CLEVELAND, Feb. 15, 2013 /PRNewswire/ --
|
Fourth Quarter and Full Year 2012 Highlights
|
- Sales were $684.6 million in the Fourth Quarter 2012; Sales were $2.9 billion for the Full year 2012, an increase of 5.9% from 2011
- Operating income increased 4.1% to $85.7 million, or 12.5% of sales, from $82.4 million, or 11.9% of sales, in the Fourth Quarter 2011; Adjusted operating income increased 10.2% to $90.7 million, or 13.3% of sales
- Operating income increased 22.0% to $362.1 million, or 12.7% of sales, from $296.7 million, or 11.0% of sales, in the Full year 2011; Adjusted operating income increased 25.5% to $372.8 million, or 13.1% of sales
- Net income increased 7.5% to $62.1 million, or $0.74 per diluted share, from $57.7 million, or $0.68 per diluted share, in the Fourth Quarter 2011; Adjusted net income increased 14.2% to $65.9 million, or $0.79 per diluted share
- Net income increased 18.5% to $257.4 million, or $3.06 per diluted share, from $217.2 million, or $2.56 per diluted share, in the Full year 2011; Adjusted net income increased 25.0% to $265.8 million, or $3.16 per diluted share from $212.6 million, or $2.51 per diluted share
- Net cash provided by operating activities in the Fourth Quarter 2012 increased $21.0 million, or 33.3%, to $84.1 million; Net cash provided by operating activities in the Full year 2012 increased $134.0 million, or 69.2%, to $327.5 million
|
Lincoln Electric Holdings, Inc. (the "Company") (Nasdaq: LECO) today reported fourth quarter 2012 net income of $62.1 million, or $0.74 per diluted share. Adjusted net income was $65.9 million, or $0.79 per diluted share, compared to adjusted net income of $57.7 million, or $0.68 per diluted share, in the comparable 2011 period.
Sales were $684.6 million in the fourth quarter 2012 versus $694.5 million in the comparable 2011 period, a decrease of 1.4%. Operating income for the fourth quarter increased $3.3 million to $85.7 million, or 12.5% of sales, from $82.4 million, or 11.9% of sales, in the comparable 2011 period. The effective tax rate for the fourth quarter 2012 was 29.3% compared with 30.8% in the same period of 2011.
Sales for the twelve months ended December 31, 2012 were $2.9 billion versus $2.7 billion in 2011, an increase of 5.9%. Operating income for the twelve months ended December 31, 2012 increased $65.4 million to $362.1 million, or 12.7% of sales, from $296.7 million, or 11.0% of sales, in 2011.
Net income for the twelve months ended December 31, 2012 was $257.4 million, or $3.06 per diluted share, compared with net income of $217.2 million, or $2.56 per diluted share, in 2011. Adjusted net income was $265.8 million, or $3.16 per diluted share, compared to adjusted net income of $212.6 million, or $2.51 per diluted share, in 2011. The effective tax rate for the twelve months ended December 31, 2012 was 30.4% compared with 28.0% in 2011. The twelve months ended December 31, 2011 included a favorable $4.8 million tax adjustment for tax audit settlements.
"Our 2012 sales and earnings per share represent the highest in the Company's 118 year history," said John M. Stropki, Chairman of the Board. "We are also pleased to report that we expanded margins, significantly increased return on invested capital and generated record cash flows.
"As we head into 2013, we continue to be cautious based on the uncertain global macroeconomic environment. We expect to see slower year-over-year overall growth in at least the first half of 2013; however, we remain very confident in our ability to execute our long-term strategic initiatives even in these challenging times."
Christopher L. Mapes, President and Chief Executive Officer added, "The goals set in our '2020 Vision' remain a priority, with our focus on achieving significant earnings growth and superior returns on invested capital. We continue to explore attractive acquisitions that will shape our product portfolio and grow our global reach, invest in new product development and expand our global commercial infrastructure. Our continued attention to improvement in operating results and execution of our global growth strategies keep us well positioned to achieve our long-term goals."
Net cash provided by operating activities increased $21.0 million to $84.1 million in the fourth quarter from $63.1 million for the comparable period in 2011. Fourth quarter cash flows from operations were reduced by a $33.4 million deposit related to a Canadian income tax assessment. During the quarter, the Company returned $51.5 million to shareholders through the payment of $30.6 million in dividends and the repurchase of $20.9 million, or 455,518 of the Company's common shares, for treasury. Dividends paid during the period included a December 28, 2012 dividend payment, which would normally have been paid in January 2013. The Company also invested $81.8 million in acquisitions and voluntarily contributed $10.1 million to its U.S. pension plans during the quarter.
