Core Insights - Lincoln Electric's first quarterly earnings report of 2025 showed a mixed performance, with the company missing analyst profitability estimates, leading to a stock price decline of over 4% [1] - The company's net sales exceeded $1 billion, reflecting a 2% year-over-year improvement, surpassing analyst projections [2] - Non-GAAP net income fell to just under $122 million, or $2.16 per share, down from nearly $129 million a year ago, while analysts had expected $2.24 per share [3] Sales Performance - Lincoln Electric's net sales for the quarter were slightly over $1 billion, marking a 2% increase compared to the previous year [2] - The sales figure was higher than the average analyst projection, which was slightly below $976 million [2] Profitability Analysis - The company's non-GAAP net income decreased to just under $122 million from almost $129 million year-over-year [3] - Analysts had anticipated a higher profit of $2.24 per share, indicating a shortfall in expected profitability [3] Growth Drivers - Management attributed the sales increase primarily to recent acquisitions, including the purchase of Vanair Manufacturing, a mobile power solutions maker [4] - The specific price of the acquisition has not been disclosed [4] - Excluding acquisitions, Lincoln Electric's organic sales experienced a decline of over 1% year-over-year [4] Investor Sentiment - Investors are generally cautious when a company's growth is primarily driven by acquisitions rather than organic growth [5] - There is a concern that Lincoln Electric's core offerings may not be performing strongly in the market [5] - Moving forward, management will need to demonstrate growth from existing operations rather than relying on acquisitions [5]

Financial Data and Key Metrics Changes - The company reported a 2.4% increase in first quarter sales to $1.4 billion, driven by a 4.9% benefit from acquisitions and a 2.6% increase from higher prices, partially offset by a 3.8% decline in volumes [13] - Adjusted operating income margin declined by 60 basis points to 16.9%, with acquisitions and the impact from Turkey contributing to an unfavorable 110 basis point impact [7][16] - Adjusted earnings per share were $2.16, slightly lower than expected, impacted by a $0.05 headwind from Turkey and unfavorable foreign exchange [8][16] - The company generated record cash flows with a 130% cash conversion ratio and returned $150 million to shareholders through dividends and share repurchases [8][22] Business Line Data and Key Metrics Changes - Americas Welding sales increased approximately 5%, driven by nearly 8% from acquisitions and 2% from higher prices, but were offset by 4% lower volumes [16] - International Welding segment sales declined approximately 7%, primarily due to 6% lower volumes, but would have increased 3% excluding Turkey's impact [19] - Harris Products Group saw a 9% increase in sales, with a 9.5% increase in price and a 60 basis point increase in volumes, reflecting strength in the HVAC industry [20] Market Data and Key Metrics Changes - Organic sales declined 1.2% in the quarter, with a 190 basis point unfavorable impact from Turkey [10] - Automation's organic sales remained steady year over year, with double-digit international growth offset by ongoing compression in the American region [10] - Heavy Industries remained challenged, with expectations of continued difficulties until production activity normalizes in the agricultural sector [11] Company Strategy and Development Direction - The company is focused on driving margin improvement and increasing returns to shareholders while managing evolving market conditions [5] - Strategic operational initiatives are being advanced to mitigate inflation and improve profitability [12] - The company is committed to maintaining a price-cost neutral position while responding to tariffs and inflationary pressures [78] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding customer capital spending, which is impacting automation demand and overall volume performance [39][40] - The company expects to generate incremental savings of $15 million to $20 million year over year in the second quarter, with a potential easing in savings rate in the third quarter [9] - There is uncertainty regarding the back half of the year due to delayed decision-making from customers and evolving trade policies [72] Other Important Information - The company has temporarily suspended merit increases to manage costs until customer demand trends are clearer [9] - Full year 2025 organic sales are expected to be relatively flat year over year, with a focus on mitigating the impact of tariffs through pricing and operational initiatives [23][25] Q&A Session Summary Question: Can you discuss growth excluding heavy industries and volume trends? - Management noted that while four out of five end markets showed growth, there is uncertainty about sustaining that momentum due to cautious capital investment spending [30][34] Question: What are customers looking for to resume capital projects? - Management indicated that customers are delaying decisions due to uncertainty in trade policies and macroeconomic conditions [38] Question: What is the split between direct price increases and surcharges? - Management stated that pricing is essentially flattish in the first quarter, with a mix of traditional pricing and surcharges to address tariffs [44] Question: How are the integrations of Red Viking and Van Aire progressing? - Integration of both acquisitions is on schedule, but results are expected to be dilutive in the first three years [47][49] Question: What is the outlook for automation business hitting $1 billion this year? - Management expressed that while the fundamentals are strong, they do not expect to hit the $1 billion target due to current order patterns and capital investment trends [56] Question: How are tariffs impacting cost structures? - Management highlighted that approximately 20% of overall COGS is exposed to tariffs, affecting steel and components sourced from various countries [74] Question: Will pricing gains be retained if the tariff situation improves? - Management indicated they will remain agile and responsive to market conditions, managing pricing based on evolving circumstances [80]

