Exhibit
99.1
Press release
Linde Reports Third-Quarter 2020 Results
Financial Highlights
➢ Operating
profit margin 14.1%; adjusted operating profit margin 22.1%, up 230
basis points versus prior year
➢ EPS
of $1.32; adjusted EPS of $2.15, up 11%
➢ Strong
free cash flow of $1.1 billion, up 20%
➢ Increased
full-year 2020 adjusted EPS guidance to $8.05 -
$8.10, represents
12% growth year-over-year, ex-FX*
Guildford,
UK, November 5, 2020 – Linde plc (NYSE: LIN; FWB: LIN) today
reported third-quarter 2020 income from continuing operations of
$699 million and diluted
earnings per share of $1.32. Excluding Linde AG purchase accounting
impacts and other charges, adjusted income from continuing
operations was $1,140 million, up 8% versus prior year and 13%
sequentially. Adjusted earnings per share was $2.15, 11% above
prior year and 13% higher sequentially.
Linde’s
sales for the third quarter were $6,855 million, 2% below prior
year and up 7% sequentially. Compared to prior year, excluding the
impacts of foreign currency, cost pass-through and divestitures,
underlying sales decreased 1%, as 2% price attainment was more than
offset by 3% lower volumes. Sequentially, industrial gas volumes
increased 6% but were partially offset by a 3% decrease in
Engineering sales. Higher pricing of 1% was driven by increases
across all geographic segments.
Third-quarter
operating profit was $969 million. Adjusted operating profit of
$1,515 million was up 9% versus prior year led by prudent price and
cost management underpinned by the stable fixed payment revenue
structure. Adjusted operating margin of 22.1%, expanded 230 basis
points versus prior year and 140 basis points
sequentially.
Third-quarter
operating cash flow of $1,884 million increased 1% versus prior
year and 7% sequentially. After
capital expenditures of $787 million, free cash flow was $1,097
million, up 20% versus prior year. In the quarter, the company
returned $692 million to shareholders through dividends and stock
repurchases, net of issuance.
Commenting
on the financial results and business outlook, Chief Executive
Officer Steve Angel said, “Linde employees once again
delivered a strong quarter with operating profit margins expanding
230 basis points and EPS growing 11%, reaching a record of
$2.15. This high level of profitability combined with
disciplined capital management resulted in further expansion of our
ROC to approximately 13%.”
Angel
continued, “Looking ahead, there is significant uncertainty
in the environment, but regardless of the underlying economy, I
have confidence in our business model and high-performance culture
to continue growing earnings and cash flow for years to
come.”
For the
full year, the company expects adjusted diluted earnings per share
to be in the range of $8.05 to $8.10, up 10% versus prior year, or
12% when excluding currency headwinds. Full-year capital
expenditures are expected to range between $3.0 billion to $3.2
billion to support operating and growth requirements including the
$3.7 billion contractual sale of gas project backlog.
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Press release
Third-Quarter 2020 Results by Segment
Americas
sales of $2,641 million were 5% below prior-year quarter, but
increased 9% sequentially. Compared with third quarter 2019,
underlying sales were flat as 2% higher pricing was offset by a 2%
volume decline. Sequentially, pricing increased 1% and volumes grew
8%, led by higher demand across all end markets. Operating profit
of $742 million was 28.1% of sales, up 390 basis points versus
prior year and 240 basis points sequentially.
APAC
(Asia Pacific) sales of $1,484 million were 2% above prior year and
up 15% sequentially. Compared to prior year, underlying sales were
flat as 1% price attainment was offset by 1% volume decline.
Sequentially, price increased 1% and volumes grew 10% led by higher
demand, primarily in China and India. Operating profit of $337
million was 22.7% of sales, up 160 basis points versus prior year
and steady sequentially.
EMEA
(Europe, Middle East & Africa) sales of $1,622 million were
down 1% versus prior year, but grew 12% sequentially. Compared with
third quarter 2019, underlying sales were down 1% as 3% higher
pricing was more than offset by a 4% decline in volume.
Sequentially, underlying sales grew 7% due to 2% higher pricing and
5% volume growth primarily in the manufacturing, food and beverage
end markets. Operating profit of $370 million was 22.8% of sales,
up 230 basis points versus prior year and 190 basis points
sequentially.
Linde
Engineering sales were $678 million, 6% higher than prior year, and
operating profit was $106 million or 15.6% of sales. Order intake
for the quarter was $484 million and third-party sale of equipment
backlog remained steady at $4.9 billion.
Earnings
Call
A
teleconference on Linde’s third-quarter 2020 results is being
held today at 10:00 am EST.
|
Live conference call
|
US
Toll-Free Dial-In Number: 1 855 758 5442
Germany
Toll-Free Dial-In Number: 0800 181 5287
UK
Toll-Free Dial-In Number: 0800 028 8438
Access
code: 1760986
|
|
Live webcast (listen-only)
|
https://investors.linde.com/events-presentations
Short
URL: https://t1p.de/i2ho
|
Materials
to be used in the teleconference are also available on the
website.
About
Linde
Linde
is a leading global industrial gases and engineering company with
2019 sales of $28 billion (€25 billion). We live our mission
of making our world more
productive every day by providing high-quality solutions,
technologies and services which are making our customers more
successful and helping to sustain and protect our
planet.
The
company serves a variety of end markets including chemicals &
refining, food & beverage, electronics, healthcare,
manufacturing and primary metals. Linde’s industrial gases
are used in countless applications, from life-saving oxygen for
hospitals to high-purity & specialty gases for electronics
manufacturing, hydrogen for clean fuels and much more. Linde also
delivers state-of-the-art gas processing solutions to support
customer expansion, efficiency improvements and emissions
reductions.
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2/11
Press release
For
more information about the company and its products and services,
please visit www.linde.com
Adjusted
amounts, free cash flow and return on capital are non-GAAP
measures. See the attachments for a summary of non-GAAP
reconciliations and calculations for adjusted amounts.
Attachments:
Summary Non-GAAP Reconciliations, Statements of Income, Balance
Sheets, Statements of Cash Flows, Segment Information and Appendix:
Non-GAAP Measures and Reconciliations.
*Note:
We are providing adjusted earnings per share (“EPS”)
guidance for 2020. This is a non-GAAP financial measure that
represents diluted earnings per share from continuing operations (a
GAAP measure) but excludes the impact of certain items that we
believe are not representative of our underlying business
performance, such as cost reduction and other charges, the impact
of potential divestitures or other potentially significant
items. Given the uncertainty of timing and magnitude of
such items, we cannot provide a reconciliation of the differences
between the non-GAAP adjusted EPS guidance and the corresponding
GAAP EPS measure without unreasonable effort.
