株探米国株
日本語 英語
エドガーで原本を確認する

 

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): October 27, 2022

 

Linde plc

(Exact name of registrant as specified in its charter)

 

Ireland

 

001-38730

 

98-1448883

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

 

 10 Riverview Dr.

Danbury, Connecticut

United States 06810

 

Forge

43 Church Street West

Woking, Surrey GU21 6HT

United Kingdom

 

(Address of principal executive offices) (Zip Code)

 

+44 1483 242200

(Registrant’s telephone numbers, 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:

 

 

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

 

 

 

 

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

 

 

 

 

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

 

 

 

 

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

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading symbol(s)

 

Name of each exchange on which registered

Ordinary shares (€0.001 nominal value per share)

 

LIN

 

New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 






 

ITEM 2.02 Results of Operations and Financial Condition

 

On October 27, 2022, Linde plc issued a press release setting forth Linde plc’s results of operations for the quarter ended September 30, 2022. A copy of Linde plc’s press release is furnished herewith as Exhibit 99.1 and is hereby incorporated by reference in this Item 2.02.

 

ITEM 9.01. Financial Statements and Exhibits.

 

(d) Exhibits. The following exhibit is furnished herewith pursuant to Item 2.02 hereof:

 

Exhibit No.

 

Description

 

 

 

99.1

 

Press Release dated October 27, 2022

 

 

 

104

 

Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 
2

 

  

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.

 

 

LINDE PLC

       
By: /s/ Kelcey E. Hoyt

 

Name:

Kelcey E. Hoyt  
  Title: Principal Accounting Officer  
Date: October 27, 2022      

 

 
3

 

EX-99.1 2 lin_ex991.htm PRESS RELEASE lin_ex991.htm

EXHIBIT 99.1

 

 

Linde Reports Third-Quarter 2022 Results

Third-Quarter Highlights

 

Sales $8.8 billion, up 15% versus prior-year quarter

 

Operating profit $1.6 billion; adjusted operating profit $2.0 billion, up 11%

 

Operating profit margin 18.3%; adjusted operating profit margin 22.8%, up 90 basis points ex. cost pass-through

 

EPS $2.54; adjusted EPS $3.10, up 14%

 

Operating cash flow of $2.6 billion, up 3% versus prior-year quarter and 24% sequentially

 

Increased full-year 2022 adjusted EPS guidance to $11.93 - $12.03, represents 12% to 13% growth year-over-year, 17% to 18% ex FX
 

Woking, UK, October 27, 2022 – Linde plc (NYSE: LIN; FWB: LIN) today reported third-quarter 2022 income from continuing operations of $1,273 million and diluted earnings per share of $2.54, up 30% and 35% respectively. Excluding Linde AG purchase accounting impacts and other charges, adjusted income from continuing operations was $1,555 million, up 9% versus prior year. Adjusted earnings per share was $3.10, 14% above prior year.

 

Linde’s sales for the third quarter were $8,797 million, 15% above prior year. Compared to prior year, underlying sales increased 11%, including 8% price attainment and 3% higher volumes, with growth in all end markets except healthcare. Sequentially, underlying sales increased 3% with growth across all end markets driven by 2% higher price and 1% volume.

 

Third-quarter operating profit was $1,613 million. Adjusted operating profit of $2,010 million was up 11% versus prior year led by higher price, volumes and continued productivity initiatives across all segments. Excluding the effects of cost pass-through, adjusted operating margins expanded 90 basis points versus prior year.

 

Third-quarter operating cash flow of $2,636 million more than covered capital expenditures of $762 million resulting in free cash flow of $1,874 million. During the quarter, the company returned $1,728 million to shareholders through dividends and stock repurchases, net of issuances.

 

Commenting on the financial results and business outlook, Chief Executive Officer Sanjiv Lamba said, “Linde employees delivered another strong quarter of financial results with EPS increasing 14% despite 7% currency headwinds. Furthermore, operating margins expanded 90 basis points when excluding cost pass-through - all underpinned by strong operating cash flow of $2.6 billion and record ROC of 21.8%. These results demonstrate, once again, Linde’s resiliency and growth capabilities in any environment.

 

Lamba continued, “Irrespective of the macro-economic uncertainty, I have confidence in our business model and high-performance culture to continue creating shareholder value for years to come.”

 

For the fourth quarter of 2022, Linde expects adjusted diluted earnings per share in the range of $2.80 to $2.90, up 1% to 5% versus prior-year quarter. This guidance includes an assumed currency headwind of 8% year-over-year and 2% sequentially.

 

For the full year 2022, the company expects adjusted diluted earnings per share to be in the range of $11.93 to $12.03, up 12% to 13% versus prior year or 17% to 18% excluding currency headwind. Full-year capital expenditures are expected to be in the range of $3.0 billion to $3.4 billion to support growth and maintenance requirements including the $3.7 billion contractual sale of gas project backlog.

 

 
Page 1/10

 

 

 

 

Third-Quarter 2022 Results by Segment

 

Americas sales of $3,694 million grew 20% versus prior-year quarter and 5% sequentially. Compared with third quarter 2021, underlying sales increased 13% driven by 6% higher pricing and 7% higher volume, with double-digit growth in all end markets except healthcare. Sequentially, underlying sales grew 4%, from 1% higher pricing and 3% volume. Operating profit of $974 million was 26.4% of sales, 140 basis points below prior year or 50 basis points higher when excluding the effects of cost pass-through.

 

APAC (Asia Pacific) sales of $1,660 million were 6% above prior year and up 1% sequentially. Compared to prior year, underlying sales grew 12% driven by 7% price attainment and 5% volume growth, with growth across all end markets except healthcare. Sequentially, underlying sales grew 6% with pricing up 2% and volume growing 4%. Operating profit of $429 million was 25.8% of sales, 140 basis points above prior year or 180 basis points higher when excluding the effects of cost pass-through.

 

EMEA (Europe, Middle East & Africa) sales of $2,125 million were up 11% versus prior year and down 1% sequentially. Compared with third-quarter 2021, underlying sales grew 11%, driven by 14% higher pricing and 3% lower volumes. Sales grew across all end markets except healthcare. Sequentially, underlying sales grew 1% driven by 4% higher pricing and 3% lower volumes. Operating profit of $465 million was 21.9% of sales, 300 basis points below prior year or 60 basis points higher when excluding the effects of cost pass-through.

 

Linde Engineering sales were $828 million, up 38% versus prior year, and operating profit was $150 million or 18.1% of sales. Order intake for the quarter was $1,001 million and third-party sale of plant backlog increased to $3.1 billion.

 

Earnings Call

A teleconference on Linde’s third-quarter 2022 results is being held today at 09:00 am EDT.

