LECO Lincoln Electric Holdings Inc

CLEVELAND, Feb. 22 /PRNewswire-FirstCall/ -- Fourth Quarter 2009 Highlights -- Sales were $462.4 million, an increase of 4.7% from the Third Quarter 2009 -- Operating income was $39.3 million, an increase of 18.4% from $33.2 million in the Third Quarter 2009 -- Operating income was $43.5 million, excluding special items, an increase of 7.7% from $40.4 million in the Third Quarter 2009 -- Net income increased 25.0% to $24.3 million, or $0.57 per diluted share from the prior year period; excluding special items, net income was $27.7 million, or $0.65 per diluted share -- Net cash provided by operating activities was $250.4 million for the full year -- Cash balance of $388.1 million as of December 31, 2009 Lincoln Electric Holdings, Inc. (the "Company") (NASDAQ:LECO) today reported 2009 fourth quarter net income of $24.3 million, or $0.57 per diluted share, on sales of $462.4 million. Operating income for the fourth quarter increased sequentially to $39.3 million, or 8.5% of sales, from $33.2 million, or 7.5% of sales, in the third quarter of 2009. Excluding special items, operating income in the quarter was $43.5 million or 9.4% of sales. Sales were $462.4 million in the fourth quarter versus $526.2 million in the comparable 2008 period, a decrease of 12.1%. Operating income for the fourth quarter included pre-tax rationalization charges of $4.2 million. Net income for the fourth quarter included after-tax rationalization charges of $3.4 million. Rationalization charges during the 2009 fourth quarter related primarily to a facility closure in Europe and the consolidation of certain manufacturing operations in the Europe and Asia Pacific segments. Net income for the fourth quarter was $24.3 million, or $0.57 per diluted share, compared with net income of $19.5 million, or $0.46 per diluted share, in the fourth quarter of 2008. Excluding special items, net income was $27.7 million, or $0.65 per diluted share compared with net income of $37.8 million, or $0.88 per diluted share in the fourth quarter of 2008. The effective tax rate for the fourth quarter of 2009 was 39.7% compared with 40.7% in 2008. "We are pleased that our fourth quarter results demonstrated another important sequential improvement in profitability," said John M. Stropki, Chairman and Chief Executive Officer. "While the 2009 economic crisis created tremendous challenges to the organization, our management and dedicated employees responded exceptionally well. The quick and decisive actions we took throughout 2009 to rationalize our operations, reduce our overall cost structure and introduce new products to the market generated improved results throughout 2009 and will provide solid momentum going into 2010. "As we continue to focus on new market opportunities in this improving but challenging economic environment, our new cost structure positions our Company for continued improvement in our operating results. In addition, our ongoing focus in managing the balance sheet and reducing working capital generated $250.4 million in operating cash flows for the year. Our strong financial position will provide us maximum flexibility to make the necessary investments to achieve our long-term strategic objectives." Net cash provided by operating activities was $19.0 million in the fourth quarter compared with $40.7 million for the comparable period in 2008. During the fourth quarter 2009, the Company paid $11.5 million in dividends. Sales for 2009 were $1.7 billion versus $2.5 billion in 2008, a decrease of 30.2%. Operating income for 2009 was $93.0 million compared with $295.4 million in 2008. Excluding special items in 2009, operating income was $121.3 million or 7.0% of sales. Special items for 2009, which impacted operating income, included pre-tax rationalization charges of $29.9 million and a pension settlement gain of $1.5 million included in selling, general and administrative expenses. Special items which impacted net income included after-tax rationalization charges of $23.8 million, a pension settlement gain of $1.5 million, a gain on the sale of a property by the Company's joint venture in Turkey of $5.7 million and a loss related to the disposal of an interest in Taiwan of $7.9 million. Net income for 2009 was $48.6 