CLEVELAND, Oct. 27 /PRNewswire-FirstCall/ --
Third Quarter 2010 Highlights
- Sales were $519.3 million, an
increase of 17.5% from the Third Quarter 2009
- Operating income increased to $48.2
million from $33.3 million or
an increase of 44.5% from the Third Quarter 2009
- Excluding special items, adjusted operating income increased
21.7% to $49.3 million from
$40.5 million in the Third Quarter
2009
- Net income increased to $32.5
million, or $0.76 per diluted
share, from $12.8 million, or
$0.30 per diluted share, in the Third
Quarter 2009
- Excluding special items, adjusted net income increased 24.2% to
$33.6 million, or $0.79 per diluted share, from $27.0 million, or $0.63 per diluted share, in the Third Quarter
2009
Lincoln Electric Holdings, Inc. (the "Company") (Nasdaq: LECO)
today reported third quarter 2010 net income of $32.5 million, or $0.76 per diluted share. Sales were
$519.3 million in the third quarter
of 2010 versus $441.8 million in the
comparable 2009 period, an increase of 17.5%. Operating
income for the third quarter increased $14.9
million to $48.2 million, or 9.3% of sales, from
$33.3 million in the comparable 2009
period. Adjusted operating income in the quarter was
$49.3 million, or 9.5% of sales.
Net income for the third quarter of 2010 was $32.5 million, or $0.76 per diluted share, compared with net income
of $12.8 million, or $0.30 per diluted share, in the third quarter of
2009. Adjusted net income was $33.6
million, or $0.79 per diluted
share, compared with $27.0 million,
or $0.63 per diluted share, in the
third quarter of 2009. The effective tax rate for the third
quarter of 2010 was 33.2% compared with 47.1% in 2009.
"We continued to improve our operating results during the
quarter," said John M. Stropki,
Chairman and Chief Executive Officer. "Our strong sales and
operating profits are encouraging in light of the weaker results we
usually experience throughout Europe in the third quarter.
"Current demand levels are stable in most market segments and
geographical regions. I am cautiously optimistic that the
global recovery will continue as we focus on market share gains and
achieving our international expansion objectives. We also
believe that our strong financial position will continue to provide
the flexibility to execute our long-term strategic objectives to
the benefit of our shareholders."
Net cash provided by operating activities was $56.0 million in the third quarter compared with
$97.1 million for the comparable
period in 2009.
Sales for the nine months ended September
30, 2010 were $1.51 billion
versus $1.27 billion in the
comparable 2009 period, an increase of 18.9%. Operating
income for the nine months ended September
30, 2010 increased $79.8 million to
$134.1 million, or 8.9% of sales, from $54.3 million in the comparable 2009 period.
Adjusted operating income in the nine months ended
September 30, 2010 was $134.7 million, or 8.9% of sales.
Net income for the nine months ended September 30, 2010 was $88.7 million, or $2.08 per diluted share, compared with net income
of $24.2 million, or $0.57 per diluted share, for the comparable
period in 2009. Adjusted net income was $91.3 million, or $2.14 per diluted share, compared with
$45.4 million, or $1.07 per diluted share, for the nine months
ended September 30, 2009. The
effective tax rate for the nine months ended September 30, 2010 was 32.9% compared with 46.8%
in 2009.
Net cash provided by operating activities was $103.7 million in the nine months ended
September 30, 2010 compared with
$231.3 million for the comparable
period in 2009. The Company returned $58.6 million to shareholders through the payment
of $35.6 million in dividends and the
repurchase of $23.0 million of the
Company's shares for treasury during the nine months ended
September 30, 2010.
The Company's Board of Directors declared a quarterly cash
dividend of $0.28 per share, which
was paid on October 15, 2010 to
holders of record as of September 30,
2010.
Financial results for the third quarter 2010 can also be
obtained at http://www.lincolnelectric.com/InvestorNews.
A conference call to discuss the third quarter 2010 financial
results is scheduled for today, Wednesday,
October 27, 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/.
Adjusted operating income, adjusted net income and adjusted
diluted earnings per share 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. Non-GAAP
financial measures should be read in conjunction with the GAAP
financial measures, as non-GAAP measures are merely a supplement
to, and not a replacement for, GAAP financial measures.
Please refer to the attached schedule for a reconciliation of
non-GAAP financial measures to the related GAAP financial
measure.