 

Live conference call

US Toll-Free Dial-In Number: 1 888 204 4368

Germany Toll-Free Dial-In Number: 0800 589 4609

UK Toll-Free Dial-In Number: 0800 358 6377

Access code: 3278896

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 2021 sales of $31 billion (€26 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 & energy, food & beverage, electronics, healthcare, manufacturing, metals and mining.  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.

 

For more information about the company and its products and services, please visit www.linde.com

 

 
Page 2/10

 

 

 

 

 

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 2022.  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 future results or circumstances to differ materially from 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, 2021 filed with the SEC on February 28, 2022 which should be reviewed carefully. Please consider Linde plc’s forward-looking statements in light of those risks.

 

 
Page 3/10

 

 

Page 4 of 10

 

LINDE PLC AND SUBSIDIARIES

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 9 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

 

Quarter Ended September 30

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Reported GAAP Amounts

 

$ 8,797

 

 

$ 7,668

 

 

$ 1,613

 

 

$ 1,292

 

 

$ 1,273

 

 

$ 978

 

 

$ 2.54

 

 

$ 1.88

 

Other charges (a)

 

 

 

 

 

 

 

 

15

 

 

 

26

 

 

 

(11 )

 

 

58

 

 

 

(0.02 )

 

 

0.11

 

Pension settlement charges (b)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5

 

 

 

3

 

 

 

0.01

 

 

 

0.01

 

Purchase accounting impacts - Linde AG (c)

 

 

 

 

 

 

 

 

382

 

 

 

492

 

 

 

288

 

 

 

382

 

 

 

0.57

 

 

 

0.73

 

Total adjustments

 

 

 

 

 

 

 

 

397

 

 

 

518

 

 

 

282

 

 

 

443

 

 

 

0.56

 

 

 

0.85

 

Adjusted amounts

 

$ 8,797

 

 

$ 7,668

 

 

$ 2,010

 

 

$ 1,810

 

 

$ 1,555

 

 

$ 1,421

 

 

$ 3.10

 

 

$ 2.73

 

 

(Millions of dollars, except per share amounts)

 

Sales

 

 

Operating Profit

 

 

Income from

Continuing

Operations

 

 

Diluted EPS from

Continuing

Operations

 

Year to Date September 30

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Reported GAAP Amounts

 

$ 25,465

 

 

$ 22,495

 

 

$ 3,682

 

 

$ 3,647

 

 

$ 2,819

 

 

$ 2,797

 

 

$ 5.57

 

 

$ 5.34

 

Russia-Ukraine conflict and other charges (a)

 

 

 

 

 

 

 

 

1,004

 

 

 

222

 

 

 

877

 

 

 

228

 

 

 

1.73

 

 

 

0.44

 

Pension settlement charges (b)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5

 

 

 

3

 

 

 

0.01

 

 

 

0.01

 

Purchase accounting impacts - Linde AG (c)

 

 

 

 

 

 

 

 

1,217

 

 

 

1,466

 

 

 

920

 

 

 

1,120

 

 

 

1.82

 

 

 

2.13

 

Total adjustments

 

 

 

 

 

 

 

 

2,221

 

 

 

1,688

 

 

 

1,802

 

 

 

1,351

 

 

 

3.56

 

 

 

2.58

 

Adjusted amounts

 

$ 25,465

 

 

$ 22,495

 

 

$ 5,903

 

 

$ 5,335

 

 

$ 4,621

 

 

$ 4,148

 

 

$ 9.13

 

 

$ 7.92

 

 

(a)

Third quarter 2022 charges include charges associated with the sale of the GIST business. 2022 year to date charges relate primarily to charges associated with the deconsolidation and impairment of Russian subsidiaries resulting from the ongoing war in Ukraine and related sanctions. 2021 charges relate to cost reduction program and other charges, primarily severance.

 

 

(b)

To adjust for pension settlement charges.

 

 

(c)

To adjust for purchase accounting impacts related to the merger.

 




 

Page 5 of 10

 

LINDE PLC AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF INCOME

(UNAUDITED)

 

 

 

Quarter Ended September 30,

 

 

Year To Date September 30,

 

(Millions of dollars, except per share data)

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Sales

 

$ 8,797

 

 

$ 7,668

 

 

$ 25,465

 

 

$ 22,495

 

Cost of sales

 

 

5,285

 

 

 

4,368

 

 

 

15,023

 

 

 

12,616

 

Selling, general and administrative

 

 

770

 

 

 

793

 

 

 

2,343

 

 

 

2,402

 

Depreciation and amortization

 

 

1,045

 

 

 

1,163

 

 

 

3,248

 

 

 

3,500

 

Research and development

 

 

35

 

 

 

36

 

 

 

107

 

 

 

105

 

Russia-Ukraine conflict and other charges

 

 

15

 

 

 

26

 

 

 

1,004

 

 

 

222

 

Other income (expense) - net

 

 

(34 )

 

 

10

 

 

 

(58 )

 

 

(3 )

Operating Profit

 

 

1,613

 

 

 

1,292

 

 

 

3,682

 

 

 

3,647

 

Interest expense - net

 

 

18

 

 

 

8

 

 

 

32

 

 

 

46

 

Net pension and OPEB cost (benefit), excluding service cost

 

 

(53 )

 

 

(45 )

 

 

(179 )

 

 

(143 )

Income From Continuing Operations Before Income Taxes and Equity Investments

 

 

1,648

 

 

 

1,329

 

 

 

3,829

 

 

 

3,744

 

Income taxes

 

 

391

 

 

 

321

 

 

 

1,046

 

 

 

923

 

Income From Continuing Operations  Before Equity Investments

 

 

1,257

 

 

 

1,008

 

 

 

2,783

 

 

 

2,821

 

Income from equity investments

 

 

43

 

 

 

1

 

 

 

137

 

 

 

81

 

Income From Continuing Operations (Including Noncontrolling Interests)

 

 

1,300

 

 

 

1,009

 

 

 

2,920

 

 

 

2,902

 

Add:  income from discontinued operations, net of tax

 

 

 

 

 

1

 

 

 

 

 

 

3

 

Income (Including Noncontrolling Interests)

 

 

1,300

 

 

 

1,010

 

 

 

2,920

 

 

 

2,905

 

Less: noncontrolling interests from continuing operations

 

 

(27 )

 

 

(31 )

 

 

(101 )

 

 

(105 )

Net Income – Linde plc

 

$ 1,273

 

 

$ 979

 

 

$ 2,819

 

 

$ 2,800

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income – Linde plc

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$ 1,273

 

 

$ 978

 

 

$ 2,819

 

 