million, or $1.14 per diluted share, compared with net income of $212.3 million, or $4.93 per diluted share, in 2008. Excluding special items, net income was $73.1 million, or $1.71 per diluted share, compared with net income of $230.6 million, or $5.36 per diluted share, in 2008. The effective tax rate for 2009 was 43.8% compared with 29.2% in 2008. The higher effective tax rate in 2009 is primarily due to losses at certain non-U.S. entities, including the loss related to the disposal of an investment in Taiwan, with no tax benefit. Net cash provided by operating activities was $250.4 million in 2009 compared with $257.4 million in 2008. During 2009, the Company repaid $30.0 million of outstanding debt on maturity under its Senior Unsecured Notes and paid $45.8 million in dividends. The Company's Board of Directors declared a quarterly cash dividend of $0.28 per share, which was paid on January 15, 2010 to holders of record as of December 31, 2009. Financial results for the 2009 fourth quarter and full year can also be obtained by clicking on the following link: http://www.lincolnelectric.com/InvestorNews. A conference call to discuss the 2009 fourth quarter financial results is scheduled for today, Monday, February 22, 2010, at 10:00 a.m., Eastern Time. An audio webcast of the call is accessible through the investor tab on the Company's website at http://www.lincolnelectric.com/corporate/. Lincoln Electric is the world leader in the design, development and manufacture of arc welding products, robotic arc-welding systems, plasma and oxyfuel cutting equipment and has a leading global position in the brazing and soldering alloys market. Headquartered in Cleveland, Ohio, Lincoln has 38 manufacturing locations, including operations and joint ventures in 18 countries and a worldwide network of distributors and sales offices covering more than 160 countries. For more information about Lincoln Electric, its products and services, visit the Company's website at http://www.lincolnelectric.com/. The Company's expectations and beliefs concerning the future contained in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements reflect management's current expectations and involve a number of risks and uncertainties. Actual results may differ materially from such statements due to a variety of factors that could adversely affect the Company's operating results. The factors include, but are not limited to: general economic and market conditions; the effectiveness of operating initiatives; currency exchange and interest rates; adverse outcome of pending or potential litigation; possible acquisitions; market risks and price fluctuations related to the purchase of commodities and energy; global regulatory complexity; and the possible effects of international terrorism and hostilities on the Company or its customers, suppliers and the economy in general. For additional discussion, see "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K. Lincoln Electric Holdings, Inc. Financial Highlights (In thousands, except per share data) (Unaudited) Consolidated Statements of Income Fav (Unfav) Three Months Ended December 31, to Prior Year --------------------------------- ---------------- % of % of 2009 Sales 2008 Sales $ % ---------- ----- ---------- ----- ---------- ----- Net sales $462,449 100.0% $526,186 100.0% $(63,737) (12.1%) Cost of goods sold 327,951 70.9% 385,078 73.2% 57,127 14.8% ---------- ---------- ---------- Gross profit 134,498 29.1% 141,108 26.8% (6,610) (4.7%) Selling, general & administrative expenses 90,980 19.7% 86,200 16.4% (4,780) (5.5%) Rationalization and asset impairment charges 4,177 0.9% 19,371 3.7% 15,194 78.4% ---------- ---------- ---------- Operating income 39,341 8.5% 35,537 6.8% 3,804 10.7% Interest income 682 0.1% 2,229 0.4% (1,547) (69.4%) Equity earnings (loss) in affiliates 1,098 0.2% (2,068) (0.4%) 3,166 153.1% Other income 1,248 0.3% 354 0.1% 894 252.5% Interest expense (1,974) (0.4%) (3,216) (0.6%) 1,242 38.6% ---------- ---------- ---------- Income before income taxes 40,395 8.7% 32,836 6.2% 7,559 23.0% Income taxes 16,050 3.5% 13,366 2.5% (2,684) (20.1%) Effective tax rate 39.7% 40.7% 1.0% ---------- ---------- ---------- Net income $24,345 5.3% $19,470 3.7% $4,875 25.0% ========== ========== ========== Reconciliation