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Lincoln Electric Q4 net income cut almost in half

Staff writer ▼ | February 23, 2016
Lincoln Electric Holdings reported fourth quarter 2015 net income of $48.7 million, or earnings per share (EPS) of $0.68.
Lincoln Electric
Lincoln Electric   Q4 adjusted net income was $53.8 million
This compares with net income of $75.2 million, or EPS of $0.96 in the comparable 2014 period. On an adjusted basis, fourth quarter 2015 adjusted net income was $53.8 million, or adjusted EPS of $0.75, which excludes the after-tax impact of $5.1 million, or $0.07 per diluted share, from special items as compared with $0.96 in the comparable 2014 period.

Fourth quarter 2015 EPS was unfavorably impacted by $0.08 from foreign currency translation and $0.09 from a contingent consideration related to an acquisition.

Fourth quarter 2015 sales decreased 17.0% to $568.0 million, or 6.2% on an organic basis, as the benefits of price and acquisitions were offset by broad volume weakness and unfavorable foreign currency translation. Operating income for the fourth quarter 2015 was $78.4 million, or 13.8% of sales, compared with $104.9 million, or 15.3% of sales, in the comparable 2014 period.

Fourth quarter 2015 operating income was impacted by special items totaling $7.5 million. Excluding these items, Adjusted operating income was $86.0 million, or 15.1% of sales on strong operational execution and the benefit of cost reduction actions. This compares with Adjusted operating income of $105.1 million, or 15.4% of sales in 2014.

“We finished a challenging year with solid margin performance, cash flows and returns,” stated Christopher L. Mapes, Chairman, President and Chief Executive Officer.

“Our results highlight the team’s focused execution, the benefits of our ‘2020 Vision and Strategy,’ and the aggressive cost reduction actions we initiated throughout 2015.

“We are pleased to report that we returned a record $486 million to shareholders while maintaining a strong balance sheet, and are positioned to repurchase $400 million of shares in 2016.

“While we expect industrial demand to remain challenging through 2016, we will continue to focus on our continuous improvement initiatives, manage margin performance and invest in Lincoln’s long-term growth opportunities to drive shareholder returns through the cycle.”