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$LECO acquired Air Liquide Welding, a subsidiary of Air Liquide for approx. $134MM, including debt assumption. $LECO funded the deal with available cash on hand. The deal is accretive to $LECO earnings at about $0.03 of diluted EPS per qtr., or $0.12 annually, in the first year and about $0.06 EPS per qtr., or $0.24 annually in the second year.
$LECO promoted Steven Hedlund to EVP and President of the International Welding segment. Hedlund succeeds Mathias Hallmann, who has decided to leave the Company to pursue other interests. Hedlund most recently served as SVP and President of Global Automation.
$LECO agreed with Air Liquide to acquire its Air Liquide Welding subsidiary. The definitive agreement reflects a $125MM purchase price. $LECO expects the deal, once closed, to be immediately accretive to earnings, excluding transaction costs, and to generate attractive return on capital in the first 5 years. The deal is expected to close in 2H17.
$LECO reported an increase in 1Q17 earnings. Net income was $55.8MM or $0.84 per share compared to $53.6MM or $0.76 per share in 1Q16. Sales grew 5.5% to $580.9MM primarily due to 2.9% higher volumes, a 2.1% increase in price and a 0.6% benefit from acquisitions.
$LECO has signed a memorandum of understanding and entered into exclusive negotiations to acquire Air Liquide’s subsidiary, Air Liquide Welding. As the parties have not yet reached a definitive agreement regarding the transaction, there can be no assurance that a definitive agreement will be entered into, or that a transaction will be consummated.
Effective June 30, 2016, $LECO deconsolidated the financial results of its Venezuela subsidiary due to the adverse conditions in the country. As a result, Venezuela is no longer included in the financial statements. In 3Q15, Venezuela contributed a minimal $34.7MM of net sales, the company said.
Industrial manufacturer $LECO reported a quarterly profit, helped by income tax benefits. The company reported 3Q16 earnings of $60.0MM, or $0.89 per share, which includes a $4.0MM, or $0.06 per share benefit from a discrete income tax item. This compares with net losses of $60.5MM, or $0.82 per share a year ago.
$LECO declared a 9.4% increase in the quarterly cash dividend, from $0.32 per share to $0.35 per share, or to $1.40 per share on an annualized basis. The declared quarterly cash dividend of $0.35 per common share is payable January 13, 2017 to shareholders of record as of December 31, 2016.
$LECO said it promoted Michael Whitehead to SVP, Strategy and Business Development and Adel Mir to President, Lincoln Electric Canada. Both positions are effective immediately. Whitehead will report to CFO Vincent Petrella. Mir will report to George Blankenship, EVP and President, Americas Welding.
Stanley Elliott of Stifel Nicolaus asks about the growth in Southeast Asia. $LECO said the growth is partly driven by investments in people and technologies in other regions around the world. The company is seeing some benefits from the technology center in Singapore. The long-term investment in the Indian market has also been favorable.