Forward-looking
Statements
This
document contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements are identified by terms and
phrases such as: anticipate, believe, intend, estimate, expect,
continue, should, could, may, plan, project, predict, will,
potential, forecast, and similar expressions. They are based on
management’s reasonable expectations and assumptions as of
the date the statements are made but involve risks and
uncertainties. These risks and uncertainties include, without
limitation: the performance of stock markets generally;
developments in worldwide and national economies and other
international events and circumstances, including trade conflicts
and tariffs; changes in foreign currencies and in interest rates;
the cost and availability of electric power, natural gas and other
raw materials; the ability to achieve price increases to offset
cost increases; catastrophic events including natural disasters,
epidemics, pandemics such as
COVID-19 and acts of war and terrorism; the ability to attract,
hire, and retain qualified personnel; the impact of changes in
financial accounting standards; the impact of changes in pension
plan liabilities; the impact of tax, environmental, healthcare and
other legislation and government regulation in jurisdictions in
which the company operates; the cost and outcomes of
investigations, litigation and regulatory proceedings; the impact
of potential unusual or non-recurring items; continued timely
development and market acceptance of new products and applications;
the impact of competitive products and pricing; future financial
and operating performance of major customers and industries served;
the impact of information technology system failures, network
disruptions and breaches in data security; and the effectiveness
and speed of integrating new acquisitions into the business. These
risks and uncertainties may cause actual future results or
circumstances to differ materially from accounting principles
generally accepted in the United States of America, International
Financial Reporting Standards or adjusted projections, estimates or
other forward-looking statements.
Linde
plc assumes no obligation to update or provide revisions to any
forward-looking statement in response to changing circumstances.
The above listed risks and uncertainties are further described in
Item 1A. Risk Factors in Linde plc’s Form 10-K for the fiscal
year ended December 31, 2019 filed with the SEC on March 2,
2020 and in Item 1A. of Linde plc's Form 10-Q for the period ending
March 31, 2020 filed with the SEC on May 7, 2020, which should be
reviewed carefully. Please consider Linde plc’s
forward-looking statements in light of those risks.
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Press release
SUMMARY NON-GAAP RECONCILIATIONS
(UNAUDITED)
The following adjusted amounts are Non-GAAP measures and are
intended to supplement investors' understanding of the company's
financial statements by providing measures which investors,
financial analysts and management use to help evaluate the
company's operating performance. Items which the company does not
believe to be indicative of ongoing business trends are excluded
from these calculations so that investors can better evaluate and
analyze historical and future business trends on a consistent
basis. Definitions of these Non-GAAP measures may not be comparable
to similar definitions used by other companies and are not a
substitute for similar GAAP measures. See the "NON-GAAP MEASURES AND
RECONCILIATIONS" starting on
page 10 for additional details relating to the
adjustments.
(Millions of dollars, except per share amounts)
|
|
Sales
|
Operating Profit
|
Income from Continuing Operations
|
Diluted EPS from Continuing Operations
|
||||
|
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
|
Quarter Ended September 30
|
|
|
|
|
|
|
|
|
|
Reported GAAP
Amounts
|
$6,855
|
$7,000
|
$969
|
$1,000
|
$699
|
$728
|
$1.32
|
$1.34
|
|
Cost reduction
program and other charges (a)
|
-
|
-
|
48
|
125
|
36
|
92
|
0.07
|
0.17
|
|
Pension
settlement charges (b)
|
-
|
-
|
-
|
-
|
5
|
30
|
0.01
|
0.07
|
|
Merger-related
divestitures (c)
|
-
|
(7)
|
-
|
(2)
|
-
|
(2)
|
-
|
(0.01)
|
|
Purchase
accounting impacts - Linde AG (d)
|
-
|
-
|
498
|
425
|
400
|
312
|
0.75
|
0.58
|
|
Gain on sale
of businesses (e)
|
-
|
-
|
-
|
(164)
|
-
|
(108)
|
-
|
(0.21)
|
|
Total
adjustments
|
-
|
(7)
|
546
|
384
|
441
|
324
|
0.83
|
0.60
|
|
Adjusted
amounts
|
$6,855
|
$6,993
|
$1,515
|
$1,384
|
$1,140
|
$1,052
|
$2.15
|
$1.94
|
|
|
Sales
|
Operating Profit
|
Income from Continuing Operations
|
Diluted EPS from Continuing Operations
|
||||
|
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
|
Year to Date September 30
|
|
|
|
|
|
|
|
|
|
Reported GAAP
Amounts
|
$19,971
|
$21,148
|
$2,293
|
$2,278
|
$1,728
|
$1,676
|
$3.25
|
$3.07
|
|
Cost reduction
program and other charges (a)
|
-
|
-
|
428
|
355
|
318
|
290
|
0.60
|
0.54
|
|
Pension
settlement charges (b)
|
-
|
-
|
-
|
-
|
5
|
76
|
0.01
|
0.15
|
|
Merger-related
divestitures (c)
|
-
|
(62)
|
-
|
(15)
|
-
|
(11)
|
-
|
(0.03)
|
|
Purchase
accounting impacts - Linde AG (d)
|
-
|
-
|
1,463
|
1,471
|
1,103
|
1,056
|
2.07
|
1.94
|
|
Gain on sale
of businesses (e)
|
-
|
-
|
-
|
(164)
|
-
|
(108)
|
-
|
(0.21)
|
|
Total
adjustments
|
-
|
(62)
|
1,891
|
1,647
|
1,426
|
1,303
|
2.68
|
2.39
|
|
Adjusted
amounts
|
$19,971
|
$21,086
|
$4,184
|
$3,925
|
$3,154
|
$2,979
|
$5.93
|
$5.46
|
(a)
To adjust for cost reduction program and other charges; 2020
includes severance of $31 million and $281 million for the quarter
and year-to-date periods, other cost reduction charges of $8
million and $49 million for the quarter and year-to-date periods,
and other charges of $9 million and $98 million for the quarter and
year-to-date periods.
(b)
To adjust for pension settlement charges. 2019 charges primarily
related to the merger.
(c)
To adjust for the results of Praxair's merger-related
divestitures.
(d)
To adjust for purchase accounting impacts related to the
merger.
(e)
To adjust for gains recognized related to the sale of businesses
related to the merger.
