8-K

0000950152-09-001648.txt : 20090223 0000950152-09-001648.hdr.sgml : 20090223 20090223080941 ACCESSION NUMBER: 0000950152-09-001648 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20090223 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20090223 DATE AS OF CHANGE: 20090223 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LINCOLN ELECTRIC HOLDINGS INC CENTRAL INDEX KEY: 0000059527 STANDARD INDUSTRIAL CLASSIFICATION: METALWORKING MACHINERY & EQUIPMENT [3540] IRS NUMBER: 340359955 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-01402 FILM NUMBER: 09626634 BUSINESS ADDRESS: STREET 1: 22801 ST CLAIR AVE CITY: CLEVELAND STATE: OH ZIP: 44117 BUSINESS PHONE: 2164818100 FORMER COMPANY: FORMER CONFORMED NAME: LINCOLN ELECTRIC CO DATE OF NAME CHANGE: 19920703 8-K 1 l35560ae8vk.htm 8-K 8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 23, 2009

LINCOLN ELECTRIC HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

0-1402
(Commission File Number)


Ohio		34-1860551
(State or other jurisdiction of incorporation)		(I.R.S. Employer Identification No.)

22801 St Clair Avenue
Cleveland, Ohio 44117
(Address of principal executive offices, with zip code)

(216) 481-8100
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Item 2.02		Results of Operations and Financial Condition.

		On February 23, 2009, Lincoln Electric Holdings, Inc. (the “Company”) issued a press release reporting its financial results for the year ended December 31, 2008. A copy of the Company’s press release issued on February 23, 2009 is attached hereto as Exhibit 99.1 and incorporated herein by reference. The press release is also available through the Company’s website at www.lincolnelectric.com. The information in this Current Report on Form 8-K, including the Exhibit, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act.

Item 9.01		Financial Statements and Exhibits.

		(d) Exhibits

		99.1 The Company’s press release dated February 23, 2009.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


	LINCOLN ELECTRIC HOLDINGS, INC.
	/s/ Vincent K. Petrella
	Vincent K. Petrella
	Senior Vice President, Chief Financial Officer and Treasurer (principal financial and accounting officer) February 23, 2009

LINCOLN ELECTRIC HOLDINGS, INC.

INDEX TO EXHIBITS


Exhibit No.		Exhibit

99.1		The Company’s press release dated February 23, 2009.

EX-99.1 2 l35560aexv99w1.htm EX-99.1 EX-99.1

Exhibit 99.1

Media Contact: Roy L. Morrow (216) 383-4893
Roy_Morrow@lincolnelectric.com

Investors Contact: Joseph P. Kelley (216) 383-8346
Joe_Kelley@lincolnelectric.com

Lincoln Electric Reports
2008 Full Year and Fourth Quarter Financial Results

Three Months Ended December 31, 2008

	•		Sales decreased 9.3% to $526.2 million

	•		Rationalization and asset impairment charges totaling $19.4 million were recorded in the quarter

	•		Net income decreased 60.7% to $19.5 million; excluding rationalization and asset impairment charges, net income decreased 22.9% to $37.8 million or $0.88 per diluted share

Twelve Months Ended December 31, 2008

	•		Sales increased 8.7% to $2.5 billion

	•		Operating income increased 6.4% to $295.4 million

	•		Net income increased 4.7% to $212.3 million; excluding rationalization and asset impairment charges, net income increased 13.8% to $230.6 million or $5.36 per diluted share

	•		Net cash provided by operating activities was $257.4 million

CLEVELAND, Ohio, U.S.A., February 23, 2009 — Lincoln Electric Holdings, Inc. (the “Company”) (NASDAQ: LECO) today reported 2008 sales increased 8.7% to $2.5 billion from $2.3 billion in 2007. Operating income for 2008 increased 6.4% to $295.4 million from $277.6 million in 2007 or increased 13.5% excluding rationalization and asset impairment charges. Sales for the Company’s North American operations were $1.45 billion in 2008 versus $1.40 billion in 2007, an increase of 3.6%. U.S. export sales in 2008 increased 24.6% to $242.3 million from $194.5 million in 2007.