$ 2,797

 

Income from discontinued operations

 

$

 

 

$ 1

 

 

$

 

 

$ 3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Share Data – Linde plc Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share from continuing operations

 

$ 2.56

 

 

$ 1.90

 

 

$ 5.62

 

 

$ 5.39

 

Basic earnings per share from discontinued operations

 

 

 

 

 

 

 

 

 

 

 

0.01

 

Basic earnings per share

 

$ 2.56

 

 

$ 1.90

 

 

$ 5.62

 

 

$ 5.40

 

Diluted earnings per share from continuing operations

 

$ 2.54

 

 

$ 1.88

 

 

$ 5.57

 

 

$ 5.34

 

Diluted earnings per share from discontinued operations

 

 

 

 

 

 

 

 

 

 

 

0.01

 

Diluted earnings per share

 

$ 2.54

 

 

$ 1.88

 

 

$ 5.57

 

 

$ 5.35

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends

 

$ 1.17

 

 

$ 1.06

 

 

$ 3.51

 

 

$ 3.18

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Shares Outstanding (000’s):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic shares outstanding (000’s)

 

 

497,186

 

 

 

515,169

 

 

 

501,743

 

 

 

518,802

 

Diluted shares outstanding (000’s)

 

 

501,151

 

 

 

520,079

 

 

 

506,012

 

 

 

523,662

 

 

Note:  See page 9 for a reconciliation to adjusted amounts which are Non-GAAP.

 






 

Page 6 of 10 

 

LINDE PLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET

(UNAUDITED)

 

 

 

September 30,

 

 

December 31,

 

(Millions of dollars)

 

2022

 

 

2021

 

Assets

 

 

 

 

 

 

Cash and cash equivalents

 

$ 3,756

 

 

$ 2,823

 

Accounts receivable - net

 

 

4,599

 

 

 

4,499

 

Contract assets

 

 

104

 

 

 

134

 

Inventories

 

 

1,855

 

 

 

1,733

 

Prepaid and other current assets

 

 

889

 

 

 

970

 

Total Current Assets

 

 

11,203

 

 

 

10,159

 

Property, plant and equipment - net

 

 

22,586

 

 

 

26,003

 

Goodwill

 

 

24,565

 

 

 

27,038

 

Other intangibles - net

 

 

11,810

 

 

 

13,802

 

Other long-term assets

 

 

4,159

 

 

 

4,603

 

Total Assets

 

$ 74,323

 

 

$ 81,605

 

Liabilities and equity

 

 

 

 

 

 

 

 

Accounts payable

 

$ 3,067

 

 

$ 3,503

 

Short-term debt

 

 

3,179

 

 

 

1,163

 

Current portion of long-term debt

 

 

1,551

 

 

 

1,709

 

Contract liabilities

 

 

2,902

 

 

 

2,940

 

Other current liabilities

 

 

4,362

 

 

 

4,328

 

Total Current Liabilities

 

 

15,061

 

 

 

13,643

 

Long-term debt

 

 

10,608

 

 

 

11,335

 

Other long-term liabilities

 

 

9,715

 

 

 

11,186

 

Total Liabilities

 

$ 35,384

 

 

$ 36,164

 

Redeemable noncontrolling interests

 

 

13

 

 

 

13

 

Linde plc Shareholders’ Equity

 

 

 

 

 

 

 

 

Ordinary shares

 

 

1

 

 

 

1

 

Additional paid-in capital

 

 

40,011

 

 

 

40,180

 

Retained earnings

 

 

19,845

 

 

 

18,710

 

Accumulated other comprehensive income (loss)

 

 

(8,094 )

 

 

(5,048 )

Less: Treasury shares, at cost

 

 

(14,135 )

 

 

(9,808 )

Total Linde plc shareholders’ equity

 

 

37,628

 

 

 

44,035

 

Noncontrolling interests

 

 

1,298

 

 

 

1,393

 

Total Equity

 

$ 38,926

 

 

$ 45,428

 

Total Liabilities and Equity

 

$ 74,323

 

 

$ 81,605

 

 






 

Page 7 of 10

 

LINDE PLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

 (UNAUDITED)

 

 

 

Quarter Ended September 30,

 

 

Year to Date September 30,

 

(Millions of dollars)

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Operations

 

 

 

 

 

 

 

 

 

 

 

 

Net income - Linde plc

 

$ 1,273

 

 

$ 979

 

 

$ 2,819

 

 

$ 2,800

 

Less: income from discontinued operations, net of tax and noncontrolling interests

 

 

 

 

 

(1 )

 

 

 

 

 

(3 )

Add:  noncontrolling interests

 

 

27

 

 

 

31

 

 

 

101

 

 

 

105

 

Net income (including noncontrolling interests)

 

 

1,300

 

 

 

1,009

 

 

 

2,920

 

 

 

2,902

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Russia-Ukraine conflict and other charges, net of payments (a)

 

 

(13 )

 

 

(12 )

 

 

909

 

 

 

83

 

Depreciation and amortization

 

 

1,045

 

 

 

1,163

 

 

 

3,248

 

 

 

3,500

 

Accounts receivable

 

 

(29 )

 

 

(151 )

 

 

(572 )

 

 

(539 )

Contract assets and liabilities, net

 

 

126

 

 

 

479

 

 

 

369

 

 

 

530

 

Inventory

 

 

(156 )

 

 

(35 )

 

 

(300 )

 

 

(77 )

Payables and accruals

 

 

306

 

 

 

92

 

 

 

376

 

 

 

131

 

Pension contributions

 

 

(25 )

 

 

(4 )

 

 

(44 )

 

 

(32 )

Deferred income taxes and other

 

 

82

 

 

 

15

 

 

 

(137 )

 

 

(6 )

Net cash provided by operating activities

 

 

2,636

 

 

 

2,556

 

 

 

6,769

 

 

 

6,492

 

Investing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 

 

(762 )

 

 

(741 )

 

 

(2,237 )

 

 

(2,247 )

Acquisitions, net of cash acquired

 

 

(61 )

 

 

 

 

 

(110 )

 

 

(31 )

Divestitures, net of cash divested and asset sales

 

 

123

 

 

 

70

 

 

 

140

 

 

 

147

 

Net cash provided by (used for) investing activities

 

 

(700 )

 

 

(671 )

 

 

(2,207 )

 

 

(2,131 )

Financing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt increase (decrease) - net

 

 

35

 

 

 

1,494

 

 

 

2,795

 

 

 

1,808

 

Issuances of ordinary shares

 

 

2

 

 

 

7

 

 

 

24

 

 

 

39

 

Purchases of ordinary shares

 

 

(1,149 )

 