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4/11
Press release
LINDE PLC AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(Millions of dollars, except per share data)
(UNAUDITED)
|
|
Quarter Ended
|
Year To Date
|
||
|
|
September 30,
|
September 30,
|
||
|
|
2020
|
2019
|
2020
|
2019
|
|
|
|
|
|
|
|
SALES
|
$6,855
|
$7,000
|
$19,971
|
$21,148
|
|
Cost of
sales
|
3,835
|
4,061
|
11,297
|
12,457
|
|
Selling,
general and administrative
|
770
|
850
|
2,391
|
2,613
|
|
Depreciation
and amortization
|
1,168
|
1,095
|
3,434
|
3,513
|
|
Research and
development
|
36
|
44
|
114
|
135
|
|
Cost reduction
programs and other charges
|
48
|
125
|
428
|
355
|
|
Net gain on
sale of business
|
-
|
164
|
-
|
164
|
|
Other income
(expense) - net
|
(29)
|
11
|
(14)
|
39
|
|
OPERATING PROFIT
|
969
|
1,000
|
2,293
|
2,278
|
|
Interest
expense - net
|
38
|
(3)
|
80
|
30
|
|
Net pension
and OPEB cost (benefit), excluding service cost
|
(41)
|
2
|
(131)
|
(7)
|
|
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND EQUITY
INVESTMENTS
|
972
|
1,001
|
2,344
|
2,255
|
|
Income
taxes
|
265
|
298
|
594
|
607
|
|
INCOME FROM CONTINUING OPERATIONS BEFORE EQUITY
INVESTMENTS
|
707
|
703
|
1,750
|
1,648
|
|
Income from
equity investments
|
23
|
28
|
69
|
90
|
|
INCOME FROM CONTINUING OPERATIONS (INCLUDING NONCONTROLLING
INTERESTS)
|
730
|
731
|
1,819
|
1,738
|
|
Add: income
from discontinued operations, net of tax
|
1
|
7
|
3
|
105
|
|
INCOME (INCLUDING NONCONTROLLING INTERESTS)
|
731
|
738
|
1,822
|
1,843
|
|
Less:
noncontrolling interests from continuing
operations
|
(31)
|
(3)
|
(91)
|
(62)
|
|
Less:
noncontrolling interests from discontinued
operations
|
-
|
-
|
-
|
(7)
|
|
NET INCOME - LINDE PLC
|
$700
|
$735
|
$1,731
|
$1,774
|
|
|
|
|
|
|
|
NET INCOME - LINDE PLC
|
|
|
|
|
|
Income from
continuing operations
|
$699
|
$728
|
$1,728
|
$1,676
|
|
Income from
discontinued operations
|
$1
|
$7
|
$3
|
$98
|
|
|
|
|
|
|
|
PER SHARE DATA - LINDE PLC SHAREHOLDERS
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings
per share from continuing operations
|
$1.33
|
$1.35
|
$3.28
|
$3.09
|
|
Basic earnings
per share from discontinued operations
|
-
|
0.01
|
0.01
|
0.18
|
|
Basic earnings
per share
|
$1.33
|
$1.36
|
$3.29
|
$3.27
|
|
|
|
|
|
|
|
Diluted
earnings per share from continuing operations
|
$1.32
|
$1.34
|
$3.25
|
$3.07
|
|
Diluted
earnings per share from discontinued operations
|
-
|
0.01
|
0.01
|
0.18
|
|
Diluted
earnings per share
|
$1.32
|
$1.35
|
$3.26
|
$3.25
|
|
|
|
|
|
|
|
Cash
dividends
|
$0.963
|
$0.875
|
$2.889
|
$2.625
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE SHARES OUTSTANDING
|
|
|
|
|
|
Basic shares
outstanding (000's)
|
525,694
|
539,753
|
527,501
|
542,589
|
|
Diluted shares
outstanding (000's)
|
530,415
|
543,616
|
531,724
|
546,507
|
Note:
See page 10 for a reconciliation to adjusted amounts which are
Non-GAAP.
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Page
5/11
Press release
LINDE PLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Millions of dollars)
(UNAUDITED)
|
|
September 30,
|
December 31,
|
|
|
2020
|
2019
|
|
ASSETS
|
|
|
|
Cash and cash
equivalents
|
$5,199
|
$2,700
|
|
Accounts
receivable - net
|
4,033
|
4,322
|
|
Contract
assets
|
170
|
368
|
|
Inventories
|
1,733
|
1,697
|
|
Assets held
for sale
|
3
|
125
|
|
Prepaid and
other current assets
|
1,127
|
1,140
|
|
TOTAL CURRENT ASSETS
|
12,265
|
10,352
|
|
Property,
plant and equipment - net
|
27,945
|
29,064
|
|
Goodwill
|
27,239
|
27,019
|
|
Other
intangibles - net
|
15,731
|
16,137
|
|
Other
long-term assets
|
4,029
|
4,040
|
|
TOTAL ASSETS
|
$87,209
|
$86,612
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
Accounts
payable
|
$2,903
|
$3,266
|
|
Short-term
debt
|
4,024
|
1,732
|
|
Current
portion of long-term debt
|
1,820
|
1,531
|
|
Contract
liabilities
|
1,714
|
1,758
|
|
Liabilities of
assets held for sale
|
1
|
2
|
|
Other current
liabilities
|
4,330
|
3,871
|
|
TOTAL CURRENT LIABILITIES
|
14,792
|
12,160
|
|
Long-term
debt
|
11,959
|
10,693
|
|
Other
long-term liabilities
|
11,866
|
12,124
|
|
TOTAL LIABILITIES
|
38,617
|
34,977
|
|
|
|
|
|
REDEEMABLE NONCONTROLLING INTERESTS
|
13
|
113
|
|
|
|
|
|
LINDE PLC SHAREHOLDERS' EQUITY:
|
|
|
|
Common
stock
|
1
|
1
|
|
Additional
paid-in capital
|
40,203
|
40,201
|
|
Retained
earnings
|
16,927
|
16,842
|
|
Accumulated
other comprehensive income (loss)
|
(5,973)
|
(4,814)
|
|
Less: Treasury
stock, at cost
|
(4,983)
|
(3,156)
|
|
Total Linde
plc shareholders' equity
|
46,175
|
49,074
|
|
Noncontrolling
interests
|
2,404
|
2,448
|
|
TOTAL EQUITY
|
48,579
|
51,522
|
|
TOTAL LIABILITIES AND EQUITY
|
$87,209
|
$86,612
|
|
|
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Page
6/11
Press release
LINDE PLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Millions of dollars)
(UNAUDITED)
|
|
Quarter Ended
|
Year to Date
|
||
|
|
September 30,
|
September 30,
|
||
|
|
2020
|
2019
|
2020
|
2019
|
|
OPERATIONS
|
|
|
|
|
|
Net income -
Linde plc
|
$700
|
$735
|
$1,731
|
$1,774
|
|
Less: income
from discontinued operations, net of tax and noncontrolling
interests
|
(1)
|
(7)
|
(3)
|
(98)
