Lincoln Electric (LECO) Oppenheimer 21st Annual Industrial Growth Virtual Conference summary

Strategic overview and RISE strategy

• RISE strategy focuses on reimagining work, innovation, customer service, and team development, aiming to accelerate growth and reshape the operating model for the long term.

• 2030 objectives include driving high single to low double-digit CAGR, with 300-400 basis points from organic and inorganic growth.

• Operating margin improvement targeted at 300 basis points per cycle, aiming for over 20% operating profit.

• Balanced capital allocation prioritizes growth, internal investment, acquisitions, consistent dividend increases, and share repurchases.

• EPS growth targeted at mid-teens compound annual rate through disciplined execution.

Market performance and outlook

• General industries showed high 30s percent growth in Q1, with positive trends in the Americas and improving PMI and industrial production.

• Heavy industries are recovering from destocking, with growth expected in the back half of 2026; energy markets remain steady but bullish, especially in the Americas.

• Transportation and structural segments saw mid-teens declines due to project timing, with continued choppiness expected.

• Americas segment is strong, especially in automation, while Asia shows positive project activity; EMEA faces demand inconsistency and Middle East conflict impacts.

• Middle East conflict caused an $8-10 million quarterly impact, mainly affecting international and export sales.

Pricing, inflation, and tariffs

• Pricing actions in response to inflation are driving 300-400 basis points of top-line growth, with most impact from the Harris segment.

• Price realization expected to mature through Q2 and Q3, with mid to high single-digit increases, then moderating to low single digits by Q4.

• Tariffs have only a modest impact; broader pricing strategy is driven by inflationary pressures.