LECO

Greetings, and welcome to the Lincoln Electric 2026 Q1 financial results conference call. It is my pleasure to introduce your host, Amanda Butler, Vice President of Investor Relations and Communications. Thank you. You may begin.

Thank you, Kathleen, and good morning, everyone. Welcome to Lincoln Electric's Q1 2026 conference call. We released our financial results earlier today, and you can find our release and this call's slide presentation at lincolnelectric.com in the investor relations section. Joining me on the call today is Steve Hedlund, Chairman and Chief Executive Officer, and Gabe Bruno, our Chief Financial Officer. Following our prepared remarks, we're happy to take your questions. Before we start our discussion, please note that certain statements made during this call may be forward-looking, and the actual results may differ materially from our expectations due to a number of risk factors and uncertainties, which are provided both in our press release and in our SEC filings on forms 10-K and 10-Q. In addition, we do discuss financial measures that do not conform to U.S. GAAP.

A reconciliation of non-GAAP measures to the most comparable GAAP measure is found in the financial tables in our earnings release, which again is available in the investor relations section of our website at lincolnelectric.com. With that, I'll turn the call over to Steve Hedlund. Steve?

Thank you, Amanda. Good morning, everyone. Turning to slide 3, we achieved solid results led by record quarterly sales and adjusted EPS performance while also navigating heightened operating complexity from geopolitics and evolving trade negotiations. Teamwork exemplified our success this quarter. We remained agile in addressing short-term dynamics while staying customer-focused, investing in long-term growth, and reimagining how work gets done. The global launch of our new RISE strategy was successful. We celebrated a string of early wins, which include the U.S. launch of our elite customer program as part of our enterprise-wide Spotlight initiative, which raises the bar for customer service in our industry. It enables us to provide superior on-time delivery, hassle-free support, and value-added services to help customers grow their business with us.

In addition, we commissioned a new automated manufacturing line in one of our Harris facilities that triples the line's productivity while significantly improving quality. This investment also showcases the breadth of automated manufacturing solutions we engineer beyond traditional welding robots. We launched a new center-led process innovation function in welding consumables to accelerate our speed to market. I am pleased by the speed of progress, and we will work hard to maintain this pace. Turning back to quarterly performance, we are encouraged by improving sales and order momentum in the Americas region through April. This aligns well with 3 consecutive months of expanding manufacturing PMI data. In the quarter, we held our adjusted operating income margin steady with prior year. While we targeted a slight margin improvement, our 10% higher price did not fully offset inflation in the quarter.

To ensure we achieve our neutral price cost target this year, we have already announced new price actions across our welding segments, which go into effect in early May. Cash flows, while seasonally lower, were further affected by a temporary increase in inventory levels we put in place to maintain high fill rates and service levels while we pursue our Spotlight initiative and migrate select products to next-generation versions. We continue to invest in long-term growth through CapEx and R&D and return cash to shareholders through both dividends and share repurchases. ROIC performance remained at top quartile levels at 21.5%. Turning to slide 4 to spend a few minutes on demand trends. The Americas region continued to outperform other geographies. Consumables remained the most resilient product category.

This was driven by factory activity and infrastructure investments in energy and data centers, which helped offset slower auto production. These same end market drivers, along with an increase in capital spending from off-highway customers, supported modest automation growth in the Americas in the quarter as well. Globally, our automation portfolio achieved $210 million in sales versus $215 million in the prior year, with compression from international markets where we have a challenging prior year comparison. We have been encouraged by the continued acceleration in both equipment and automation order rates and backlog levels in the Americas through April. This should support modest volume growth in the Americas Welding segment starting in the Q2, with further improvement in the back half of the year if conditions are sustained.

Internationally, we also saw a broad improvement in sales from European customers, with organic sales pivoting to growth across Northern, Eastern, and Central Europe and in Turkey. India and Australia improved. The headwind in our international business was largely from challenging prior year comparisons in regional automation and energy projects and, to a lesser extent, the Middle East conflict. On a consolidated basis, the Middle East represents a relatively small portion of sales, and we estimate an approximate $8 million sales impact from the conflict as several customers suspended activity.