|
|
Add:
noncontrolling interests
|
31
|
3
|
91
|
62
|
|
Net income
(including noncontrolling interests)
|
730
|
731
|
1,819
|
1,738
|
|
|
|
|
|
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
Cost reduction
programs and other charges, net of payments (a)
|
1
|
(70)
|
240
|
(356)
|
|
Depreciation
and amortization
|
1,168
|
1,095
|
3,434
|
3,513
|
|
Accounts
receivable
|
42
|
158
|
(76)
|
(30)
|
|
Contract
assets and liabilities, net
|
18
|
68
|
89
|
(35)
|
|
Inventory
|
(19)
|
12
|
(101)
|
(61)
|
|
Payables and
accruals
|
15
|
(164)
|
(12)
|
(411)
|
|
Pension
contributions
|
(35)
|
(26)
|
(76)
|
(69)
|
|
Deferred
income taxes and other
|
(36)
|
68
|
(322)
|
(344)
|
|
Net cash
provided by operating activities
|
1,884
|
1,872
|
4,995
|
3,945
|
|
|
|
|
|
|
|
INVESTING
|
|
|
|
|
|
Capital
expenditures
|
(787)
|
(959)
|
(2,373)
|
(2,667)
|
|
Acquisitions,
net of cash acquired
|
-
|
(21)
|
(41)
|
(161)
|
|
Divestitures
and asset sales
|
55
|
271
|
435
|
4,960
|
|
Net cash
provided by (used for) investing activities
|
(732)
|
(709)
|
(1,979)
|
2,132
|
|
|
|
|
|
|
|
FINANCING
|
|
|
|
|
|
Debt increase
(decrease) - net
|
(188)
|
(467)
|
3,335
|
(1,744)
|
|
Issuances of
ordinary shares
|
16
|
5
|
41
|
60
|
|
Purchases of
ordinary shares
|
(202)
|
(684)
|
(2,030)
|
(1,934)
|
|
Cash dividends
- Linde plc shareholders
|
(506)
|
(471)
|
(1,523)
|
(1,422)
|
|
Noncontrolling
interest transactions and other (b)
|
(53)
|
(35)
|
(201)
|
(3,257)
|
|
Net cash
provided by (used for) financing activities
|
(933)
|
(1,652)
|
(378)
|
(8,297)
|
|
|
|
|
|
|
|
DISCONTINUED OPERATIONS
|
|
|
|
|
|
Cash provided
by operating activities
|
-
|
(3)
|
-
|
67
|
|
Cash provided
by investing activities
|
-
|
-
|
-
|
(59)
|
|
Cash provided
by financing activities
|
-
|
-
|
-
|
5
|
|
Net
cash provided by (used for) discontinued
operations
|
-
|
(3)
|
-
|
13
|
|
|
|
|
|
|
|
Effect of
exchange rate changes on cash and cash
equivalents
|
39
|
(77)
|
(139)
|
(126)
|
|
|
|
|
|
|
|
Change in cash
and cash equivalents
|
258
|
(569)
|
2,499
|
(2,333)
|
|
Cash and cash
equivalents, beginning-of-period
|
4,941
|
2,686
|
2,700
|
4,466
|
|
Cash and cash
equivalents, including discontinued operations
|
5,199
|
2,117
|
5,199
|
2,133
|
|
Cash and cash
equivalents of discontinued operations
|
-
|
3
|
-
|
(13)
|
|
Cash and cash
equivalents, end-of-period
|
$5,199
|
$2,120
|
$5,199
|
$2,120
|
(a) Cost reduction programs and other charges cash outflows were
$47 million and $195 million for the quarters ended September 30,
2020 and 2019, respectively, and $188 million and $711 million for
the nine months ended September 30, 2020 and 2019,
respectively.
(b) Noncontrolling interest transactions and other for the 2019
year to date period includes approximately $3.2 billion related to
the cash merger squeeze-out of the 8% Linde AG shares which were
not tendered in the exchange offer.
|
|
|
|
Page
7/11
Press release
LINDE PLC AND SUBSIDIARIES
SEGMENT INFORMATION
(Millions of dollars)
(UNAUDITED)
|
|
Quarter Ended September 30,
|
Year to Date September 30,
|
||
|
|
2020
|
2019
|
2020
|
2019
|
|
SALES
|
|
|
|
|
|
Americas
|
$2,641
|
$2,771
|
$7,735
|
$8,252
|
|
EMEA
|
1,622
|
1,634
|
4,703
|
4,989
|
|
APAC
|
1,484
|
1,461
|
4,115
|
4,376
|
|
Engineering
|
678
|
641
|
2,096
|
2,029
|
|
Other
|
430
|
486
|
1,322
|
1,440
|
|
Segment
sales
|
$6,855
|
$6,993
|
$19,971
|
$21,086
|
|
Merger-related
divestitures (a)
|
-
|
7
|
-
|
62
|
|
Total
sales
|
$6,855
|
$7,000
|
$19,971
|
$21,148
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING PROFIT
|
|
|
|
|
|
Americas
|
$742
|
$671
|
$2,025
|
$1,901
|
|
EMEA
|
370
|
335
|
1,028
|
1,014
|
|
APAC
|
337
|
308
|
912
|
885
|
|
Engineering
|
106
|
120
|
335
|
297
|
|
Other
|
(40)
|
(50)
|
(116)
|
(172)
|
|
Segment
operating profit
|
$1,515
|
$1,384
|
$4,184
|
$3,925
|
|
Cost reduction
programs and other charges
|
(48)
|
(125)
|
(428)
|
(355)
|
|
Merger-related
divestitures (a)
|
-
|
2
|
-
|
15
|
|
Net gain on
sale of business (b)
|
-
|
164
|
-
|
164
|
|
Purchase
accounting impacts - Linde AG
|
(498)
|
(425)
|
(1,463)
|
(1,471)
|
|
Total
operating profit
|
$969
|
$1,000
|
$2,293
|
$2,278
|
(a)
To adjust for the results of Praxair's merger-related
divestitures.
(b)
To adjust for gains recognized related to the sale of businesses
related to the merger.
|
|
|
|
Page
8/11
Press release
LINDE PLC AND SUBSIDIARIES
APPENDIX
NON-GAAP MEASURES AND RECONCILIATIONS
(Millions of dollars, except per share data)
(UNAUDITED)
The following Non-GAAP measures are intended to supplement
investors’ understanding of the company’s financial
information by providing measures which investors, financial
analysts and management use to help evaluate the company’s
operating performance and liquidity. Items which the company does
not believe to be indicative of on-going business trends are
excluded from these calculations so that investors can better
evaluate and analyze historical and future business trends on a
consistent basis. Definitions of these Non-GAAP measures may not be
comparable to similar definitions used by other companies and are
not a substitute for similar GAAP measures.