Financial Data and Key Metrics Changes - The company reported a 2.4% increase in first quarter sales to $1.4 billion, driven by a 4.9% benefit from acquisitions and a 2.6% increase from higher prices, partially offset by a 3.8% decline in volumes and a 130 basis point unfavorable impact from foreign exchange [12][4] - Adjusted operating income margin declined by 60 basis points to 16.9%, with acquisitions and the impact from Turkey contributing to an unfavorable 110 basis point impact [6][15] - Adjusted earnings per share were $2.16, slightly lower than expected, impacted by a $0.05 headwind from Turkey and unfavorable foreign exchange [6][15] - The company generated record cash flows with a 130% cash conversion ratio and returned $150 million to shareholders through dividends and share repurchases [6][22] Business Line Data and Key Metrics Changes - Americas Welding sales increased approximately 5%, driven by nearly 8% from acquisitions and 2% from higher prices, but were offset by 4% lower volumes [15][16] - International Welding segment sales declined approximately 7%, primarily due to 6% lower volumes, but would have increased 3% excluding Turkey's impact [19] - Harris Products Group saw first quarter sales increase by 9%, with a 9.5% increase in price and a 60 basis point increase in volumes [20] Market Data and Key Metrics Changes - Organic sales declined 1.2% in the quarter, with a 190 basis point unfavorable impact from Turkey [8] - Automation's organic sales remained steady year over year, with double-digit international growth offset by ongoing compression in the American region [9] - Heavy Industries remained challenged, with expectations of continued difficulties through year-end until production activity normalizes in the agricultural sector [10] Company Strategy and Development Direction - The company is focused on managing evolving market conditions while investing in long-term growth and strategic operational initiatives aimed at driving margin improvement [4] - The company plans to implement additional pricing actions in response to tariffs and is prepared to take further pricing actions if necessary [5] - The company is committed to limiting discretionary spending until volume performance improves and has temporarily suspended merit increases to manage costs [7] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding the second half of the year due to uncertainty in customer capital spending and macroeconomic conditions [34][69] - The company expects to generate incremental savings in the second quarter but anticipates some easing in savings rates in the third quarter [7] - Management noted that evolving trade policies and tariffs will continue to shape market conditions and uncertainty in the upcoming quarters [25] Other Important Information - The company expects full-year 2025 organic sales to be relatively flat year over year, with an estimated full-year consolidated price increase in the mid-single-digit percent range [23] - The company is maintaining its capital allocation strategy through the cycle, with an estimated share repurchase range of $300 million to $400 million for the year [26] Q&A Session Summary Question: Can you provide clarity on growth excluding heavy industries and volume expectations for the remainder of the year? - Management noted that while four out of five end markets showed growth, there is uncertainty regarding future activity levels, particularly in construction and automotive sectors [28][30] Question: What are customers saying about deferring capital spending and resuming projects? - Management indicated that customers are cautious and delaying decisions due to uncertainty in trade policies and macroeconomic conditions [36][38] Question: Can you clarify the pricing strategy and its impact on volumes? - Management stated that pricing actions are aimed at maintaining a price-cost neutral position, with expectations that pricing and volume will offset each other in the near term [40][41] Question: How are the integrations of Red Viking and Van Aire progressing? - Management confirmed that integrations are on schedule, but results are expected to be dilutive in the first three years [46][50] Question: What is the outlook for the automation business given current market conditions? - Management expressed that while the fundamentals are strong, they do not expect to hit the $1 billion target for the automation business this year due to delays in customer decision-making [54][55] Question: How are tariffs impacting cost structures and sourcing? - Management highlighted that approximately 20% of overall COGS is exposed to tariffs, with ongoing efforts to mitigate costs through alternative sourcing [71][72]