In April, EMEA order rates continued to improve, and we are monitoring for consistency as activity may reflect pre-buying ahead of higher inflation and regional commodity supply concerns. In the Middle East, we are engaged with regional customers servicing active requests, and our global team of welding experts are ready to support their repair and expansion needs as called upon, whether for rapid large scale metal, 3D printing of replacement and spare parts to core welding and automation solutions. Pivoting to end market performance, we continue to see 3 of our 5 end markets achieving flat to higher organic sales growth in the quarter. Most notable is the high 30% growth rate in general fabrication, which represented accelerated factory and fabrication activity in the Americas, as well as in data center and HVAC projects. Heavy industries grew in the quarter, led by growth and off-highway globally.

Both construction and ag equipment grew across a broad mix of solutions, including automation. Energy was steady, but was bifurcated between a high teens% growth rate in Americas, which was offset Internationally. We remain bullish on energy and expect Americas to continue to outperform International with a strong pipeline of pending LNG projects and energy infrastructure projects needed to support data center investments. With our strong broad presence across oil and gas and power generation applications, including gas turbine, battery, nuclear, and renewables, our energy team is encouraged by the opportunities ahead. Our two challenged end markets, non-residential structural steel and transportation, are both project-oriented and capital intensive, which can result in choppy results quarter-to-quarter. Non-residential was largely impacted by International weakness, while transportation was broader and largely driven by lower capital spending versus prior year and a slight decline in production rates.

To conclude, before passing the call to Gabe, while we are operating in a more complex environment, we are well-positioned to adapt and react effectively to short-term dynamics. We are financially disciplined, maintained a solid balance sheet profile, and continue to generate strong cash flows and manage the business for long-term profitable growth. This is evident in our balanced capital allocation strategy, as well as our track record of compounding earnings and increasing shareholder returns through the cycle to deliver superior long-term value. This is an exciting time at Lincoln Electric with the launch of our new RISE strategy, and the entire team is energized to achieve our mission of being the essential link to help customers build better and execute on our 20/30 goals. Now I will pass the call to Gabe Bruno to cover Q1 financials in more detail.

Thank you, Steve. Moving to slide 5, our Q1 sales increased approximately 12% to $1.121 billion from approximately 10% higher price, 2% favorable foreign exchange translation, and a 1.6% benefit from the Alloy Steel acquisition. This was partially offset by 2.6% lower volumes. Gross profit increased approximately 9% to $399 million, reflecting higher sales. Our gross profit margin declined 80 basis points to 35.6% due to lower volumes, timing of price cost recovery, and an approximate $1 million LIFO charge. Price cost was unfavorable 90 basis points in the quarter. We continue to target a neutral price cost posture and have implemented new pricing actions in our Welding segment, which will go into effect in early May.

Our SG&A expense increased by 7% or $14 million-$211 million. The increase was driven by foreign exchange translation, higher discretionary spending, which was largely commercially driven, and from higher employee costs. SG&A as a percent of sales improved 80 basis points to 18.8% on higher sales levels. On April 1st, we implemented our seasonal merit increase, which raises employee costs by approximately $6 million per quarter on a year-over-year basis. We expect our quarterly SG&A run rate to be at $250 million for the balance of the year. For analysts reviewing our segment EBIT schedule, our corporate expense of approximately $1.4 million reflects our decision to allocate additional center-led enterprise investments to our reportable segments.

Looking ahead, we expect corporate expense to be approximately $1 million-$2 million per quarter for the balance of the year. Reported operating income increased 13% on higher sales. Excluding special items, adjusted operating income increased 11.5% to $189 million, and we held our adjusted operating income margin steady year-over-year at 16.9% with a 17% incremental margin. Our steady margin performance reflected favorable SG&A leverage, which offset the impact of lower volumes and an unfavorable price cost position. Q1 diluted earnings per share performance increased 18% to $2.47. On an adjusted basis, earnings per share increased 16% to $2.50. We recognize a $0.04 benefit from foreign exchange translation and $0.05 from share repurchases. Moving to our reportable segments on slide 6.

Americas Welding sales increased approximately 8% in the quarter, driven by nearly 8% higher price and 1% favorable foreign exchange translation. Volume declines narrowed to 40 basis points as orders accelerated through the quarter across all 3 product areas on improving demand trends from most end markets. We expect volumes to inflect to modest growth in the Q2. Q1 Americas price marked peak levels in the segment as we started to anniversary last year's actions in the Q2. The team has recently announced new pricing actions to mitigate rising raw material and logistics costs. We expect Americas Welding to achieve a full quarter benefit of these new actions starting the Q3 at 150 basis points per quarter run rate. We will continue to monitor evolving operating conditions and will respond as necessary.

