# EDGAR Filing Document

**Accession Number:** 0000059527
**File Stem:** 0000059527-23-000002
**Filing Date:** 2023-2
**Character Count:** 41164
**Document Hash:** 76ebeeb46036232542bad9980f340d92
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000059527-23-000002.hdr.sgml**: 20230221

**ACCESSION NUMBER**: 0000059527-23-000002

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 13

**CONFORMED PERIOD OF REPORT**: 20230221

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230221

**DATE AS OF CHANGE**: 20230221

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** LINCOLN ELECTRIC HOLDINGS INC
- **CENTRAL INDEX KEY:** 0000059527
- **STANDARD INDUSTRIAL CLASSIFICATION:** METALWORKING MACHINERY & EQUIPMENT [3540]
- **IRS NUMBER:** 340359955
- **STATE OF INCORPORATION:** OH
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-01402
- **FILM NUMBER:** 23645479

**BUSINESS ADDRESS:**
- **STREET 1:** 22801 ST CLAIR AVE
- **CITY:** CLEVELAND
- **STATE:** OH
- **ZIP:** 44117
- **BUSINESS PHONE:** 2164818100

**MAIL ADDRESS:**
- **STREET 1:** 22801 ST CLAIR AVE
- **CITY:** CLEVELAND
- **STATE:** OH
- **ZIP:** 44117

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** LINCOLN ELECTRIC CO
- **DATE OF NAME CHANGE:** 19920703

?xml version='1.0' encoding='UTF-8'?

------

**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 21, 2023

**LINCOLN ELECTRIC HOLDINGS, INC.**

(Exact name of registrant as specified in its charter)

0-1402

(Commission File Number)

<u>Ohio</u> &nbsp;&nbsp;&nbsp;&nbsp; <u>34-1860551</u> <br> (State or other jurisdiction ofincorporation) (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):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

<u>Title of each class</u> <u>Trading Symbol</u> <u>Name of exchange on which registered</u> <br> Common Shares, without par value LECO The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

------

---

| | |
|:---|:---|
| **Item 2.02** | **Results of Operations and Financial Condition.** |
|  | On February 21, 2023, Lincoln Electric Holdings, Inc. (the "Company") issued a press release reporting its financial results for the quarter ended December 31, 2022. A copy of the Company's press release issued on February 21, 2023 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 21, 2023. |
|  | 104 Cover page Interactive Data File (formatted as Inline XBRL and contained in the Exhibit 101 attachments) |

---

**LINCOLN ELECTRIC HOLDINGS, INC.**

**INDEX TO EXHIBITS**

**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/ Gabriel Bruno** |
| **Gabriel Bruno** |
| **Executive Vice President, Chief Financial Officer and Treasurer** |
| **(Principal Financial and Accounting Officer)** |
| **February 21, 2023** |

---

## Exhibit 99.1

**Exhibit 99.1**

**Investor Relations: Amanda Butler (216) 383-2534**

Amanda_Butler@lincolnelectric.com

**LINCOLN ELECTRIC REPORTS FOURTH QUARTER AND FULL YEAR 2022 RESULTS**

---

| |
|:---|
| <br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Fourth Quarter 2022 Highlights**<br>|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>◾<br>Net sales increase 10% to record $930.9 million on 14% higher organic sales<br>◾<br>Operating income margin of 15.2%; Adjusted operating income margin of 15.8% <br>◾<br>EPS increases 50% to record $1.87; Adjusted EPS increases 21% to record $1.94<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Full Year 2022 Highlights**<br>◾<br>Net sales increase 16% to record $3.8 billion on 20% higher organic sales<br>◾<br>Record Operating income margin of 16.3%; Record Adjusted operating income margin of 16.8% <br>◾<br>EPS increases 75% to record $8.04; Adjusted EPS increases 33% to record $8.27<br>◾<br>ROIC at 22.1%; Adjusted ROIC at 22.7%<br>◾<br>Returned $312 million to shareholders through dividends and share repurchases<br>|

---

CLEVELAND, Tuesday, February 21, 2023 - Lincoln Electric Holdings, Inc. (the "Company") (Nasdaq: LECO) today reported fourth quarter 2022 net income of $109.1 million, or diluted earnings per share (EPS) of $1.87 which includes special item after-tax net charges of $4.1 million or $0.07 EPS. This compares with prior year period net income of $74.4 million, or $1.25 EPS, which included special item after-tax charges of $21.8 million, or $0.36 EPS. Excluding these items, fourth quarter 2022 Adjusted net income was $113.2 million, or $1.94 Adjusted EPS. This compares with Adjusted net income of $96.2 million, or $1.61 Adjusted EPS, in the prior year period.