 

(1,169 )

 

 

(4,478 )

 

 

(3,251 )

Cash dividends - Linde plc shareholders

 

 

(581 )

 

 

(546 )

 

 

(1,758 )

 

 

(1,648 )

Noncontrolling interest transactions and other

 

 

(27 )

 

 

(42 )

 

 

(62 )

 

 

(319 )

Net cash provided by (used for) financing activities

 

 

(1,720 )

 

 

(256 )

 

 

(3,479 )

 

 

(3,371 )

Effect of exchange rate changes on cash and cash equivalents

 

 

(115 )

 

 

(66 )

 

 

(150 )

 

 

(44 )

Change in cash and cash equivalents

 

 

101

 

 

 

1,563

 

 

 

933

 

 

 

946

 

Cash and cash equivalents, beginning-of-period

 

 

3,655

 

 

 

3,137

 

 

 

2,823

 

 

 

3,754

 

Cash and cash equivalents, end-of-period

 

$ 3,756

 

 

$ 4,700

 

 

$ 3,756

 

 

$ 4,700

 

 

(a)  Russia-Ukraine conflict and other charges were  $15 million and  $26 million  for the quarters ended September 30, 2022 and 2021, respectively, and $1,004 million  and $222 million for the nine months ended September 30, 2022 and 2021, respectively. Related cash outflows were $28 million and $38 million for the quarters ended September 30, 2022 and 2021, respectively, and $95 million and $139 million for the nine months ended September 30, 2022 and 2021, respectively.

 






 

Page 8 of 10

 

LINDE PLC AND SUBSIDIARIES

SEGMENT INFORMATION

(UNAUDITED)

 

 

 

Quarter Ended September 30,

 

 

Year to Date September 30,

 

(Millions of dollars)

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Sales

 

 

 

 

 

 

 

 

 

 

 

 

Americas

 

$ 3,694

 

 

$ 3,091

 

 

$ 10,453

 

 

$ 8,951

 

EMEA

 

 

2,125

 

 

 

1,911

 

 

 

6,417

 

 

 

5,585

 

APAC

 

 

1,660

 

 

 

1,564

 

 

 

4,913

 

 

 

4,544

 

Engineering

 

 

828

 

 

 

601

 

 

 

2,200

 

 

 

1,921

 

Other

 

 

490

 

 

 

501

 

 

 

1,482

 

 

 

1,494

 

Total segment sales

 

$ 8,797

 

 

$ 7,668

 

 

$ 25,465

 

 

$ 22,495

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Profit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Americas

 

$ 974

 

 

$ 859

 

 

$ 2,788

 

 

$ 2,525

 

EMEA

 

 

465

 

 

 

476

 

 

 

1,504

 

 

 

1,414

 

APAC

 

 

429

 

 

 

382

 

 

 

1,254

 

 

 

1,122

 

Engineering

 

 

150

 

 

 

106

 

 

 

398

 

 

 

323

 

Other

 

 

(8 )

 

 

(13 )

 

 

(41 )

 

 

(49 )

Segment operating profit

 

 

2,010

 

 

 

1,810

 

 

 

5,903

 

 

 

5,335

 

Russia-Ukraine conflict and other charges

 

 

(15 )

 

 

(26 )

 

 

(1,004 )

 

 

(222 )

Purchase accounting impacts - Linde AG

 

 

(382 )

 

 

(492 )

 

 

(1,217 )

 

 

(1,466 )

Total operating profit

 

$ 1,613

 

 

$ 1,292

 

 

$ 3,682

 

 

$ 3,647

 

 






 

Page 9 of 10

 

LINDE PLC AND SUBSIDIARIES

APPENDIX

NON-GAAP MEASURES AND RECONCILIATIONS

(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.

 

 

 

2022

 

 

2021

 

(Millions of dollars)

 

Year to Date September 30,

 

 

Q3

 

 

Q2

 

 

Q1

 

 

Year to Date September 30,

 

 

Q4

 

 

Q3

 

 

Q2

 

 

Q1

 

Adjusted Operating Profit and Operating Margin

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported operating profit

 

$ 3,682

 

 

$ 1,613

 

 

$ 589

 

 

$ 1,480

 

 

$ 3,647

 

 

$ 1,337

 

 

$ 1,292

 

 

$ 1,142

 

 

$ 1,213

 

Add: Russia-Ukraine conflict and other charges (a)

 

 

1,004

 

 

 

15

 

 

 

993

 

 

 

(4 )

 

 

222

 

 

 

51

 

 

 

26

 

 

 

204

 

 

 

(8 )

Add: Purchase accounting impacts - Linde AG (c)

 

 

1,217

 

 

 

382

 

 

 

406

 

 

 

429

 

 

 

1,466

 

 

 

453

 

 

 

492

 

 

 

491

 

 

 

483

 

Total adjustments

 

 

2,221

 

 

 

397

 

 

 

1,399

 

 

 

425

 

 

 

1,688

 

 

 

504

 

 

 

518

 

 

 

695

 

 

 

475

 

Adjusted operating profit

 

$ 5,903

 

 

$ 2,010

 

 

$ 1,988

 

 

$ 1,905

 

 

$ 5,335

 

 

$ 1,841

 

 

$ 1,810

 

 

$ 1,837

 

 

$ 1,688

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported percentage change

 

 

1 %

 

 

25 %

 

 

(48 )%

 

 

22 %

 

 

59 %

 

 

30 %

 

 

33 %

 

 

93 %

 

 

65 %

Adjusted percentage change

 

 

11 %

 

 

11 %

 

 

8 %

 

 

13 %

 

 

28 %

 

 

14 %

 

 

19 %

 

 

39 %

 

 

25 %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported sales

 

$ 25,465

 

 

$ 8,797

 

 

$ 8,457

 

 

$ 8,211

 

 

$ 22,495

 

 

$ 8,298

 

 

$ 7,668

 

 

$ 7,584

 

 

$ 7,243

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported operating margin

 

 

14.5 %

 

 

18.3 %

 

 

7.0 %

 

 

18.0 %

 

 

16.2 %

 

 

16.1 %

 

 

16.8 %

 

 

15.1 %

 

 

16.7 %

Adjusted operating margin

 

 

23.2 %

 

 

22.8 %

 

 

23.5 %

 

 

23.2 %

 

 

23.7 %

 

 

22.2 %

 

 

23.6 %

 

 

24.2 %

 

 

23.3 %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Depreciation and amortization

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported depreciation and amortization

 

$ 3,248

 

 

$ 1,045

 

 

$ 1,091

 

 

$ 1,112

 

 

$ 3,500

 

 

$ 1,135

 

 

$ 1,163

 