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 37 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.
#102710#
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Lincoln
Electric Holdings, Inc.
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Financial
Highlights
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(In
thousands, except per share data)
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|
(Unaudited)
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|
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Consolidated Statements of
Income
|
|
|
|
Three Months
Ended September 30,
|
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Fav (Unfav)
to Prior Year
|
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2010
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% of
Sales
|
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2009
|
|
% of
Sales
|
|
$
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%
|
|
Net sales
|
$
519,338
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100.0%
|
|
$
441,802
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100.0%
|
|
$
77,536
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17.5%
|
|
Cost of goods sold
|
375,267
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72.3%
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|
316,671
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71.7%
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|
(58,596)
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(18.5%)
|
|
Gross profit
|
144,071
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27.7%
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|
125,131
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28.3%
|
|
18,940
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|
15.1%
|
|
Selling, general &
administrative expenses
|
95,612
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18.4%
|
|
84,648
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|
19.2%
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|
(10,964)
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|
(13.0%)
|
|
Rationalization
charges
|
269
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|
0.1%
|
|
7,144
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1.6%
|
|
6,875
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|
96.2%
|
|
Operating income
|
48,190
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|
9.3%
|
|
33,339
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7.5%
|
|
14,851
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|
44.5%
|
|
Interest income
|
602
|
|
0.1%
|
|
716
|
|
0.2%
|
|
(114)
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(15.9%)
|
|
Equity earnings (loss) in
affiliates
|
1,070
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|
0.2%
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|
(8,692)
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(2.0%)
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|
9,762
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112.3%
|
|
Other income
|
628
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|
0.1%
|
|
1,030
|
|
0.2%
|
|
(402)
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(39.0%)
|
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Interest expense
|
(1,671)
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(0.3%)
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|
(2,032)
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(0.5%)
|
|
361
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17.8%
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Income before income
taxes
|
48,819
|
|
9.4%
|
|
24,361
|
|
5.5%
|
|
24,458
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|
100.4%
|
|
Income taxes
|
16,191
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|
3.1%
|
|
11,474
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2.6%
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(4,717)
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(41.1%)
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Effective tax rate
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33.2%
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47.1%
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|
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13.9%
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|
|
|
Net income including
noncontrolling interests
|
32,628
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6.3%
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|
12,887
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2.9%
|
|
19,741
|
|
153.2%
|
|
Noncontrolling interests in
subsidiaries' earnings
|
155
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-
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|
130
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-
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(25)
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(19.2%)
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Net income
|
$
32,473
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6.3%
|
|
$
12,757
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2.9%
|
|
$
19,716
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|
154.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
$
0.77
|
|
|
|
$
0.30
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|
|
|
$
0.47
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|
156.7%
|
|
Diluted earnings per
share
|
$
0.76
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|
|
$
0.30
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|
|
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$
0.46
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153.3%
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Weighted average shares
(basic)
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42,134
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|
42,396
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Weighted average shares
(diluted)
|
42,535
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|
42,642
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Nine Months
Ended September 30,
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Fav (Unfav)
to Prior Year
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2010
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% of
Sales
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2009
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% of
Sales
|
|
$
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%
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Net sales
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$
1,505,880
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100.0%
|
|
$
1,266,836
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100.0%
|
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$
239,044
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18.9%
|
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Cost of goods sold
|
1,089,893