Fourth quarter 2022 sales increased 10.3% to $930.9 million as a result of a 14.3% increase in organic sales and a 0.7% benefit from acquisitions, partially offset by 4.7% unfavorable foreign exchange. Operating income for the fourth quarter 2022 was $141.5 million, or 15.2% of sales. This compares with operating income of $120.3 million, or 14.3% of sales, in the prior year period. Excluding special items, Adjusted operating income was $146.8 million, or 15.8% of sales, as compared with $122.2 million, or 14.5% of sales, in the prior year period.

"I am pleased to report record 2022 sales, operating profit margin and earnings performance; demonstrating strong execution in a challenging environment," stated Christopher L. Mapes, Chairman, President and Chief Executive Officer. "Our team is energized and focused on achieving our Higher Standard 2025 Strategy targets through our growth initiatives, operational excellence programs, and continued investment in our people." Mapes continued, "We are well-positioned to capitalize on the opportunities ahead and expect organic sales growth and the Fori acquisition will continue to generate superior value for our stakeholders."

**Twelve Months 2022 Summary** 

Net income for the twelve months ended December 31, 2022 was $472.2 million, or $8.04 EPS, which includes special item after-tax net charges of $13.4 million or $0.23 EPS. This compares with prior year period net income of $276.5 million, or $4.60 EPS, which included special item after-tax net charges of $96.9 million, or $1.62 EPS. Excluding these items, Adjusted net income for the twelve months ended December 31, 2022 increased 30.1% to $485.7 million, or $8.27 EPS. This compares with Adjusted net income of $373.3 million, or $6.22 EPS, in the prior year period.

Sales increased 16.3% to $3.8 billion in the twelve months ended December 31, 2022 as a result of a 19.5% increase in organic sales and a 2.3% benefit from acquisitions, partially offset by 5.5% unfavorable foreign exchange. Operating income for the twelve months ended December 31, 2022 was $612.3 million, or 16.3% of sales. This compares with operating income of $461.7 million, or 14.3% of sales, in the prior year period. Excluding special items, Adjusted operating income was $631.2 million, or 16.8% of sales, as compared with $479.2 million, or 14.8% of sales, in the prior year period.

------

**LINCOLN ELECTRIC REPORTS FOURTH QUARTER AND FULL YEAR 2022 RESULTS**

**Other Matters**

On December 1, 2022, the Company completed its acquisition of Fori Automation, LLC ("Fori") for a cash purchase price of $427 million, subject to customary working capital adjustments. The Company funded the transaction with available cash on hand and a $400 million senior unsecured term loan. Fori's balance sheet is included in the Company's Consolidated Balance Sheet as of December 31, 2022. The Company will begin consolidating Fori's operating results in the first quarter 2023.

**Webcast Information**

A conference call to discuss fourth quarter and full year 2022 financial results will be webcast live today, February 21, 2023, at 10:00 a.m., Eastern Time. Those interested in participating via webcast in listen-only mode can access the event <u>here</u> or on the Company's <u>Investor Relations</u> home page at <u>https://ir.lincolnelectric.com</u>. For participants who would like to participate via telephone, please register <u>here</u> to receive the dial-in number along with a unique PIN number that is required to access the call. A replay of the earnings call will be available via webcast on the Company's <u>website</u>.

**About Lincoln Electric**

Lincoln Electric is the world leader in the engineering, design, and manufacturing of advanced arc welding solutions, automated joining, assembly and cutting systems, plasma and oxy-fuel cutting equipment, and has a leading global position in brazing and soldering alloys. Lincoln is recognized as the Welding Expert™ for its leading materials science, software development, automation engineering, and application expertise, which advance customers' fabrication capabilities to help them build a better world. Headquartered in Cleveland, Ohio, Lincoln has 71 manufacturing locations in 20 countries and a worldwide network of distributors and sales offices serving customers in over 160 countries. For more information about Lincoln Electric and its products and services, visit the Company's website at <u>https://www.lincolnelectric.com</u>.

**Non-GAAP Information**

Adjusted operating income, Adjusted net income, Adjusted EBIT, Adjusted effective tax rate, Adjusted diluted earnings per share ("Adjusted EPS"), Organic sales, Cash conversion<u>,</u> Adjusted net operating profit after taxes and Adjusted return on invested capital ("Adjusted ROIC") are non-GAAP financial measures. Management uses non-GAAP measures to assess the Company's operating performance by excluding certain disclosed special items that management believes are not representative of the Company's core business. Management believes that excluding these special items enables them to make better period-over-period comparisons and benchmark the Company's operational performance against other companies in its industry more meaningfully. Furthermore, management believes that non-GAAP financial measures provide investors with meaningful information that provides a more complete understanding of Company operating results and enables investors to analyze financial and business trends more thoroughly. Non-GAAP financial measures should not be viewed in isolation, are not a substitute for GAAP measures and have limitations including, but not limited to, their usefulness as comparative measures as other companies may define their non-GAAP measures differently.