Net cash provided by operating activities increased $134.0 million to $327.5 million in the twelve months ended December 31, 2012 from $193.5 million in 2011. The 2012 cash flows from operations was reduced by a $89.4 million deposit related to a Canadian income tax assessment. During the period, the Company repaid its $80.0 million senior unsecured note. The Company also returned $154.1 million to shareholders through the payment of $73.1 million in dividends and the repurchase of $81.0 million, or 1,797,502 of the Company's common shares, for treasury during the period. The Company also invested $134.6 million in acquisitions and voluntarily contributed $63.4 million to its U.S. pension plans.
The Company's Board of Directors declared a quarterly cash dividend of $0.20 per share, which was paid on December 28, 2012 to holders of record on December 17, 2012.
Financial results for the fourth quarter 2012 can also be obtained at http://www.lincolnelectric.com/InvestorNews.
A conference call to discuss fourth quarter 2012 financial results is scheduled for today, Friday, February 15, 2013, at 10:00 a.m., Eastern Time. An audio webcast of the call is accessible through the Company's website at http://www.lincolnelectric.com/InvestorWebcasts/.
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 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 measures.
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 45 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 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. Forward-looking statements generally can be identified by the use of words such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe," "forecast," "guidance" or words of similar meaning. 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 events beyond our control, such as political unrest, acts of terror and natural disasters, 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 amounts)
(Unaudited)
|
|
Consolidated Statements of Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31, 2012
|
|
Fav (Unfav) to Prior Year
|
|
|
2012
|
|
% of Sales
|
|
2011
|
|
% of Sales
|
|
$
|
|
%
|
|
Net sales
|
|
$
|
684,648
|
|
100.0%
|
|
$
|
694,513
|
|
100.0%
|
|
$
|
(9,865)
|
|
(1.4%)
|
|
Cost of goods sold
|
|
471,616
|
|
68.9%
|
|
500,170
|
|
72.0%
|
|
28,554
|
|
5.7%
|
|
Gross profit
|
|
213,032
|
|
31.1%
|
|
194,343
|
|
28.0%
|
|
18,689
|
|
9.6%
|
|
Selling, general & administrative expenses
|
|
122,290
|
|
17.9%
|
|
111,981
|
|
16.1%
|
|
(10,309)
|
|
(9.2%)
|
|
Rationalization and asset impairment
charges (gains)
|
|
5,037
|
|
0.7%
|
|
—
|
|
—
|
|
(5,037)
|
|
(100.0%)
|
|
Operating income
|
|
85,705
|
|
12.5%
|
|
82,362
|
|
11.9%
|
|
3,343
|
|
4.1%
|
|
Interest income
|
|
1,340
|
|
0.2%
|
|
685
|
|
0.1%
|
|
655
|
|
95.6%
|
|
Equity earnings in affiliates
|
|
743
|
|
0.1%
|
|
1,352
|
|
0.2%
|
|
(609)
|
|
(45.0%)
|
|
Other income
|
|
670
|
|
0.1%
|
|
695
|
|
0.1%
|
|
(25)
|
|
(3.6%)
|
|
Interest expense
|
|
(853)
|
|
(0.1%)
|
|
(1,667)
|
|
(0.2%)
|
|
814
|
|
48.8%
|
|
Income before income taxes
|
|
87,605
|
|
12.8%
|
|
83,427
|
|
12.0%
|
|
4,178
|
|
5.0%
|
|
Income taxes
|
|
25,639
|
|
3.7%
|
|
25,736
|
|
3.7%
|
|
97
|
|
0.4%
|
|
Effective tax rate
|
|
29.3%
|
|
|
|
30.8%
|
|
|
|
1.5%
|
|
|
|
Net income including non-controlling
interests
|
|
61,966
|
|
9.1%
|
|
57,691
|
|
8.3%