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72.4%
|
|
945,066
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74.6%
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(144,827)
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(15.3%)
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Gross profit
|
415,987
|
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27.6%
|
|
321,770
|
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25.4%
|
|
94,217
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29.3%
|
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Selling, general &
administrative expenses
|
284,452
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18.9%
|
|
241,791
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19.1%
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|
(42,661)
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(17.6%)
|
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Rationalization (gains)
charges
|
(2,559)
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(0.2%)
|
|
25,720
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2.0%
|
|
28,279
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109.9%
|
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Operating income
|
134,094
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8.9%
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|
54,259
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4.3%
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|
79,835
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147.1%
|
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Interest income
|
1,781
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0.1%
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|
2,780
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0.2%
|
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(999)
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(35.9%)
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Equity earnings (loss) in
affiliates
|
2,684
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0.2%
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(6,123)
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(0.5%)
|
|
8,807
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143.8%
|
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Other income
|
1,324
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|
0.1%
|
|
2,341
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|
0.2%
|
|
(1,017)
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(43.4%)
|
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Interest expense
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(4,751)
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(0.3%)
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(6,547)
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(0.5%)
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|
1,796
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27.4%
|
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Income before income
taxes
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135,132
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9.0%
|
|
46,710
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3.7%
|
|
88,422
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|
189.3%
|
|
Income taxes
|
44,431
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|
3.0%
|
|
21,855
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1.7%
|
|
(22,576)
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(103.3%)
|
|
Effective tax rate
|
32.9%
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|
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46.8%
|
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|
|
13.9%
|
|
|
|
Net income including
noncontrolling interests
|
90,701
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6.0%
|
|
24,855
|
|
2.0%
|
|
65,846
|
|
264.9%
|
|
Noncontrolling interests in
subsidiaries' earnings
|
1,960
|
|
0.1%
|
|
624
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|
-
|
|
(1,336)
|
|
(214.1%)
|
|
Net income
|
$
88,741
|
|
5.9%
|
|
$
24,231
|
|
1.9%
|
|
$
64,510
|
|
266.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
$
2.10
|
|
|
|
$
0.57
|
|
|
|
$
1.53
|
|
268.4%
|
|
Diluted earnings per
share
|
$
2.08
|
|
|
|
$
0.57
|
|
|
|
$
1.51
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264.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
(basic)
|
42,282
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|
|
42,385
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|
|
|
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|
Weighted average shares
(diluted)
|
42,670
|
|
|
|
42,602
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
Lincoln
Electric Holdings, Inc.
|
|
Financial
Highlights
|
|
(In
thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
Non-GAAP
Financial Measures
|
|
|
|
|
|
Three Months
Ended September 30,
|
|
Nine Months
Ended September 30,
|
|
|
|
|
2010
|
|
2009
|
|
2010
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income as
reported
|
$
48,190
|
|
$
33,339
|
|
$
134,094
|
|
$
54,259
|
|
|
Special items
(pre-tax):
|
|
|
|
|
|
|
|
|
|
|
Rationalization charges (gains)
(1)
|
269
|
|
7,144
|
|
(2,559)
|
|
25,720
|
|
|
|
Venezuela - functional currency
change and devaluation (2)
|
815
|
|
-
|
|
3,123
|
|
-
|
|
|
|
Pension settlement
gain
|
-
|
|
-
|
|
-
|
|
(2,144)
|
|
Adjusted operating income
(4)
|
$
49,274
|
|
$
40,483
|
|
$
134,658
|
|
$
77,835
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income as
reported
|
$
32,473
|
|
$
12,757
|
|
$
88,741
|
|
$
24,231
|
|
|
Special items
(after-tax):
|
|
|
|
|
|
|
|
|
|
|
Rationalization charges (gains)
(1)
|
265
|
|
6,340
|
|
(2,896)
|
|
20,407
|
|
|
|
Venezuela - functional currency
change and devaluation (2)
|
815
|
|
-
|
|
3,560
|
|
-
|
|
|
|
Pension settlement
gain
|
-
|
|
-
|
|
-
|
|
(2,144)
|
|
|
|
Gain on sale of property of
equity investment
|
-
|
|
-
|
|
-
|
|
(5,667)
|
|
|
|
Loss on disposal of equity
investment (3)
|
-
|
|
7,943
|
|
-
|
|
7,943
|
|
|
|
Noncontrolling
interests
|
44
|
|
-
|
|
1,890
|
|
601
|
|
Adjusted net income
(4)
|
$
33,597
|
|
$
27,040
|
|
$
91,295
|
|
$
45,371
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share as
reported
|
$
0.76
|
|
$
0.30
|
|
$
2.08
|
|
$
0.57
|
|
Special items
|
0.03
|
|
0.33
|
|
0.06
|
|
0.50
|
|
Adjusted diluted earnings per
share (4)
|
$
0.79
|
|
$
0.63
|
|
$
2.14
|
|
$
1.07
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares (diluted)
|
42,535
|
|
42,642
|
|
42,670
|
|
42,602
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The three months ended
September 30, 2010 primarily include charges associated with the
consolidation of manufacturing operations initiated in 2009.
The nine months ended September 30, 2010 include gains of
$4,971 ($5,012 after-tax) on the disposal of assets at rationalized
operations offset by charges of $2,412 ($2,116 after-tax) primarily
associated with the consolidation of manufacturing operations
initiated in 2009.