**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, financial and market conditions; the effectiveness of commercial and 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; adverse outcome of pending or potential litigation; actual costs of the Company's rationalization plans; possible acquisitions, including the Company's ability to successfully integrate acquisitions; market risks and price fluctuations related to the purchase of commodities and energy; global regulatory complexity; the effects of changes in tax law; tariff rates in the countries where the Company conducts business; and the possible effects of events beyond our control, such as the impact of the Russia-Ukraine conflict, political unrest, acts of terror, natural disasters and pandemics, including the current coronavirus disease ("COVID-19") pandemic, 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, 2021 and on Form 10-Q for the quarter ended March 31, 2022.

------

**Lincoln Electric Holdings, Inc.**

**Financial Highlights**

**(In thousands, except per share amounts)**

**(Unaudited)**

**Consolidated Statements of Income**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  |  |  |  |  | **Fav (Unfav) to** | **Fav (Unfav) to** |
|  | **Three Months Ended December 31,**  | **Three Months Ended December 31,**  | **Three Months Ended December 31,**  | **Three Months Ended December 31,**  | **Prior Year** | **Prior Year** |
|  | **2022** | **% of Sales** | **2021** | **% of Sales** | **$** | **%** |
| Net sales | $930934 | 100.0% | $844251 | 100.0% | $86683 | 10.3% |
| Cost of goods sold | 622950 | 66.9% | 571594 | 67.7% | (51356) | (9.0)% |
| Gross profit | 307984 | 33.1% | 272657 | 32.3% | 35327 | 13.0% |
| Selling, general & administrative expenses | 164113 | 17.6% | 150758 | 17.9% | (13355) | (8.9)% |
| Rationalization and asset impairment charges | 2383 | 0.3% | 1550 | 0.2% | (833) | (53.7)% |
| Operating income | 141488 | 15.2% | 120349 | 14.3% | 21139 | 17.6% |
| Interest expense, net | 8633 | 0.9% | 5478 | 0.6% | (3155) | (57.6)% |
| Other income (expense) | 2903 | 0.3% | (43302) | (5.1)% | 46205 | 106.7% |
| Income before income taxes | 135758 | 14.6% | 71569 | 8.5% | 64189 | 89.7% |
| Income taxes | 26612 | 2.9% | (2841) | (0.3)% | (29453) | (1036.7)% |
| Effective tax rate | 19.6% |  | (4.0)% |  | (23.6)% |  |
| Net income including non-controlling interests | 109146 | 11.7% | 74410 | 8.8% | 34736 | 46.7% |
| Non-controlling interests in subsidiaries' income (loss) |  |  | (17) |  | 17 | 100.0% |
| Net income | $109146 | 11.7% | $74427 | 8.8% | $34719 | 46.6% |
| Basic earnings per share | $1.89 |  | $1.26 |  | $0.63 | 50.0% |
| Diluted earnings per share | $1.87 |  | $1.25 |  | $0.62 | 49.6% |
| Weighted average shares (basic) | 57676 |  | 58842 |  |  |  |
| Weighted average shares (diluted) | 58459 |  | 59637 |  |  |  |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  |  |  |  |  | **Fav (Unfav) to** | **Fav (Unfav) to** |
|  | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,** | **Prior Year** | **Prior Year** |
|  | **2022** | **% of Sales** | **2021** | **% of Sales** | **$** | **%** |
| Net sales | $3761211 | 100.0% | $3234180 | 100.0% | $527031 | 16.3% |
| Cost of goods sold | 2480451 | 65.9% | 2165575 | 67.0% | (314876) | (14.5)% |
| Gross profit | 1280760 | 34.1% | 1068605 | 33.0% | 212155 | 19.9% |
| Selling, general & administrative expenses | 656636 | 17.5% | 597109 | 18.5% | (59527) | (10.0)% |
| Rationalization and asset impairment charges | 11788 | 0.3% | 9827 | 0.3% | (1961) | (20.0)% |
| Operating income | 612336 | 16.3% | 461669 | 14.3% | 150667 | 32.6% |
| Interest expense, net | 29500 | 0.8% | 22214 | 0.7% | (7286) | (32.8)% |
| Other income (expense) | 9991 | 0.3% | (114457) | (3.5)% | 124448 | 108.7% |
| Income before income taxes | 592827 | 15.8% | 324998 | 10.0% | 267829 | 82.4% |
| Income taxes | 120603 | 3.2% | 48418 | 1.5% | (72185) | (149.1)% |
| Effective tax rate | 20.3% |  | 14.9% |  | (5.4)% |  |
| Net income including non-controlling interests | 472224 | 12.6% | 276580 | 8.6% | 195644 | 70.7% |
| Non-controlling interests in subsidiaries' income |  |  | 114 |  | (114) | (100.0)% |
| Net income | $472224 | 12.6% | $276466 | 8.5% | $195758 | 70.8% |
| Basic earnings per share | $8.14 |  | $4.66 |  | $3.48 | 74.7% |
| Diluted earnings per share | $8.04 |  | $4.60 |  | $3.44 | 74.8% |
| Weighted average shares (basic) | 58030 |  | 59309 |  |  |  |
| Weighted average shares (diluted) | 58749 |  | 60062 |  |  |  |