Core Viewpoint - Lincoln Electric Holdings (LECO) reported quarterly earnings of $2.16 per share, missing the Zacks Consensus Estimate of $2.22 per share, and down from $2.23 per share a year ago [1][2] Financial Performance - The earnings surprise for the quarter was -2.70%, while the previous quarter saw a positive surprise of 28.50% with actual earnings of $2.57 against an expectation of $2 per share [2] - Revenues for the quarter reached $1 billion, exceeding the Zacks Consensus Estimate by 3.01%, and up from $981.2 million year-over-year [3] Stock Performance - Lincoln Electric shares have declined approximately 1.9% since the beginning of the year, compared to a decline of 5.5% for the S&P 500 [4] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [7] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $2.34 on revenues of $1.01 billion, and for the current fiscal year, it is $9.20 on revenues of $4.01 billion [8] - The estimate revisions trend for Lincoln Electric is mixed, which may change following the recent earnings report [7] Industry Context - The Manufacturing - Tools & Related Products industry, to which Lincoln Electric belongs, is currently ranked in the bottom 23% of over 250 Zacks industries, indicating potential challenges ahead [9]

Financial Performance - Net sales for the three months ended March 31, 2025, were $1,004,388, representing a 2.4% increase from $981,197 in the same period of 2024[80]. - Gross profit decreased to $365,448, or 36.4% of sales, down from 37.5% in the prior year, primarily due to operational inefficiencies[80][82]. - Operating income was $164,918, or 16.4% of sales, compared to 16.8% in the previous year, with adjusted operating income at 16.9%[80][84]. - Net income for the quarter was $118,487, a decrease of 4.0% from $123,415 in 2024, resulting in diluted earnings per share of $2.10[80][90]. - Adjusted EBIT for the consolidated company was $169,889, down 2.2% from $173,676 in the prior year[90]. - Operating income for Q1 2025 was reported at $164,918, a slight decrease from $165,047 in Q1 2024, with adjusted operating income at $169,445, down from $171,414[92]. - Net income for Q1 2025 was $118,487, compared to $123,415 in Q1 2024, while adjusted net income decreased to $121,856 from $128,656[92]. Segment Performance - The Americas Welding segment reported net sales of $653,107, a 4.6% increase, while International Welding saw a decline of 7.1% to $219,061[86][90]. - The Harris Products Group experienced a 9.0% increase in net sales to $132,220, driven by effective cost management[90]. Cash Flow and Capital Expenditures - Cash provided by operating activities increased to $185,693 in Q1 2025, up by $52,399 from $133,294 in Q1 2024[97]. - The company had $394,705 in cash and cash equivalents as of March 31, 2025, with $4,391 in outstanding borrowings under its $1,031,457 revolving credit facilities[93]. - Anticipated capital expenditures for 2025 are projected to be between $100,000 and $120,000, aimed at increasing capacity and improving operational effectiveness[98]. Tax and Financial Ratios - The effective tax rate increased to 22.7% for the three months ended March 31, 2025, compared to 22.2% in the same period of 2024[80][85]. - The effective tax rate as reported was 22.7% for Q1 2025, slightly higher than 22.2% in Q1 2024, with an adjusted effective tax rate of 22.8%[92]. - The company reported a return on invested capital (ROIC) of 19.1% for the twelve months ended March 31, 2025, down from 23.9% in the previous year[107]. - Average operating working capital to net sales ratio was 17.8% as of March 31, 2025, compared to 18.8% a year earlier[102]. Strategic Initiatives - The company faced a decrease in organic sales due to softer demand, partially offset by acquisitions[81]. - The company continues to monitor trade negotiations and their potential impact on business operations following U.S. tariffs on imported goods[78]. - The company continues to explore global expansion and acquisitions, with operational cash flow expected to fund these initiatives[96]. - The company has a share repurchase program authorized for up to 10 million shares, with 6.2 million shares available for repurchase as of March 31, 2025[103].