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The three and nine month periods
ended September 30, 2009 include primarily employee severance
costs.
|
|
|
|
(2) Represents the impact of the
change in the functional currency of the Company's Venezuelan
operation to the dollar and the devaluation of the Venezuelan
currency.
|
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|
|
(3) Represents the impact of the
completion of the Company's 100% acquisition of Jinzhou Jin Tai
Welding and Metal Co., Ltd. and associated disposal of the
Company's 35% interest in Taiwan-based Kuang Tai Metal Industrial
Co., Ltd.
|
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(4) Adjusted operating income,
Adjusted net income and Adjusted diluted earnings per share 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. Non-GAAP financial measures should be
read in conjunction with the GAAP financial measures, as non-GAAP
measures are merely a supplement to, and not a replacement for,
GAAP financial measures.
|
|
|
|
|
|
|
|
|
|
|
|
Lincoln
Electric Holdings, Inc.
|
|
Financial
Highlights
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
Balance
Sheet Highlights
|
|
|
|
|
|
|
|
|
|
Selected
Consolidated Balance Sheet Data
|
September
30,
|
|
December
31,
|
|
|
2010
|
|
2009
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
382,537
|
|
$
388,136
|
|
Total current
assets
|
1,120,111
|
|
1,023,546
|
|
Property, plant and
equipment, net
|
459,793
|
|
460,061
|
|
Total assets
|
1,798,692
|
|
1,705,292
|
|
|
|
|
|
|
Total current
liabilities
|
372,283
|
|
297,971
|
|
Short-term debt
|
14,815
|
|
35,867
|
|
Long-term debt
|
85,458
|
|
87,850
|
|
Total equity
|
1,146,631
|
|
1,085,675
|
|
|
|
|
|
|
Net
Operating Working Capital
|
September
30,
|
|
December
31,
|
|
|
2010
|
|
2009
|
|
|
|
|
|
|
Accounts
receivable
|
$
319,530
|
|
$
273,700
|
|
Inventory
|
315,455
|
|
255,743
|
|
Trade accounts
payable
|
153,524
|
|
100,052
|
|
Net operating working
capital
|
$
481,461
|
|
$
429,391
|
|
|
|
|
|
|
Net operating working
capital to net sales (1)
|
23.2%
|
|
23.2%
|
|
|
|
|
|
|
Invested
Capital
|
September
30,
|
|
December
31,
|
|
|
2010
|
|
2009
|
|
|
|
|
|
|
Short-term debt
|
$
14,815
|
|
$
35,867
|
|
Long-term debt
|
85,458
|
|
87,850
|
|
Total debt
|
100,273
|
|
123,717
|
|
Total equity
|
1,146,631
|
|
1,085,675
|
|
Invested
capital
|
$
1,246,904
|
|
$
1,209,392
|
|
|
|
|
|
|
Total debt / invested
capital
|
8.0%
|
|
10.2%
|
|
Return on invested
capital (2)
|
9.3%
|
|
4.3%
|
|
|
|
(1)
Net operating working capital to
net sales is defined as net operating working capital divided by
annualized rolling three 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 September 30,
|
|
|
|
|
|
2010
|
|
2009
|
|
|
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
Net income
|
|
|
$
32,473
|
|
$
12,757
|
|
|
Noncontrolling interests in
subsidiaries' earnings
|
|
|
155
|
|
130
|
|
|
Net income including
noncontrolling interests
|
|
|
32,628
|
|
12,887
|
|
|
Adjustments to reconcile
Net income including noncontrolling interests to Net
|
|
|
|
|
|
|
|
cash provided by
operating activities:
|
|
|
|
|
|
|
|
Rationalization
gains
|
|
|
(119)
|
|
-
|
|
|
Depreciation and
amortization
|
|
|