 

$ 1,171

 

 

$ 1,166

 

Less: Purchase accounting impacts - Linde AG (c)

 

 

(1,196 )

 

 

(377 )

 

 

(401 )

 

 

(418 )

 

 

(1,426 )

 

 

(437 )

 

 

(469 )

 

 

(479 )

 

 

(478 )

Adjusted depreciation and amortization

 

$ 2,052

 

 

$ 668

 

 

$ 690

 

 

$ 694

 

 

$ 2,074

 

 

$ 698

 

 

$ 694

 

 

$ 692

 

 

$ 688

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Other Income (Expense) – net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported Other Income (Expense) – net

 

$ (58 )

 

$ (34 )

 

$ (36 )

 

$ 12

 

 

$ (3 )

 

$ (23 )

 

$ 10

 

 

$ (17 )

 

$ 4

 

Add: Purchase accounting impacts - Linde AG (c)

 

 

(21 )

 

 

(5 )

 

 

(5 )

 

 

(11 )

 

 

(40 )

 

 

(16 )

 

 

(23 )

 

 

(12 )

 

 

(5 )

Adjusted Other Income (Expense) – net

 

$ (37 )

 

$ (29 )

 

$ (31 )

 

$ 23

 

 

$ 37

 

 

$ (7 )

 

$ 33

 

 

$ (5 )

 

$ 9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Net Pension and OPEB Cost (Benefit), Excluding Service Cost

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported net pension and OPEB cost (benefit), excluding service cost

 

$ (179 )

 

$ (53 )

 

$ (62 )

 

$ (64 )

 

$ (143 )

 

$ (49 )

 

$ (45 )

 

$ (49 )

 

$ (49 )

Add: Pension settlement charges

 

 

(6 )

 

 

(6 )

 

 

 

 

 

 

 

 

(4 )

 

 

 

 

 

(4 )

 

 

 

 

 

 

Adjusted Net Pension and OPEB cost (benefit), excluding service costs

 

$ (185 )

 

$ (59 )

 

$ (62 )

 

$ (64 )

 

$ (147 )

 

$ (49 )

 

$ (49 )

 

$ (49 )

 

$ (49 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Interest Expense – Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported interest expense – net

 

$ 32

 

 

$ 18

 

 

$ 5

 

 

$ 9

 

 

$ 46

 

 

$ 31

 

 

$ 8

 

 

$ 18

 

 

$ 20

 

Add: Purchase accounting impacts - Linde AG (c)

 

 

27

 

 

 

8

 

 

 

9

 

 

 

10

 

 

 

43

 

 

 

10

 

 

 

10

 

 

 

15

 

 

 

18

 

Adjusted interest expense – net

 

$ 59

 

 

$ 26

 

 

$ 14

 

 

$ 19

 

 

$ 89

 

 

$ 41

 

 

$ 18

 

 

$ 33

 

 

$ 38

 

 






 

Page 9 of 10 (cont'd)

 

 

 

2022

 

 

2021

 

 

 

 

 

(Millions of dollars)

 

Year to Date September 30,

 

 

Q3

 

 

Q2

 

 

Q1

 

 

Year to Date September 30,

 

 

Q4

 

 

Q3

 

 

Q2

 

 

Q1

 

Adjusted Income Taxes (a)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported income taxes

 

$ 1,046

 

 

$ 391

 

 

$ 286

 

 

$ 369

 

 

$ 923

 

 

$ 339

 

 

$ 321

 

 

$ 334

 

 

$ 268

 

Add: Purchase accounting impacts - Linde AG (c)

 

 

308

 

 

 

92

 

 

 

108

 

 

 

108

 

 

 

349

 

 

 

103

 

 

 

115

 

 

 

116

 

 

 

118

 

Add: Pension settlement charges

 

 

1

 

 

 

1

 

 

 

 

 

 

 

 

 

1

 

 

 

 

 

 

1

 

 

 

 

 

 

 

Add: Russia-Ukraine conflict and other charges (a)

 

 

127

 

 

 

26

 

 

 

104

 

 

 

(3 )

 

 

29

 

 

 

 

 

 

3

 

 

 

6

 

 

 

20

 

Total adjustments

 

 

436

 

 

 

119

 

 

 

212

 

 

 

105

 

 

 

379

 

 

 

103

 

 

 

119

 

 

 

122

 

 

 

138

 

Adjusted income taxes

 

$ 1,482

 

 

$ 510

 

 

$ 498

 

 

$ 474

 

 

$ 1,302

 

 

$ 442

 

 

$ 440

 

 

$ 456

 

 

$ 406

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Effective Tax Rate (a)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported income before income taxes and equity investments

 

$ 3,829

 

 

$ 1,648

 

 

$ 646

 

 

$ 1,535

 

 

$ 3,744

 

 

$ 1,355

 

 

$ 1,329

 

 

$ 1,173

 

 

$ 1,242

 

Add: Pension settlement charge

 

 

6

 

 

 

6

 

 

 

 

 

 

 

 

 

4

 

 

 

 

 

 

4

 

 

 

 

 

 

 

Add: Purchase accounting impacts - Linde AG (c)

 

 

1,190

 

 

 

374

 

 

 

397

 

 

 

419

 

 

 

1,423

 

 

 

443

 

 

 

482

 

 

 

476

 

 

 

465

 

Add: Russia-Ukraine conflict and other charges (a)

 

 

1,004

 

 

 

15

 

 

 

993

 

 

 

(4 )

 

 

222

 

 

 

51

 

 

 

26

 

 

 

204

 

 

 

(8 )

Total adjustments

 

 

2,200

 

 

 

395

 

 

 

1,390

 

 

 

415

 

 

 

1,649

 

 

 

494

 

 

 

512

 

 

 

680

 

 

 

457

 

Adjusted income before income taxes and equity investments

 

$ 6,029

 

 

$ 2,043

 

 

$ 2,036

 

 

$ 1,950

 

 

$ 5,393

 

 

$ 1,849

 

 

$ 1,841

 

 

$ 1,853

 

 

$ 1,699

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported Income taxes

 

$ 1,046

 

 

$ 391

 

 

$ 286

 

 

$ 369

 

 

$ 923

 

 

$ 339

 

 

$ 321

 

 

$ 334

 

 

$ 268

 

Reported effective tax rate

 

 

27.3 %

 

 

23.7 %

 

 

44.3 %

 

 

24.0 %

 

 

24.7 %

 

 

25.0 %

 

 

24.2 %

 

 

28.5 %

 

 

21.6 %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted income taxes

 

$ 1,482

 

 

$ 510

 

 

$ 498

 

 

$ 474

 

 