April 30, 2025 LINCOLN ELECTRIC HOLDINGS, INC. Q1 2025 Earnings Safe Harbor and Regulation G Disclosures Forward-Looking Statements: Statements made during this presentation which are not historical facts may be considered forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual events or results to differ materially from those expressed or implied. Forward-looking statements generally can be identified by the use of words such as "may," "will," "expect, ...

Investor Relations: Amanda Butler (216) 383-2534 Amanda_Butler@lincolnelectric.com Exhibit 99.1 LINCOLN ELECTRIC REPORTS FIRST QUARTER 2025 RESULTS First Quarter 2025 Highlights CLEVELAND, Wednesday, April 30, 2025 - Lincoln Electric Holdings, Inc. (the "Company") (Nasdaq: LECO) today reported first quarter 2025 net income of $118.5 million, or diluted earnings per share (EPS) of $2.10, which included special item after-tax net charges of $3.4 million, or $0.06 EPS. This compares with prior year period net ...

Core Insights - The Motley Fool aims to enhance the financial well-being of individuals by providing investment solutions and market analysis [1] Company Overview - Founded in 1993, The Motley Fool is a financial services company focused on making the world smarter, happier, and richer [1] - The company reaches millions of people monthly through various platforms, including premium investing solutions, free guidance, and market analysis on Fool.com [1] - The Motley Fool also produces top-rated podcasts and operates a non-profit organization, The Motley Fool Foundation [1]

Financial Performance - Net sales for 2024 were $4,008,670, a decrease of $182,966 or 4.4% compared to 2023's $4,191,636, primarily due to softer demand across all segments[116]. - Gross profit increased to $1,472,912, representing 36.7% of sales, up from 35.0% in 2023, driven by effective cost management and operational efficiencies[116][118]. - Operating income for 2024 was $636,462, or 15.9% of sales, down from 17.1% in 2023, with adjusted operating income at 17.6%[116][121]. - Net income decreased to $466,108, a decline of $79,140 or 14.5% from 2023's $545,248, with diluted earnings per share falling to $8.15 from $9.37[116]. - SG&A expenses rose to $780,590, accounting for 19.5% of sales, primarily due to acquisition-related costs[116][119]. - Rationalization and asset impairment net charges were $55,860 in 2024, significantly higher than the net gains of $36,187 in 2023[116][120]. - Adjusted EBIT for 2024 was $713,605, down $17,769 or 2.4% from $731,374 in 2023[127]. - Cash provided by operating activities decreased by $68,565 to $598,977 in 2024 compared to 2023[138]. - Cash used by investing activities increased significantly by $286,502 to $361,231 in 2024, primarily due to acquisitions[138]. - Return on invested capital (ROIC) as reported was 19.2% in 2024, down from 24.0% in 2023[154]. - Adjusted return on invested capital was 21.8% in 2024, compared to 24.1% in 2023[154]. Segment Performance - The Americas Welding segment reported net sales of $2,564,847, a decrease of 3.4% from 2023, while International Welding saw a 10.2% decline to $933,722[124]. - The Harris Products Group experienced a 2.8% increase in net sales to $510,101, attributed to price actions in response to higher commodity costs[124][125]. - Americas Welding segment net sales decreased by $90,699 or 3.4% to $2,564,847 in 2024[127]. - International Welding segment net sales decreased by $106,284 or 10.2% to $933,722 in 2024[127]. - The Harris Products Group saw an increase in net sales of $14,017 or 2.8% to $510,101 in 2024[127]. Tax and Liabilities - The effective tax rate increased to 21.6% in 2024 from 20.6% in 2023, influenced by the mix of earnings and discrete tax items[116][123]. - The Company had total liabilities of $55,425 for deferred compensation as of December 31, 2024[148]. - The Company had approximately $207,739 of gross deferred tax assets as of December 31, 2024[167]. - A valuation allowance of $35,284 was recorded against certain deferred tax assets based on realizability assessments[167]. Cash and Debt Management - As of December 31, 2024, the company had $377,262 in cash and cash equivalents and $10,520 in outstanding borrowings under its revolving credit facilities[134]. - Total debt outstanding as of December 31, 2024, was $1,261,075, including $110,524 in short-term debt[145]. - Total future minimum lease payments amounted to $61,942, with $14,896 classified as short-term lease obligations[146]. - The Company had total purchase commitments of $91,028 as of December 31, 2024, including $89,792 in current liabilities[147]. Risk Management - The Company manages financial market risks, including currency exchange rates, commodity prices, and interest rates, using derivative financial instruments[182]. - The gross notional dollar amount of foreign exchange contracts at December 31, 2024, was $96,444[186]. - A hypothetical 10% change in year-end exchange rates would have resulted in an increase or decrease to income before income taxes of $17,271 related to foreign exchange positions[187]. - A hypothetical 10% strengthening or weakening in the U.S. dollar would have changed accumulated other comprehensive income (loss) by $32,617[187]. - The notional dollar amount of a foreign currency forward contract hedge designated as a net investment hedge was $319,450 at December 31, 2024[187]. - The Company does not expect any counterparties to fail to meet their obligations, minimizing credit risk through investments with major banks[188]. Operational Investments - The company continues to invest in research and development to maintain its market-leading position and improve product quality and productivity[105]. - The company anticipates capital expenditures of $100,000 to $120,000 in 2025 for capacity and operational improvements[141]. - Average operating working capital to net sales decreased to 16.9% in 2024 from 17.1% in 2023[143]. - The excess of current cost over LIFO cost was $120,633 in 2024, down from $129,946 in 2023[170].