14,062
|
|
14,665
|
|
|
Equity (earnings) loss in
affiliates, net
|
|
|
(534)
|
|
9,466
|
|
|
Other non-cash items,
net
|
|
|
11,757
|
|
10,292
|
|
|
Changes in operating
assets and liabilities, net of effects from
acquisitions:
|
|
|
|
|
|
|
|
Decrease in accounts
receivable
|
|
|
1,274
|
|
17,050
|
|
|
(Increase) decrease in
inventories
|
|
|
(11,139)
|
|
17,628
|
|
|
Increase in trade accounts
payable
|
|
|
5,850
|
|
8,554
|
|
|
Decrease in accrued
pensions
|
|
|
(11,101)
|
|
(11,537)
|
|
|
Net change in other
current assets and liabilities
|
|
|
14,942
|
|
16,700
|
|
|
Net change in other
long-term assets and liabilities
|
|
|
(1,649)
|
|
1,383
|
|
|
NET CASH PROVIDED BY OPERATING
ACTIVITIES
|
|
|
55,971
|
|
97,088
|
|
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(19,718)
|
|
(5,466)
|
|
|
Acquisition of businesses,
net of cash acquired
|
|
|
(1,000)
|
|
(17,558)
|
|
|
Proceeds from sale of
property, plant and equipment
|
|
|
1,797
|
|
378
|
|
|
NET CASH USED BY INVESTING
ACTIVITIES
|
|
|
(18,921)
|
|
(22,646)
|
|
|
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
Net change in
borrowings
|
|
|
(12,763)
|
|
(6,916)
|
|
|
Proceeds from exercise of
stock options
|
|
|
311
|
|
87
|
|
|
Tax benefit from exercise
of stock options
|
|
|
99
|
|
31
|
|
|
Purchase of shares for
treasury
|
|
|
(10,036)
|
|
-
|
|
|
Cash dividends paid to
shareholders
|
|
|
(11,829)
|
|
(11,453)
|
|
|
NET CASH USED BY FINANCING
ACTIVITIES
|
|
|
(34,218)
|
|
(18,251)
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes
on Cash and cash equivalents
|
|
|
5,804
|
|
2,877
|
|
|
INCREASE IN CASH AND CASH
EQUIVALENTS
|
|
|
8,636
|
|
59,068
|
|
|
Cash and cash equivalents at
beginning of period
|
|
|
373,901
|
|
346,899
|
|
|
Cash and cash equivalents at end
of period
|
|
|
$
382,537
|
|
$
405,967
|
|
|
|
|
|
|
|
|
|
|
Cash dividends paid per
share
|
|
|
$
0.28
|
|
$
0.27
|
|
|
|
|
|
|
|
|
Lincoln
Electric Holdings, Inc.
|
|
Financial
Highlights
|
|
(In
thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Cash
Flows
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended September 30,
|
|
|
|
|
|
2010
|
|
2009
|
|
|
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
Net income
|
|
|
$
88,741
|
|
$
24,231
|
|
|
Noncontrolling interests in
subsidiaries' earnings
|
|
|
1,960
|
|
624
|
|
|
Net income including
noncontrolling interests
|
|
|
90,701
|
|
24,855
|
|
|
Adjustments to reconcile
Net income including noncontrolling interests to Net
|
|
|
|
|
|
|
|
cash provided by
operating activities:
|
|
|
|
|
|
|
|
Rationalization
gains
|
|
|
(4,834)
|
|
-
|
|
|
Depreciation and
amortization
|
|
|
42,422
|
|
42,333
|
|
|
Equity (earnings) loss in
affiliates, net
|
|
|
(704)
|
|
8,954
|
|
|
Other non-cash items,
net
|
|
|
23,460
|
|
19,441
|
|
|
Changes in operating
assets and liabilities, net of effects from
acquisitions:
|
|
|
|
|
|
|
|
(Increase) decrease in
accounts receivable
|
|
|
(48,598)
|
|
57,583
|
|
|
(Increase) decrease in
inventories
|
|
|
(57,211)
|
|
105,876
|
|
|
Increase (decrease) in
trade accounts payable
|
|
|
54,315
|
|
(16,389)
|
|
|
Decrease in accrued
pensions
|
|
|
(29,241)
|
|
(30,488)
|
|
|
Net change in other
current assets and liabilities
|
|
|
41,266
|
|
