XML 35 R14.htm IDEA: XBRL DOCUMENT
v3.8.0.1

SEGMENT INFORMATION | 12 Months Ended
--- | ---
Dec. 31, 2017
Segment Reporting [Abstract] |
SEGMENT INFORMATION | SEGMENT INFORMATION The Company's primary business is the design and manufacture of arc welding and cutting products, manufacturing a broad line of arc welding equipment, consumable welding products and other welding and cutting products. Welding products include arc welding power sources, CNC and plasma cutters, wire feeding systems, robotic welding packages, integrated automation systems, fume extraction equipment, consumable electrodes, fluxes and welding accessories and specialty welding consumables and fabrication. The Company's product offering also includes oxy-fuel cutting systems and regulators and torches used in oxy-fuel welding, cutting and brazing. In addition, the Company has a leading global position in the brazing and soldering alloys market. During the first quarter of 2016, the Company realigned its organizational and leadership structure into three operating segments to support growth strategies and enhance the utilization of the Company's worldwide resources and global sourcing initiatives. The operating segments consist of Americas Welding, International Welding and The Harris Products Group. The Americas Welding segment includes welding operations in North and South America. The International Welding segment primarily includes welding operations in Europe, Africa, Asia and Australia. The Harris Products Group includes the Company's global cutting, soldering and brazing businesses as well as its retail business in the United States. 2015 results reflect the realigned segment structure. Segment performance is measured and resources are allocated based on a number of factors, the primary profit measure being adjusted earnings before interest and income taxes ("Adjusted EBIT"). EBIT is defined as Operating income plus Equity earnings in affiliates and Other income. Segment EBIT is adjusted for special items as determined by management such as the impact of rationalization activities, certain asset impairment charges and gains or losses on disposals of assets. The accounting principles applied at the operating segment level are generally the same as those applied at the consolidated financial statement level with the exception of LIFO. Segment assets include inventories measured on a FIFO basis while consolidated inventories include inventories reported on a LIFO basis. Segment and consolidated income before interest and income taxes include the effect of inventories reported on a LIFO basis. At December 31, 2017 approximately 32% of total inventories were valued using the LIFO method. At December 31, 2016 and 2015 approximately 40% of total inventories were valued using the LIFO method. LIFO is used for a substantial portion of U.S. inventories included in Americas Welding. Inter-segment sales are recorded at agreed upon prices that approximate arm's length prices and are eliminated in consolidation. Corporate-level expenses are allocated to the operating segments. Financial information for the reportable segments follows:
| Americas Welding (1) |  | International Welding (2) |  | The Harris Products Group |  | Corporate / Eliminations (3) |  | Consolidated
For the Year Ended December 31, 2017 |  |  |  |  |  |  |  |  |
Net sales | $ | 1,609,779 |  |  | $ | 724,024 |  |  | $ | 290,628 |  |  | $ | — |  |  | $ | 2,624,431 |
Inter-segment sales | 97,382 |  |  | 18,860 |  |  | 8,190 |  |  | (124,432 | ) |  | $ | — |
Total | $ | 1,707,161 |  |  | $ | 742,884 |  |  | $ | 298,818 |  |  | $ | (124,432 | ) |  | $ | 2,624,431 |
Adjusted EBIT | $ | 291,866 |  |  | $ | 41,721 |  |  | $ | 36,442 |  |  | $ | 309 |  |  | $ | 370,338 |
Special items charge (gain) | 9,242 |  |  | 10,076 |  |  | — |  |  | (34,648 | ) |  | $ | (15,330 | )
EBIT | $ | 282,624 |  |  | $ | 31,645 |  |  | $ | 36,442 |  |  | $ | 34,957 |  |  | $ | 385,668 |
Interest income |  |  |  |  |  |  |  |  | 4,788 |
Interest expense |  |  |  |  |  |  |  |  | (24,220 | )
Income before income taxes |  |  |  |  |  |  |  |  | $ | 366,236 |
Total assets | $ | 1,253,411 |  |  | $ | 919,995 |  |  | $ | 175,151 |  |  | $ | 57,990 |  |  | $ | 2,406,547 |
Equity investments in affiliates | 4,037 |  |  | 24,489 |  |  | — |  |  | — |  |  | $ | 28,526 |
Capital expenditures | 43,158 |  |  | 14,549 |  |  | 3,949 |  |  | — |  |  | $ | 61,656 |
Depreciation and amortization | 47,038 |  |  | 18,364 |  |  | 2,885 |  |  | (172 | ) |  | $ | 68,115 |
For the Year Ended December 31, 2016 |  |  |  |  |  |  |  |  |
Net sales | $ | 1,494,982 |  |  | $ | 507,289 |  |  | $ | 272,343 |  |  | $ | — |  |  | $ | 2,274,614 |
Inter-segment sales | 93,612 |  |  | 15,975 |  |  | 8,709 |  |  | (118,296 | ) |  | $ | — |
Total | $ | 1,588,594 |  |  | $ | 523,264 |  |  | $ | 281,052 |  |  | $ | (118,296 | ) |  | $ | 2,274,614 |
Adjusted EBIT | $ | 266,633 |  |  | $ | 29,146 |  |  | $ | 32,380 |  |  | $ | 564 |  |  | $ | 328,723 |