of Net Income as Reported to Adjusted Net Income Three Months Ended December 31, Change ---------------------------------- ------------------- 2009 2008 $ % ---------- ---------- ---------- ----- Net income as reported (1) $24,345 $19,470 $4,875 25.0% Special items (1) 3,382 18,313 (14,931) (81.5%) ---------- ---------- ---------- Adjusted net income (2) $27,727 $37,783 $(10,056) (26.6%) ========== ========== ========== Basic earnings per share $0.57 $0.46 $0.11 23.9% Special items (1) 0.08 0.43 (0.35) (81.4%) ---------- ---------- ---------- Adjusted basic earnings per share (2) $0.65 $0.89 $(0.24) (27.0%) ========== ========== ========== Diluted earnings per share $0.57 $0.46 $0.11 23.9% Special items (1) 0.08 0.42 (0.34) (81.0%) ---------- ---------- ---------- Adjusted diluted earnings per share (2) $0.65 $0.88 $(0.23) (26.1%) ========== ========== ========== Weighted average shares (basic) 42,408 42,430 Weighted average shares (diluted) 42,730 42,695 (1) Net income in the fourth quarter of 2009 includes rationalization charges of $2,786 ($3,298 pre-tax)and asset impairment charges of $596 ($879 pre-tax). Net income in the fourth quarter of 2008 includes rationalization charges of $1,698 ($2,447 pre-tax)and asset impairment charges of $16,615 ($16,924 pre-tax). (2) Adjusted net income excluding special items and adjusted basic and diluted earnings per share excluding special items are non-GAAP financial measures that management believes are important to investors to evaluate and compare the Company's financial performance from period to period. Management uses this information in assessing and evaluating the Company's underlying operating performance. Lincoln Electric Holdings, Inc. Financial Highlights (In thousands, except per share data) (Unaudited) Consolidated Statements of Income Fav (Unfav) Twelve Months Ended December 31, to Prior Year --------------------------------- ---------------- % of % of 2009 Sales 2008 Sales $ % ---------- ----- ---------- ----- ---------- ----- Net sales $1,729,285 100.0% $2,479,131 100.0% $(749,846) (30.2%) Cost of goods sold 1,273,017 73.6% 1,758,980 71.0% 485,963 27.6% ---------- ---------- ---------- Gross profit 456,268 26.4% 720,151 29.0% (263,883) (36.6%) Selling, general & administrative expenses 333,395 19.3% 405,376 16.4% 71,981 17.8% Rationalization and asset impairment charges 29,897 1.7% 19,371 0.8% (10,526) (54.3%) ---------- ---------- ---------- Operating income 92,976 5.4% 295,404 11.9% (202,428) (68.5%) Interest income 3,462 0.2% 8,845 0.4% (5,383) (60.9%) Equity (loss) earnings in affiliates (5,025) (0.3%) 6,034 0.2% (11,059)(183.3%) Other income 3,589 0.2% 1,681 0.1% 1,908 113.5% Interest expense (8,521) (0.5%) (12,155) (0.5%) 3,634 29.9% ---------- ---------- ---------- Income before income taxes 86,481 5.0% 299,809 12.1% (213,328) (71.2%) Income taxes 37,905 2.2% 87,523 3.5% 49,618 56.7% Effective tax rate 43.8% 29.2% (14.6%) ---------- ---------- ---------- Net income $48,576 2.8% $212,286 8.6% $(163,710) (77.1%) ========== ========== ========== Reconciliation of Net Income as Reported to Adjusted Net Income Twelve Months Ended December 31, Change ---------------------------------- ------------------- 2009 2008 $ % ---------- ---------- ---------- ----- Net income as reported (1) $48,576 $212,286 $(163,710) (77.1%) Special items (1) 24,522 18,313 6,209 33.9% ---------- ---------- ---------- Adjusted net income (2) $73,098 $230,599 $(157,501) (68.3%) ========== ========== ========== Basic earnings per share $1.15 $4.98 $(3.83) (76.9%) Special items (1) 0.57 0.43 0.14 32.6% ---------- ---------- ---------- Adjusted basic earnings per share (2) $1.72 $5.41 $(3.69) (68.2%) ========== ========== ========== Diluted earnings per share $1.14 $4.93 $(3.79) (76.9%) Special items (1) 0.57 0.43 0.14 32.6% ---------- ---------- ---------- Adjusted diluted earnings per share (2) $1.71 $5.36 $(3.65) (68.1%) ========== ========== ========== Weighted average shares (basic) 42,391 42,648 Weighted average shares (diluted) 42,634 43,054 (1) Net income for 2009 includes rationalization charges of $23,193 ($29,018 pre-tax), asset impairment charges of $596 ($879 pre-tax), a pension settlement gain of $1,543 ($1,543 pre-tax) included in Selling, general & administrative