  $25,752  $(32,536) $209,839 
As a percent of total sales 16.3% 5.6% 11.9%   12.3%
Special items charge (3)       34,348  34,348 
Adjusted EBIT (4) $194,924  $21,699  $25,752  $1,812  $244,187 
As a percent of total sales 16.3% 5.6% 11.9%   14.3%
Nine months ended September 30, 2015        
Net sales $1,354,010  $409,246  $204,550  $  $1,967,806 
Inter-segment sales 72,496  15,738  7,034  (95,268)  
Total $1,426,506  $424,984  $211,584  $(95,268) $1,967,806 
           
EBIT (2) $71,423  $15,036  $22,221  $(54) $108,626 
As a percent of total sales 5.0% 3.5% 10.5%   5.5%
Special items charge (3) 166,178  16,183      182,361 
Adjusted EBIT (4) $237,601  $31,219  $22,221  $(54) $290,987 
As a percent of total sales 16.7% 7.3% 10.5%   14.8%


 (1)As previously announced on February 9, 2016, the Company realigned its organizational structure into three operating segments which was effective beginning in the first quarter of 2016.
 (2)EBIT is defined as Operating income plus Equity earnings in affiliates and Other income.
 (3)Special items within Corporate/Elimination reflect a charge ($34.1 million non-cash) related to the deconsolidation of the Company's Venezuelan subsidiary in the second quarter 2016.  Refer to 'Non-GAAP Financial Measures' for detail on excluded special items.
 (4)The primary profit measure used by management to assess segment performance is Adjusted EBIT.  EBIT for each operating segment is adjusted for special items to derive Adjusted EBIT.

 

Lincoln Electric Holdings, Inc. 
Change in Net Sales by Segment 
(In thousands) 
(Unaudited) 
  
Three Months Ended September 30th Change in Net Sales by Segment 
        
    Change in Net Sales due to:   
  Net Sales
2015
 Volume Acquisitions Price Foreign
Exchange
 Net Sales
2016
 
Operating Segments             
Americas Welding $454,172  $(81,338) $12,300  $(5,645) $(1,969) $377,520  
International Welding 128,072  (6,322) 1,454  (1,255) (2,385) 119,564  
The Harris Products Group 62,922  5,235    2,226  179  70,562  
Consolidated $645,166  $(82,425) $13,754  $(4,674) $(4,175) $567,646  
              
Americas Welding (excluding Venezuela) $419,483  $(46,648) $12,300  $(5,646) $(1,969) $377,520  
Consolidated (excluding Venezuela) $610,476  $(47,734) $13,754  $(4,674) $(4,176) $567,646  
              
% Change             
Americas Welding   (17.9%) 2.7% (1.2%) (0.4%) (16.9%) 
International Welding   (4.9%) 1.1% (1.0%) (1.9%) (6.6%) 
The Harris Products Group   8.3%   3.5% 0.3% 12.1% 
Consolidated   (12.8%) 2.1% (0.7%) (0.6%) (12.0%) 
              
Americas Welding (excluding Venezuela)   (11.1%) 2.9% (1.3%)  (0.5%)  (10.0%) 
Consolidated (excluding Venezuela)   (7.8%) 2.3% (0.8%)  (0.7%)  (7.0%) 
              
Nine Months Ended September 30th Change in Net Sales by Segment 
        
    Change in Net Sales due to:   
  Net Sales
2015
 Volume Acquisitions Price Foreign
Exchange
 Net Sales
2016
 
Operating Segments            
Americas Welding $1,354,010  $(226,400) $35,600  $268,381  $(306,691) $1,124,900 
International Welding 409,246  (21,256) 8,622  (8,243) (11,685) $376,684 
The Harris Products Group 204,550  7,361    (987) (1,722) $209,202 
Consolidated $1,967,806  $(240,295) $44,222  $259,151  $(320,098) $1,710,786 
             
Americas Welding (excluding Venezuela) $1,273,090  $(172,465) $35,600  $(7,698) $(14,441) $1,114,086 
Consolidated (excluding Venezuela) $1,886,886  $(186,360) $44,222  $(16,927) $(27,848) $1,699,973 
             
% Change            
Americas Welding   (16.7%) 2.6% 19.8% (22.7%) (16.9%)
International Welding   (5.2%) 2.1% (2.0%) (2.9%) (8.0%)
The Harris Products Group   3.6%   (0.5%) (0.8%) 2.3%
Consolidated   (12.2%) 2.2% 13.2% (16.3%) (13.1%)
             
Americas Welding (excluding Venezuela)   (13.5%) 2.8% (0.6%) (1.1%) (12.5%)
Consolidated (excluding Venezuela)   (9.9%) 2.3% (0.9%) (1.5%) (9.9%)

            

Coordonnées