$ 1,302

 

 

$ 442

 

 

$ 440

 

 

$ 456

 

 

$ 406

 

Adjusted effective tax rate

 

 

24.6 %

 

 

25.0 %

 

 

24.5 %

 

 

24.3 %

 

 

24.1 %

 

 

23.9 %

 

 

23.9 %

 

 

24.6 %

 

 

23.9 %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from Equity Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported income from equity investments

 

$ 137

 

 

$ 43

 

 

$ 50

 

 

$ 44

 

 

$ 81

 

 

$ 38

 

 

$ 1

 

 

$ 37

 

 

$ 43

 

Add: Russia-Ukraine conflict and other charges (e)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

35

 

 

 

 

 

 

35

 

 

 

 

 

 

 

Add: Purchase accounting impacts - Linde AG (c)

 

 

57

 

 

 

18

 

 

 

19

 

 

 

20

 

 

 

57

 

 

 

20

 

 

 

19

 

 

 

19

 

 

 

19

 

Total adjustments

 

 

57

 

 

 

18

 

 

 

19

 

 

 

20

 

 

 

92

 

 

 

20

 

 

 

54

 

 

 

19

 

 

 

19

 

Adjusted income from equity investments

 

$ 194

 

 

$ 61

 

 

$ 69

 

 

$ 64

 

 

$ 173

 

 

$ 58

 

 

$ 55

 

 

$ 56

 

 

$ 62

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Noncontrolling Interests from Continuing Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported noncontrolling interests from continuing operations

 

$ (101 )

 

$ (27 )

 

$ (38 )

 

$ (36 )

 

$ (105 )

 

$ (30 )

 

$ (31 )

 

$ (36 )

 

$ (38 )

Add: Purchase accounting impacts - Linde AG (c)

 

 

(19 )

 

 

(12 )

 

 

(3 )

 

 

(4 )

 

 

(11 )

 

 

(4 )

 

 

(4 )

 

 

(2 )

 

 

(5 )

Adjusted noncontrolling interests from continuing operations

 

$ (120 )

 

$ (39 )

 

$ (41 )

 

$ (40 )

 

$ (116 )

 

$ (34 )

 

$ (35 )

 

$ (38 )

 

$ (43 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Income from Continuing Operations (b)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported income from continuing operations

 

$ 2,819

 

 

$ 1,273

 

 

$ 372

 

 

$ 1,174

 

 

$ 2,797

 

 

$ 1,024

 

 

$ 978

 

 

$ 840

 

 

$ 979

 

Add: Pension settlement charge

 

 

5

 

 

 

5

 

 

 

 

 

 

 

 

 

3

 

 

 

 

 

 

3

 

 

 

 

 

 

 

Add: Russia-Ukraine conflict and other charges (a)

 

 

877

 

 

 

(11 )

 

 

889

 

 

 

(1 )

 

 

228

 

 

 

51

 

 

 

58

 

 

 

198

 

 

 

(28 )

Add: Purchase accounting impacts - Linde AG (c)

 

 

920

 

 

 

288

 

 

 

305

 

 

 

327

 

 

 

1,120

 

 

 

356

 

 

 

382

 

 

 

377

 

 

 

361

 

Total adjustments

 

 

1,802

 

 

 

282

 

 

 

1,194

 

 

 

326

 

 

 

1,351

 

 

 

407

 

 

 

443

 

 

 

575

 

 

 

333

 

Adjusted income from continuing operations

 

$ 4,621

 

 

$ 1,555

 

 

$ 1,566

 

 

$ 1,500

 

 

$ 4,148

 

 

$ 1,431

 

 

$ 1,421

 

 

$ 1,415

 

 

$ 1,312

 

 






 

Page 9 of 10 (cont'd)

 

 

 

2022

 

 

2021

 

 

 

 

 

(Millions of dollars, except per share data)

 

Year to Date September 30,

 

 

Q3

 

 

Q2

 

 

Q1

 

 

Year to Date September 30,

 

 

Q4

 

 

Q3

 

 

Q2

 

 

Q1

 

Adjusted Diluted EPS from Continuing Operations (b)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported diluted EPS from continuing operations

 

$ 5.57

 

 

$ 2.54

 

 

$ 0.74

 

 

$ 2.30

 

 

$ 5.34

 

 

$ 1.98

 

 

$ 1.88

 

 

$ 1.60

 

 

$ 1.86

 

Add: Pension settlement charge

 

 

0.01

 

 

 

0.01

 

 

 

 

 

 

 

 

 

0.01

 

 

 

 

 

 

0.01

 

 

 

 

 

 

 

Add: Russia-Ukraine conflict and other charges (a)

 

 

1.73

 

 

 

(0.02 )

 

 

1.76

 

 

 

 

 

 

0.44

 

 

 

0.10

 

 

 

0.11

 

 

 

0.38

 

 

 

(0.05 )

Add:  Purchase accounting impacts - Linde AG (c)

 

 

1.82

 

 

 

0.57

 

 

 

0.60

 

 

 

0.63

 

 

 

2.13

 

 

 

0.69

 

 

 

0.73

 

 

 

0.72

 

 

 

0.68

 

Total adjustments

 

 

3.56

 

 

 

0.56

 

 

 

2.36

 

 

 

0.63

 

 

 

2.58

 

 

 

0.79

 

 

 

0.85

 

 

 

1.10

 

 

 

0.63

 

Adjusted diluted EPS from continuing operations

 

$ 9.13

 

 

$ 3.10

 

 

$ 3.10

 

 

$ 2.93

 

 

$ 7.92

 

 

$ 2.77

 

 

$ 2.73

 

 

$ 2.70

 

 

$ 2.49

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported percentage change

 

 

4 %

 

 

35 %

 

 

(54 )%

 

 

24 %

 

 

64 %

 

 

37 %

 

 

42 %

 

 

84 %

 

 

74 %

Adjusted percentage change

 

 

15 %

 

 

14 %

 

 

15 %

 

 

18 %

 

 

34 %

 

 

20 %

 

 

27 %

 

 

42 %

 

 

32 %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

Fourth Quarter 2022

 

 

Full Year 2022

 

 

 

 

Adjusted Diluted EPS from Continuing Operations Guidance (d)

 

 

 

 

 

Low

End

 

 

High

End

 

 

Low

End

 

 

High

End

 

 

 

 

 

 

 

2022 Adjusted Guidance

 

 

 

 

 

 

 

$ 2.80

 

 

$ 2.90

 

 

$ 11.93

 

 

$ 12.03

 

 

 

 

 

 

 

 

 

 

Adjusted percentage changes versus 2021 adjusted diluted EPS

 

 

 

 