expenses, a gain on the sale of a property by the Company's joint venture in Turkey of $5,667 ($5,667 pre-tax) included in Equity (loss) earnings in affiliates and a loss of $7,943 ($7,943 pre-tax) on the disposal of an investment in Taiwan included in Equity (loss) earnings in affiliates. Net income for 2008 includes rationalization charges of $1,698 ($2,447 pre-tax) and asset impairment charges of $16,615 ($16,924 pre-tax). (2) Adjusted net income excluding special items and adjusted basic and diluted earnings per share excluding special items are non-GAAP financial measures that management believes are important to investors to evaluate and compare the Company's financial performance from period to period. Management uses this information in assessing and evaluating the Company's underlying operating performance. Lincoln Electric Holdings, Inc. Financial Highlights (In thousands) (Unaudited) Balance Sheet Highlights Selected Consolidated Balance Sheet Data December 31, December 31, 2009 2008 ---------- ---------- Cash and cash equivalents $388,136 $284,332 Total current assets 1,023,546 1,024,726 Property, plant and equipment, net 460,061 427,902 Total assets 1,705,292 1,718,805 Total current liabilities 297,971 356,642 Short-term debt 35,867 50,693 Long-term debt 87,850 91,537 Total equity 1,085,675 1,009,973 Net Operating Working Capital December 31, December 31, 2009 2008 ---------- ---------- Trade accounts receivable $273,700 $299,171 Inventory 255,743 346,932 Trade accounts payable 100,052 124,388 ---------- ---------- Net operating working capital $429,391 $521,715 ========== ========== Net operating working capital to net sales (1) 23.2% 24.8% ========== ========== Invested Capital December 31, December 31, 2009 2008 ---------- ---------- Short-term debt $35,867 $50,693 Long-term debt 87,850 91,537 ---------- ---------- Total debt 123,717 142,230 Total equity 1,085,675 1,009,973 ---------- ---------- Invested capital $1,209,392 $1,152,203 ========== ========== Total debt / invested capital 10.2% 12.3% Return on invested capital (2) 4.3% 18.6% (1) Net operating working capital to net sales is defined as net operating working capital divided by annualized rolling 3 months of sales. (2) Return on invested capital is defined as rolling 12 months of earnings excluding tax-effected interest divided by invested capital. Lincoln Electric Holdings, Inc. Financial Highlights (In thousands, except per share data) (Unaudited) Consolidated Statements of Cash Flows Three Months Ended December 31, ------------------------------- 2009 2008 ---------- ---------- OPERATING ACTIVITIES: Net income $24,345 $19,470 Adjustments to reconcile net income to net cash provided by operating activities: Rationalization and asset impairment charges 2,940 19,371 Depreciation and amortization 14,265 14,024 Equity (earnings) loss in affiliates, net (400) 2,595 Other non-cash items, net 3,626 13,037 Changes in operating assets and liabilities, net of effects from acquisitions: Decrease in accounts receivable 3,330 63,084 Decrease in inventories 21,863 52,048 Decrease in accounts payable (13,975) (55,205) Decrease in accrued pensions (8,697) (8,403) Net change in other current assets and liabilities (29,464) (76,455) Net change in other long-term assets and liabilities 1,204 (2,860) ---------- ---------- NET CASH PROVIDED BY OPERATING ACTIVITIES 19,037 40,706 INVESTING ACTIVITIES: Capital expenditures (11,916) (18,947) Acquisition of businesses, net of cash acquired (7,891) (16,015) Proceeds from sale of property, plant and equipment (81) 73 ---------- ---------- NET CASH USED BY INVESTING ACTIVITIES (19,888) (34,889) FINANCING ACTIVITIES: Net change in borrowings (6,476) (221) Proceeds from exercise of stock options 400 81 Tax benefit from exercise of stock options 90 312 Purchase of shares for treasury - (19,216) Cash dividends paid to shareholders (11,454) (10,685) ---------- ---------- NET CASH USED BY FINANCING ACTIVITIES (17,440) (29,729) Effect of exchange rate changes on cash and cash equivalents 460 (4,346) ---------- ---------- DECREASE IN CASH AND CASH EQUIVALENTS (17,831) (28,258) Cash and cash equivalents at beginning of period 405,967 312,590 ---------- ---------- Cash and cash equivalents at end of period $388,136 $284,332 ========== ========== Cash dividends paid per share $0.27 $0.25 Lincoln Electric Holdings, Inc. Financial Highlights (In thousands, except per share data) (Unaudited) Consolidated Statements of Cash Flows Twelve Months Ended December 31, -------------------------------- 2009 2008 ---------- ---------- OPERATING ACTIVITIES: Net income $48,576 $212,286 Adjustments to reconcile net income to net cash provided by operating activities: Rationalization and asset impairment charges 2,940 19,371 Depreciation and amortization 56,598 56,925 Equity loss (earnings) in affiliates, net 8,554 (3,235) Other non-cash items, net 23,691 17,611 Changes in operating assets and liabilities, net of effects from acquisitions: Decrease in accounts receivable 60,913 30,130 Decrease (increase) in inventories 127,739 (27,845) Decrease in accounts payable (30,364) (26,768) Decrease in accrued pensions (39,185) (25,975) Net change in other current assets and liabilities (12,556) 9,590 Net change in other long-term assets and liabilities 3,444 (4,641) ---------- ---------- NET CASH PROVIDED BY OPERATING ACTIVITIES 250,350 257,449 INVESTING ACTIVITIES: Capital expenditures (38,201) (72,426) Additions to equity investment in affiliates (488) - Acquisition of businesses, net of cash acquired (25,449) (44,036) Proceeds from sale of property, plant and equipment 557 662 ---------- ---------- NET CASH USED BY INVESTING ACTIVITIES (63,581) (115,800) FINANCING ACTIVITIES: Net change in borrowings (43,828) 6,423 Proceeds from exercise of stock options 705 7,201 Tax benefit from exercise of stock options 195 3,728 Purchase of shares for treasury (343) (42,337) Cash dividends paid to shareholders (45,801) (42,756) ---------- ---------- NET CASH USED BY FINANCING ACTIVITIES (89,072) (67,741) Effect of exchange rate changes on cash and cash equivalents 6,107 (6,958) ---------- ---------- INCREASE IN CASH AND CASH EQUIVALENTS 103,804 66,950 Cash and cash equivalents at beginning of period 284,332 217,382 ---------- ---------- Cash and cash equivalents at end of period $388,136 $284,332 ========== ========== Cash dividends paid per share $1.08 $1.00 Lincoln Electric Holdings, Inc. Segment Highlights (In thousands) (Unaudited) The North Asia South Harris Corporate/ America Europe Pacific America Products Elimin- Consoli- Welding Welding Welding Welding Group ations dated ------- ------- ------- ------- ------- --------- --------- Three months ended December 31, 2009 Net sales $218,207 $85,808 $75,136 $29,974 $53,324 $- $462,449 Inter- segment sales 21,894 1,724 2,051 308 1,546 (27,523) - -------- -------- ------- ------- ------- -------- -------- Total $240,101 $87,532 $77,187 $30,282 $54,870 $(27,523) $462,449 ======== ======= ======= ======= ======= ======== ======== EBIT (1) $41,668 $1,641 $(4,207) $3,554 $(108) $(861) $41,687 As a percent of total sales 17.4% 1.9% (5.5%) 11.7% (0.2%) 9.0% Special items (2) $195 $1,010 $1,876 $- $1,096 $- $4,177 EBIT, as adjusted (1) $41,863 $2,651 $(2,331) $3,554 $988 $(861) $45,864 As a percent of total sales 17.4% 3.0% (3.0%) 11.7% 1.8% 9.9% Three months ended December 31, 2008 Net sales $286,287 $108,801 $48,064 $26,593 $56,441 $- $526,186 Inter- segment sales 30,910 1,905 1,170 8 1,677 (35,670) - -------- -------- ------- ------- ------- -------- -------- Total $317,197 $110,706 $49,234 $26,601 $58,118 $(35,670) $526,186 ======== ======== ======= ======= ======= ======== ======== EBIT (1) $54,588 $(851) $(16,304) $2,554 $(5,087) $(1,077) $33,823 As a percent of total sales 17.2% (0.8%) (33.1%) 9.6% (8.8%) 6.4% Special items (2) $818 $2,052 $15,582 $- $919 $- $19,371 EBIT, as adjusted (1) $55,406 $1,201 $(722) $2,554 $(4,168) $(1,077) $53,194 As a percent of total sales 17.5% 1.1% (1.5%) 9.6% (7.2%) 10.1% Twelve months ended December 31, 2009 Net sales $858,180 $346,383 $208,280 $99,171 $217,271 $- $1,729,285 Inter- segment sales 85,630 8,725 4,051 308 7,739 (106,453) - -------- -------- -------- ------- -------- --------- ---------- Total $943,810 $355,108 $212,331 $99,479 $225,010 $(106,453) $1,729,285 ======== ======== ======== ======= ======== ========= ========== EBIT (1) $124,158 $(6,531) $(27,977) $10,120 $(4,886) $(3,344) $91,540 As a percent of total sales 13.2% (1.8%) (13.2%) 10.2% (2.2%) 5.3% Special items (3) $10,386 $4,335 $9,607 $528 $5,774 $- $30,630 EBIT, as adjusted (1) $134,544 $(2,196) $(18,370) $10,648 $888 $(3,344) $122,170 As a percent of total sales 14.3% (0.6%) (8.7%) 10.7% 0.4% 7.1% Twelve months ended December 31, 2008 Net sales$1,313,881 $538,570 $230,661 $116,061 $279,958 $- $2,479,131 Inter- segment sales 127,087 15,649 3,522 37 8,568 (154,863) - ---------- -------- -------- -------- -------- --------- ---------- Total $1,440,968 $554,219 $234,183 $116,098 $288,526 $(154,863) $2,479,131 ========== ======== ======== ======== ======== ========= ========== EBIT (1) $242,830 $53,946 $(7,322) $9,984 $9,299 $(5,618) $303,119 As a percent of total sales 16.9% 9.7% (3.1%) 8.6% 3.2% 12.2% Special items (2) $818 $2,052 $15,582 $- $919 $- $19,371 EBIT, as adjusted (1) $243,648 $55,998 $8,260 $9,984 $10,218 $(5,618) $322,490 As a percent of total sales 16.9% 10.1% 3.5% 8.6% 3.5% 13.0% (1) The primary profit measure used by management to assess segment performance is earnings before interest and income taxes ("EBIT"), as adjusted. Segment EBIT is adjusted for special items such as the impact of rationalization activities, certain asset impairment charges and gains or losses on disposals of assets. (2) Special items includes the impacts of rationalization activities and asset impairment charges. (3) Special items includes the impacts of rationalization activities, asset impairment charges, a gain on the sale of a property, a pension settlement gain and a loss on the disposal of an investment. Lincoln Electric Holdings, Inc. Change in Net Sales by Segment (In thousands) (Unaudited) Fourth Quarter Change in Net Sales by Segment Change in Net Sales due to: ------------------------------------------ Net Sales Foreign Net Sales 2008 Volume Acquisitions Price Exchange 2009 ---------- -------- ------------ ---------- --------- ---------- Operating Segments North America Welding $286,287 $(58,806) $- $(11,819) $2,545 $218,207 Europe Welding 108,801 (18,952) - (10,126) 6,085 85,808 Asia Pacific Welding 48,064 (7,611) 32,813 (2,781) 4,651 75,136 South America Welding 26,593 (2,276) - 3,299 2,358 29,974 The Harris Products Group 56,441 (7,793) - 3,676 1,000 53,324 ---------- ---------- ---------- ---------- ---------- ---------- Consoli- dated $526,186 $(95,438) $32,813 $(17,751) $16,639 $462,449 ========== ========== ========== ========== ========== ========== % Change North America Welding (20.5%) - (4.1%) 0.9% (23.8%) Europe Welding (17.4%) - (9.3%) 5.6% (21.1%) Asia Pacific Welding (15.8%) 68.3% (5.8%) 9.7% 56.3% South America Welding (8.6%) - 12.4% 8.9% 12.7% The Harris Products Group (13.8%) - 6.5% 1.8% (5.5%) ---------- ---------- ---------- ---------- ---------- Consolidated (18.1%) 6.2% (3.4%) 3.2% (12.1%) ========== ========== ========== ========== ========== Full Year Change in Net Sales by Segment Change in Net Sales due to: ------------------------------------------ Net Sales Foreign Net Sales 2008 Volume Acquisitions Price Exchange 2009 ---------- -------- ------------ ---------- ---------- ---------- Operating Segments North America Welding $1,313,881 $(456,826) $- $15,912 $(14,787) $858,180 Europe Welding 538,570 (130,235) 5,242 (22,510) (44,684) 346,383 Asia Pacific Welding 230,661 (68,447) 54,638 (5,471) (3,101) 208,280 South America Welding 116,061 (23,831) - 13,117 (6,176) 99,171 The Harris Products Group 279,958 (59,196) 13,570 (14,178) (2,883) 217,271 ---------- --------- --------- ---------- ---------- ---------- Consoli- dated $2,479,131 $(738,535) $73,450 $(13,130) $(71,631)$1,729,285 ========== ========= ========= ========== ========== ========== % Change North America Welding (34.8%) - 1.2% (1.1%) (34.7%) Europe Welding (24.2%) 1.0% (4.2%) (8.3%) (35.7%) Asia Pacific Welding (29.7%) 23.7% (2.4%) (1.3%) (9.7%) South America Welding (20.5%) - 11.3% (5.3%) (14.6%) The Harris Products Group (21.1%) 4.8% (5.1%) (1.0%) (22.4%) ---------- ---------- ---------- ---------- ---------- Consolidated (29.8%) 3.0% (0.5%) (2.9%) (30.2%) ========== ========== ========== ========== ========== DATASOURCE: Lincoln Electric Holdings, Inc. CONTACT: Media: Roy L. Morrow, +1-216-383-4893, , or Investors: Earl L. Ward, +1-216-383-5067, Web Site: http://www.lincolnelectric.com/

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