Lincoln Electric Holdings, Inc. (NASDAQ:LECO) Q3 2023 Earnings Call Transcript

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Gabe Bruno: So, Rob, I think we got your question regarding Fori. And first, I would like to say that I am very excited about the work that our team has done in integrating the business. We are right on schedule with our integration plan and where we see the opportunities to continue to shape and grow the business, not only in terms of sales contributions, but the EBIT profile that we would expect longer term. There is some choppiness as you could appreciate in this project-based business. You saw the significant uptick in the third quarter. That’s all timing of projects. And so there is a pacing that very much in line to where we expect the business to be. And I would just expect a little bit of a different tasting in the fourth quarter. And that’s why the overall sales assumptions are where they are at, so more strength on the organic side. You will see some pacing on the acquisition side, that’s particular to the Fori business into the fourth quarter.

Robert Jameson: No, that helps. I appreciate that. And then I guess just on margin cadence, could you impact us just a little bit more? It looks like for 4Q, it’s a little step down in incrementals. And then also because kind of the way I read it, the impact ex-Fori on your incrementals went up. Just curious, is the Fori business still on target for the $0.12 to $0.15 accretion for your first year ownership. Yes and just any other color there around what we should expect and what’s embedded in 4Q?

Gabe Bruno: Yes. So, Robert, Fori is right in line to where our expectations are. So, as you know, we talked at low-double digit EBIT profile before we were right on track with that. The fourth quarter just has the normal dynamic so progressively into the – from the third quarter to fourth quarter. You saw that we were above the range at Harris. So, not to give any segment particulars, but in general, we would see Harris to maintain more on the higher end of the range versus over the range. And the strength of the incrementals, we expect that to continue to progress into the fourth quarter. So, we did move up as you saw in the assumptions and we are confident in that profile in our business.

Robert Jameson: Great. Thank you.

Operator: Thank you. This concludes our question-and-answer session. I would like to turn the call back to Gabe Bruno for closing remarks.

Chris Mapes: Well, thank you. This is Chris. I just want to make a couple of final comments before Gabe closes out the call for us. I just wanted to make sure I shared with our investor community and our listeners that our leadership transition here at Lincoln Electric is going exceptionally well. Steve and the team are already ingrained in the transition as I finish up my time here as CEO at the end of the year. And very excited about the work and the opportunities the team has in front of them. But I just wanted to share that our transition and the work that we are doing around that is going exceptionally well and confident about our continued success here at the company. And with that, I will turn it back to Gabe.

Gabe Bruno: Thank you, Chris. I would like to thank everyone for joining us on the call today and for your continued interest in Lincoln Electric. We look forward to discussing the progression of our strategic initiatives in the future. Thank you very much.

Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.

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