---

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**Lincoln Electric Holdings, Inc.**

**Financial Highlights**

**(In thousands)**

**(Unaudited)**

**Balance Sheet Highlights**

---

| | | |
|:---|:---|:---|
| **Selected Consolidated Balance Sheet Data** | **December 31, 2022** | **December 31, 2021** |
| Cash and cash equivalents | $197150 | $192958 |
| Accounts receivable, net | 541529 | 429074 |
| Inventories | 665451 | 539919 |
| Total current assets | 1557790 | 1289593 |
| Property, plant and equipment, net | 544871 | 511744 |
| Total assets | 3180546 | 2592307 |
| Trade accounts payable | 352079 | 330230 |
| Total current liabilities | 852897 | 755905 |
| Short-term debt <sup>(1)</sup> | 93483 | 52730 |
| Long-term debt, less current portion | 1110396 | 717089 |
| Total equity | 1034041 | 863909 |
| **Operating Working Capital** | **December 31, 2022** | **December 31, 2021** |
| Average operating working capital to Net sales <sup>(2) (3)</sup> | 20.9% | 16.3% |
| **Invested Capital** | **December 31, 2022** | **December 31, 2021** |
| Short-term debt <sup>(1)</sup> | $93483 | $52730 |
| Long-term debt, less current portion | 1110396 | 717089 |
| Total debt | 1203879 | 769819 |
| Total equity | 1034041 | 863909 |
| Invested capital | $2237920 | $1633728 |
| Total debt / invested capital | 53.8% | 47.1% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Includes current portion of long-term debt.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Average operating working capital to Net sales is defined as the sum of Accounts receivable, Inventories and contract assets less Trade accounts payable and contract liabilities as of period end divided by annualized rolling three months of Net sales.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Average operating working capital excluding Fori would have been 18.6% as a percent of Net sales for December 31, 2022.

------

**Lincoln Electric Holdings, Inc.**

**Financial Highlights**

**(In thousands, except per share amounts)**

**(Unaudited)**

 **Non-GAAP Financial Measures**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,**  | **Three Months Ended December 31,**  | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,** |
|  | **2022** | **2021** | **2022** | **2021** |
| Operating income as reported | $141488 | $120349 | $612336 | $461669 |
| &nbsp;&nbsp;Special items (pre-tax): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Rationalization and asset impairment charges <sup>(2)</sup> | 2383 | 1550 | 11788 | 9827 |
| &nbsp;&nbsp;&nbsp;&nbsp;Acquisition transaction costs <sup>(3)</sup> | 2935 |  | 6003 | 1923 |
| &nbsp;&nbsp;&nbsp;&nbsp;Amortization of step up in value of acquired inventories <sup>(4)</sup> |  | 273 | 1106 | 5804 |
| Adjusted operating income <sup>(1)</sup> | $146806 | $122172 | $631233 | $479223 |
| &nbsp;&nbsp;As a percent of total sales | 15.8% | 14.5% | 16.8% | 14.8% |
| Net income as reported | $109146 | $74427 | $472224 | $276466 |
| &nbsp;&nbsp;Special items: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Rationalization and asset impairment charges <sup>(2)</sup> | 2383 | 1550 | 11788 | 9827 |
| &nbsp;&nbsp;&nbsp;&nbsp;Acquisition transaction costs <sup>(3)</sup> | 2935 |  | 6003 | 1923 |
| &nbsp;&nbsp;&nbsp;&nbsp;Pension settlement net charges <sup>(5)</sup> |  | 46404 | (4273) | 126502 |
| &nbsp;&nbsp;&nbsp;&nbsp;Amortization of step up in value of acquired inventories <sup>(4)</sup> |  | 273 | 1106 | 5804 |
| &nbsp;&nbsp;&nbsp;&nbsp;Tax effect of Special items <sup>(6)</sup> | (1250) | (26451) | (1192) | (47188) |
| Adjusted net income <sup>(1)</sup> | 113214 | 96203 | 485656 | 373334 |
| &nbsp;&nbsp;Non-controlling interests in subsidiaries' income (loss) |  | (17) |  | 114 |
| &nbsp;&nbsp;Interest expense, net | 8633 | 5478 | 29500 | 22214 |
| &nbsp;&nbsp;Income taxes as reported | 26612 | (2841) | 120603 | 48418 |
| &nbsp;&nbsp;Tax effect of Special items <sup>(6)</sup> | 1250 | 26451 | 1192 | 47188 |
| Adjusted EBIT <sup>(1)</sup> | $149709 | $125274 | $636951 | $491268 |
| Effective tax rate as reported | 19.6% | (4.0)% | 20.3% | 14.9% |
| Net special item tax impact | 0.1% | 23.7% | (0.2)% | 5.5% |
| Adjusted effective tax rate <sup>(1)</sup> | 19.7% | 19.7% | 20.1% | 20.4% |
| Diluted earnings per share as reported | $1.87 | $1.25 | $8.04 | $4.60 |
| Special items per share | 0.07 | 0.36 | 0.23 | 1.62 |
| Adjusted diluted earnings per share <sup>(1)</sup> | $1.94 | $1.61 | $8.27 | $6.22 |
| Weighted average shares (diluted) | 58459 | 59637 | 58749 | 60062 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Adjusted operating income, Adjusted net income, Adjusted EBIT, Adjusted effective tax rate and Adjusted diluted EPS are non-GAAP financial measures. Refer to Non-GAAP Information section.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) 2022 charges are primarily related to non-cash asset impairment charges. 2021 charges are primarily related to severance, gains or losses on the disposal of assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Related to acquisitions and are included in Selling, general & administrative expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Related to acquisitions and are included in Cost of goods sold.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Pension settlement net charges related to the termination of a pension plan and are included in Other income (expense).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) Includes the net tax impact of Special items recorded during the respective periods.