|
|
4,275
|
|
7.4%
|
|
Non-controlling interests in subsidiaries'
loss
|
|
(118)
|
|
—
|
|
(42)
|
|
—
|
|
(76)
|
|
(181.0%)
|
|
Net income
|
|
$
|
62,084
|
|
9.1%
|
|
$
|
57,733
|
|
8.3%
|
|
$
|
4,351
|
|
7.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share
|
|
$
|
0.75
|
|
|
|
$
|
0.69
|
|
|
|
$
|
0.06
|
|
8.7%
|
|
Diluted earnings per share
|
|
$
|
0.74
|
|
|
|
$
|
0.68
|
|
|
|
$
|
0.06
|
|
8.8%
|
|
Weighted average shares (basic)
|
|
82,651
|
|
|
|
83,384
|
|
|
|
|
|
|
|
Weighted average shares (diluted)
|
|
83,677
|
|
|
|
84,384
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended December 31,
|
|
Fav (Unfav) to Prior Year
|
|
|
2012
|
|
% of Sales
|
|
2011
|
|
% of Sales
|
|
$
|
|
%
|
|
Net sales
|
|
$
|
2,853,367
|
|
100.0%
|
|
$
|
2,694,609
|
|
100.0%
|
|
$
|
158,758
|
|
5.9%
|
|
Cost of goods sold
|
|
1,986,711
|
|
69.6%
|
|
1,957,872
|
|
72.7%
|
|
(28,839)
|
|
(1.5%)
|
|
Gross profit
|
|
866,656
|
|
30.4%
|
|
736,737
|
|
27.3%
|
|
129,919
|
|
17.6%
|
|
Selling, general & administrative expenses
|
|
495,221
|
|
17.4%
|
|
439,775
|
|
16.3%
|
|
(55,446)
|
|
(12.6%)
|
|
Rationalization and asset impairment
charges (gains)
|
|
9,354
|
|
0.3%
|
|
282
|
|
—
|
|
(9,072)
|
|
(3,217.0%)
|
|
Operating income
|
|
362,081
|
|
12.7%
|
|
296,680
|
|
11.0%
|
|
65,401
|
|
22.0%
|
|
Interest income
|
|
3,988
|
|
0.1%
|
|
3,121
|
|
0.1%
|
|
867
|
|
27.8%
|
|
Equity earnings in affiliates
|
|
5,007
|
|
0.2%
|
|
5,385
|
|
0.2%
|
|
(378)
|
|
(7.0%)
|
|
Other income
|
|
2,685
|
|
0.1%
|
|
2,849
|
|
0.1%
|
|
(164)
|
|
(5.8%)
|
|
Interest expense
|
|
(4,191)
|
|
(0.1%)
|
|
(6,704)
|
|
(0.2%)
|
|
2,513
|
|
37.5%
|
|
Income before income taxes
|
|
369,570
|
|
13.0%
|
|
301,331
|
|
11.2%
|
|
68,239
|
|
22.6%
|
|
Income taxes
|
|
112,354
|
|
3.9%
|
|
84,318
|
|
3.1%
|
|
(28,036)
|
|
(33.3%)
|
|
Effective tax rate
|
|
30.4%
|
|
|
|
28.0%
|
|
|
|
(2.4%)
|
|
|
|
Net income including non-controlling
interests
|
|
257,216
|
|
9.0%
|
|
217,013
|
|
8.1%
|
|
40,203
|
|
18.5%
|
|
Non-controlling interests in subsidiaries'
loss
|
|
(195)
|
|
—
|
|
(173)
|
|
—
|
|
(22)
|
|
(12.7%)
|
|
Net income
|
|
$
|
257,411
|
|
9.0%
|
|
$
|
217,186
|
|
8.1%
|
|
$
|
40,225
|
|
18.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share
|
|
$
|
3.10
|
|
|
|
$
|
2.60
|
|
|
|
$
|
0.50
|
|
19.2%
|
|
Diluted earnings per share
|
|
$
|
3.06
|
|
|
|
$
|
2.56
|
|
|
|
$
|
0.50
|
|
19.5%
|
|
Weighted average shares (basic)
|
|
83,087
|
|
|
|
83,681
|
|
|
|
|
|
|
|
Weighted average shares (diluted)
|
|
84,175
|
|
|
|
84,708
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share amounts)
(Unaudited)
|
|
Non-GAAP Financial Measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31,
|
|
Twelve months ended December 31,
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
Operating income as reported
|
|
$
|
85,705
|
|
|
$
|
82,362
|
|
|
$
|
362,081
|
|
|
$
|
296,680
|
|
|
Special items (pre-tax):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rationalization and asset impairment charges (gains) (1)
|
|
5,037
|
|
|
—
|
|
|
9,354
|
|
|
282
|
|
|
Venezuelan statutory severance obligation (2)
|
|
—
|
|
|
—
|
|
|
1,381
|
|
|
—
|
|
|
Adjusted operating income (4)
|
|
$
|
90,742
|
|
|
$
|
82,362
|
|
|
$
|
372,816
|
|
|
$
|
296,962
|
|
|
|
|
|
|
|
|
|
|
|
Net income as reported
|
|
$
|
62,084
|
|
|
$
|
57,733
|
|
|
$
|