|
|
2020
|
2019
|
|||||||
|
|
Year to Date September 30,
|
Q3
|
Q2
|
Q1
|
Year to Date September 30,
|
Q4
|
Q3
|
Q2
|
Q1
|
|
Adjusted Sales
|
|
|
|
|
|
|
|
|
|
|
Reported
Sales
|
$19,971
|
$6,855
|
$6,377
|
$6,739
|
$21,148
|
$7,080
|
$7,000
|
$7,204
|
$6,944
|
|
Less:
Merger-related divestitures (d)
|
-
|
-
|
-
|
-
|
(62)
|
(3)
|
(7)
|
(25)
|
(30)
|
|
Adjusted
Sales
|
$19,971
|
$6,855
|
$6,377
|
$6,739
|
$21,086
|
$7,077
|
$6,993
|
$7,179
|
$6,914
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Operating Profit and Operating
Margin
|
|
|
|
|
|
|
|
|
|
|
Reported
operating profit
|
$2,293
|
$969
|
$591
|
$733
|
$2,278
|
$655
|
$1,000
|
$669
|
$609
|
|
Less:
Merger-related divestitures (d)
|
-
|
-
|
-
|
-
|
(15)
|
(1)
|
(2)
|
(6)
|
(7)
|
|
Add: Cost
reduction programs and other charges
|
428
|
48
|
249
|
131
|
355
|
212
|
125
|
141
|
89
|
|
Less: Net gain
on sale of businesses
|
-
|
-
|
-
|
-
|
(164)
|
-
|
(164)
|
-
|
-
|
|
Add: Purchase
accounting impacts - Linde AG (c)
|
1,463
|
498
|
477
|
488
|
1,471
|
481
|
425
|
515
|
531
|
|
Total
adjustments
|
1,891
|
546
|
726
|
619
|
1,647
|
692
|
384
|
650
|
613
|
|
Adjusted
operating profit
|
$4,184
|
$1,515
|
$1,317
|
$1,352
|
$3,925
|
$1,347
|
$1,384
|
$1,319
|
$1,222
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported
percentage change
|
1%
|
(3)%
|
(12)%
|
20%
|
|
|
|
|
|
|
Adjusted
percentage change
|
7%
|
9%
|
-%
|
11%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported
sales
|
$19,971
|
$6,855
|
$6,377
|
$6,739
|
$21,148
|
$7,080
|
$7,000
|
$7,204
|
$6,944
|
|
Adjusted
sales
|
$19,971
|
$6,855
|
$6,377
|
$6,739
|
$21,086
|
$7,077
|
$6,993
|
$7,179
|
$6,914
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported
operating margin
|
11.5%
|
14.1%
|
9.3%
|
10.9%
|
10.8%
|
9.3%
|
14.3%
|
9.3%
|
8.8%
|
|
Adjusted
operating margin
|
21.0%
|
22.1%
|
20.7%
|
20.1%
|
18.6%
|
19.0%
|
19.8%
|
18.4%
|
17.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Depreciation and amortization
|
|
|
|
|
|
|
|
|
|
|
Reported
depreciation and amortization
|
$3,434
|
$1,168
|
$1,124
|
$1,142
|
$3,513
|
$1,162
|
$1,095
|
$1,195
|
$1,223
|
|
Less: Purchase
accounting impacts - Linde AG (c)
|
(1,431)
|
(487)
|
(468)
|
(476)
|
(1,459)
|
(481)
|
(423)
|
(515)
|
(521)
|
|
Adjusted
depreciation and amortization
|
$2,003
|
$681
|
$656
|
$666
|
$2,054
|
$681
|
$672
|
$680
|
$702
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Other Income (Expense) - net
|
|
|
|
|
|
|
|
|
|
|
Reported Other
Income (Expense) - net
|
$(14)
|
$(29)
|
$-
|
$15
|
$39
|
$29
|
$11
|
$10
|
$18
|
|
Add: Purchase
accounting impacts - Linde AG (c)
|
(32)
|
(11)
|
(9)
|
(12)
|
-
|
-
|
-
|
-
|
-
|
|
Adjusted Other
Income (Expense) - net
|
$18
|
$(18)
|
$9
|
$27
|
$39
|
$29
|
$11
|
$10
|
$18
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Pension and OPEB Cost (Benefit), Excluding Service
Cost
|
|
|
|
|
|
|
|
|
|
|
Reported net
pension and OPEB cost (benefit), excluding service
cost
|
$(131)
|
$(41)
|
$(45)
|
$(45)
|
$(7)
|
$(25)
|
$2
|
$(24)
|
$15
|
|
Add: Pension
settlement charges
|
(6)
|
(6)
|
-
|
-
|
(101)
|
(6)
|
(40)
|
(10)
|
(51)
|
|
Adjusted Net
Pension and OPEB cost (benefit), excluding service
costs
|
$(137)
|
$(47)
|
$(45)
|
$(45)
|
$(108)
|
$(31)
|
$(38)
|
$(34)
|
$(36)
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Interest Expense - Net
|
|
|
|
|
|
|
|
|
|
|
Reported
interest expense - net
|
$80
|
$38
|
$18
|
$24
|
$30
|
$8
|
$(3)
|
$10
|
$23
|
|
Add: Purchase
accounting impacts - Linde AG (c)
|
67
|
23
|
22
|
22
|
74
|
22
|
22
|
25
|
27
|
|
Adjusted
interest expense - net
|
$147
|
$61
|
$40
|
$46
|
$104
|
$30
|
$19
|
$35
|
$50
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Income Taxes (a)
|
|
|
|
|
|
|
|
|
|
|
Reported
income taxes
|
$594
|
$265
|
$164
|
$165
|
$607
|
$162
|
$298
|
$169
|
$140
|
|
Add: Purchase
accounting impacts - Linde AG (c)
|
292
|
75
|
95
|
122
|
345
|
105
|
99
|
119
|
127
|
|
Add: Pension
settlement charges
|
1
|
1
|
-
|
-
|
25
|
1
|
10
|
2
|
13
|
|
Add: Cost
reduction programs and other charges
|
110
|
12
|
62
|
36
|
30
|
53
|
(2)
|
26
|
6
|
|
Less:
Merger-related divestitures (d)
|
-
|
-
|
-
|
-
|
(5)
|
-
|
(1)
|
(2)
|
(2)
|
|
Less: Net gain
on sale of businesses
|
-
|
-
|
-
|
-
|
(56)
|
-
|
(56)
|
-
|
-
|
|
Total
adjustments
|
403
|
88
|
157
|
158
|
339
|
159
|
50
|
145
|
144
|
|
Adjusted
income taxes
|
$997
|
$353
|
$321
|
$323
|
$946
|
$321
|
$348
|
$314
|
$284
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Effective Tax Rate (a)
|
|
|
|
|
|
|
|
|
|
|
Reported
income before income taxes and equity
investments
|
$2,344
|
$972
|
$618
|
$754
|
$2,255
|
$672
|
$1,001
|
$683
|
$571
|
|
Less:
Merger-related divestitures (d)
|
-
|
-
|
-
|
-
|
(15)
|
(1)
|
(2)
|
(6)
|
(7)
|
|
Add: Pension
settlement charge
|
6
|
6
|
-
|
-
|
101
|
6
|
40
|
10
|
51
|
|
Add: Purchase
accounting impacts - Linde AG (c)
|
1,396
|
475
|
455
|
466
|
1,397
|
459
|
403
|
490
|
504
|
|
Add: Cost
reduction programs and other charges
|
428
|
48
|
249
|
131
|
355
|
212
|
125
|
141
|
89
|
|
Less: Net gain
on sale of businesses
|
-
|
-
|
-
|
-
|
(164)
|
-
|
(164)
|
-
|
-
|
|
Total