The tax effect of Special items impacting pre-tax income was calculated as the pre-tax amount multiplied by the applicable tax rate. The applicable tax rates reflect the taxable jurisdiction and nature of each Special item.

------

**Lincoln Electric Holdings, Inc.**

**Financial Highlights**

**(In thousands, except per share amounts)**

**(Unaudited)**

**Non-GAAP Financial Measures**

---

| | | |
|:---|:---|:---|
|  | **Twelve Months Ended December 31,**  | **Twelve Months Ended December 31,**  |
| **Return on Invested Capital** | **2022** | **2021** |
| &nbsp;&nbsp;Net income as reported | $472224 | $276466 |
| &nbsp;&nbsp;&nbsp;&nbsp;Plus: Interest expense (after-tax) | 23276 | 17794 |
| &nbsp;&nbsp;&nbsp;&nbsp;Less: Interest income (after-tax) | 1202 | 1172 |
| &nbsp;&nbsp;Net operating profit after taxes | $494298 | $293088 |
| Special items: |  |  |
| &nbsp;&nbsp;Rationalization and asset impairment charges | 11788 | 9827 |
| &nbsp;&nbsp;Acquisition transaction costs | 6003 | 1923 |
| &nbsp;&nbsp;Pension settlement net charges | (4273) | 126502 |
| &nbsp;&nbsp;Amortization of step up in value of acquired inventories | 1106 | 5804 |
| &nbsp;&nbsp;Tax effect of Special items <sup>(2)</sup> | (1192) | (47188) |
| Adjusted net operating profit after taxes <sup>(1)</sup> | $507730 | $389956 |
| **Invested Capital** | **December 31, 2022** | **December 31, 2021** |
| &nbsp;&nbsp;Short-term debt | $93483 | $52730 |
| &nbsp;&nbsp;Long-term debt, less current portion | 1110396 | 717089 |
| &nbsp;&nbsp;Total debt | 1203879 | 769819 |
| &nbsp;&nbsp;Total equity | 1034041 | 863909 |
| Invested capital | $2237920 | $1633728 |
| Return on invested capital as reported <sup>(3)</sup> | 22.1% | 17.9% |
| Adjusted return on invested capital <sup>(3)</sup> | 22.7% | 23.9% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Adjusted net operating profit after taxes and Adjusted ROIC are non-GAAP financial measures. Refer to Non-GAAP Information section.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Includes the net tax impact of Special items recorded during the respective periods.

The tax effect of Special items impacting pre-tax income was calculated as the pre-tax amount multiplied by the applicable tax rate. The applicable tax rates reflect the taxable jurisdiction and nature of each Special item.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Return on invested capital and Adjusted return on invested capital excluding Fori would have been 27.9% and 28.6%, respectively, for December 31, 2022.