Special items charge | — |  |  | — |  |  | — |  |  | 34,348 |  |  | $ | 34,348 |
EBIT | $ | 266,633 |  |  | $ | 29,146 |  |  | $ | 32,380 |  |  | $ | (33,784 | ) |  | $ | 294,375 |
Interest income |  |  |  |  |  |  |  |  | 2,092 |
Interest expense |  |  |  |  |  |  |  |  | (19,079 | )
Income before income taxes |  |  |  |  |  |  |  |  | $ | 277,388 |
Total assets | $ | 1,278,417 |  |  | $ | 529,223 |  |  | $ | 161,391 |  |  | $ | (25,594 | ) |  | $ | 1,943,437 |
Equity investments in affiliates | 3,946 |  |  | 23,355 |  |  | — |  |  | — |  |  | $ | 27,301 |
Capital expenditures | 35,314 |  |  | 12,354 |  |  | 2,209 |  |  | — |  |  | $ | 49,877 |
Depreciation and amortization | 47,359 |  |  | 15,063 |  |  | 2,860 |  |  | (209 | ) |  | $ | 65,073 |
For the Year Ended December 31, 2015 |  |  |  |  |  |  |  |  |
Net sales | $ | 1,741,350 |  |  | $ | 530,460 |  |  | $ | 263,981 |  |  | $ | — |  |  | $ | 2,535,791 |
Inter-segment sales | 92,538 |  |  | 18,747 |  |  | 9,312 |  |  | (120,597 | ) |  | $ | — |
Total | $ | 1,833,888 |  |  | $ | 549,207 |  |  | $ | 273,293 |  |  | $ | (120,597 | ) |  | $ | 2,535,791 |
Adjusted EBIT | $ | 316,689 |  |  | $ | 34,511 |  |  | $ | 27,882 |  |  | $ | (275 | ) |  | $ | 378,807 |
Special items charge | 173,239 |  |  | 16,671 |  |  | — |  |  | — |  |  | $ | 189,910 |
EBIT | $ | 143,450 |  |  | $ | 17,840 |  |  | $ | 27,882 |  |  | $ | (275 | ) |  | $ | 188,897 |
Interest income |  |  |  |  |  |  |  |  | 2,714 |
Interest expense |  |  |  |  |  |  |  |  | (21,824 | )
Income before income taxes |  |  |  |  |  |  |  |  | $ | 169,787 |
Total assets | $ | 1,165,817 |  |  | $ | 543,254 |  |  | $ | 143,905 |  |  | $ | (68,805 | ) |  | $ | 1,784,171 |
Equity investments in affiliates | 3,791 |  |  | 23,450 |  |  | — |  |  | — |  |  | $ | 27,241 |
Capital expenditures | 35,721 |  |  | 12,059 |  |  | 2,727 |  |  | — |  |  | $ | 50,507 |
Depreciation and amortization | 45,447 |  |  | 15,776 |  |  | 2,978 |  |  | (194 | ) |  | $ | 64,007 |
(1) | 2017 special items reflect non-cash pension settlement charges related to lump sum pension payments, as well as non-cash charges related to the impairment of goodwill.
2015 special items reflect net charges related to employee severance and other related costs, Venezuelan foreign exchange remeasurement losses related to the adoption of a new foreign exchange mechanism and non-cash pension settlement charges related to the purchase of a group annuity contract.
(2) | 2017 special items reflect amortization of step up in value of acquired inventories related to the Air Liquide Welding acquisition as discussed in Note 3 to the consolidated financial statements, as well as charges related to employee severance, asset impairments and other related costs.
2015 special items reflect net charges related to employee severance and other costs and adjustments to reclassify a potential divestiture that was previously held-for-sale, as well as non-cash charges related to the impairment of goodwill and long-lived assets.
(3) | 2017 special items reflect a bargain purchase gain and acquisition transaction and integration costs related to the Air Liquide Welding acquisition as discussed in Note 3 to the consolidated financial statements.
2016 special items reflect a loss related to the deconsolidation of the Company's Venezuelan subsidiary. Export sales (excluding inter-company sales) from the United States were $151,630 in 2017, $134,216 in 2016 and $175,049 in 2015. No individual customer comprised more than 10% of the Company's total revenues for any of the three years ended December 31, 2017. The geographic split of the Company's Net sales, based on the location of the customer, and property, plant and equipment were as follows:
|  | Year Ended December 31,
|  | 2017 |  | 2016 |  | 2015
Net sales: |  |  |  |  |  |
United States |  | $ | 1,388,816 |  |  | $ | 1,308,635 |  |  | $ | 1,387,882 |
Foreign countries |  | 1,235,615 |  |  | 965,979 |  |  | 1,147,909 |
Total |  | $ | 2,624,431 |  |  | $ | 2,274,614 |  |  | $ | 2,535,791 |
|  | December 31,
|  | 2017 |  | 2016 |  | 2015
Property, plant and equipment, net: |  |  |  |  |  |
United States |  | $ | 194,491 |  |  | $ | 176,041 |  |  | $ | 173,974 |
Foreign countries |  | 282,931 |  |  | 196,679 |  |  | 237,718 |
Eliminations |  | (391 | ) |  | (343 | ) |  | (369 | )
Total |  | $ | 477,031 |  |  | $ | 372,377 |  |  | $ | 411,323 |

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8981-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9038-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8971-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8595-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8984-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9031-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8538-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8864-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8924-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8906-108599 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration