Exhibit 99.1
LINCOLN ELECTRIC REPORTS
2004 FIRST-QUARTER
FINANCIAL RESULTS
- - Record First Quarter sales
- - 2004 First Quarter Diluted EPS 45 cents
- - Net Income increases 50% on sales rise of 23%
CLEVELAND, Ohio, U.S.A., April 15, 2004 -- Lincoln Electric Holdings,
Inc. (Nasdaq: LECO) today reported strong net income and record sales for the
2004 first quarter. Net income increased 50% to $18.2 million for the 2004 first
quarter, or 45 cents per diluted share, on sales of $306.5 million. This
compares with $12.2 million in net income, or 29 cents per diluted share, on net
sales of $249.2 million in the 2003 first quarter. The sales increase was 23%
over 2003 first quarter and 13.8% over fourth quarter 2003.
The 2003 first quarter included rationalization charges of
approximately $1.3 million, net of tax, related to asset impairments and
severance charges. Excluding the rationalization charges, 2003 first-quarter net
income was $13.5 million, or 32 cents per diluted share.
"The surge in U.S. sales and the double-digit sales growth in other
global markets contributed to our strongest first quarter sales in the Company's
history," said Anthony A. Massaro, Chairman and Chief Executive Officer. "We are
clearly pleased with the results for the quarter, which were led by the rebound
in the U.S. Demand remains high, both domestically and internationally, and we
anticipate that the U.S. domestic industrial economy will continue to be strong.
We expect to continue to maintain favorable year-over-year comparisons in the
next quarter."
The Company's U.S. operations net sales in the quarter increased 23% to
$181.1 million, compared with $147.3 million in the prior year's quarter. Export
sales rose 23.3% to $16.9 million, compared with $13.7 million in the same
quarter last year.
Non-U.S. net sales were $125.4 million in the quarter, compared with
$101.9 million in the 2003 first quarter. In local currencies, non-U.S. net
sales increased 10.7%
Mr. Massaro stated: "Our global growth strategy continues to provide
benefits to our employees, our distributors, our customers, and, of course, our
shareholders."
-more-
LINCOLN ELECTRIC REPORTS 2004 FIRST-QUARTER FINANCIAL RESULTS -2-
Cash flow from operations for the quarter was $11.9 million compared to
$8.9 million in the prior year despite higher accounts receivable and inventory
levels needed to satisfy higher sales demand.
On April 15, 2004, the Company paid a quarterly cash dividend of 17
cents per share to holders of record March 31, 2004. As previously announced,
the dividend was an increase of 6.25% over the previous dividend. The Company's
dividend is now 42% higher than it was five years ago.
The Company also announced today that the Annual Meeting of
Shareholders of Lincoln Electric Holdings, Inc. is scheduled for 10:30 a.m.,
Thursday, April 29, 2004, at the Wellington Center, Highland Heights, Ohio.
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. Headquartered in Cleveland, Ohio, Lincoln has
operations, manufacturing alliances and joint ventures in 18 countries and a
worldwide network of distributors and sales offices covering more than 160
countries. For more information about Lincoln Electric, its products and
services, visit the Company's Web site at 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. 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: the effectiveness of
operating initiatives; currency exchange and interest rates; adverse outcome of
pending or potential litigation; possible acquisitions; the strength of demand
for the Company's products; the availability and pricing of key input
commodities such as steel; and the possible effects of international terrorism
and hostilities on the Company or its customers, suppliers and the economy in
general.
###
LINCOLN ELECTRIC HOLDINGS, INC.
FINANCIAL HIGHLIGHTS
(AMOUNTS IN MILLIONS, EXCEPT SHARE DATA)
(UNAUDITED)
Three Months to March 31,
CONSOLIDATED STATEMENT OF OPERATIONS 2004 2003
------------- --------------
Net Sales $306.5 100.0% $249.2 100.0%
Cost of Goods Sold 222.6 72.6% 181.8 72.9%
----------- ----------
Gross Profit 83.9 27.4% 67.4 27.1%
SG&A Expenses 60.5 19.7% 50.5 20.3%
Rationalization Charges -- 0.0% 1.7 0.7%
---------- -----------
Operating Income 23.4 7.6% 15.2 6.1%
Interest Income 0.6 0.2% 0.6 0.2%
Equity Earnings in Affiliates 0.9 0.3% 0.5 0.2%
Other Income 0.4 0.1% 1.3 0.5%
Interest Expense (1.7) (0.6%) (2.1) (0.8%)
----------- -------------
Income Before Income Taxes 23.6 7.7% 15.5 6.2%
Income Taxes 5.4 1.7% 3.3 1.3%
----------- -------------
Net Income $18.2 6.0% $12.2 4.9%
=========== =============
Basic and Diluted Earnings Per Share $0.45 $0.29
Rationalization Charges (1) -- 0.03
----------- -------------
Basic and Diluted Earnings Per Share without
Rationalization Charges (1) $0.45 $0.32
===== =====
Weighted Average Shares (Basic) 40,714,968 41,911,538
Weighted Average Shares (Diluted) (2) 40,880,076 41,112,806
</Table>
(1) Basic and diluted earnings per share without rationalization charges
are presented as management believes this financial measure is
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.
(2) Diluted weighted average shares include the effect of employee stock
options.
LINCOLN ELECTRIC HOLDINGS, INC.
FINANCIAL HIGHLIGHTS
(AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<Table>
<Caption>
March 31, December 31,
SELECTED CONSOLIDATED BALANCE SHEET DATA 2004 2003
------------- ----------------
Cash and Cash Equivalents $169.2 $170.5
Total Current Assets 589.6 555.4
Net Property, Plant and Equipment 280.0 282.3
Total Assets 963.0 928.9
Total Current Liabilities 229.8 213.1
Short-Term Debt 3.0 4.3
Long-Term Debt 169.0 169.0
Total Shareholders' Equity 490.9 478.5
Three Months to March 31,
SELECTED CONSOLIDATED CASH FLOW DATA 2004 2003
------------- ----------------
Cash Flow from Operations $11.9 $8.9
Capital Expenditures 8.8 7.0
Purchase (Issuance) of Common Shares for Treasury, net (3.4) 8.5
Decrease in Cash and Cash Equivalents (1.3) (13.1)
Depreciation and Amortization 9.4 9.3
Dividends Paid 6.5 6.7
Cash Dividends Paid Per Share $0.16 $0.16