Core Viewpoint - Lincoln Electric Holdings, Inc. (LECO) reported strong adjusted earnings for Q4 2024, exceeding expectations, despite a decline in total revenues and organic sales [1][2][9]. Financial Performance - Adjusted earnings per share for Q4 2024 were $2.57, surpassing the Zacks Consensus Estimate of $2.00, representing a 4.9% year-over-year increase [1] - Including one-time items, earnings were $2.47 per share, down from $2.70 in the same quarter last year [2] - Total revenues decreased by 3.4% year-over-year to $1.02 billion, but exceeded the Zacks Consensus Estimate of $996 million [2][10] - Organic sales fell by 7.5%, while foreign exchange had a negative impact of 1.1%, partially offset by a 5.2% contribution from acquisitions [2] Costs and Margins - Cost of goods sold decreased by 5% year-over-year to $653 million, leading to a gross profit decline of 0.6% to $369 million [3] - Gross margin improved to 36.1% from 35.1% in the previous year [3] - Selling, general and administrative expenses fell by 1% to $187 million, while adjusted operating profit rose by 1.9% to $186 million, resulting in an adjusted operating margin of 18.2% [4] Segment Performance - Americas Welding segment saw a slight sales increase of 0.2% to $692 million, with adjusted operating income rising to $132 million [5] - International Welding segment experienced a significant revenue drop of 16.3% to $254 million, with adjusted operating profit decreasing to $33 million [6] - The Harris Products Group reported a strong performance with sales up 11.3% to approximately $127 million and adjusted operating profit increasing to $22 million [7] Cash Flow and Balance Sheet - Cash and cash equivalents at the end of 2024 were approximately $377 million, down from $394 million at the end of 2023 [8] - The company generated a record cash flow from operations of $599 million in 2024, compared to $668 million in 2023 [8] - Lincoln Electric returned $426 million to shareholders through dividends and share repurchases during the year [8] - Debt to invested capital ratio increased to 48.7% from 45.8% year-over-year [8] Annual Results - For the full year 2024, adjusted earnings per share were $9.29, a decrease of 1.3% from $9.41 in 2023, but above the Zacks Consensus Estimate of $8.72 [9] - Total revenues for 2024 fell by 4.4% to $4.01 billion, surpassing the Zacks Consensus Estimate of $3.98 billion [9][10] - The company faced a 6.5% decline in organic sales, while acquisitions contributed positively with a 2.5% increase [10] Stock Performance - Lincoln Electric's shares have declined by 6.4% over the past year, contrasting with a 1.6% growth in the industry [11]