adjustments
|
1,830
|
529
|
704
|
597
|
1,674
|
676
|
402
|
635
|
637
|
|
Adjusted
income before income taxes and equity
investments
|
$4,174
|
$1,501
|
$1,322
|
$1,351
|
$3,929
|
$1,348
|
$1,403
|
$1,318
|
$1,208
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported
Income taxes
|
$594
|
$265
|
$164
|
$165
|
$607
|
$162
|
$298
|
$169
|
$140
|
|
Reported
effective tax rate
|
25.3%
|
27.3%
|
26.5%
|
21.9%
|
26.9%
|
24.1%
|
29.8%
|
24.7%
|
24.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
income taxes
|
$997
|
$353
|
$321
|
$323
|
$946
|
$321
|
$348
|
$314
|
$284
|
|
Adjusted
effective tax rate
|
23.9%
|
23.5%
|
24.3%
|
23.9%
|
24.1%
|
23.8%
|
24.8%
|
23.8%
|
23.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from Equity Investments
|
|
|
|
|
|
|
|
|
|
|
Reported
income from equity investments
|
$69
|
$23
|
$29
|
$17
|
$90
|
$24
|
$28
|
$28
|
$34
|
|
Add: Purchase
accounting impacts - Linde AG (c)
|
42
|
14
|
14
|
14
|
43
|
14
|
15
|
14
|
14
|
|
Adjusted
income from equity investments
|
$111
|
$37
|
$43
|
$31
|
$133
|
$38
|
$43
|
$42
|
$48
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Noncontrolling Interests from Continuing
Operations
|
|
|
|
|
|
|
|
|
|
|
Reported
noncontrolling interests from continuing
operations
|
$(91)
|
$(31)
|
$(25)
|
$(35)
|
$(62)
|
$(27)
|
$(3)
|
$(29)
|
$(30)
|
|
Add: Cost
reduction programs and other charges
|
-
|
-
|
-
|
-
|
(35)
|
-
|
(35)
|
-
|
-
|
|
Add: Purchase
accounting impacts - Linde AG (c)
|
(43)
|
(14)
|
(14)
|
(15)
|
(40)
|
(14)
|
(8)
|
(17)
|
(15)
|
|
Total
adjustments
|
(43)
|
(14)
|
(14)
|
(15)
|
(75)
|
(14)
|
(43)
|
(17)
|
(15)
|
|
Adjusted
noncontrolling interests from continuing
operations
|
$(134)
|
$(45)
|
$(39)
|
$(50)
|
$(137)
|
$(41)
|
$(46)
|
$(46)
|
$(45)
|
|
|
|
|
Page
9/11
Press release
|
LINDE PLC AND SUBSIDIARIES
|
|||||||||||||
|
APPENDIX
|
|||||||||||||
|
NON-GAAP MEASURES AND RECONCILIATIONS
|
|||||||||||||
|
(Millions of dollars, except per share data)
|
|||||||||||||
|
(UNAUDITED)
|
|
Adjusted Income from Continuing Operations (b)
|
|
|
|
|
|
|
|
|
|
|
Reported
income from continuing operations
|
$1,728
|
$699
|
$458
|
$571
|
$1,676
|
$507
|
$728
|
$513
|
$435
|
|
Add: Pension
settlement charge
|
5
|
5
|
-
|
-
|
76
|
5
|
30
|
8
|
38
|
|
Less:
Merger-related divestitures (d)
|
-
|
-
|
-
|
-
|
(11)
|
(1)
|
(2)
|
(4)
|
(5)
|
|
Add: Cost
reduction programs and other charges
|
318
|
36
|
187
|
95
|
290
|
159
|
92
|
115
|
83
|
|
Less: Net gain
on sale of business
|
-
|
-
|
-
|
-
|
(108)
|
-
|
(108)
|
-
|
-
|
|
Add: Purchase
accounting impacts - Linde AG (c)
|
1,103
|
400
|
360
|
343
|
1,056
|
354
|
312
|
368
|
376
|
|
Total
adjustments
|
1,426
|
441
|
547
|
438
|
1,303
|
517
|
324
|
487
|
492
|
|
Adjusted
income from continuing operations
|
$3,154
|
$1,140
|
$1,005
|
$1,009
|
$2,979
|
$1,024
|
$1,052
|
$1,000
|
$927
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Diluted EPS from Continuing Operations
(b)
|
|
|
|
|
|
|
|
|
|
|
Reported
diluted EPS from continuing operations
|
$3.25
|
$1.32
|
$0.87
|
$1.07
|
$3.07
|
$0.94
|
$1.34
|
$0.94
|
$0.79
|
|
Add: Pension
settlement charge
|
0.01
|
0.01
|
-
|
-
|
0.15
|
0.01
|
0.07
|
0.01
|
0.07
|
|
Add: Cost
reduction programs and other charges
|
0.60
|
0.07
|
0.35
|
0.18
|
0.54
|
0.29
|
0.17
|
0.22
|
0.15
|
|
Less:
Merger-related divestitures (d)
|
-
|
-
|
-
|
-
|
(0.03)
|
-
|
(0.01)
|
(0.01)
|
(0.01)
|
|
Less: Net gain
on sale of business
|
-
|
-
|
-
|
-
|
(0.21)
|
-
|
(0.21)
|
-
|
-
|
|
Add: Purchase
accounting impacts - Linde AG
|
2.07
|
0.75
|
0.68
|
0.64
|
1.94
|
0.65
|
0.58
|
0.67
|
0.69
|
|
Total
adjustments
|
2.68
|
0.83
|
1.03
|
0.82
|
2.39
|
0.95
|
0.60
|
0.89
|
0.90
|
|
Adjusted
diluted EPS from continuing operations
|
$5.93
|
$2.15
|
$1.90
|
$1.89
|
$5.46
|
$1.89
|
$1.94
|
$1.83
|
$1.69
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported
percentage change
|
6%
|
(1)%
|
(7)%
|
35%
|
|
$7.34
|
Full Year 2019
Adjusted diluted EPS
|
||
|
Adjusted
percentage change
|
9%
|
11%
|
4%
|
12%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Diluted EPS from Continuing Operations Guidance
(e)
|
Fourth Quarter 2020
|
Full Year 2020
|
||
|
|
Low End
|
High End
|
Low End
|
High End
|
|
2020 Adjusted
Guidance
|
$2.11
|
$2.16
|
$8.05
|
$8.10
|
|
Adjusted
percentage change versus 2019 adjusted diluted
EPS
|
12%
|
14%
|
10%
|
10%
|
|
Add: Estimated
currency headwind
|
1%
|
1%
|
2%
|
2%
|
|
Adjusted
percentage change excluding currency
|
13%
|
15%
|
12%
|
12%
|
|
Adjusted EBITDA and % of Sales
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations
|
$1,728
|
$699
|
$458
|
$571
|
$1,676
|
$507
|
$728
|
$513
|
$435
|
|
Add:
Noncontrolling interests related to continuing
operations
|
91
|
31
|
25
|
35
|
62
|
27
|
3
|
29
|
30
|
|
Add: Net
pension and OPEB cost (benefit), excluding service
cost
|
(131)
|
(41)
|
(45)
|
(45)
|
(7)
|
(25)
|
2
|
(24)
|
15
|
|
Add: Interest
expense
|
80
|
38
|
18
|
24
|
30
|
8
|
(3)
|
10
|
23
|
|
Add: Income
taxes
|
594
|
265
|
164
|
165
|
607
|
162
|
298
|
169
|
140
|
|
Add:
Depreciation and amortization
|
3,434
|
1,168
|
1,124
|
1,142
|
3,513
|
1,162
|
1,095
|
