UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): February 9, 2016
 
LINCOLN ELECTRIC HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
0-1402
(Commission File Number)
 
Ohio
 
34-1860551
(State or other jurisdiction of
incorporation)
 
(I.R.S. Employer Identification No.)
 
22801 St. Clair Avenue, Cleveland, Ohio 44117
(Address of principal executive offices, with zip code)
 
(216) 481-8100
(Registrant’s telephone number, including area code)
 
Not applicable
(Former name or former address, if changed since last report.)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))






Item 2.02
 
Results of Operations and Financial Condition.
 
 
On February 9, 2016, Lincoln Electric Holdings, Inc. (the “Company”) issued a press release announcing a new organizational and segment reporting structure. The press release announces that, effective in the first quarter of 2016, the Company will report three operating segments (Americas Welding, International Welding and The Harris Products Group) and contains the reclassification of historical results into the three new business segments for previously reported periods for 2013, 2014 and the first, second and third quarters of 2015. A copy of the Company’s press release issued on February 9, 2016 is attached hereto as Exhibit 99.1 and incorporated herein by reference. The press release is also available through the Company’s website at www.lincolnelectric.com. The information in this Current Report on Form 8-K, including the Exhibit, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act.
 
 
 
Item 9.01
 
Financial Statements and Exhibits.
 
 
 
 
 
(d) Exhibits
 
 
 
 
 
99.1  The Company’s press release dated February 9, 2016.






SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
LINCOLN ELECTRIC HOLDINGS, INC.
 
 
 
 
 
/s/ Vincent K. Petrella
 
 
Vincent K. Petrella
 
 
Executive Vice President, Chief Financial Officer and Treasurer
 
 
(principal financial officer)
 
 
February 9, 2016













LINCOLN ELECTRIC HOLDINGS, INC.
 
INDEX TO EXHIBITS
 
 
 
 
Exhibit No.
 
Exhibit
 
 
 
99.1

 
The Company’s press release dated February 9, 2016.
 
 
 






Exhibit 99.1
 
Investor Relations: Amanda Butler (216) 383-2534
Amanda_Butler@lincolnelectric.com


 
LINCOLN ELECTRIC ANNOUNCES NEW ORGANIZATIONAL AND
SEGMENT REPORTING STRUCTURE

New Structure Supports Operational Efficiencies and the 2020 Growth Strategy


CLEVELAND, Ohio, February 9, 2016 - - Lincoln Electric Holdings Inc., (“Lincoln Electric,” the “Company”) (Nasdaq: LECO) today announced that it has realigned its organizational and leadership structure to drive greater operational efficiency and further support the Company’s 2020 vision and growth strategy.

Lincoln Electric has combined its North America Welding and South America Welding businesses into “Americas Welding.” This segment will be led by George Blankenship in the newly created position of Executive Vice President and President, Americas Welding. Additionally, the Europe Welding and Asia Pacific Welding businesses will be combined into “International Welding,” and will be led by Mathias Hallmann, in the newly created position of Senior Vice President and President, International Welding. The Company will continue to operate and report The Harris Products Group business separately, which includes the Company’s global cutting, soldering and brazing businesses, as well as retail channel distribution in the United States.

“We believe our new welding organizational structure will improve efficiencies by further integrating operational and product development processes across regions to better serve customer needs,” said Christopher L. Mapes, Lincoln Electric’s Chairman, President and Chief Executive Officer. “This structure also leverages the functional and technical strength of our core teams in developing markets, which will help accelerate profitable growth in advanced applications as part of our 2020 growth strategy.”

The reclassification of historical results into the three new reportable segments for previously reported periods for 2013, 2014 and the 2015 first, second and third quarters are attached and can also be obtained on our Investor Relations website at http://ir.lincolnelectric.com. The Company did not operate under the realigned segment structure for any of these prior periods and will begin to report comparative results under the new structure effective with the filing of its Quarterly Report on Form 10-Q for the period ended March 31, 2016.

About Lincoln Electric

Lincoln Electric is the world leader in the design, development and manufacture of arc welding products, robotic arc welding systems, plasma and oxyfuel cutting equipment and has a leading global position in the brazing and soldering alloys market. Headquartered in Cleveland, Ohio, Lincoln has 47 manufacturing locations, including operations and joint ventures in 19 countries and a worldwide network of distributors and sales offices covering more than 160 countries. For more information about Lincoln Electric and its products and services, visit the Company’s website at www.lincolnelectric.com.