 

 

 

 

1 %

 

 

5 %

 

 

12 %

 

 

13 %

 

 

 

 

 

 

 

 

 

Add: Estimated currency headwind/(tailwind)

 

 

 

 

 

 

 

 

8 %

 

 

8 %

 

 

5 %

 

 

5 %

 

 

 

 

 

 

 

 

 

Adjusted percentage change excluding currency

 

 

 

 

 

 

 

 

9 %

 

 

13 %

 

 

17 %

 

 

18 %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA and % of Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$ 2,819

 

 

$ 1,273

 

 

$ 372

 

 

$ 1,174

 

 

$ 2,797

 

 

$ 1,024

 

 

$ 978

 

 

$ 840

 

 

$ 979

 

Add: Noncontrolling interests related to continuing operations

 

 

101

 

 

 

27

 

 

 

38

 

 

 

36

 

 

 

105

 

 

 

30

 

 

 

31

 

 

 

36

 

 

 

38

 

Add: Net pension and OPEB cost (benefit), excluding service cost

 

 

(179 )

 

 

(53 )

 

 

(62 )

 

 

(64 )

 

 

(143 )

 

 

(49 )

 

 

(45 )

 

 

(49 )

 

 

(49 )

Add: Interest expense

 

 

32

 

 

 

18

 

 

 

5

 

 

 

9

 

 

 

46

 

 

 

31

 

 

 

8

 

 

 

18

 

 

 

20

 

Add: Income taxes

 

 

1,046

 

 

 

391

 

 

 

286

 

 

 

369

 

 

 

923

 

 

 

339

 

 

 

321

 

 

 

334

 

 

 

268

 

Add: Depreciation and amortization

 

 

3,248

 

 

 

1,045

 

 

 

1,091

 

 

 

1,112

 

 

 

3,500

 

 

 

1,135

 

 

 

1,163

 

 

 

1,171

 

 

 

1,166

 

EBITDA from continuing operations

 

 

7,067

 

 

 

2,701

 

 

 

1,730

 

 

 

2,636

 

 

 

7,228

 

 

 

2,510

 

 

 

2,456

 

 

 

2,350

 

 

 

2,422

 

Add: Russia-Ukraine conflict and other charges (a)

 

 

1,004

 

 

 

15

 

 

 

993

 

 

 

(4 )

 

 

257

 

 

 

51

 

 

 

61

 

 

 

204

 

 

 

(8 )

Add: Purchase accounting impacts - Linde AG (c)

 

 

77

 

 

 

23

 

 

 

23

 

 

 

31

 

 

 

97

 

 

 

36

 

 

 

42

 

 

 

31

 

 

 

24

 

Total adjustments

 

 

1,081

 

 

 

38

 

 

 

1,016

 

 

 

27

 

 

 

354

 

 

 

87

 

 

 

103

 

 

 

235

 

 

 

16

 

Adjusted EBITDA from continuing operations

 

$ 8,148

 

 

$ 2,739

 

 

$ 2,746

 

 

$ 2,663

 

 

$ 7,582

 

 

$ 2,597

 

 

$ 2,559

 

 

$ 2,585

 

 

$ 2,438

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported sales

 

$ 25,465

 

 

$ 8,797

 

 

$ 8,457

 

 

$ 8,211

 

 

$ 22,495

 

 

$ 8,298

 

 

$ 7,668

 

 

$ 7,584

 

 

$ 7,243

 

% of sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA from continuing operations

 

 

27.8 %

 

 

30.7 %

 

 

20.5 %

 

 

32.1 %

 

 

32.1 %

 

 

30.2 %

 

 

32.0 %

 

 

31.0 %

 

 

33.4 %

Adjusted EBITDA from continuing operations

 

 

32.0 %

 

 

31.1 %

 

 

32.5 %

 

 

32.4 %

 

 

33.7 %

 

 

31.3 %

 

 

33.4 %

 

 

34.1 %

 

 

33.7 %

 

(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”. 

 






 

Page 9 of 10 (cont'd)

 

(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) We are providing adjusted earnings per share (“EPS”) guidance for 2022. 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, any impairment or other charges related to scaling back operations in Russia as actions are defined and executed and as sanctions are enacted that impact the Company’s operations, 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. 

 

(e)  Impairment charge related to a joint venture in the APAC segment.

 






 

Page 10 of 10

 

LINDE PLC AND SUBSIDIARIES

APPENDIX

NON-GAAP MEASURES AND RECONCILIATIONS

(UNAUDITED)

 

 

 

2022

 

 

2021

 

(Millions of dollars)

 

Q3

 

 

Q2

 

 

Q1

 

 

Q4

 

 

Q3

 

 

Q2

 

 

Q1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Free Cash Flow (FCF) - Free cash flow is a measure used by investors, financial analysts and management to evaluate the ability of a company to pursue opportunities that enhance shareholder value. FCF equals cash flow from operations less capital expenditures.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Cash Flow

 

$ 2,636

 

 

$ 2,133

 

 

$ 2,000

 

 

$ 3,233

 

 

$ 2,556

 

 

$ 1,827

 

 

$ 2,109

 

Less: Capital Expenditures

 

 

(762 )

 

 

(826 )

 

 

(649 )

 

 

(839 )

 

 

(741 )

 

 

(744 )

 

 

(762 )

Free Cash Flow

 

$ 1,874

 

 

$ 1,307

 

 

$ 1,351

 

 

$ 2,394

 

 

$ 1,815

 

 

$ 1,083

 

 

$ 1,347

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$ 15,338

 

 

$ 16,043

 

 

$ 16,456

 

 

$ 14,207

 

 

$ 16,727

 

 

$ 15,492

 

 

$ 15,750

 

Less: Cash and cash equivalents

 

 

(3,756 )

 

 

(3,655 )

 

 

(4,464 )

 

 

(2,823 )

 

 

(4,700 )

 

 

(3,137 )

 

 

(4,096 )

Net debt

 

 

11,582

 

 

 

12,388

 

 

 

11,992

 

 

 

11,384

 

 

 

12,027

 

 

 

12,355

 

 

 

11,654

 

Less:  Purchase accounting impacts - Linde AG

 

 

(28 )

 

 

(38 )

 

 

(50 )

 

 

(61 )

 

 

(72 )

 

 

(84 )

 

 

(98 )

Adjusted net debt

 

 

11,554

 

 

 

12,350

 

 

 

11,942

 

 

 

11,323

 

 

 

11,955

 

 

 

12,271

 

 

 

11,556

 

Less:  Net assets held for sale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1 )

 

 

(1 )

 

 

(4 )

Adjusted net debt less net assets held for sale

 

$ 11,554

 