Americas Welding segment's Q1 adjusted EBIT increased approximately 3% to $128 million on higher sales. The adjusted EBIT margin declined 100 basis points to 17.2%, primarily due to timing of price cost recovery and higher corporate expense allocated to the segment. We expect Americas Welding margin to perform in the mid-18% to mid-19% EBIT margin range for the remainder of the year. Moving to slide 7. The International Welding segment sales increased approximately 4%, primarily from favorable foreign exchange translation and strong sales in our Alloy Steel acquisition, which will anniversary in early August. This increase was partially offset by 10% lower volumes, primarily from automation, and to a lesser extent, a temporary decline in customer activity due to the Middle East conflict. Adjusted EBIT decreased 1.5% to $23 million.

Margin declined 50 basis points to 9.7% as the benefit from Alloy Steel was offset by lower volumes and higher corporate expense allocated to the segment. We now expect International Welding's margins performance to improve sequentially, but remain in the 11% range until conditions improve in the Middle East. Moving to the Harris Products Group on slide 8. Q1 sales increased 42%, led by 41% higher price. The outsized price impact reflects actions taken to mitigate record high metal costs, most notably in silver and copper. The segment effectively managed costs and achieved their neutral price cost target in the quarter. While metal prices remain elevated, we expect Harris's price to moderate from Q1 record levels based on current metal price trends and prior year comparisons.

Harris volume compression narrowed, benefiting from the growth in the retail channel, as well as an improvement in HVAC production activity, which we anticipate will inflect positive by mid-year. Looking ahead to the Q2, we expect segment volumes to compress due to a challenging comparison from last year's retail channel load in of a new customer. Volumes are expected to pivot to growth in the back half of the year. Adjusted EBIT increased approximately 68% to $41 million and margin improved 330 basis points to 21.2%. The profitability improvement reflects SG&A leverage from higher sales dollars and favorable mix. We expect the Harris segment will operate in the 19%-20% margin range at current metal prices. Moving to slide 9.

We generated $102 million in cash flows from operations in the quarter, which was lower due to higher uses of working capital. We strategically increased inventory levels on a short-term basis to ensure high customer service levels while we transition select products to newer models and ensure we capitalize on early strengthening of demand, especially in the Americas. We expect to reduce inventory levels in the second half of the year. The increase in inventories resulted in an 80 basis point increase in our average operating working capital to sales ratio to 18.6%. Moving to slide 10. We continued to execute on our capital allocation strategy by investing $39 million in CapEx, and returned $101 million to shareholders from a combination of our higher dividend payout and from share repurchases.

We maintained a solid adjusted return on invested capital ratio of 21.5%. Moving to slide 11 to discuss our operating assumptions for 2026. We have increased our net sales growth assumption to incorporate recently announced price actions taken to offset rising input costs. We now expect net sales growth to be in the high single-digit % range as compared to our initial assumption of mid-single-digit % growth. Our organic sales mix is now expected to be three-quarters price at a mid-single-digit % rate and Q1 volume. Given how early we are in the year and the potential trade-off of strong order rates in Americas offsetting lower sales from the Middle East conflict, we have not changed our original volume growth assumption of a low single-digit % growth rate.

We estimate the sales impact from the Middle East conflict to be $8 million-$10 million per quarter while the conflict persists, which is split evenly between the Americas Welding and International Welding segments. We also continue to anticipate a 70 basis point M&A benefit from the Alloy Steel acquisition, which again anniversaries in early August. We're maintaining our other full-year assumptions on operating income margin improvement at mid-20% incremental margin, interest expense, tax rate, CapEx, and cash conversion. Now I would like to turn the call over for questions.

Ladies and gentlemen, at this time, we will be conducting a question and answer session. If you would like to ask a question during this time, simply press star Star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, press the star 1 again. To ensure that everyone has an opportunity to participate, we ask that you ask 1 question and 1 follow-up question. Your first question comes from the line of Bryan Blair of Oppenheimer. Your line is now open.

Thank you. Good morning, everyone.

Good morning, Bryan.