1,195
|
1,223
|
|
EBITDA from
continuing operations
|
5,796
|
2,160
|
1,744
|
1,892
|
5,881
|
1,841
|
2,123
|
1,892
|
1,866
|
|
Less:
Merger-related divestitures (d)
|
-
|
-
|
-
|
-
|
(15)
|
(1)
|
(2)
|
(6)
|
(7)
|
|
Less: Net gain
on sale of business
|
-
|
-
|
-
|
-
|
(164)
|
-
|
(164)
|
-
|
-
|
|
Add: Cost
reduction programs and other charges
|
428
|
48
|
249
|
131
|
355
|
212
|
125
|
141
|
89
|
|
Add: Purchase
accounting impacts - Linde AG
|
74
|
25
|
23
|
26
|
55
|
14
|
17
|
14
|
24
|
|
Total
adjustments
|
502
|
73
|
272
|
157
|
231
|
225
|
(24)
|
149
|
106
|
|
Adjusted
EBITDA from continuing operations
|
$6,298
|
$2,233
|
$2,016
|
$2,049
|
$6,112
|
$2,066
|
$2,099
|
$2,041
|
$1,972
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported
sales
|
$19,971
|
$6,855
|
$6,377
|
$6,739
|
$21,148
|
$7,080
|
$7,000
|
$7,204
|
$6,944
|
|
Adjusted
sales
|
$19,971
|
$6,855
|
$6,377
|
$6,739
|
$21,086
|
$7,077
|
$6,993
|
$7,179
|
$6,914
|
|
% of
sales
|
|
|
|
|
|
|
|
|
|
|
EBITDA from
continuing operations
|
29.0%
|
31.5%
|
27.3%
|
28.1%
|
27.8%
|
26.0%
|
30.3%
|
26.3%
|
26.9%
|
|
Adjusted
EBITDA from continuing operations
|
31.5%
|
32.6%
|
31.6%
|
30.4%
|
29.0%
|
29.2%
|
30.0%
|
28.4%
|
28.5%
|
(a) The income tax expense (benefit) on the non-GAAP pre-tax
adjustments was determined using the applicable tax rates for the
jurisdictions that were utilized in calculating the GAAP income tax
expense (benefit) and included both current and deferred income tax
amounts.
(b) Net of income taxes which are shown separately in
“Adjusted Income Taxes and Effective Tax
Rate”.
(c) The company believes that its non-GAAP measures excluding
Purchase accounting impacts - Linde AG are useful to investors
because: (i) the business combination was a merger of equals in an
all-stock merger transaction, with no cash consideration, (ii) the
company is managed on a geographic basis and the results of certain
geographies are more heavily impacted by purchase accounting than
others, causing results that are not comparable at the reportable
segment level, therefore, the impacts of purchasing accounting
adjustments to each segment vary and are not comparable within the
company and when compared to other companies in similar regions,
(iii) business management is evaluated and variable compensation is
determined based on results excluding purchase accounting impacts,
and; (iv) it is important to investors and analysts to understand
the purchase accounting impacts to the financial
statements.
A summary of each of the adjustments made for Purchase accounting
impacts - Linde AG are as follows:
Adjusted Operating Profit and Margin: The purchase accounting adjustments for the
periods presented relate primarily to depreciation and amortization
related to the fair value step up of fixed assets and intangible
assets (primarily customer related) acquired in the merger and the
allocation of fair value step-up for ongoing Linde AG asset
disposals (reflected in Other
Income/(Expense)).
Adjusted Interest Expense - Net: Relates to the amortization of the fair value of
debt acquired in the merger.
Adjusted Income Taxes and Effective Tax Rate: Relates to the current and deferred income tax
impact on the adjustments discussed above. The income tax expense
(benefit) on the non-GAAP pre-tax adjustments was determined using
the applicable tax rates for the jurisdictions that were utilized
in calculating the GAAP income tax expense (benefit) and included
both current and deferred income tax amounts.
Adjusted Income from Equity Investments: Represents the amortization of increased fair
value on equity investments related to depreciable and amortizable
assets.
Adjusted Noncontrolling Interests from Continuing
Operations: Represents the
noncontrolling interests’ ownership portion of the
adjustments described above determined on an entity by entity
basis.
(d) To adjust for the results of Praxair's merger-related
divestitures.
(e) We are providing adjusted earnings per share ("EPS") guidance
for 2020. This is a non-GAAP financial measure that represents
diluted earnings per share from continuing operations (a GAAP
measure) but excludes the impact of certain items that we believe
are not representative of our underlying business performance, such
as cost reduction and other charges, the impact of potential
divestitures or other potentially significant items. Given the
uncertainty of timing and magnitude of such items, we cannot
provide a reconciliation of the differences between the non-GAAP
adjusted EPS guidance and the corresponding GAAP EPS measure
without unreasonable effort.
|
|
|
|
Page
10/11
Press release
LINDE PLC AND SUBSIDIARIES
APPENDIX
NON-GAAP MEASURES AND RECONCILIATIONS
(Millions of dollars)
(UNAUDITED)
|
|
2020
|
2019
|
2018
|
|||||
|
|
Q3
|
Q2
|
Q1
|
Q4
|
Q3
|
Q2
|
Q1
|
Q4
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow (FCF)
- Free cash flow is a mesure used by
investors, financial analysts and management to evaluate the
ability of a company to pursue opportunitites that enhance
shareholder value. FCF equals cash flow from operations less
capital expenditures.
