Research Desk Line-up: Simpson Manufacturing Post Earnings Coverage

LONDON, UK / ACCESSWIRE / August 4, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Lincoln Electric Holdings, Inc. (NASDAQ: LECO) ("Lincoln Electric"), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=LECO, following the Company's release of its second quarter fiscal 2017 results on July 25, 2017. The manufacturer of specialized welding products and other equipment outperformed top- and bottom-line expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:

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Get more of our free earnings reports coverage from other constituents of the Small Tools & Accessories industry. Pro-TD has currently selected Simpson Manufacturing Co., Inc. (NYSE: SSD) for due-diligence and potential coverage as the Company announced on July 27, 2017, its financial results for Q2 2017. Register for a free membership today, and be among the early birds that get access to our report on Simpson Manufacturing when we publish it.

At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on LECO; also brushing on SSD. With the links below you can directly download the report of your stock of interest free of charge at:

http://protraderdaily.com/optin/?symbol=LECO

http://protraderdaily.com/optin/?symbol=SSD

Earnings Reviewed

Lincoln Electric's Q2 2017 sales increased 5.8% to $626.9 million on 3.2% higher volumes and a 2.6% increase in price. Excluding Venezuela from prior year's results due to the deconsolidation of the operation, the Company's sales increased 6.9%, from 4.2% higher volumes and a 2.7% increase in price. Lincoln Electric's sales numbers exceeded analysts' expectations of $622 million.

During Q2 2017, Lincoln Electric's selling, general, and administrative expenses (SG&A) increased approximately 8%, or $9.3 million, primarily due to higher compensation expenses and acquisition transaction and integration costs related to the proposed acquisition of Air Liquide Welding. Excluding those acquisition-related costs, SG&A increased 4%, or $5 million, and SG&A as a percentage of sales improved by 30 basis points to 20%.

Lincoln Electric's operating income for Q2 2017 was $87.6 million, or 14.0% of sales, compared to operating income of $48.1 million, or 8.1% of sales, in Q2 2016 period. On an adjusted basis, the Company's operating income was $92.1 million, or 14.7% of sales, compared to $82.4 million, or 13.9% of sales, in the prior year's same quarter.

For Q2 2017, Lincoln Electric's net income of $61.4 million, or diluted earnings per share (EPS) of $0.92, which included acquisition transaction and integration costs of $3.5 million after-tax, or $0.05 EPS, related to the proposed acquisition of Air Liquide Welding. For Q2 2016 the Company's net income was $31.3 million, or $0.45 EPS. The Company's earnings, adjusted for costs related to mergers and acquisitions, came in at $0.97 per share, exceeding Wall Street's expectations for earnings of $0.94 per share.

On April 27, 2017, Lincoln Electric entered into a definitive agreement with Air Liquide to acquire its Air Liquide Welding subsidiary. The definitive agreement reflects an approximate $131 million purchase price for the Air Liquide Welding business, including the assumption of net debt and working capital adjustments. The proposed acquisition is expected to close on July 31, 2017.

Segment Results

During Q2 2017, Lincoln Electric's Americas Welding segment's adjusted earnings before interest and taxes (EBIT) margin increased 140 basis points to 17.2% on higher volumes. Sales, excluding Venezuelan results in the prior year, increased 5.9% to $435.52 million on 3.3% higher volumes, 2.7% higher price, and a 40 basis point improvement from acquisitions.

For Q2 2017, International Welding segment's adjusted EBIT margin decreased 60 basis points to 6.5%, reflecting higher raw material costs and the timing of pricing actions. The segment recorded sales of $146.98 million, while organic sales were strong in the reported quarter at 6.6%, with both volumes and price up 3.3% each.

During Q2 2017, Lincoln Electric's Harris Products segment's second quarter adjusted EBIT margin decreased 70 basis points to 11.8% on challenging prior year comparisons, unfavorable mix, and higher costs. Volumes increased 11.1% from retail channel demand and from the Company's brazing and soldering solutions. The group recorded sales of $82.61 million for the reported quarter.

Cash Matters

For Q2 2017, Lincoln Electric's cash flow from operations was $75 million compared to $102 million in Q2 2016, reflecting the impact of increasing sales levels in the reported quarter. The Company's operating working capital ratio improved 70 basis points to 16.7% compared to 17.4% in the prior year's same quarter. Lincoln Electric's capital expenditures held steady at $16 million in Q2 2017. The Company paid a cash dividend to shareholders of $23 million in the reported quarter, reflecting the 9% higher dividend payout rate in 2017.

Stock Performance

On Thursday, August 03, 2017, the stock closed the trading session at $86.99, marginally down 0.65% from its previous closing price of $87.56. A total volume of 272.61 thousand shares have exchanged hands. Lincoln Electric's stock price soared 6.31% in the past six months and 41.24% in the previous twelve months. Furthermore, since the start of the year, shares of the Company have rallied 13.46%. The stock is trading at a PE ratio of 25.16 and has a dividend yield of 1.61%. At Thursday's closing price, the stock's net capitalization stands at $5.78 billion.

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SOURCE: Pro-Trader Daily