SEGMENT INFORMATION

12 Months Ended

Dec. 31, 2016

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. All prior period results have been revised to 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, 2016, 2015 and 2014, 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		International Welding		The Harris Products Group		Corporate / Eliminations			Consolidated
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
For the Year Ended    December 31, 2014
Net sales	$	1,837,670	$	681,424	$	294,230	$	—		$	2,813,324
Inter-segment sales	110,524		21,608		8,210		(140,342		)	$	—
Total	$	1,948,194	$	703,032	$	302,440	$	(140,342	)	$	2,813,324
Adjusted EBIT	$	353,255	$	48,720	$	28,563	$	3,802		$	434,340
Special items charge	21,647		29,539		—		—			$	51,186
EBIT	$	331,608	$	19,181	$	28,563	$	3,802		$	383,154
Interest income										3,093
Interest expense										(10,434		)
Income before income taxes										$	375,813
Total assets	$	1,214,988	$	663,164	$	147,990	$	(86,927	)	$	1,939,215
Equity investments in affiliates	3,579		23,902		—		—			$	27,481
Capital expenditures	62,066		10,099		825		—			$	72,990
Depreciation and amortization	44,710		21,624		3,512		(239		)	$	69,607

In 2016, special items within Corporate /Eliminations reflect a loss on the deconsolidation of the Venezuelan subsidiary.

In 2015, special items in Americas Welding and International Welding include rationalization charges primarily related to employee severance and other related costs. Americas Welding special items also reflect Venezuelan foreign exchange remeasurement losses related to the adoption of a new foreign exchange mechanism, as well as pension settlement charges primarily related to the purchase of a group annuity contract. International Welding special items also include charges related to the impairment of long-lived assets and charges related to the impairment to the carrying value of goodwill.

In 2014, special items in Americas Welding and International Welding include net rationalization charges primarily related to employee severance and other costs associated with the consolidation of manufacturing operations. Americas Welding special items also include Venezuelan foreign exchange remeasurement losses related to the adoption of a new foreign exchange mechanism. International Welding special items also include net charges related to the impairment of long-lived assets partially offset by gains related to the sale of assets.

Export sales (excluding inter-company sales) from the United States were $134,216 in 2016, $175,049 in 2015 and $210,325 in 2014. No individual customer comprised more than 10% of the Company's total revenues for any of the three years ended December 31, 2016.

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,
	2016		2015		2014
Net sales:
United States	$	1,308,635	$	1,387,882	$	1,417,750
Foreign countries	965,979		1,147,909		1,395,574
Total	$	2,274,614	$	2,535,791	$	2,813,324

	December 31,
	2016			2015			2014
Property, plant and equipment, net:
United States	$	176,041		$	173,974		$	171,746
Foreign countries	196,679			237,718			267,423
Eliminations	(343		)	(369		)	(423		)
Total	$	372,377		$	411,323		$	438,746