GAAP Information

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.









Forward-Looking Statements

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; completion of planned divestitures; interest rates; disruptions, uncertainty or volatility in the credit markets that may limit our access to capital; currency exchange rates and devaluations, including in highly inflationary countries such as Venezuela; adverse outcome of pending or potential litigation; actual costs of the Company’s rationalization plans; 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 for the year ended December 31, 2014.





Lincoln Electric Holdings, Inc.
Segment Highlights
(In thousands)
(Unaudited)
 
 
Americas Welding
 
International Welding
 
The Harris Products Group
 
Corporate /
Eliminations
 
Consolidated
Three months ended
September 30, 2015
 
 

 
 

 
 

 
 

 
 

Net sales
 
$
454,172

 
$
128,072

 
$
62,922

 
$

 
$
645,166

Inter-segment sales
 
25,571

 
5,400

 
2,307

 
(33,278
)
 

Total
 
$
479,743

 
$
133,472

 
$
65,229

 
$
(33,278
)
 
$
645,166

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
(83,413
)
 
$
(5,676
)
 
$
6,422

 
$
(748
)
 
$
(83,415
)
As a percent of total sales
 
(17.4
%)
 
(4.3
%)
 
9.8
%
 
 
 
(12.9
%)
Special items charge (2)
 
$
166,178

 
$
14,944

 
$

 
$

 
$
181,122

EBIT, as adjusted (3)
 
$
82,765

 
$
9,268

 
$
6,422

 
$
(748
)
 
$
97,707

As a percent of total sales
 
17.3
%
 
6.9
%
 
9.8
%
 
 

 
15.1
%
Three months ended
June 30, 2015
 
 
 
 

 
 

 
 

 
 

Net sales
 
$
451,001

 
$
141,927

 
$
71,812

 
$

 
$
664,740

Inter-segment sales
 
23,902

 
5,311

 
2,716

 
(31,929
)
 

Total
 
$
474,903

 
$
147,238

 
$
74,528

 
$
(31,929
)
 
$
664,740

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
79,421

 
$
9,778

 
$
8,250

 
$
634

 
$
98,083

As a percent of total sales
 
16.7
%
 
6.6
%
 
11.1
%
 
 

 
14.8
%
Special items charge (2)
 
$

 
$
1,239

 
$

 
$

 
$
1,239

EBIT, as adjusted (3)
 
$
79,421

 
$
11,017

 
$
8,250

 
$
634

 
$
99,322

As a percent of total sales
 
16.7
%
 
7.5
%
 
11.1
%
 
 

 
14.9
%
Three months ended
   March 31, 2015
 
 

 
 

 
 

 
 

 
 

Net sales
 
$
448,837

 
$
139,247

 
$
69,816

 
$

 
$
657,900

Inter-segment sales
 
23,023

 
5,027

 
2,011

 
(30,061
)
 

Total
 
$
471,860

 
$
144,274

 
$
71,827

 
$
(30,061
)
 
$
657,900

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
75,415

 
$
10,934

 
$
7,549

 
$
60

 
$
93,958

As a percent of total sales
 
16.0
%
 
7.6
%
 
10.5
%
 
 

 
14.3
%
Special items charge
 
$

 
$

 
$

 
$

 
$

EBIT, as adjusted (3)
 
$
75,415

 
$
10,934

 
$
7,549

 
$
60

 
$
93,958

As a percent of total sales
 
16.0
%
 
7.6
%
 
10.5
%
 
 

 
14.3
%
Nine months ended
   September 30, 2015
 
 

 
 

 
 

 
 

 
 

Net sales
 
$
1,354,010

 
$
409,246

 
$
204,550

 
$

 
$
1,967,806

Inter-segment sales
 
72,496

 
15,738

 
7,034

 
(95,268
)
 

Total
 
$
1,426,506

 
$
424,984

 
$
211,584

 
$
(95,268
)
 
$
1,967,806

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
71,423

 
$
15,036

 
$
22,221

 
$
(54
)
 