It'd be great to hear a little more on how your team's thinking about cycle positioning here and the prospects for overall demand acceleration and broadening product growth over the coming quarters. You know, consumables, growth has been encouraging since Q2 of last year. Obviously very robust in Q1. Trends have been a bit choppier on the equipment side, but it sounds like you do expect near-term improvement. Just any additional color on that front would be helpful.

Bryan, this is Steven. I would say we're cautiously optimistic, right? We're seeing good order rates in the Americas Welding. We've got continued strength in the PMI data. You know, conversations with customers are encouraging, we don't wanna get ahead of ourselves, right? We wanna see a little bit more consistency month to month. In Europe, there's a lot of choppiness. We're concerned that some of the volume growth we saw there might have been pull forward around pricing and other regulatory issues in terms of carbon taxes and the like. Don't really have any more clarity than anybody else about what's gonna happen in the Middle East and keeping our fingers crossed there. Cautiously optimistic, I guess, is our overall position.

Yeah. Bryan, just to add, you know, as we mentioned, you know, in the Americas Welding segment. We look at real volumes, consumables and automation were up. As Steve mentioned as well as I, the progression in the quarter on orders were strengthening through March as well as into April, and it also positions for growth on the equipment side. Steve mentioned the key word for us is being just cautiously optimistic about what we're seeing in the business.

Okay. That all makes sense. Specific to automation, sorry if I missed any related detail here, is the expectation that the strategy turns to growth in Q2? Is mid-single digit range still a reasonable outlook for 2026? Have you seen any improvements in, you know, the scope of quoting outside of the large projects that you cited last quarter?

Yeah. Bryan, we do expect to turn to modest growth on the automation side as we exit Q2 with an expectation that 2nd half we see a broad volume improvement across the automation business. Our order intake continues to be strong, backlog levels strong. The mix, while a lot of project activity, which creates some choppiness as you saw, particularly in the International Welding side in this first quarter, we do expect to posture to grow 2nd half.

Understood. Thank you again.

Your next question comes from the line of Angel Castillo of Morgan Stanley. Please go ahead.

Hey, good morning, Steve, Gabe. This is Oliver on for Angel this morning. Just a question on your Gen Fab end markets. I know you guys were up, you know, high 30s this quarter. Can you help us unpack that in terms of how much of that was driven by price versus volume? Just on the back half of the year, you know, we're seeing some of your customers talk about, you know, order numbers that are higher than that even. You know, just how does that translate in terms of volume growth for you guys in the back half of the year?

Yeah. Just high level, you know, our volumes, particularly on consumables in the Americas Welding segment, were up low double digits. We're pleased with the mix. You know, we do have a significant component of the overall increase tied to automation projects in this first quarter. Overall we're seeing a broad-based strength across general industry. We're optimistic, you know, cautiously optimistic that, as you know, almost a third of our business is tied to general industries. As we see now 3 months in a row on PMI improving and the flash numbers in April also point to positive, we're tracking that closely, 'cause it's a key part of our business.

Got it. That's super helpful. Then maybe just one on automation. Was that a drag on Americas margin this quarter? Then, you know, looking forward, how does the margin look in terms of what you signed into your backlog? You know, I know you guys are targeting mid-teens there, any color there would be helpful.

Yeah. For the first quarter, we did have some pressure on automation margins. You know, as you know, that's dilutive to our overall business. Wasn't as key driver to the overall margin performance in the Americas Welding segment because, as I mentioned, it was driven by price costs. We're trailing a bit there as well as the increase in corporate allocations into the segment, which is about 40 basis points. We expect improvement in volumes to also track with it with a high single-digit type of margin for the automation business.

Got it. Appreciate that.

Your next question comes from the line of Mig Dobre of Baird. Please go ahead.

Hey, good morning, everyone. I just have a couple of points of clarification here. Gabe, I appreciate all the commentary. I was trying to take notes, I guess I'm not a fast enough note-taker here. In terms of pricing, do you expect to be back to neutral from a price cost standpoint in Q2, is that delayed until later in the year? As far as the embedded price in the guide, does that reflect the actions that you talked about in the welding business that occurred in May? Is that embedded in that or not? How about Harris? Like, because obviously, I mean, what we saw in Q1 at Harris is just outsized, I know things are moderating, at what pace should we expect that to happen?