16,908
|
|
|
Net change in other
long-term assets and liabilities
|
|
|
(7,862)
|
|
2,240
|
|
|
NET CASH PROVIDED BY OPERATING
ACTIVITIES
|
|
|
103,714
|
|
231,313
|
|
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(43,208)
|
|
(26,285)
|
|
|
Additions to equity
investment in affiliates
|
|
|
-
|
|
(488)
|
|
|
Acquisition of businesses,
net of cash acquired
|
|
|
(1,182)
|
|
(17,558)
|
|
|
Proceeds from sale of
property, plant and equipment
|
|
|
9,746
|
|
638
|
|
|
NET CASH USED BY INVESTING
ACTIVITIES
|
|
|
(34,644)
|
|
(43,693)
|
|
|
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
Net change in
borrowings
|
|
|
(17,605)
|
|
(37,352)
|
|
|
Proceeds from exercise of
stock options
|
|
|
1,319
|
|
305
|
|
|
Tax benefit from exercise
of stock options
|
|
|
469
|
|
105
|
|
|
Purchase of shares for
treasury
|
|
|
(22,960)
|
|
(343)
|
|
|
Cash dividends paid to
shareholders
|
|
|
(35,584)
|
|
(34,347)
|
|
|
NET CASH USED BY FINANCING
ACTIVITIES
|
|
|
(74,361)
|
|
(71,632)
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes
on Cash and cash equivalents
|
|
|
(308)
|
|
5,647
|
|
|
(DECREASE) INCREASE IN CASH AND
CASH EQUIVALENTS
|
|
|
(5,599)
|
|
121,635
|
|
|
Cash and cash equivalents at
beginning of period
|
|
|
388,136
|
|
284,332
|
|
|
Cash and cash equivalents at end
of period
|
|
|
$
382,537
|
|
$
405,967
|
|
|
|
|
|
|
|
|
|
|
Cash dividends paid per
share
|
|
|
$
0.84
|
|
$
0.81
|
|
|
|
|
|
|
|
|
Lincoln
Electric Holdings, Inc.
|
|
Segment
Highlights
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
North
|
|
|
|
South
|
|
The
Harris
|
|
|
|
|
|
|
America
|
|
Europe
|
|
Asia
Pacific
|
|
America
|
|
Products
|
|
Corporate
/
|
|
|
|
|
|
|
|
Welding
|
|
Welding
|
|
Welding
|
|
Welding
|
|
Group
|
|
Eliminations
|
|
Consolidated
|
|
Three months
ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
255,636
|
|
$
85,892
|
|
$
79,657
|
|
$
34,065
|
|
$
64,088
|
|
$
-
|
|
$
519,338
|
|
Inter-segment sales
|
|
28,291
|
|
3,242
|
|
4,224
|
|
662
|
|
1,518
|
|
(37,937)
|
|
-
|
|
|
Total
|
|
$
283,927
|
|
$
89,134
|
|
$
83,881
|
|
$
34,727
|
|
$
65,606
|
|
$
(37,937)
|
|
$
519,338
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT (1)
|
|
$
43,187
|
|
$
5,294
|
|
$
(1,387)
|
|
$
2,355
|
|
$
4,119
|
|
$
(3,680)
|
|
$
49,888
|
|
|
As a percent of total
sales
|
|
15.2%
|
|
5.9%
|
|
(1.7%)
|
|
6.8%
|
|
6.3%
|
|
|
|
9.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special items (2)
|
|
$
-
|
|
$
370
|
|
$
(101)
|
|
$
815
|
|
$
-
|
|
$
-
|
|
$
1,084
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT, as adjusted (3)
|
|
$
43,187
|
|
$
5,664
|
|
$
(1,488)
|
|
$
3,170
|
|
$
4,119
|
|
$
(3,680)
|
|
$
50,972
|
|
|
As a percent of total
sales
|
|
15.2%
|
|
6.4%
|
|
(1.8%)
|
|
9.1%
|
|
6.3%
|
|
|
|
9.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
213,132
|
|
$
84,365
|
|
$
62,204
|
|
$
26,430
|
|
$
55,671
|
|
$
-
|
|
$
441,802
|
|
Inter-segment sales
|
|
21,393
|
|
2,668
|
|
1,171
|
|
-
|
|
1,416
|
|
(26,648)
|
|
-
|
|
|
Total
|
|
$
234,525
|
|
$
87,033
|
|
$
63,375
|
|
$
26,430
|
|
$
57,087
|
|
$
(26,648)
|
|
$
441,802
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT (1)
|
|
$
34,497
|
|
$
(3,834)
|
|
$
(11,489)
|
|
$
4,354
|
|
$
1,725
|
|
$
424