257,411
|
|
|
$
|
217,186
|
|
|
Special items (after-tax):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rationalization and asset impairment charges (gains) (1)
|
|
3,823
|
|
|
—
|
|
|
7,442
|
|
|
237
|
|
|
Venezuelan statutory severance obligation (2)
|
|
—
|
|
|
—
|
|
|
906
|
|
|
—
|
|
|
Adjustment for tax audit settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,844)
|
|
|
Adjusted net income (4)
|
|
$
|
65,907
|
|
|
$
|
57,733
|
|
|
$
|
265,759
|
|
|
$
|
212,579
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share as reported
|
|
$
|
0.74
|
|
|
$
|
0.68
|
|
|
$
|
3.06
|
|
|
$
|
2.56
|
|
|
Special items
|
|
0.05
|
|
|
—
|
|
|
0.10
|
|
|
(0.05)
|
|
|
Adjusted diluted earnings per share (4)
|
|
$
|
0.79
|
|
|
$
|
0.68
|
|
|
$
|
3.16
|
|
|
$
|
2.51
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares (diluted)
|
|
83,677
|
|
|
84,384
|
|
|
84,175
|
|
|
84,708
|
|
|
|
|
(1)
|
The three and twelve months ended December 31, 2012 include net charges associated with severance, impairment and other costs from the consolidation of manufacturing operations initiated in 2012 partially offset by gains related to the sale of assets at rationalized operations. The twelve months ended December 31, 2011 includes charges associated with severance and other costs from the consolidation of manufacturing operations initiated in 2009 partially offset by gains related to the sale of assets at rationalized operations.
|
|
|
|
(2)
|
Represents an unfavorable adjustment due to a change in Venezuelan labor law which provides for increased employee severance obligations.
|
|
|
|
(3)
|
Represents a favorable adjustment for tax audit settlements.
|
|
|
|
(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 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
|
|
December 31, 2012
|
|
|
December 31, 2011
|
|
|
Cash and cash equivalents
|
|
$
|
286,464
|
|
|
$
|
361,101
|
|
|
Total current assets
|
|
1,132,816
|
|
|
1,219,270
|
|
|
Property, plant and equipment, net
|
|
486,236
|
|
|
470,451
|
|
|
Total assets
|
|
2,089,863
|
|
|
1,976,776
|
|
|
Total current liabilities
|
|
440,267
|
|
|
471,042
|
|
|
Short-term debt (1)
|
|
18,676
|
|
|
101,418
|
|
|
Long-term debt
|
|
1,599
|
|
|
1,960
|
|
|
Total equity
|
|
1,358,321
|
|
|
1,193,242
|
|
|
|
|
|
|
|
Net Operating Working Capital
|
|
December 31, 2012
|
|
|
December 31, 2011
|
|
|
Accounts receivable
|
|
$
|
360,662
|
|
|
$
|
386,197
|
|
|
Inventory
|
|
364,890
|
|
|
373,238
|
|
|
Trade accounts payable
|
|
209,647
|
|
|
176,312
|
|
|
Net operating working capital
|
|
$
|
515,905
|
|
|
$
|
583,123
|
|
|
|
|
|
|
|
Net operating working capital to net sales (2)
|
|
18.8%
|
|
|
21.0%
|
|
|
|
|
|
|
|
Invested Capital
|
|
December 31, 2012
|
|
|
December 31, 2011
|
|
|
Short-term debt (1)
|
|
$
|
18,676
|
|
|
$
|
101,418
|
|
|
Long-term debt
|
|
1,599
|
|
|
1,960
|
|
|
Total debt
|
|
20,275
|
|
|
103,378
|
|
|
Total equity
|
|
1,358,321
|
|
|
1,193,242
|
|
|
Invested capital
|
|
$
|
1,378,596
|
|
|
$
|
1,296,620
|
|
|
|
|
|
|
|
Total debt / invested capital
|
|
1.5%
|
|
|
8.0%
|
|
|
Return on invested capital (3)
|
|
18.7%
|
|
|
16.9%
|
|
|
|
|
(1)
|
Includes current portion of long-term debt.
|
|
|
|
(2)
|
Net operating working capital to net sales is defined as net operating working capital divided by annualized rolling three months of sales.