Sales at Lincoln subsidiaries outside North America increased 16.9% to $1.03 billion in 2008, compared with $879.4 million in 2007. Excluding acquisitions and the effect of changes in foreign currency exchange rates, sales outside North America increased 5.4% in 2008 compared with 2007.

-more-

Lincoln Electric Reports 2008 Full Year and Fourth Quarter Financial Results

Net income for 2008 increased 4.7% to $212.3 million, or $4.93 per diluted share, from $202.7 million, or $4.67 per diluted share, in 2007. Included in net income was a $19.4 million charge ($18.3 million after-tax), or $0.43 per diluted share, associated with rationalization and non-cash asset impairment charges. The rationalization charges totaled $2.4 million ($1.7 million after-tax) related to fourth quarter actions to align the business to current market conditions. Asset impairment charges included $13.2 million of goodwill and $2.4 million of long-lived assets related to Chinese businesses and intangible assets totaling $1.3 million ($1.0 million after-tax) related to North American and European businesses.

“Financial results for 2008 were the best in Lincoln’s history,” said John M. Stropki, Chairman and Chief Executive Officer. “Sales of nearly $2.5 billion and net income of $4.93 per diluted share were both records. Results in the fourth quarter, however, started to reflect the significant challenges in this very difficult economic environment.

“During the fourth quarter, our sales around the world suffered from the weakened global economy, and we expect the lower sales volumes experienced in the quarter to continue. The impact of liquidating high cost inventory combined with declining volumes will continue to pressure margins into 2009.”

Sales for the fourth quarter decreased 9.3% to $526.2 million from $580.3 million in the comparable 2007 period. Sales for the Company’s North American operations were $309.0 million in the quarter versus $345.1 million in the comparable quarter last year, a decrease of 10.5%. U.S. export sales in the quarter increased 16.4% to $53.8 million from $46.3 million in 2007.

Sales at Lincoln subsidiaries outside North America decreased to $217.2 million in the fourth quarter compared with $235.2 million in the year-ago quarter, a decrease of 7.7%. Excluding acquisitions and the effect of changes in foreign currency exchange rates, sales outside North America decreased 3.5% in the quarter.

Net income for the fourth quarter decreased 60.7% to $19.5 million, or $0.46 per diluted share, from $49.5 million in 2007. Excluding rationalization and asset impairment charges, net income decreased 22.9% to $37.8 million or $0.88 per diluted share. The 2008 fourth quarter effective tax rate increased to 40.7% compared with 28.8% in 2007 primarily as a result of asset impairment charges with no tax benefit.

-more-

Lincoln Electric Reports 2008 Full Year and Fourth Quarter Financial Results

“As announced on February 2, 2009, we have taken aggressive measures to align our business with current market conditions. These actions plus additional cost cutting measures will result in a first quarter 2009 pre-tax rationalization charge between $10 million and $12 million and will generate annualized savings of approximately $80 million. We are monitoring these initiatives closely to ensure we achieve the expected financial results. Our strong financial position will allow us to continue making strategic investments to enhance our global presence and develop new products and services for the future,” said Mr. Stropki.

Net cash provided by operating activities was $40.7 million in the fourth quarter and $257.4 million for the full year of 2008. During 2008, the Company paid $42.8 million in dividends and spent $42.3 million on share repurchases. The Company’s Board of Directors declared a quarterly cash dividend of $0.27 per share, which was paid on January 15, 2009 to holders of record as of December 31, 2008.

Lincoln Electric is the world leader in the design, development and manufacture of arc welding products, robotic arc-welding systems, plasma and oxyfuel cutting equipment and has a leading global position in the brazing and soldering alloys market. Headquartered in Cleveland, Ohio, Lincoln has 38 manufacturing locations, including operations and joint ventures in 20 countries and a worldwide network of distributors and sales offices covering more than 160 countries. For more information about Lincoln Electric, its products and services, visit the Company’s website at http://www.lincolnelectric.com.