------

**Lincoln Electric Holdings, Inc.**

**Financial Highlights**

**(In thousands, except per share amounts)**

**(Unaudited)**

**Condensed Consolidated Statements of Cash Flows**

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended December 31,**  | **Three Months Ended December 31,**  |
|  | **2022** | **2021** |
| OPERATING ACTIVITIES: |  |  |
| Net income | $109146 | $74427 |
| Non-controlling interests in subsidiaries' income (loss) |  | (17) |
| Net income including non-controlling interests | 109146 | 74410 |
| &nbsp;&nbsp;Adjustments to reconcile Net income including non-controlling interests to Net cash provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Rationalization and asset impairment net charges | 324 | 108 |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 19050 | 20588 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity earnings in affiliates, net | (174) | (100) |
| &nbsp;&nbsp;&nbsp;&nbsp;Pension settlement charges |  | 46404 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-cash items, net | (13450) | (10777) |
| &nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities, net of effects from acquisitions: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Increase) decrease in accounts receivable | (441) | 5368 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decrease (increase) in inventories | 54390 | (25491) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Decrease) increase in trade accounts payable | (2720) | 27413 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net change in other current assets and liabilities | (58966) | (34580) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net change in other long-term assets and liabilities | 4644 | 6595 |
| NET CASH PROVIDED BY OPERATING ACTIVITIES | 111803 | 109938 |
| INVESTING ACTIVITIES: |  |  |
| &nbsp;&nbsp;Capital expenditures | (19582) | (16091) |
| &nbsp;&nbsp;Acquisition of businesses, net of cash acquired | (414004) | 2499 |
| &nbsp;&nbsp;Proceeds from sale of property, plant and equipment | 994 | 2934 |
| &nbsp;&nbsp;Other investing activities | 159 |  |
| NET CASH USED BY INVESTING ACTIVITIES | (432433) | (10658) |
| FINANCING ACTIVITIES: |  |  |
| &nbsp;&nbsp;Proceeds from short-term borrowings | 24955 | 14078 |
| &nbsp;&nbsp;Proceeds from (payments on) long-term borrowings | 399843 | (405) |
| &nbsp;&nbsp;Proceeds from exercise of stock options | 4217 | 11311 |
| &nbsp;&nbsp;Purchase of shares for treasury | (25077) | (60678) |
| &nbsp;&nbsp;Cash dividends paid to shareholders | (32347) | (30134) |
| &nbsp;&nbsp;Other financing activities | (441) |  |
| NET CASH PROVIDED BY (USED BY) FINANCING ACTIVITIES | 371150 | (65828) |
| Effect of exchange rate changes on Cash and cash equivalents | 5323 | (1053) |
| INCREASE IN CASH AND CASH EQUIVALENTS | 55843 | 32399 |
| Cash and cash equivalents at beginning of period | 141307 | 160559 |
| Cash and cash equivalents at end of period | $197150 | $192958 |
| Cash dividends paid per share | $0.56 | $0.51 |

---

------

**Lincoln Electric Holdings, Inc.**

**Financial Highlights**

**(In thousands, except per share amounts)**

**(Unaudited)**

**Condensed Consolidated Statements of Cash Flows**

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,**  | **Year Ended December 31,**  |
|  | **2022** | **2021** |
| OPERATING ACTIVITIES: |  |  |
| Net income | $472224 | $276466 |
| Non-controlling interests in subsidiaries' income (loss) |  | 114 |
| Net income including non-controlling interests | 472224 | 276580 |
| &nbsp;&nbsp;Adjustments to reconcile Net income including non-controlling interests to Net cash provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Rationalization and asset impairment net charges (gains) | 8100 | (1054) |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 78059 | 81146 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity earnings in affiliates, net | 80 | (499) |
| &nbsp;&nbsp;&nbsp;&nbsp;Pension settlement charges |  | 126502 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-cash items, net | (11038) | (21744) |
| &nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities, net of effects from acquisitions: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Increase) in accounts receivable | (65010) | (65844) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Increase) in inventories | (81188) | (154347) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase in trade accounts payable | 16852 | 82394 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net change in other current assets and liabilities | (26496) | 44379 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net change in other long-term assets and liabilities | (8197) | (2450) |
| NET CASH PROVIDED BY OPERATING ACTIVITIES | 383386 | 365063 |
| INVESTING ACTIVITIES: |  |  |
| &nbsp;&nbsp;Capital expenditures | (71883) | (62531) |
| &nbsp;&nbsp;Acquisition of businesses, net of cash acquired | (436298) | (156106) |
| &nbsp;&nbsp;Proceeds from sale of property, plant and equipment | 3331 | 6781 |
| &nbsp;&nbsp;Other investing activities | 159 | 6500 |
| NET CASH USED BY INVESTING ACTIVITIES | (504691) | (205356) |
| FINANCING ACTIVITIES: |  |  |
| &nbsp;&nbsp;Proceeds from short-term borrowings | 34351 | 46476 |
| &nbsp;&nbsp;Proceeds from (payments on) long-term borrowings | 405444 | (508) |
| &nbsp;&nbsp;Proceeds from exercise of stock options | 6385 | 19232 |
| &nbsp;&nbsp;Purchase of shares for treasury | (181293) | (164526) |
| &nbsp;&nbsp;Cash dividends paid to shareholders | (130724) | (121851) |
| &nbsp;&nbsp;Other financing activities | (438) | (763) |
| NET CASH PROVIDED BY (USED BY) FINANCING ACTIVITIES | 133725 | (221940) |
| Effect of exchange rate changes on Cash and cash equivalents | (8228) | (2088) |
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 4192 | (64321) |
| Cash and cash equivalents at beginning of period | 192958 | 257279 |
| Cash and cash equivalents at end of period | $197150 | $192958 |
| Cash dividends paid per share | $2.24 | $2.04 |