Mig, let me handle the first part of that, and then I'll let Gabe comment more specifically. You know, obviously our goal is to be price cost neutral at the margin level and that we've got a long history of achieving that objective. What you saw was an inflection in input costs for us in the latter part of Q1, and then there's a little bit of a delay for us to be able to announce the pricing to our customers, communicate all that, and have it go effective. I would expect that we're gonna recover most of that in Q2 as the pricing goes into effect beginning of May. I think our guide for the year on total price reflects that assumption of the pricing we've already announced.

Yeah. Mig, I would expect price cost neutral as we enter the third quarter. The timing of the price increases will have an impact positively in the second quarter, we'll have the full impact in the third quarter. In terms of our price assumptions, if you think about the increase in between 300 and 400 basis points, the way I think about it is about a quarter of that on a full year basis is tied to the new price actions and the balance really tied to the Harris, what we've seen throughout Harris. We don't get the full year impact, obviously, with the new price actions being taken.

If you just think about that 150 basis points that I mentioned, that begins in the 3rd quarter, take about half of that, and that's really about a quarter of the overall pricing change assumption.

Great. That's very helpful. My follow-up, going back to international, I'm trying to make sense of the volume decline that you have in there. I understand the Middle East impact, something around 230 basis points. You know, what about the rest of it? Because at least optically to me, when I'm looking at the prior year, the comparison was not that difficult. I know you talked about tough comps, but, you know, volumes were down about 6% last year as well. Can you unpack what's going on here and what regions are doing what outside of the Middle East?

Yeah. Just real simply, the largest driver was the timing of projects within our automation business. We did see pockets of strength in certain markets within Europe, you had the impact of Middle East, that was the key driver. On the Asia side, we've seen favorable trends in the likes of India, Australia, and that. Biggest driver overall was the timing of projects and the tough comps on the automation side. We were down automation International. We're slightly up on the Americas side.

Thank you.

We have our last question from Nathan Jones of Stifel. Please go ahead.

Good morning, everyone, and thanks for the question. It's John-Erik Anderson on for Nathan Jones. Just moving on to the margin side, can you maybe talk about some of the cost management actions Lincoln's taking to drive improved margins near term?

Yeah. We have a series of initiatives we're driving under this RISE strategy in terms of enterprise-led initiatives. We're focusing a lot on sourcing and trying to get more leverage out of our global spend. We're looking at trying to improve supply chain planning so we can become more efficient in how we run the factories and servicing our customers with less inventory going forward. We're looking at SG&A productivity initiatives and the combination of all those things are reflected in our assumptions around incremental margins over the course of the RISE strategy period.

Just to remind you know, when we talk about our expectations in the operating margins as well as incrementals for 2026, as you know, we're targeting that mid-20s. When we think about our 2030 targets, we're talking about high 20s. So we're looking to make a step change, and a lot of the investments we're making currently have longer-term implications while we're continuing to improve the short-term margin outlooks.

Gotcha. Thank you. That's helpful. Just specifically to Harris, I guess, can you walk us through what were the primary margin drivers in Harris? Was it mainly mix related? Maybe just a little bit more color there.

Well, mix was certainly favorable. We did have some strengthening across on the retail side as well as, what we've seen on HVAC, which was better than expected. We also have the pricing impact, where we've achieved our price cost neutral posture. With the leverage on SG&A, we probably have about low to mid-twenties type of incremental margin on that. Mix a big part of it and then our pricing and strategy as well.

Thank you. I'll hop back into the queue. Appreciate it.

We have more questions. The next question comes from Walter Liptak of Seaport Research Partners. Please proceed.

Hi. Thanks. good morning.

Yeah

ask about the lower international margins. I wanted you to hopefully talk about that a little bit. I think you, Gabe, talked about an 11% international margin throughout the year, and I think previously it was at 11%-12%. I wonder if you could help us understand, is this more price cost or is it the Middle East, you know, kind of volume overhang? Help us understand what's going on with the international profitability.

Yeah. Well, certainly the volume impact in the first quarter, while the 9.9% down had an impact. We do expect to see more stability in the overall business profile as we enter the second quarter. Timing of projects, as I mentioned, how the automation has an impact. Depending on how the conflict progresses in the Middle East, we'll continue to see an impact there. The mix is good from an Alloy Steel acquisition standpoint. They have our anniversary, as I mentioned, in August, and we expect that to also have a favorable impact. The impact on volumes, you know, had an impact coming into the second quarter, which we expect that to stabilize.