|
|
|
|
(3)
|
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 amounts)
(Unaudited)
|
|
|
Condensed Consolidated Statements of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31,
|
|
|
2012
|
|
2011
|
|
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
62,084
|
|
|
$
|
57,733
|
|
|
Non-controlling interests in subsidiaries' loss
|
|
(118)
|
|
|
(42)
|
|
|
Net income including non-controlling interests
|
|
61,966
|
|
|
57,691
|
|
|
Adjustments to reconcile Net income including non-controlling interests to Net cash
provided by operating activities:
|
|
|
|
|
|
|
|
Rationalization and asset impairment charges
|
|
1,383
|
|
|
—
|
|
|
Depreciation and amortization
|
|
17,114
|
|
|
14,962
|
|
|
Equity loss (earnings) in affiliates, net
|
|
1,609
|
|
|
(655)
|
|
|
Other non-cash items, net
|
|
11,423
|
|
|
16,508
|
|
|
Changes in operating assets and liabilities, net of effects from acquisitions:
|
|
|
|
|
|
|
|
Decrease in accounts receivable
|
|
44,009
|
|
|
4,769
|
|
|
Decrease in inventories
|
|
35,118
|
|
|
47,048
|
|
|
Increase (decrease) in trade accounts payable
|
|
17,292
|
|
|
(26,316)
|
|
|
Net change in other current assets and liabilities
|
|
(61,032)
|
|
|
(49,103)
|
|
|
Decrease in accrued pensions
|
|
(10,729)
|
|
|
(1,286)
|
|
|
Net change in other long-term assets and liabilities
|
|
(34,010)
|
|
|
(478)
|
|
|
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
|
84,143
|
|
|
63,140
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
Capital expenditures
|
|
(13,408)
|
|
|
(15,063)
|
|
|
Acquisition of businesses, net of cash acquired
|
|
(81,751)
|
|
|
(3,889)
|
|
|
Proceeds from sale of property, plant and equipment
|
|
849
|
|
|
243
|
|
|
NET CASH USED BY INVESTING ACTIVITIES
|
|
(94,310)
|
|
|
(18,709)
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
Net change in borrowings
|
|
(1,302)
|
|
|
10,827
|
|
|
Proceeds from exercise of stock options
|
|
6,081
|
|
|
4,140
|
|
|
Tax benefit from exercise of stock options
|
|
2,225
|
|
|
589
|
|
|
Purchase of shares for treasury
|
|
(20,863)
|
|
|
(9,367)
|
|
|
Cash dividends paid to shareholders
|
|
(30,602)
|
|
|
(12,934)
|
|
|
Other financing activities
|
|
—
|
|
|
3,346
|
|
|
NET CASH USED BY FINANCING ACTIVITIES
|
|
(44,461)
|
|
|
(3,399)
|
|
|
|
|
|
|
|
Effect of exchange rate changes on Cash and cash equivalents
|
|
417
|
|
|
(1,391)
|
|
|
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
|
|
(54,211)
|
|
|
39,641
|
|
|
Cash and cash equivalents at beginning of period
|
|
340,675
|
|
|
321,460
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
286,464
|
|
|
$
|
361,101
|
|
|
|
|
|
|
|
Cash dividends paid per share
|
|
$
|
0.37
|
|
|
$
|
0.155
|
|
|
Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share amounts)
(Unaudited)
|
|
|
Condensed Consolidated Statements of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended December 31,
|
|
|
2012
|
|
2011
|
|
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
257,411
|
|
|
$
|
217,186
|
|
|
Non-controlling interests in subsidiaries' loss
|
|
(195)
|
|
|
(173)
|
|
|
Net income including non-controlling interests
|
|
257,216
|
|
|
217,013
|
|
|
Adjustments to reconcile Net income including non-controlling interests to Net cash
provided by operating activities:
|
|
|
|
|
|
|
|
Rationalization and asset impairment charges
|
|
1,740
|
|
|
23
|
|
|
Depreciation and amortization
|
|
65,334
|