---

------

**Lincoln Electric Holdings, Inc.**

**Segment Highlights**

**(In thousands)**

**(Unaudited)**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Americas**<br>**Welding** | **International** <br>**Welding** | **The Harris**<br>**Products Group** | **Corporate /**<br>**Eliminations** | <br>**Consolidated** |
| **Three months ended December 31, 2022** |  |  |  |  |  |
| Net sales | $573592 | $243114 | $114228 | $— | $930934 |
| Inter-segment sales | 29479 | 5754 | 2470 | (37703) |  |
| &nbsp;&nbsp;Total sales | $603071 | $248868 | $116698 | $(37703) | $930934 |
| Net income |  |  |  |  | $109146 |
| &nbsp;&nbsp;As a percent of total sales |  |  |  |  | 11.7% |
| EBIT <sup>(1)</sup> | $113813 | $21020 | $12056 | $(2498) | $144391 |
| &nbsp;&nbsp;As a percent of total sales | 18.9% | 8.4% | 10.3% |  | 15.5% |
| Special items charges <sup>(3)</sup> | 567 | 1816 |  | 2935 | 5318 |
| Adjusted EBIT <sup>(2)</sup> | $114380 | $22836 | $12056 | $437 | $149709 |
| &nbsp;&nbsp;As a percent of total sales | 19.0% | 9.2% | 10.3% |  | 16.1% |
| **Three months ended December 31, 2021** |  |  |  |  |  |
| Net sales | $480263 | $245529 | $118459 | $— | $844251 |
| Inter-segment sales | 30657 | 8071 | 1720 | (40448) |  |
| &nbsp;&nbsp;Total sales | $510920 | $253600 | $120179 | $(40448) | $844251 |
| Net income |  |  |  |  | $74427 |
| &nbsp;&nbsp;As a percent of total sales |  |  |  |  | 8.8% |
| EBIT <sup>(1)</sup> | $40258 | $26824 | $12320 | $(2355) | $77047 |
| &nbsp;&nbsp;As a percent of total sales | 7.9% | 10.6% | 10.3% |  | 9.1% |
| Special items charges (gains) <sup>(4)</sup> | 43450 | 1539 | 3238 |  | 48227 |
| Adjusted EBIT <sup>(2)</sup> | $83708 | $28363 | $15558 | $(2355) | $125274 |
| &nbsp;&nbsp;As a percent of total sales | 16.4% | 11.2% | 12.9% |  | 14.8% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) EBIT is defined as Operating income plus Other income (expense).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The primary profit measure used by management to assess segment performance is Adjusted EBIT. EBIT for each operating segment is adjusted for special items to derive Adjusted EBIT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Special items in 2022 primarily reflect Rationalization and asset impairment charges of $1,816 and $567 in International Welding and Americas Welding, respectively, and acquisition transaction costs of $2,935 in Corporate/Eliminations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Special items in 2021 reflect Rationalization and asset impairment charges of $1,550 primarily in International Welding, pension settlement charges of $43,439 and $2,965 in Americas Welding and The Harris Products Group, respectively, and amortization of step up in value of acquired inventories of $273 in The Harris Products Group.