The Company’s expectations and beliefs concerning the future contained in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements reflect management’s current expectations and involve a number of risks and uncertainties. Actual results may differ materially from such statements due to a variety of factors that could adversely affect the Company’s operating results. The factors include, but are not limited to: general economic and market conditions; the effectiveness of operating initiatives; currency exchange and interest rates; adverse outcome of pending or potential litigation; possible acquisitions; market risks and price fluctuations related to the purchase of commodities and energy; global regulatory complexity; and the possible effects of international terrorism and hostilities on the Company or its customers, suppliers and the economy in general. For additional discussion, see “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K.

A conference call to discuss financial results for the 2008 fourth quarter and full year is scheduled for today, Monday, February 23, 2009, at 10:00 a.m., Eastern Time. An audio webcast of the call is accessible through the investor tab on the Company’s website at http://www.lincolnelectric.com.

#022309#

Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share data)
(Unaudited)

Consolidated Statements of Income


	Three Months Ended December 31,												Fav (Unfav) to Prior Year
	2008			% of Sales			2007			% of Sales			$			%

Net sales	$	526,186			100.0	%	$	580,279			100.0	%	$	(54,093	)		(9.3	%)
Cost of goods sold		385,078			73.2	%		419,338			72.3	%		34,260			8.2	%

Gross profit		141,108			26.8	%		160,941			27.7	%		(19,833	)		(12.3	%)
Selling, general & administrative expenses		86,200			16.4	%		95,145			16.4	%		8,945			9.4	%
Rationalization and asset impairment charges (gain)		19,371			3.7	%		(584	)		(0.1	%)		(19,955	)		N/A

Operating income		35,537			6.8	%		66,380			11.4	%		(30,843	)		(46.5	%)
Interest income		2,229			0.4	%		2,855			0.5	%		(626	)		(21.9	%)
Equity (loss) earnings in affiliates		(2,068	)		(0.4	%)		2,420			0.4	%		(4,488	)		(185.5	%)
Other income		354			0.1	%		960			0.2	%		(606	)		(63.1	%)
Interest expense		(3,216	)		(0.6	%)		(3,051	)		(0.5	%)		(165	)		(5.4	%)

Income before income taxes		32,836			6.2	%		69,564			12.0	%		(36,728	)		(52.8	%)
Income taxes		13,366			2.5	%		20,055			3.5	%		6,689			33.4	%

Effective tax rate		40.7	%					28.8	%					(11.9	%)

Net income	$	19,470			3.7	%	$	49,509			8.5	%	$	(30,039	)		(60.7	%)

Reconciliation of Net Income as Reported to Adjusted Net Income:


	Three Months Ended December 31,					Change
	2008		2007			$			%
Net income as reported ⁽¹⁾	$	19,470	$	49,509		$	(30,039	)		(60.7	%)
Adjustments:
Rationalization and asset impairment charges (gain) after-tax		18,313		(503	)		18,816			N/A

Adjusted net income ⁽²⁾	$	37,783	$	49,006		$	(11,223	)		(22.9	%)


Basic earnings per share	$	0.46	$	1.15		$	(0.69	)		(60.0	%)
Adjustments ⁽¹⁾		0.43		(0.01	)		0.44			N/A

Adjusted basic earnings per share ⁽²⁾	$	0.89	$	1.14		$	(0.25	)		(21.9	%)


Diluted earnings per share	$	0.46	$	1.14		$	(0.68	)		(59.6	%)
Adjustments ⁽¹⁾		0.42		(0.01	)		0.43			N/A

Adjusted diluted earnings per share ⁽²⁾	$	0.88	$	1.13		$	(0.25	)		(22.1	%)


Weighted average shares (basic)		42,430		42,969
Weighted average shares (diluted)		42,695		43,447


⁽¹⁾		Net income includes a rationalization charge of $2,447 ($1,698 after-tax) and asset impairment charges of $16,924 ($16,615 after-tax) in the fourth quarter of 2008 and a gain of $584 ($503 after-tax) in the fourth quarter of 2007 related to rationalization actions.

⁽²⁾		Adjusted net income excluding rationalization and asset impairment charges and adjusted basic and diluted earnings per share excluding rationalization and asset impairment charges are non-GAAP financial measures that management believes are important to investors to evaluate and compare the Company’s financial performance from period to period. Management uses this information in assessing and evaluating the Company’s underlying operating performance.

Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share data)
(Unaudited)

Consolidated Statements of Income


	Twelve Months Ended December 31,												Fav (Unfav) to Prior Year
	2008			% of Sales			2007			% of Sales			$			%

Net sales	$	2,479,131			100.0	%	$	2,280,784			100.0	%	$	198,347			8.7	%
Cost of goods sold		1,758,980			71.0	%		1,633,218			71.6	%		(125,762	)		(7.7	%)

Gross profit		720,151			29.0	%		647,566			28.4	%		72,585			11.2	%
Selling, general & administrative expenses		405,376			16.4	%		370,122			16.2	%		(35,254	)		(9.5	%)
Rationalization and asset impairment charges (gain)		19,371			0.8	%		(188	)		(0.0	%)		(19,559	)		N/A

Operating income		295,404			11.9	%		277,632			12.2	%		17,772			6.4	%
Interest income		8,845			0.4	%		8,294			0.4	%		551			6.6	%
Equity earnings in affiliates		6,034			0.2	%		9,838			0.4	%		(3,804	)		(38.7	%)
Other income		1,681			0.1	%		2,823			0.1	%		(1,142	)		(40.5	%)
Interest expense		(12,155	)		(0.5	%)		(11,430	)		(0.5	%)		(725	)		(6.3	%)

Income before income taxes		299,809			12.1	%		287,157			12.6	%		12,652			4.4	%
Income taxes		87,523			3.5	%		84,421			3.7	%		(3,102	)		(3.7	%)

Effective tax rate		29.2	%					29.4	%					0.2	%

Net income	$	212,286			8.6	%	$	202,736			8.9	%	$	9,550			4.7	%

Reconciliation of Net Income as Reported to Adjusted Net Income:


	Twelve Months Ended December 31,					Change
	2008		2007			$		%
Net income as reported ⁽¹⁾	$	212,286	$	202,736		$	9,550		4.7	%
Adjustments:
Rationalization and asset impairment charges (gain) after-tax		18,313		(107	)		18,420		N/A

Adjusted net income ⁽²⁾	$	230,599	$	202,629		$	27,970		13.8	%


Basic earnings per share	$	4.98	$	4.73		$	0.25		5.3	%
Adjustments ⁽¹⁾		0.43		—			0.43		N/A

Adjusted basic earnings per share ⁽²⁾	$	5.41	$	4.73		$	0.68		14.4	%


Diluted earnings per share	$	4.93	$	4.67		$	0.26		5.6	%
Adjustments ⁽¹⁾		0.43		—			0.43		N/A

Adjusted diluted earnings per share⁽²⁾	$	5.36	$	4.67		$	0.69		14.8	%


Weighted average shares (basic)		42,648		42,899
Weighted average shares (diluted)		43,054		43,392


⁽¹⁾		Net income includes a rationalization charge of $2,447 ($1,698 after-tax) and asset impairment charges of $16,924 ($16,615 after-tax) in 2008 and a gain of $188 ($107 after-tax) in 2007 related to rationalization actions.

⁽²⁾		Adjusted net income excluding rationalization and asset impairment charges and adjusted basic and diluted earnings per share excluding rationalization and asset impairment charges are non-GAAP financial measures that management believes are important to investors to evaluate and compare the Company’s financial performance from period to period. Management uses this information in assessing and evaluating the Company’s underlying operating performance.

Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands)
(Unaudited)

Balance Sheet Highlights

Selected Consolidated Balance Sheet Data


	December 31,		December 31,
	2008		2007

Cash and cash equivalents	$	284,332	$	217,382
Total current assets		1,024,726		969,648
Property, plant and equipment, net		427,902		429,944
Total assets		1,718,805		1,645,296

Total current liabilities		356,642		311,921
Short-term debt		50,693		12,486
Long-term debt		91,537		117,329
Total shareholders’ equity		995,312		1,087,220

Net Operating Working Capital


	December 31,			December 31,
	2008			2007

Trade accounts receivable	$	299,171		$	344,058
Inventory		346,932			343,849
Trade accounts payable		124,388			152,301