|
|
62,051
|
|
|
Equity loss (earnings) in affiliates, net
|
|
160
|
|
|
(1,971)
|
|
|
Other non-cash items, net
|
|
40,582
|
|
|
44,564
|
|
|
Changes in operating assets and liabilities, net of effects from acquisitions:
|
|
|
|
|
|
|
|
Decrease (increase) in accounts receivable
|
|
57,759
|
|
|
(67,518)
|
|
|
Decrease (increase) in inventories
|
|
28,286
|
|
|
(51,679)
|
|
|
Increase in trade accounts payable
|
|
16,110
|
|
|
8,672
|
|
|
Net change in other current assets and liabilities
|
|
12,381
|
|
|
17,981
|
|
|
Decrease in accrued pensions
|
|
(65,201)
|
|
|
(31,776)
|
|
|
Net change in other long-term assets and liabilities
|
|
(86,883)
|
|
|
(3,842)
|
|
|
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
|
327,484
|
|
|
193,518
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
Capital expenditures
|
|
(52,715)
|
|
|
(65,813)
|
|
|
Acquisition of businesses, net of cash acquired
|
|
(134,602)
|
|
|
(66,229)
|
|
|
Proceeds from sale of property, plant and equipment
|
|
1,387
|
|
|
1,246
|
|
|
Other investing activities
|
|
(1,541)
|
|
|
—
|
|
|
NET CASH USED BY INVESTING ACTIVITIES
|
|
(187,471)
|
|
|
(130,796)
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
Net change in borrowings
|
|
(89,303)
|
|
|
7,949
|
|
|
Proceeds from exercise of stock options
|
|
18,776
|
|
|
11,351
|
|
|
Tax benefit from exercise of stock options
|
|
7,819
|
|
|
2,916
|
|
|
Purchase of shares for treasury
|
|
(81,018)
|
|
|
(36,997)
|
|
|
Cash dividends paid to shareholders
|
|
(73,112)
|
|
|
(51,935)
|
|
|
Other financing activities
|
|
—
|
|
|
3,346
|
|
|
NET CASH USED BY FINANCING ACTIVITIES
|
|
(216,838)
|
|
|
(63,370)
|
|
|
|
|
|
|
|
Effect of exchange rate changes on Cash and cash equivalents
|
|
2,188
|
|
|
(4,444)
|
|
|
DECREASE IN CASH AND CASH EQUIVALENTS
|
|
(74,637)
|
|
|
(5,092)
|
|
|
Cash and cash equivalents at beginning of period
|
|
361,101
|
|
|
366,193
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
286,464
|
|
|
$
|
361,101
|
|
|
|
|
|
|
|
Cash dividends paid per share
|
|
$
|
0.88
|
|
|
$
|
0.62
|
|
|
Lincoln Electric Holdings, Inc.
Segment Highlights
(In thousands)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North
America
Welding
|
|
Europe
Welding
|
|
Asia Pacific
Welding
|
|
South
America
Welding
|
|
The Harris
Products
Group
|
|
Corporate /
Eliminations
|
|
Consolidated
|
|
Three months ended
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
392,939
|
|
$
|
107,507
|
|
$
|
70,223
|
|
$
|
39,931
|
|
$
|
74,048
|
|
$
|
—
|
|
$
|
684,648
|
|
Inter-segment sales
|
|
29,676
|
|
3,870
|
|
3,188
|
|
—
|
|
1,944
|
|
(38,678)
|
|
—
|
|
Total
|
|
$
|
422,615
|
|
$
|
111,377
|
|
$
|
73,411
|
|
$
|
39,931
|
|
$
|
75,992
|
|
$
|
(38,678)
|
|
$
|
684,648
|
|
EBIT (1)
|
|
$
|
75,925
|
|
$
|
3,914
|
|
$
|
(5,090)
|
|
$
|
4,829
|
|
$
|
5,544
|
|
$
|
1,996
|
|
$
|
87,118
|
|
As a percent of total sales
|
|
18.0%
|
|
3.5%
|
|
(6.9%)
|
|
12.1%
|
|
7.3%
|
|
|
|
12.7%
|
|
Special items charge (gain) (2)
|
|
$
|
273
|
|
$
|
1,068
|
|
$
|
3,696
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
5,037
|
|
EBIT, as adjusted (4)
|
|
$
|
76,198
|
|
$
|
4,982
|
|
$
|
(1,394)
|
|
$
|
4,829
|
|
$
|
5,544
|
|
$
|
1,996
|
|
$
|
92,155
|
|
As a percent of total sales
|
|
18.0%
|
|
4.5%
|
|
(1.9%)
|
|
12.1%
|
|
7.3%
|
|
|
|
13.5%
|
|
Three months ended
December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
361,905
|
|
$
|
126,942
|
|
$
|
88,204
|
|
$
|
40,673
|
|
$
|
76,789
|
|
$
|
—
|
|
$
|
694,513
|
|
Inter-segment sales
|
|
30,895
|
|
4,047
|
|
4,893
|
|
120
|
|
1,761
|
|
(41,716)
|
|
—
|
|
Total
|
|
$
|
392,800
|
|
$
|
130,989
|
|
$
|
93,097
|
|
$
|
40,793
|
|
$
|
78,550
|
|
$
|
(41,716)
|
|
$
|
694,513
|
|
EBIT (1)
|
|
$
|
69,732
|
|
$
|
8,904
|
|
$
|
(652)
|
|
$
|
3,295
|
|
$
|
4,401
|
|
$
|
(1,271)
|
|
$
|
84,409
|
|
As a percent of total sales
|
|
17.8%
|
|
6.8%
|
|
(0.7%)
|
|
8.1%
|
|
5.6%
|
|
|
|
12.2%
|
|
Special items charge (gain)
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
EBIT, as adjusted (4)
|
|
$
|
69,732
|
|
$
|
8,904
|
|
$
|
(652)
|
|
$
|
3,295
|
|
$
|
4,401
|
|
$
|
(1,271)
|
|
$
|
84,409
|
|
As a percent of total sales
|
|
17.8%
|
|
6.8%
|
|
(0.7%)
|
|
8.1%
|
|
5.6%
|
|
|
|
12.2%
|
|
Twelve months ended
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
1,580,818
|
|
$
|
452,227
|
|
$
|
324,482
|
|
$
|
161,483
|
|
$
|
334,357
|
|
$
|
—
|
|
$
|
2,853,367
|
|
Inter-segment sales
|
|
131,062
|
|
16,048
|
|
14,829
|
|
38
|
|
8,549
|
|
(170,526)
|
|
—
|
|
Total
|
|
$
|
1,711,880
|
|
$
|
468,275
|
|
$
|
339,311
|
|
$
|
161,521
|
|
$
|
342,906
|
|
$
|
(170,526)
|
|
$
|
2,853,367
|
|
EBIT (1)
|
|
$
|
292,243
|
|
$
|
33,765
|
|
$
|
2,254
|
|
$
|
16,920
|
|
$
|
29,477
|
|
$
|
(4,886)
|
|
$
|
369,773
|
|
As a percent of total sales
|
|
17.1%
|
|
7.2%
|
|
0.7%
|
|
10.5%
|
|
8.6%
|
|
|
|
13.0%
|
|
Special items charge (gain) (2)
|
|
$
|
827
|
|
$
|
3,534
|
|
$
|
4,993
|
|
$
|
1,381
|
|
$
|
—
|
|
$
|
—
|
|
$
|
10,735
|
|
EBIT, as adjusted (4)
|
|
$
|
293,070
|
|
$
|
37,299
|
|
$
|
7,247
|
|
$
|
18,301
|
|
$
|
29,477
|
|
$
|
(4,886)
|
|
$
|
380,508
|
|
As a percent of total sales
|
|
17.1%
|
|
8.0%
|
|
2.1%
|
|
11.3%
|
|
8.6%
|
|
|
|
13.3%
|
|
Twelve months ended
December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
1,309,499
|
|
$
|
508,692
|
|
$
|
376,276
|
|
$
|
156,684
|
|
$
|
343,458
|
|
$
|
—
|
|
$
|
2,694,609
|
|
Inter-segment sales
|
|
136,314
|
|
17,422
|
|
15,614
|
|
494
|
|
8,496
|
|
(178,340)
|
|
—
|
|
Total
|
|
$
|
1,445,813
|
|
$
|
526,114
|
|
$
|
391,890
|
|
$
|
157,178
|
|
$
|
351,954
|
|
$
|
(178,340)
|
|
$
|
2,694,609
|
|
EBIT (1)
|
|
$
|
227,924
|
|
$
|
35,779
|
|
$
|
2,739
|
|
$
|
12,895
|
|
$
|
25,151
|
|
$
|
426
|
|
$
|
304,914
|
|
As a percent of total sales
|
|
15.8%
|
|
6.8%
|
|
0.7%
|
|
8.2%
|
|
7.1%
|
|
|
|
11.3%
|
|
Special items charge (gain) (3)
|
|
$
|
—
|
|
$
|
392
|
|
$
|
(110)
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
282
|
|
EBIT, as adjusted (4)
|
|
$
|
227,924
|
|
$
|
36,171
|
|
$
|
2,629
|
|
$
|
12,895
|
|
$
|
25,151
|
|
$
|
426
|
|
$
|
305,196
|
|
As a percent of total sales
|
|
15.8%
|
|
6.9%
|
|
0.7%
|
|
8.2%
|
|
7.1%
|
|
|
|
11.3%
|
|
|
|
(1)
|
EBIT is defined as Operating income plus Equity earnings in affiliates and Other income.
|
|
|
|
(2)
|
Special items in the three and twelve month periods ended December 31, 2012 include rationalization and asset impairment charges (gains). Special items in the twelve months ended December 31, 2012 also include an unfavorable adjustment due to a change in Venezuelan labor law which provides for increased employee severance obligations.
|
|
|
|
(3)
|
Special items include rationalization and asset impairment charges (gains).
|
|
|
|
(4)
|
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.
|
|
Lincoln Electric Holdings, Inc.