$
108,626

As a percent of total sales
 
5.0
%
 
3.5
%
 
10.5
%
 
 

 
5.5
%
Special items charge (2)
 
$
166,178

 
$
16,183

 
$

 
$

 
$
182,361

EBIT, as adjusted (3)
 
$
237,601

 
$
31,219

 
$
22,221

 
$
(54
)
 
$
290,987

As a percent of total sales
 
16.7
%
 
7.3
%
 
10.5
%
 
 

 
14.8
%

(1)
EBIT is defined as Operating income plus Equity earnings in affiliates and Other income.
(2)
Special items in indicated periods include rationalization charges related to employee severance and other related costs. Special items in the three and nine months ended September 30, 2015 also include charges related to pension settlements, charges related to the impairment of long-lived assets and goodwill and charges related to Venezuelan remeasurement losses upon the adoption of a new foreign exchange mechanism.
(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.





Lincoln Electric Holdings, Inc.
Segment Highlights
(In thousands)
(Unaudited)
 
 
Americas Welding
 
International Welding
 
The Harris Products Group
 
Corporate /
Eliminations
 
Consolidated
Three months ended
December 31, 2014
 
 

 
 

 
 

 
 

 
 

Net sales
 
$
460,907

 
$
157,090

 
$
65,957

 
$

 
$
683,954

Inter-segment sales
 
26,074

 
4,825

 
1,821

 
(32,720
)
 

Total
 
$
486,981

 
$
161,915

 
$
67,778

 
$
(32,720
)
 
$
683,954

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
89,600

 
$
10,183

 
$
6,380

 
$
649

 
$
106,812

As a percent of total sales
 
18.4
%
 
6.3
%
 
9.4
%
 
 

 
15.6
%
Special items charge (2)
 
$

 
$
166

 
$

 
$

 
$
166

EBIT, as adjusted (4)
 
$
89,600

 
$
10,349

 
$
6,380

 
$
649

 
$
106,978

As a percent of total sales
 
18.4
%
 
6.4
%
 
9.4
%
 
 

 
15.6
%
Three months ended
September 30, 2014
 
 

 
 

 
 

 
 

 
 

Net sales
 
$
469,390

 
$
168,004

 
$
78,383

 
$

 
$
715,777

Inter-segment sales
 
27,244

 
4,715

 
2,009

 
(33,968
)
 

Total
 
$
496,634

 
$
172,719

 
$
80,392

 
$
(33,968
)
 
$
715,777

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
83,444

 
$
(13,757
)
 
$
8,947

 
$
(302
)
 
$
78,332

As a percent of total sales
 
16.8
%
 
(8.0
%)
 
11.1
%
 
 

 
10.9
%
Special items charge (2)
 
$
582

 
$
28,486

 
$

 
$

 
$
29,068

EBIT, as adjusted (4)
 
$
84,026

 
$
14,729

 
$
8,947

 
$
(302
)
 
$
107,400

As a percent of total sales
 
16.9
%
 
8.5
%
 
11.1
%
 
 

 
15.0
%
Three months ended
June 30, 2014
 
 
 
 

 
 

 
 

 
 

Net sales
 
$
465,524

 
$
185,588

 
$
77,419

 
$

 
$
728,531

Inter-segment sales
 
28,989

 
6,080

 
2,262

 
(37,331
)
 

Total
 
$
494,513

 
$
191,668

 
$
79,681

 
$
(37,331
)
 
$
728,531

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
92,494

 
$
14,471

 
$
7,178

 
$
785

 
$
114,928

As a percent of total sales
 
18.7
%
 
7.6
%
 
9.0
%
 
 

 
15.8
%
Special items charge (3)
 
$
3,447

 
$
857

 
$

 
$

 
$
4,304

EBIT, as adjusted (4)
 
$
95,941

 
$
15,328

 
$
7,178

 
$
785

 
$
119,232

As a percent of total sales
 
19.4
%
 
8.0
%
 
9.0
%
 
 

 
16.4
%
Three months ended
   March 31, 2014
 
 

 
 

 
 

 
 

 
 

Net sales
 
$
441,849

 
$
170,742

 
$
72,471

 
$

 
$
685,062

Inter-segment sales
 
28,217

 
5,988

 
2,118

 
(36,323
)
 