Net operating working capital	$	521,715		$	535,606


Net operating working capital % to net sales		21.0	%		23.5	%

Invested Capital


	December 31,			December 31,
	2008			2007

Short-term debt	$	50,693		$	12,486
Long-term debt		91,537			117,329

Total debt		142,230			129,815
Total shareholders’ equity		995,312			1,087,220

Invested capital	$	1,137,542		$	1,217,035


Total debt / Invested capital		12.5	%		10.7	%
Return on invested capital ⁽¹⁾		18.8	%		16.8	%


⁽¹⁾		Return on invested capital is defined as rolling 12 months of earnings excluding tax-effected interest divided by invested capital.

Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share data)
(Unaudited)

Consolidated Statements of Cash Flows


	Three Months Ended December 31,
	2008			2007
OPERATING ACTIVITIES:
Net income	$	19,470		$	49,509

Adjustments to reconcile net income to net cash provided by operating activities:
Rationalization and asset impairment charges (gain)		19,371			(584	)
Depreciation and amortization		14,024			13,514
Equity loss (earnings) of affiliates, net		2,595			(1,677	)
Other non-cash items, net		13,037			9,667
Changes in operating assets and liabilities net of effects from acquisitions:
Decrease in accounts receivable		63,084			14,462
Decrease in inventories		52,048			18,170
(Decrease) increase in accounts payable		(55,205	)		9,999
(Decrease) increase in accrued pensions		(8,403	)		1,583
Net change in other current assets and liabilities		(76,455	)		(69,116	)
Net change in other long-term assets and liabilities		(2,860	)		198

NET CASH PROVIDED BY OPERATING ACTIVITIES		40,706			45,725

INVESTING ACTIVITIES:
Capital expenditures		(18,947	)		(15,856	)
Acquisition of businesses, net of cash acquired		(16,015	)		(12,671	)
Proceeds from sale of property, plant and equipment		73			94

NET CASH USED BY INVESTING ACTIVITIES		(34,889	)		(28,433	)

FINANCING ACTIVITIES:
Net change in borrowings		(221	)		123
Proceeds from exercise of stock options		81			1,055
Tax benefit from exercise of stock options		312			(712	)
Purchase of shares for treasury		(19,216	)		(15,459	)
Cash dividends paid to shareholders		(10,685	)		(9,473	)

NET CASH USED BY FINANCING ACTIVITIES		(29,729	)		(24,466	)

Effect of exchange rate changes on cash and cash equivalents		(4,346	)		1,336

DECREASE IN CASH AND CASH EQUIVALENTS		(28,258	)		(5,838	)
Cash and cash equivalents at beginning of period		312,590			223,220

Cash and cash equivalents at end of period	$	284,332		$	217,382


Cash dividends paid per share	$	0.25		$	0.22

Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands, except per share data)
(Unaudited)

Consolidated Statements of Cash Flows


	Twelve Months Ended December 31,
	2008			2007
OPERATING ACTIVITIES:
Net income	$	212,286		$	202,736

Adjustments to reconcile net income to net cash provided by operating activities:
Rationalization and asset impairment charges (gain)		19,371			(188	)
Depreciation and amortization		56,925			52,610
Equity earnings of affiliates, net		(3,235	)		(7,208	)
Other non-cash items, net		17,611			(609	)
Changes in operating assets and liabilities net of effects from acquisitions:
Decrease (increase) in accounts receivable		30,130			(20,723	)
(Increase) decrease in inventories		(27,845	)		36,011
Decrease in accounts payable		(26,768	)		(3,333	)
Decrease in accrued pensions		(25,975	)		(9,794	)
Net change in other current assets and liabilities		9,590			556
Net change in other long-term assets and liabilities		(4,641	)		(226	)

NET CASH PROVIDED BY OPERATING ACTIVITIES		257,449			249,832

INVESTING ACTIVITIES:
Capital expenditures		(72,426	)		(61,633	)
Acquisition of businesses, net of cash acquired		(44,036	)		(18,773	)
Proceeds from sale of property, plant and equipment		662			701

NET CASH USED BY INVESTING ACTIVITIES		(115,800	)		(79,705	)