|
|
$
25,677
|
|
|
As a percent of total
sales
|
|
14.7%
|
|
(4.4%)
|
|
(18.1%)
|
|
16.5%
|
|
3.0%
|
|
|
|
5.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special items (4)
|
|
$
-
|
|
$
6,338
|
|
$
8,606
|
|
$
164
|
|
$
(21)
|
|
$
-
|
|
$
15,087
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT, as adjusted (3)
|
|
$
34,497
|
|
$
2,504
|
|
$
(2,883)
|
|
$
4,518
|
|
$
1,704
|
|
$
424
|
|
$
40,764
|
|
|
As a percent of total
sales
|
|
14.7%
|
|
2.9%
|
|
(4.5%)
|
|
17.1%
|
|
3.0%
|
|
|
|
9.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
740,780
|
|
$
255,773
|
|
$
233,965
|
|
$
85,009
|
|
$
190,353
|
|
$
-
|
|
$
1,505,880
|
|
Inter-segment sales
|
|
81,381
|
|
9,787
|
|
9,310
|
|
1,064
|
|
4,877
|
|
(106,419)
|
|
-
|
|
|
Total
|
|
$
822,161
|
|
$
265,560
|
|
$
243,275
|
|
$
86,073
|
|
$
195,230
|
|
$
(106,419)
|
|
$
1,505,880
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT (1)
|
|
$
114,484
|
|
$
12,642
|
|
$
5,273
|
|
$
2,383
|
|
$
9,794
|
|
$
(6,474)
|
|
$
138,102
|
|
|
As a percent of total
sales
|
|
13.9%
|
|
4.8%
|
|
2.2%
|
|
2.8%
|
|
5.0%
|
|
|
|
9.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special items (2)
|
|
$
-
|
|
$
2,079
|
|
$
(4,222)
|
|
$
3,123
|
|
$
(416)
|
|
$
-
|
|
$
564
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT, as adjusted (3)
|
|
$
114,484
|
|
$
14,721
|
|
$
1,051
|
|
$
5,506
|
|
$
9,378
|
|
$
(6,474)
|
|
$
138,666
|
|
|
As a percent of total
sales
|
|
13.9%
|
|
5.5%
|
|
0.4%
|
|
6.4%
|
|
4.8%
|
|
|
|
9.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
639,973
|
|
$
260,575
|
|
$
133,144
|
|
$
69,197
|
|
$
163,947
|
|
$
-
|
|
$
1,266,836
|
|
Inter-segment sales
|
|
63,736
|
|
7,001
|
|
2,000
|
|
-
|
|
6,193
|
|
(78,930)
|
|
-
|
|
|
Total
|
|
$
703,709
|
|
$
267,576
|
|
$
135,144
|
|
$
69,197
|
|
$
170,140
|
|
$
(78,930)
|
|
$
1,266,836
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT (1)
|
|
$
82,490
|
|
$
(8,172)
|
|
$
(23,209)
|
|
$
6,566
|
|
$
(4,715)
|
|
$
(2,483)
|
|
$
50,477
|
|
|
As a percent of total
sales
|
|
11.7%
|
|
(3.1%)
|
|
(17.2%)
|
|
9.5%
|
|
(2.8%)
|
|
|
|
4.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special items (5)
|
|
$
10,191
|
|
$
3,325
|
|
$
7,130
|
|
$
528
|
|
$
4,678
|
|
$
-
|
|
$
25,852
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT, as adjusted (3)
|
|
$
92,681
|
|
$
(4,847)
|
|
$
(16,079)
|
|
$
7,094
|
|
$
(37)
|
|
$
(2,483)
|
|
$
76,329
|
|
|
As a percent of total
sales
|
|
13.2%
|
|
(1.8%)
|
|
(11.9%)
|
|
10.3%
|
|
-
|
|
|
|
6.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) EBIT is defined as Operating
income plus Equity earnings (loss) in affiliates and Other
income.
|
|
|
|
(2) Special items include
rationalization charges (gains) and the impact of the change in the
functional currency of the Company's Venezuelan operation to the
dollar and the devaluation of the Venezuelan currency.
|
|
|
|
(3) The primary profit measure
used by management to assess segment performance is EBIT, as
adjusted. EBIT for each operating segment is adjusted for
special items to derive EBIT, as adjusted.
|
|
|
|
(4) Special items include
rationalization charges (gains) and a loss related to an
acquisition included in Equity earnings (loss) in
affiliates.