Total
 
$
470,066

 
$
176,730

 
$
74,589

 
$
(36,323
)
 
$
685,062

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
66,070

 
$
8,284

 
$
6,058

 
$
2,670

 
$
83,082

As a percent of total sales
 
14.1
%
 
4.7
%
 
8.1
%
 
 

 
12.1
%
Special items charge (3)
 
$
17,618

 
$
30

 
$

 
$

 
$
17,648

EBIT, as adjusted (4)
 
$
83,688

 
$
8,314

 
$
6,058

 
$
2,670

 
$
100,730

As a percent of total sales
 
17.8
%
 
4.7
%
 
8.1
%
 
 

 
14.7
%

(1)
EBIT is defined as Operating income plus Equity earnings in affiliates and Other income.
(2)
Special items in the three months ended December 31, 2014 and September 30, 2014 represent net asset impairment charges. Special items in the three months ended September 30, 2014 also includes net rationalization charges and a gain on sale of real estate.
(3)
Special items in the three months ended June 30, 2014 and March 30, 2014 include net rationalization charges partially offset by gains related to the sale of assets at rationalized operations and the impact of Venezuelan remeasurement losses related to the adoption of a new foreign exchange mechanism.
(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.
Segment Highlights
(In thousands)
(Unaudited)

 
 
Americas Welding
 
International Welding
 
The Harris Products Group
 
Corporate /
Eliminations
 
Consolidated
Twelve months ended
   December 31, 2014
 
 

 
 

 
 

 
 

 
 

Net sales
 
$
1,837,670

 
$
681,424

 
$
294,230

 
 
 
$
2,813,324

Inter-segment sales
 
110,524

 
21,608

 
8,210

 
(140,342
)
 

Total
 
$
1,948,194

 
$
703,032

 
$
302,440

 
$
(140,342
)
 
$
2,813,324

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
331,608

 
$
19,181

 
$
28,563

 
$
3,802

 
$
383,154

As a percent of total sales
 
17.0
%
 
2.7
%
 
9.4
%
 
 

 
13.6
%
Special items charge (2)
 
$
21,647

 
$
29,539

 
$

 
 
 
$
51,186

EBIT, as adjusted (3)
 
$
353,255

 
$
48,720

 
$
28,563

 
$
3,802

 
$
434,340

As a percent of total sales
 
18.1
%
 
6.9
%
 
9.4
%
 
 

 
15.4
%

(1)
EBIT is defined as Operating income plus Equity earnings in affiliates and Other income.
(2)
Special items in the twelve months ended December 31, 2014 include net rationalization and asset impairment charges partially offset by the gain on sale of real estate. Special items in the twelve months ended December 31, 2014 also include the impact of Venezuelan remeasurement losses related to the adoption of a new foreign exchange mechanism.
(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.


 
 
Americas Welding
 
International Welding
 
The Harris Products Group
 
Corporate /
Eliminations
 
Consolidated
Twelve months ended
December 31, 2013
 
 

 
 

 
 

 
 

 
 

Net sales
 
$
1,848,663

 
$
695,831

 
$
308,177

 
$

 
$
2,852,671

Inter-segment sales
 
105,811

 
22,668

 
9,605

 
(138,084
)
 

Total
 
$
1,954,474

 
$
718,499

 
$
317,782

 
$
(138,084
)
 
$
2,852,671

 
 
 
 
 
 
 
 
 
 
 
EBIT (1)
 
$
364,186

 
$
29,921

 
$
27,826

 
$
(5,948
)
 
$
415,985

As a percent of total sales
 
18.6
%
 
4.2
%
 
8.8
%
 
 

 
14.6
%
Special items charge (2)
 
$
13,250

 
$
8,116

 
$

 
$

 
$
21,366

EBIT, as adjusted (3)
 
$
377,436

 
$
38,037

 
$
27,826

 
$
(5,948
)
 
$
437,351

As a percent of total sales
 
19.3
%
 
5.3
%
 
8.8
%
 
 

 
15.3
%

(1)
EBIT is defined as Operating income plus Equity earnings in affiliates and Other income.
(2)
Special items in the twelve months ended December 31, 2013 include net rationalization and asset impairment charges, a loss on the sale of land and the impact of 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.



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