 

$ 12,350

 

 

$ 11,942

 

 

$ 11,323

 

 

$ 11,954

 

 

$ 12,270

 

 

$ 11,552

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$ 1,273

 

 

$ 372

 

 

$ 1,174

 

 

$ 1,024

 

 

$ 978

 

 

$ 840

 

 

$ 979

 

Add: noncontrolling interests from continuing operations

 

 

27

 

 

 

38

 

 

 

36

 

 

 

30

 

 

 

31

 

 

 

36

 

 

 

38

 

Add: interest expense - net

 

 

18

 

 

 

5

 

 

 

9

 

 

 

31

 

 

 

8

 

 

 

18

 

 

 

20

 

Less: tax benefit on interest expense - net *

 

 

(5 )

 

 

(1 )

 

 

(2 )

 

 

(8 )

 

 

(2 )

 

 

(5 )

 

 

(5 )

Reported NOPAT

 

$ 1,313

 

 

$ 414

 

 

$ 1,217

 

 

$ 1,077

 

 

$ 1,015

 

 

$ 889

 

 

$ 1,032

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted income from continuing operations

 

$ 1,555

 

 

$ 1,566

 

 

$ 1,500

 

 

$ 1,431

 

 

$ 1,421

 

 

$ 1,415

 

 

$ 1,312

 

Add: adjusted noncontrolling interests from continuing operations

 

 

39

 

 

 

41

 

 

 

40

 

 

 

34

 

 

 

35

 

 

 

38

 

 

 

43

 

Add: adjusted interest expense - net

 

 

26

 

 

 

14

 

 

 

19

 

 

 

41

 

 

 

18

 

 

 

33

 

 

 

38

 

Less: tax benefit on interest expense - net *

 

 

(7 )

 

 

(3 )

 

 

(5 )

 

 

(10 )

 

 

(5 )

 

 

(8 )

 

 

(10 )

Adjusted NOPAT

 

$ 1,613

 

 

$ 1,618

 

 

$ 1,554

 

 

$ 1,496

 

 

$ 1,469

 

 

$ 1,478

 

 

$ 1,383

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4-quarter trailing reported NOPAT

 

$ 4,021

 

 

$ 3,723

 

 

$ 4,198

 

 

$ 4,013

 

 

$ 3,765

 

 

$ 3,508

 

 

$ 3,115

 

4-quarter trailing adjusted NOPAT

 

$ 6,281

 

 

$ 6,137

 

 

$ 5,997

 

 

$ 5,826

 

 

$ 5,627

 

 

$ 5,389

 

 

$ 4,985

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 






 

Page 10 of 10 (cont'd)

 

 

 

2022

 

 

2021

 

(Millions of dollars)

 

Q3

 

 

Q2

 

 

Q1

 

 

Q4

 

 

Q3

 

 

Q2

 

 

Q1

 

Equity and redeemable noncontrolling interests:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Redeemable noncontrolling interests

 

$ 13

 

 

$ 13

 

 

$ 13

 

 

$ 13

 

 

$ 13

 

 

$ 13

 

 

$ 13

 

Linde plc shareholders’ equity

 

 

37,628

 

 

 

39,674

 

 

 

42,963

 

 

 

44,035

 

 

 

44,323

 

 

 

45,777

 

 

 

46,210

 

Noncontrolling interests

 

 

1,298

 

 

 

1,353

 

 

 

1,414

 

 

 

1,393

 

 

 

1,401

 

 

 

1,438

 

 

 

1,410

 

Total equity and redeemable noncontrolling interests

 

$ 38,939

 

 

$ 41,040

 

 

$ 44,390

 

 

$ 45,441

 

 

$ 45,737

 

 

$ 47,228

 

 

$ 47,633

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported capital

 

$ 50,521

 

 

$ 53,428

 

 

$ 56,382

 

 

$ 56,825

 

 

$ 57,763

 

 

$ 59,582

 

 

$ 59,283

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total equity and redeemable noncontrolling interests

 

$ 38,939

 

 

$ 41,040

 

 

$ 44,390

 

 

$ 45,441

 

 

$ 45,737

 

 

$ 47,228

 

 

$ 47,633

 

Add:  Adjusted net debt less net assets held for sale

 

 

11,554

 

 

 

12,350

 

 

 

11,942

 

 

 

11,323

 

 

 

11,954

 

 

 

12,270

 

 

 

11,552

 

Less:  Linde AG Goodwill (a)

 

 

24,256

 

 

 

24,256

 

 

 

24,256

 

 

 

24,256

 

 

 

24,256

 

 

 

24,256

 

 

 

24,256

 

Less:  Linde AG Indefinite lived intangibles (a)

 

 

1,868

 

 

 

1,868

 

 

 

1,868

 

 

 

1,868

 

 

 

1,868

 

 

 

1,868

 

 

 

1,868

 

Adjusted capital

 

$ 24,369

 

 

$ 27,266

 

 

$ 30,208

 

 

$ 30,640

 

 

$ 31,567

 

 

$ 33,374

 

 

$ 33,061

 

(a) Represent opening balance sheet purchase accounting impacts of non-amortizing assets related to the Linde AG merger.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending capital (see above)

 

$ 50,521

 

 

$ 53,428

 

 

$ 56,382

 

 

$ 56,825

 

 

$ 57,763

 

 

$ 59,582

 

 

$ 59,283

 

5-quarter average ending capital

 

$ 54,984

 

 

$ 56,796

 

 

$ 57,967

 

 

$ 59,086

 

 

$ 59,960

 

 

$ 60,502

 

 

$ 60,584

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending adjusted capital (see above)

 

$ 24,369

 

 

$ 27,266

 

 

$ 30,208

 

 

$ 30,640

 

 

$ 31,567

 

 

$ 33,374

 

 

$ 33,061

 

5-quarter average ending adjusted capital

 

$ 28,810

 

 

$ 30,611

 

 

$ 31,770

 

 

$ 32,875

 

 

$ 33,735

 

 

$ 34,261

 

 

$ 34,325

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

After-tax ROC (4 quarter reported NOPAT / 5-quarter average ending capital)

 

 

7.3 %

 

 

6.6 %

 

 

7.2 %

 

 

6.8 %

 

 

6.3 %

 

 

5.8 %

 

 

5.1 %

Adjusted after-tax ROC (4 quarter trailing adjusted NOPAT / 5-quarter average ending adjusted capital)

 

 

21.8 %

 

 

20.0 %

 

 

18.9 %

 

 

17.7 %

 

 

16.7 %

 

 

15.7 %

 

 

14.5 %

 

*Tax benefit on interest expense - net is generally presented using the reported effective rate.