|
|
|
|
(5) Special items include
rationalization charges, a gain on the sale of a property, a
pension settlement gain and a loss related to an acquisition
included in Equity earnings (loss) in affiliates.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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
|
|
|
|
|
|
|
|
Foreign
|
|
Net
Sales
|
|
|
2009
|
|
Volume
|
|
Acquisitions
|
|
Price
|
|
Exchange
|
|
2010
|
|
Operating
Segments
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
Welding
|
$
213,132
|
|
$
37,360
|
|
$
-
|
|
$
3,351
|
|
$
1,793
|
|
$
255,636
|
|
Europe Welding
|
84,365
|
|
9,515
|
|
-
|
|
28
|
|
(8,016)
|
|
85,892
|
|
Asia Pacific
Welding
|
62,204
|
|
5,022
|
|
12,338
|
|
(1,598)
|
|
1,691
|
|
79,657
|
|
South America
Welding
|
26,430
|
|
11,996
|
|
-
|
|
5,539
|
|
(9,900)
|
|
34,065
|
|
The Harris Products
Group
|
55,671
|
|
3,180
|
|
-
|
|
5,384
|
|
(147)
|
|
64,088
|
|
Consolidated
|
$
441,802
|
|
$
67,073
|
|
$
12,338
|
|
$
12,704
|
|
$
(14,579)
|
|
$
519,338
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
Welding
|
|
|
17.5%
|
|
-
|
|
1.6%
|
|
0.8%
|
|
19.9%
|
|
Europe Welding
|
|
|
11.3%
|
|
-
|
|
-
|
|
(9.5%)
|
|
1.8%
|
|
Asia Pacific
Welding
|
|
|
8.1%
|
|
19.8%
|
|
(2.6%)
|
|
2.7%
|
|
28.1%
|
|
South America
Welding
|
|
|
45.4%
|
|
-
|
|
21.0%
|
|
(37.5%)
|
|
28.9%
|
|
The Harris Products
Group
|
|
|
5.7%
|
|
-
|
|
9.7%
|
|
(0.3%)
|
|
15.1%
|
|
Consolidated
|
|
|
15.2%
|
|
2.8%
|
|
2.9%
|
|
(3.3%)
|
|
17.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30th
Change in Net Sales by Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
Net Sales due to:
|
|
|
|
|
Net
Sales
|
|
|
|
|
|
|
|
Foreign
|
|
Net
Sales
|
|
|
2009
|
|
Volume
|
|
Acquisitions
|
|
Price
|
|
Exchange
|
|
2010
|
|
Operating
Segments
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
Welding
|
$
639,973
|
|
$
100,131
|
|
$
-
|
|
$
(9,460)
|
|
$
10,136
|
|
$
740,780
|
|
Europe Welding
|
260,575
|
|
11,610
|
|
-
|
|
(10,697)
|
|
(5,715)
|
|
255,773
|
|
Asia Pacific
Welding
|
133,144
|
|
11,236
|
|
86,235
|
|
(5,973)
|
|
9,323
|
|
233,965
|
|
South America
Welding
|
69,197
|
|
24,552
|
|
-
|
|
11,719
|
|
(20,459)
|
|
85,009
|
|
The Harris Products
Group
|
163,947
|
|
10,978
|
|
-
|
|
12,445
|
|
2,983
|
|
190,353
|
|
Consolidated
|
$
1,266,836
|
|
$
158,507
|
|
$
86,235
|
|
$
(1,966)
|
|
$
(3,732)
|
|
$
1,505,880
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
Welding
|
|
|
15.6%
|
|
-
|
|
(1.5%)
|
|
1.6%
|
|
15.8%
|
|
Europe Welding
|
|
|
4.5%
|
|
-
|
|
(4.1%)
|
|
(2.2%)
|
|
(1.8%)
|
|
Asia Pacific
Welding
|
|
|
8.4%
|
|
64.8%
|
|
(4.5%)
|
|
7.0%
|
|
75.7%
|
|
South America
Welding
|
|
|
35.5%
|
|
-
|
|
16.9%
|
|
(29.6%)
|
|
22.9%
|
|
The Harris Products
Group
|
|
|
6.7%
|
|
-
|
|
7.6%
|
|
1.8%
|
|
16.1%
|
|
Consolidated
|
|
|
12.5%
|
|
6.8%
|
|
(0.2%)
|
|
(0.3%)
|
|
18.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE Lincoln Electric Holdings, Inc.
Copyright . 27 PR Newswire