Lincoln Electric Holdings, Inc. Q1 FY2026 earnings call

• Global launch of new RISE strategy was successful, with early wins like U.S. launch of Elite Customer Program, new automated manufacturing line in Harris facility tripling productivity and improving quality, and new center-led process innovation function in welding consumables. • Achieved solid results with record quarterly sales and adjusted EPS, navigated geopolitics and trade negotiations, remained agile, customer focused, and invested in long-term growth. • Americas region outperformed, consumables resilient driven by factory activity and infrastructure investments, automation growth in Americas, broad improvement in European sales, and end markets with some growing and others challenged.

America's welding: sales increased ~8% in Q1, driven by ~8% higher price and 1% favorable foreign exchange, volume declines narrowed, adjusted EBIT increased ~3% to $128M with margin at 17.2%. International welding: sales increased ~4% primarily from favorable foreign exchange and alloy steel acquisition, but volume down 10% primarily from automation and Middle East conflict, adjusted EBIT decreased 1.5% to $23M with margin at 9.7%. Harris Products Group: sales increased 42% led by 41% higher price, adjusted EBIT increased ~68% to $41M with margin at 21.2%.

• Increased net sales growth assumption to high single digit percent range due to new price actions. • Original bond growth assumption remains low single-digit percent. • Estimated sales impact from Middle East conflict at $8 - $10M per quarter. • Anticipate 70 basis point M&A benefit from Alloy Steel Acquisition. • Maintain other full-year assumptions on operating income margin, incremental margin, etc.

• Heightened operating complexity from geopolitics and evolving trade negotiations. • Middle East conflict impacting sales, with an estimated $8 - $10M per quarter impact. • Volatility in metal prices affecting Harris Products Group's pricing and margin.

Q: Brian Blair asked about cycle positioning, demand acceleration, and automation.

A: Steve said cautiously optimistic, seeing good order rates in Americas, but Europe has choppiness, and Middle East unclear. Gabe added Americas welding consumable volumes up, and automation expected to turn to modest growth in Q2 with second half improvement.

Q: Oliver asked on GenFab end markets and automation margin.

A: Volumes in Americas welding consumables up low double digits, automation had margin pressure in Q1 but expected improvement.

Q: Dave asked on pricing and Harris margin.

A: Expect to recover most price cost in Q2, price-cost neutral in Q3, Harris margin expected to moderate from Q1 record levels.

Q: Walt asked on international margins.

A: Volume impact in Q1, expecting stability in Q2, mix good from alloy steel acquisition.

Q: Nick asked on international volume growth and inflation impact.

A: Expect volume growth in Asia Pacific, cautious on Europe due to pull forward and regulations, posture is price cost neutral in international markets