Change in Net Sales by Segment
(In thousands)
(Unaudited)
|
|
|
Three Months Ended December 31st Change in Net Sales by Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in Net Sales due to:
|
|
|
|
|
Net Sales
2011
|
|
Volume
|
|
Acquisitions
|
|
Price
|
|
Foreign
Exchange
|
|
Net Sales
2012
|
|
Operating Segments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Welding
|
|
$
|
361,905
|
|
$
|
(2,722)
|
|
$
|
26,469
|
|
$
|
6,072
|
|
$
|
1,215
|
|
$
|
392,939
|
|
Europe Welding
|
|
126,942
|
|
(15,952)
|
|
—
|
|
(2,252)
|
|
(1,231)
|
|
107,507
|
|
Asia Pacific Welding
|
|
88,204
|
|
(18,138)
|
|
—
|
|
(429)
|
|
586
|
|
70,223
|
|
South America Welding
|
|
40,673
|
|
(1,700)
|
|
—
|
|
2,894
|
|
(1,936)
|
|
39,931
|
|
The Harris Products Group
|
|
76,789
|
|
(2,058)
|
|
—
|
|
704
|
|
(1,387)
|
|
74,048
|
|
Consolidated
|
|
$
|
694,513
|
|
$
|
(40,570)
|
|
$
|
26,469
|
|
$
|
6,989
|
|
$
|
(2,753)
|
|
$
|
684,648
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Welding
|
|
|
|
(0.8%)
|
|
7.3%
|
|
1.7%
|
|
0.3%
|
|
8.6%
|
|
Europe Welding
|
|
|
|
(12.6%)
|
|
—
|
|
(1.8%)
|
|
(1.0%)
|
|
(15.3%)
|
|
Asia Pacific Welding
|
|
|
|
(20.6%)
|
|
—
|
|
(0.5%)
|
|
0.7%
|
|
(20.4%)
|
|
South America Welding
|
|
|
|
(4.2%)
|
|
—
|
|
7.1%
|
|
(4.8%)
|
|
(1.8%)
|
|
The Harris Products Group
|
|
|
|
(2.7%)
|
|
—
|
|
0.9%
|
|
(1.8%)
|
|
(3.6%)
|
|
Consolidated
|
|
|
|
(5.8%)
|
|
3.8%
|
|
1.0%
|
|
(0.4%)
|
|
(1.4%)
|
|
Twelve Months Ended December 31st Change in Net Sales by Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in Net Sales due to:
|
|
|
|
|
Net Sales
2011
|
|
Volume
|
|
Acquisitions
|
|
Price
|
|
Foreign
Exchange
|
|
Net Sales
2012
|
|
Operating Segments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Welding
|
|
$
|
1,309,499
|
|
$
|
112,898
|
|
$
|
124,830
|
|
$
|
37,124
|
|
$
|
(3,533)
|
|
$
|
1,580,818
|
|
Europe Welding
|
|
508,692
|
|
(36,199)
|
|
8,322
|
|
4,874
|
|
(33,462)
|
|
452,227
|
|
Asia Pacific Welding
|
|
376,276
|
|
(54,289)
|
|
—
|
|
1,646
|
|
849
|
|
324,482
|
|
South America Welding
|
|
156,684
|
|
(1,284)
|
|
—
|
|
15,584
|
|
(9,501)
|
|
161,483
|
|
The Harris Products Group
|
|
343,458
|
|
13,683
|
|
—
|
|
(13,427)
|
|
(9,357)
|
|
334,357
|
|
Consolidated
|
|
$
|
2,694,609
|
|
$
|
34,809
|
|
$
|
133,152
|
|
$
|
45,801
|
|
$
|
(55,004)
|
|
$
|
2,853,367
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Welding
|
|
|
|
8.6%
|
|
9.5%
|
|
2.8%
|
|
(0.3%)
|
|
20.7%
|
|
Europe Welding
|
|
|
|
(7.1%)
|
|
1.6%
|
|
1.0%
|
|
(6.6%)
|
|
(11.1%)
|
|
Asia Pacific Welding
|
|
|
|
(14.4%)
|
|
—
|
|
0.4%
|
|
0.2%
|
|
(13.8%)
|
|
South America Welding
|
|
|
|
(0.8%)
|
|
—
|
|
9.9%
|
|
(6.1%)
|
|
3.1%
|
|
The Harris Products Group
|
|
|
|
4.0%
|
|
—
|
|
(3.9%)
|
|
(2.7%)
|
|
(2.6%)
|
|
Consolidated
|
|
|
|
1.3%
|
|
4.9%
|
|
1.7%
|
|
(2.0%)
|
|
5.9%
|
SOURCE Lincoln Electric Holdings, Inc.