------

**Lincoln Electric Holdings, Inc.**

**Segment Highlights**

**(In thousands)**

**(Unaudited)**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Americas**<br>**Welding** | **International**<br>**Welding** | **The Harris**<br>**Products Group** | **Corporate /**<br>**Eliminations** | <br>**Consolidated** |
| **Year ended December 31, 2022** |  |  |  |  |  |
| Net sales | $2288934 | $954281 | $517996 | $— | $3761211 |
| Inter-segment sales | 122019 | 31503 | 11040 | (164562) |  |
| &nbsp;&nbsp;Total sales | $2410953 | $985784 | $529036 | $(164562) | $3761211 |
| Net income |  |  |  |  | $472224 |
| &nbsp;&nbsp;As a percent of total sales |  |  |  |  | 12.6% |
| EBIT <sup>(1)</sup> | $465879 | $108476 | $64008 | $(16036) | $622327 |
| &nbsp;&nbsp;As a percent of total sales | 19.3% | 11.0% | 12.1% |  | 16.5% |
| Special items charges (gains) <sup>(3)</sup> | (3060) | 11681 |  | 6003 | 14624 |
| Adjusted EBIT <sup>(2)</sup> | $462819 | $120157 | $64008 | $(10033) | $636951 |
| &nbsp;&nbsp;As a percent of total sales | 19.2% | 12.2% | 12.1% |  | 16.9% |
| **Year ended December 31, 2021** |  |  |  |  |  |
| Net sales | $1824481 | $948125 | $461574 | $— | $3234180 |
| Inter-segment sales | 140650 | 26331 | 8096 | (175077) |  |
| &nbsp;&nbsp;Total sales | $1965131 | $974456 | $469670 | $(175077) | $3234180 |
| Net income |  |  |  |  | $276466 |
| &nbsp;&nbsp;As a percent of total sales |  |  |  |  | 8.5% |
| EBIT <sup>(1)</sup> | $205902 | $90974 | $64662 | $(14326) | $347212 |
| &nbsp;&nbsp;As a percent of total sales | 10.5% | 9.3% | 13.8% |  | 10.7% |
| Special items charges (gains) <sup>(4)</sup> | 123114 | 15234 | 3785 | 1923 | 144056 |
| Adjusted EBIT <sup>(2)</sup> | $329016 | $106208 | $68447 | $(12403) | $491268 |
| &nbsp;&nbsp;As a percent of total sales | 16.7% | 10.9% | 14.6% |  | 15.2% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) EBIT is defined as Operating income plus Other income (expense).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The primary profit measure used by management to assess segment performance is Adjusted EBIT. EBIT for each operating segment is adjusted for special items to derive Adjusted EBIT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Special items in 2022 primarily reflect amortization of step up in value of acquired inventories of $1,106 in Americas Welding, acquisition transaction costs of $6,003 in Corporate/Eliminations and a $3,735 net gain related to the final settlement associated with the termination of a pension plan in Americas Welding. Special items in 2022 also include Rationalization and asset impairment charges of $11,681 in International Welding and net gains of $431 in Americas Welding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Special items in 2021 reflect pension settlement charges of $123,091, $2,965 and $446 in Americas Welding, The Harris Products Group and International Welding, respectively, Rationalization and asset impairment charges of $9,827 primarily in International Welding, amortization of step up in value of acquired inventories of $4,984 and $820 in International Welding and The Harris Products Group, respectively, and acquisition transaction costs of $1,923 in Corporate/Eliminations.

------

**Lincoln Electric Holdings, Inc.**

**Change in Net Sales by Segment**

**(In thousands)**

**(Unaudited)**

**Three Months Ended December 31**<sup>st</sup> **Change in Net Sales by Segment**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | | **Change in Net Sales due to:** | **Change in Net Sales due to:** | **Change in Net Sales due to:** | **Change in Net Sales due to:** | |
|  | <br>**Net Sales**<br>**2021** | <br>**Volume** | <br>**Acquisitions** | <br>**Price** | **Foreign**<br>**Exchange** | <br>**Net Sales**<br>**2022** |
| **Operating Segments** |  |  |  |  |  |  |
| Americas Welding | $480263 | $36752 | $5696 | $54968 | $(4087) | $573592 |
| International Welding | 245529 | 3329 |  | 28697 | (34441) | 243114 |
| The Harris Products Group | 118459 | (2837) |  | (97) | (1297) | 114228 |
| **Consolidated** | $**844251** | $**37244** | $**5696** | $**83568** | $**(39825)** | $**930934** |
| **% Change** |  |  |  |  |  |  |
| Americas Welding |  | 7.7% | 1.2% | 11.4% | (0.9)% | 19.4% |
| International Welding |  | 1.4% |  | 11.7% | (14.0)% | (1.0)% |
| The Harris Products Group |  | (2.4)% |  | (0.1)% | (1.1)% | (3.6)% |
| **Consolidated** |  | **4.4%** | **0.7%** | **9.9%** | **(4.7)%** | **10.3%** |

---

**Twelve Months Ended December 31**<sup>st</sup> **Change in Net Sales by Segment**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | | **Change in Net Sales due to:** | **Change in Net Sales due to:** | **Change in Net Sales due to:** | **Change in Net Sales due to:** | |
|  | <br>**Net Sales**<br>**2021** | <br>**Volume** | <br>**Acquisitions** | <br>**Price** | **Foreign**<br>**Exchange** | &nbsp;&nbsp;&nbsp;&nbsp;<br>**Net Sales**<br>**2022** |
| **Operating Segments** |  |  |  |  |  |  |
| Americas Welding | $1824481 | $156561 | $17602 | $298928 | $(8638) | $2288934 |
| International Welding | 948125 | (9019) | 17632 | 159130 | (161587) | 954281 |
| The Harris Products Group | 461574 | 12820 | 39411 | 10867 | (6676) | 517996 |
| **Consolidated** | $**3234180** | $**160362** | $**74645** | $**468925** | $**(176901)** | $**3761211** |
| **% Change** |  |  |  |  |  |  |
| Americas Welding |  | 8.6% | 1.0% | 16.4% | (0.5)% | 25.5% |
| International Welding |  | (1.0)% | 1.9% | 16.8% | (17.0)% | 0.6% |
| The Harris Products Group |  | 2.8% | 8.5% | 2.4% | (1.4)% | 12.2% |
| **Consolidated** |  | **5.0%** | **2.3%** | **14.5**% | **(5.5)%** | **16.3%** |

---

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