Okay, great. You know, kind of going back to the earlier questions about some of the general fab markets and just the way that things trended. Was this quarter kind of in line with what you guys were thinking going into it, or did you see more of a pickup as the quarter went on and into April?

Yeah, as you know, I mentioned the level of in Americas Welding consumable volumes being up double digits. That was stronger than we would have expected as we spoke in February. We saw strengthening in real volume activity in general industries. We continue to see that momentum into April. That's what gives us the cautious optimism on the early parts of recovery, particularly in the Americas Welding side.

Yeah. Well, I would say the improvement in general fabrication, particularly in the Americas, consumables may be a little bit ahead of what we were anticipating, and standard equipment may be a little bit behind what we were anticipating. The consumable is a great barometer of factory activity, and with continued strength and the factory activity and hopefully improving confidence, we should see the standard equipment follow in fairly short order.

Okay, understood. Sounds great. Thank you.

Your next question comes from the line of Steve Barger of KeyBanc. Please go ahead.

Morning, everyone. This is Christian Zyla on for Steve Barger.

Hey, Christian.

Morning. One clarifying question. Just with your earlier comments on the 2Q volume expectations, are you expecting overall margins in 2Q to be somewhat similar to 1Q and then a pretty meaningful step up to get to your full guide of slight improvement? Can you just help us walk through the cadence for the full year?

Yeah, no, I expect the second quarter to show a step improvement compared to what we've realized in the first quarter and seeing that progressively stable as we get full realization of price cost neutral in the third quarter.

Got it. Then to follow up on that, is that driven primarily by volume or mix in the back half? Just kind of help us parse that out.

Yes. For sure, volumes, we do see progressively improving. You know, as we talked prior to the increase in our pricing assumptions for the year, we did point to the mix of price volume to progress into volumes in the back half of the year as we've anniversary then the price actions from that we had taken in 2025. We have pivoted to volume in the back half of the year. The only comment we made to reinforce mix is that the strengthening of Americas depending on what progresses within the Middle East conflict could be an offset, which, you know, we estimate that impact to be about $8 million-$10 million per quarter.

Yeah, Christian, so our expectation is still for continued volume improvement in the second half of the year. We haven't seen anything yet to have us come off of that, but we're cautiously monitoring demand trends to stay on top of that. Hence our cautious optimism.

Thank you. Understood. One final one for me is just on the cash flow for the year. I think I understood the comment of the increased working capital or inventory levels. Do you expect that to repeat as we go for the full year, or should we expect a similar, you know, 2026 versus 2025 free cash flow, which then would imply about $140 million-$150 million per quarter? Thank you.

Yeah, no, we expect to, we're still anchored on 100% cash conversion. We expect that while we're investing short term with some product transitions that would turn around in the back half of the year.

Great. Thank you.

We have one last follow-up question from Mig Dobre of Baird. Please go ahead.

Hey, thanks for taking a follow-up. still back on International Welding for me. If we're kind of leaving out the Middle East conflict and the drag that you've outlined from that, so excluding this, you know, do you expect to see volume growth in the rest of that business at any point in time in 2026? As far as inflation goes, what is the impact on that flow through in pricing in International Welding? Well, thank you.

Yeah. Mig, I would say we're expecting volume growth in the Asia Pac region of the business. The Western Europe in particular and the broader European region, excluding the Middle East, a little more cautious. We were pleased to see a little bit of an uptick this quarter versus the prior quarters, but we're concerned that that might be pulled forward related to pricing actions and also some of the government regulations around the Carbon Border Adjustment Mechanism coming into play. It's just a little too early to call any bottoming and improvement in Europe at this point in time. We continue to see growth in Asia Pac and believe that we're investing appropriately to take advantage of that growth.

Our posture, Mig, in international markets is to be price cost neutral. We'll take some action to achieve that objective. That's what drives the improvement as we see from Q1 into that 11% type EBIT margin profile that we expect from the business.

All right. Appreciate it. Thank you.

This concludes our question and answer session. I would like to turn the call back over to Gabriel Bruno for the closing remarks.

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 RISE strategy in the future. Thank you very much.

Ladies and gentlemen, that concludes today's call. Thank you everyone for joining. You may now disconnect.