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
Operating Cash
Flow
|
$1,884
|
$1,764
|
$1,347
|
$2,174
|
$1,872
|
$1,005
|
$1,068
|
$1,305
|
|
Less: Capital
Expenditures
|
(787)
|
(783)
|
(803)
|
(1,015)
|
(959)
|
(865)
|
(843)
|
(827)
|
|
Free
Cash Flow
|
$1,097
|
$981
|
$544
|
$1,159
|
$913
|
$140
|
$225
|
$478
|
|
|
|
|
|
|
|
|
|
|
|
Net
Debt - Net debt
is a financial liquidity metric used by investors, financial
analysts and management to evaluate the ability of a company to
repay its debt and is calculated as total debt (excluding purchase
accounting impacts) less liquid assets.
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
Debt
|
$17,803
|
$17,480
|
$16,875
|
$13,956
|
$13,201
|
$13,957
|
$14,146
|
$15,296
|
|
Less: Cash and cash
equivalents
|
(5,199)
|
(4,941)
|
(4,014)
|
(2,700)
|
(2,120)
|
(2,686)
|
(5,791)
|
(4,466)
|
|
Net
debt
|
12,604
|
12,539
|
12,861
|
11,256
|
11,081
|
11,271
|
8,355
|
10,830
|
|
Less: Purchase
accounting impacts - Linde AG
|
(133)
|
(150)
|
(170)
|
(195)
|
(211)
|
(243)
|
(262)
|
(291)
|
|
Adjusted net
debt
|
$12,471
|
$12,389
|
$12,691
|
$11,061
|
$10,870
|
$11,028
|
$8,093
|
$10,539
|
|
Less: Net assets held
for sale
|
(2)
|
(2)
|
(115)
|
(123)
|
(223)
|
(272)
|
(1,629)
|
(4,730)
|
|
Adjusted net debt less
net assets held for sale
|
$12,469
|
$12,387
|
$12,576
|
$10,938
|
$10,647
|
$10,756
|
$6,464
|
$5,809
|
|
|
|
|
|
|
|
|
|
|
|
After-tax
Return on Capital and Adjusted After-tax Return on Capital
(ROC)
-
After-tax return on capital is a measure used by investors,
financial analysts and management to evaluate the return on net
assets employed in the business. ROC measures the after-tax
operating profit that the company was able to generate with the
investments made by all parties in the business (debt,
noncontrolling interests and Linde plc shareholders’
equity).
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
Reported income from
continuing operations
|
$699
|
$458
|
$571
|
$507
|
$728
|
$513
|
$435
|
$2,870
|
|
Add: noncontrolling
interests from continuing operations
|
31
|
25
|
35
|
27
|
3
|
29
|
30
|
(33)
|
|
Add: interest expense -
net
|
38
|
18
|
24
|
8
|
(3)
|
10
|
23
|
72
|
|
Less: tax benefit on
interest expense - net *
|
(10)
|
(5)
|
(6)
|
(2)
|
1
|
(3)
|
(6)
|
(18)
|
|
Reported
NOPAT
|
$758
|
$496
|
$624
|
$540
|
$729
|
$549
|
$482
|
$2,891
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted income from
continuing operations
|
$1,140
|
$1,005
|
$1,009
|
$1,024
|
$1,052
|
$1,000
|
927
|
$841
|
|
Add: adjusted
noncontrolling interests from continuing
operations
|
45
|
39
|
50
|
41
|
46
|
46
|
45
|
40
|
|
Add: adjusted interest
expense - net
|
61
|
40
|
46
|
30
|
19
|
35
|
50
|
50
|
|
Less: tax benefit on
interest expense - net *
|
(15)
|
(10)
|
(12)
|
(7)
|
(5)
|
(9)
|
(13)
|
(12)
|
|
Adjusted
NOPAT
|
$1,231
|
$1,074
|
$1,093
|
$1,088
|
$1,112
|
$1,072
|
$1,009
|
$919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4-quarter trailing
reported NOPAT
|
$2,418
|
$2,389
|
$2,442
|
$2,300
|
|
|
|
|
|
4-quarter trailing
adjusted NOPAT
|
$4,486
|
$4,367
|
$4,365
|
$4,281
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity and redeemable
noncontrolling interests:
|
|
|
|
|
|
|
|
|
|
Redeemable
noncontrolling interests
|
$13
|
$13
|
$92
|
$113
|
$14
|
$15
|
15
|
$16
|
|
Linde plc shareholders'
equity
|
46,175
|
45,537
|
44,776
|
49,074
|
48,953
|
50,564
|
51,175
|
51,596
|
|
Noncontrolling
interests
|
2,404
|
2,387
|
2,375
|
2,448
|
2,341
|
2,315
|
5,457
|
5,484
|
|
Total equity and
redeemable noncontrolling interests
|
$48,592
|
$47,937
|
$47,243
|
$51,635
|
$51,308
|
$52,894
|
$56,647
|
$57,096
|
|
|
|
|
|
|
|
|
|
|
|
Reported
capital
|
$61,194
|
$60,474
|
$59,989
|
$62,768
|
$62,166
|
$63,893
|
63,373
|
$63,196
|
|
|
|
|
|
|
|
|
|
|
|
Total equity and
redeemable noncontrolling interests
|
$48,592
|
$47,937
|
$47,243
|
$51,635
|
$51,308
|
$52,894
|
56,647
|
$57,096
|
|
Add: Adjusted net debt
less net assets held for sale
|
12,469
|
12,387
|
12,576
|
10,938
|
10,647
|
10,756
|
6,464
|
5,809
|
|
Less: Linde AG Goodwill
(a)
|
24,256
|
24,256
|
24,256
|
24,256
|
24,197
|
24,197
|
24,197
|
24,197
|
|
Less: Linde AG
Indefinite lived intangibles (a)
|
1,868
|
1,868
|
1,868
|
1,868
|
1,868
|
1,868
|
1,868
|
1,868
|
|
Adjusted
capital
|
$34,937
|
$34,200
|
$33,695
|
$36,449
|
$35,890
|
$37,585
|
$37,046
|
$36,840
|
|
|
|
|
|
|
|
|
|
|
|
(a) Represent balance sheet purchase accounting impacts of
non-amortizing assets related to the Linde AG merger.
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
Ending capital (see
above)
|
$61,194
|
$60,474
|
$59,989
|
$62,768
|
|
|
|
|
|
5-quarter average
ending capital
|
$61,318
|
$61,858
|
$62,438
|
$63,079
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending adjusted capital
(see above)
|
$34,937
|
$34,200
|
$33,695
|
$36,449
|
|
|
|
|
|
5-quarter average
ending adjusted capital
|
$35,034
|
$35,564
|
$36,133
|
$36,762
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
After-tax
ROC (4 quarter reported NOPAT / 5-quarter average ending
capital)
|
3.9%
|
3.9%
|
3.9%
|
3.6%
|
|
|
|
|
|
Adjusted
after-tax ROC (4 quarter trailing adjusted NOPAT / 5-quarter
average ending adjusted capital)
|
12.8%
|
12.3%
|
12.1%
|
11.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
Tax benefit
on interest expense - net is generally presented using the reported
effective rate.
|
||||||||
|
|
|
|
Page
11/11