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DGAP-News: Linde plc / Key word(s): Quarter Results
Linde Reports Third-Quarter 2021 Results
Guildford, UK, October 28, 2021 - Linde plc (NYSE: LIN; FWB: LIN) today reported third-quarter 2021 income from continuing operations of $978 million and diluted earnings per share of $1.88, an increase of 42% versus prior year. Excluding Linde AG purchase accounting impacts and other charges, adjusted income from continuing operations was $1,421 million, up 25% versus prior year and flat sequentially. Adjusted earnings per share was $2.73, 27% above prior year and 1% higher sequentially.
Linde's sales for the third quarter were $7,668 million, 12% above prior year and up 1% sequentially. Compared to prior year, underlying sales increased 11%, including 3% price attainment and 8% higher volumes. Volume growth was broad-based across all geographic segments and end markets. Sequentially, underlying sales increased 1% driven by higher price.
Third-quarter operating profit was $1,292 million. Adjusted operating profit of $1,810 million was up 19% versus prior year led by higher price, strong volumes and continued productivity initiatives across all segments. Adjusted operating margin of 23.6% expanded 150 basis points versus prior year and 220 basis points when excluding the effects of cost pass-through. Sequentially, operating margins were stable when excluding cost pass-through. Cost pass-through represents the contractual billing of energy cost variance, primarily to onsite customers, with minimal effect on profit.
Third-quarter operating cash flow of $2,556 million increased 36% versus prior year and 40% sequentially. After capital expenditures of $741 million, free cash flow was $1,815 million, up 65% versus prior year and 68% sequentially. During the quarter, the company returned $1,708 million to shareholders through dividends and stock repurchases, net of issuance.
In addition, the company ended the third quarter with a total backlog of approximately $13.4 billion which includes both sale of gas and sale of plant projects, all contractually secured with high-quality customers.
Commenting on the financial results and business outlook, Chief Executive Officer Steve Angel said, "Linde employees delivered another stellar quarter achieving record EPS, operating cash flow and return on capital. We maintained our industry leading performance and significantly expanded our project backlog. We also announced new GHG emission goals including a commitment to absolute emissions reduction, reaching climate neutrality by 2050."
Angel continued, "The Linde team demonstrated, once again, they can deliver in any environment. We are well positioned for the future and I am confident our best days, indeed, lie ahead."
For full year 2021, the company has updated its adjusted diluted earnings per share guidance to be in the range of $10.52 to $10.62, up 43% to 45% versus 2019 and 28% to 29% versus prior year. This guidance assumes 3% currency tailwind versus 2020. Full-year capital expenditures are expected to be in the range of $3.0 billion to $3.2 billion to support maintenance and growth requirements including the contractual project backlog.
APAC (Asia Pacific) sales of $1,564 million were 5% above prior year. Underlying sales grew 11% driven by 1% price attainment and 10% volume growth, led by higher demand across all end markets and project start-ups. Sequentially, price increased 1% and volume grew 2%, led by growth across most end markets. Divestitures were driven by an accounting deconsolidation of a joint venture which reduced sales 11% versus prior year but had no impact on earnings per share. Operating profit of $382 million was 24.4% of sales, up 170 basis points versus prior year or 220 basis points when excluding the effects of cost pass-through.
EMEA (Europe, Middle East & Africa) sales of $1,911 million were up 18% versus prior year. Underlying sales grew 9% from 4% higher pricing and 5% higher volumes across all end markets. Sequentially, underlying sales were flat with pricing up 1%, offset by lower volumes. Operating profit of $476 million was 24.9% of sales, up 210 basis points versus prior year or 370 basis points when excluding the effects of cost pass-through.
Materials to be used in the teleconference are also available on the website.
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
Adjusted amounts, free cash flow and return on capital are non-GAAP measures. See the attachments (Earnings release tables: https://eqs-cockpit.com/cgi-bin/fncls.ssp?u=d3837d27092df1ebfa46bdf118e14713) 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 2021. 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.
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, 2020 filed with the SEC on March 1, 2021 which should be reviewed carefully. Please consider Linde plc's forward-looking statements in light of those risks.
28.10.2021 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
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