FINANCING ACTIVITIES:
Net change in borrowings		6,423			(37,316	)
Proceeds from exercise of stock options		7,201			8,644
Tax benefit from exercise of stock options		3,728			4,289
Purchase of shares for treasury		(42,337	)		(15,459	)
Cash dividends paid to shareholders		(42,756	)		(37,744	)

NET CASH USED BY FINANCING ACTIVITIES		(67,741	)		(77,586	)

Effect of exchange rate changes on cash and cash equivalents		(6,958	)		4,629

INCREASE IN CASH AND CASH EQUIVALENTS		66,950			97,170
Cash and cash equivalents at beginning of period		217,382			120,212

Cash and cash equivalents at end of period	$	284,332		$	217,382


Cash dividends paid per share	$	1.00		$	0.88

Lincoln Electric Holdings, Inc.
Financial Highlights
(In thousands)
(Unaudited)

Segment Highlights


	North						Other
	America			Europe			Countries			Eliminations			Consolidated
Three months ended December 31, 2008
Net sales to unaffiliated customers	$	309,011		$	116,829		$	100,346		$	—		$	526,186
Inter-segment sales		28,726			4,029			3,468			(36,223	)		—

Total	$	337,737		$	120,858		$	103,814		$	(36,223	)	$	526,186

Income before interest and income taxes	$	45,318		$	(2,973	)	$	(8,185	)	$	(337	)	$	33,823
As a percent of total sales		13.4	%		(2.5	%)		(7.9	%)					6.4	%

Adjustments:
Rationalization and asset impairment charges	$	1,319		$	2,470		$	15,582		$	—		$	19,371

Adjusted income before interest and income taxes excluding rationalization and asset impairment charges ⁽¹⁾	$	46,637		$	(503	)	$	7,397		$	(337	)	$	53,194
As a percent of total sales		13.8	%		(0.4	%)		7.1	%					10.1	%

Three months ended December 31, 2007
Net sales to unaffiliated customers	$	345,104		$	134,579		$	100,596		$	—		$	580,279
Inter-segment sales		25,483			7,470			1,272			(34,225	)		—

Total	$	370,587		$	142,049		$	101,868		$	(34,225	)	$	580,279

Income before interest and income taxes	$	54,809		$	14,169		$	1,458		$	(676	)	$	69,760
As a percent of total sales		14.8	%		10.0	%		1.4	%					12.0	%


	North						Other
	America			Europe			Countries			Eliminations			Consolidated
Twelve months ended December 31, 2008
Net sales to unaffiliated customers	$	1,451,333		$	576,945		$	450,853		$	—		$	2,479,131
Inter-segment sales		114,686			25,612			10,590			(150,888	)		—

Total	$	1,566,019		$	602,557		$	461,443		$	(150,888	)	$	2,479,131

Income before interest and income taxes	$	224,706		$	55,407		$	22,591		$	415		$	303,119
As a percent of total sales		14.3	%		9.2	%		4.9	%					12.2	%

Adjustments:
Rationalization and asset impairment charges	$	1,319		$	2,470		$	15,582		$	—		$	19,371

Adjusted income before interest and income taxes excluding rationalization and asset impairment charges ⁽¹⁾	$	226,025		$	57,877		$	38,173		$	415		$	322,490
As a percent of total sales		14.4	%		9.6	%		8.3	%					13.0	%

Twelve months ended December 31, 2007
Net sales to unaffiliated customers	$	1,401,393		$	510,514		$	368,877		$	—		$	2,280,784
Inter-segment sales		99,227			24,156			11,645			(135,028	)		—

Total	$	1,500,620		$	534,670		$	380,522		$	(135,028	)	$	2,280,784

Income before interest and income taxes	$	211,092		$	63,170		$	18,578		$	(2,547	)	$	290,293
As a percent of total sales		14.1	%		11.8	%		4.9	%					12.7	%


⁽¹⁾		Adjusted income before interest and income taxes excluding rationalization and asset impairment charges is a non-GAAP financial measure that management believes is important to investors to evaluate and compare the Company’s financial performance from period to period. Management uses this information in assessing and evaluating the Company’s underlying operating performance.