x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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23-1274455
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(State or Other Jurisdiction of Incorporation or Organization)
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(I.R.S. Employer Identification No.)
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7201 Hamilton Boulevard, Allentown, Pennsylvania
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18195-1501
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(Address of Principal Executive Offices)
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(Zip Code)
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Large accelerated
filer
x
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Accelerated
filer
¨
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Non-accelerated
filer
¨
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Smaller reporting
company
¨
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Emerging
growth company
¨
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(Do not check if a smaller reporting company)
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|
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Class
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Outstanding at 30 June 2017
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Common Stock, $1 par value
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217,957,369
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Page No.
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Three Months Ended
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Nine Months Ended
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||||||||||
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30 June
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30 June
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||||||||||
(Millions of dollars, except for share data)
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2017
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2016
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2017
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2016
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||||||||
Sales
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$
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2,121.9
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$
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1,914.5
|
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$
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5,984.5
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$
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5,558.2
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Cost of sales
|
1,486.2
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1,320.2
|
|
4,208.1
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3,829.1
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|
||||
Selling and administrative
|
184.5
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168.4
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528.1
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510.1
|
|
||||
Research and development
|
14.6
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18.7
|
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44.5
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53.8
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|
||||
Business separation costs
|
—
|
|
9.5
|
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30.2
|
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28.9
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|
||||
Cost reduction and asset actions
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42.7
|
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13.2
|
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103.0
|
|
23.9
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|
||||
Pension settlement loss
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5.5
|
|
1.0
|
|
9.6
|
|
3.0
|
|
||||
Goodwill and intangible asset impairment charge
|
162.1
|
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—
|
|
162.1
|
|
—
|
|
||||
Other income (expense), net
|
26.3
|
|
11.1
|
|
73.0
|
|
29.3
|
|
||||
Operating Income
|
252.6
|
|
394.6
|
|
971.9
|
|
1,138.7
|
|
||||
Equity affiliates' income (loss)
|
(36.9
|
)
|
42.1
|
|
35.3
|
|
107.7
|
|
||||
Interest expense
|
29.8
|
|
35.1
|
|
89.8
|
|
83.0
|
|
||||
Other non-operating income (expense), net
|
9.8
|
|
—
|
|
19.5
|
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—
|
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||||
Income From Continuing Operations Before Taxes
|
195.7
|
|
401.6
|
|
936.9
|
|
1,163.4
|
|
||||
Income tax provision
|
89.3
|
|
145.9
|
|
262.2
|
|
335.8
|
|
||||
Income from Continuing Operations
|
106.4
|
|
255.7
|
|
674.7
|
|
827.6
|
|
||||
Income (Loss) From Discontinued Operations, net of tax
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(2.3
|
)
|
98.4
|
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1,871.5
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(567.0
|
)
|
||||
Net Income
|
104.1
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|
354.1
|
|
2,546.2
|
|
260.6
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||||
Net Income Attributable to Noncontrolling Interests of Continuing Operations
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2.2
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5.4
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14.5
|
|
17.5
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||||
Net Income Attributable to Noncontrolling Interests of Discontinued Operations
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—
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1.9
|
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—
|
|
6.0
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|
||||
Net Income Attributable to Air Products
|
$
|
101.9
|
|
$
|
346.8
|
|
$
|
2,531.7
|
|
$
|
237.1
|
|
Net Income Attributable to Air Products
|
|
|
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||||||||
Income from continuing operations
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$
|
104.2
|
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$
|
250.3
|
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$
|
660.2
|
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$
|
810.1
|
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Income (Loss) from discontinued operations
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(2.3
|
)
|
96.5
|
|
1,871.5
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(573.0
|
)
|
||||
Net Income Attributable to Air Products
|
$
|
101.9
|
|
$
|
346.8
|
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$
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2,531.7
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$
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237.1
|
|
Basic Earnings Per Common Share Attributable to Air Products
|
|
|
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||||||||
Income from continuing operations
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$
|
.48
|
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$
|
1.16
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$
|
3.03
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$
|
3.75
|
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Income (Loss) from discontinued operations
|
(.01
|
)
|
.44
|
|
8.59
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(2.65
|
)
|
||||
Net Income Attributable to Air Products
|
$
|
.47
|
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$
|
1.60
|
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$
|
11.62
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$
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1.10
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Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
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||||||||
Income from continuing operations
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$
|
.47
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$
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1.15
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$
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3.00
|
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$
|
3.72
|
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Income (Loss) from discontinued operations
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(.01
|
)
|
.44
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|
8.52
|
|
(2.63
|
)
|
||||
Net Income Attributable to Air Products
|
$
|
.46
|
|
$
|
1.59
|
|
$
|
11.52
|
|
$
|
1.09
|
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Weighted Average Common Shares – Basic
(in millions)
|
218.1
|
|
216.6
|
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217.9
|
|
216.1
|
|
||||
Weighted Average Common Shares – Diluted
(in millions)
|
219.8
|
|
218.5
|
|
219.8
|
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218.0
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||||
Dividends Declared Per Common Share – Cash
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$
|
.95
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$
|
.86
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$
|
2.76
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$
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2.53
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Three Months Ended
|
||||||
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|
30 June
|
||||||
(Millions of dollars)
|
|
2017
|
|
2016
|
||||
Net Income
|
|
$
|
104.1
|
|
|
$
|
354.1
|
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Other Comprehensive Income (Loss), net of tax:
|
|
|
|
|
||||
Translation adjustments, net of tax of ($33.1) and $11.5
|
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141.4
|
|
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(89.0
|
)
|
||
Net gain (loss) on derivatives, net of tax of $9.6 and ($7.1)
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23.0
|
|
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(22.2
|
)
|
||
Pension and postretirement benefits
|
|
.1
|
|
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—
|
|
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Reclassification adjustments:
|
|
|
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|
||||
Currency translation adjustment
|
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8.2
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(.1
|
)
|
||
Derivatives, net of tax of ($7.9) and $4.0
|
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(23.6
|
)
|
|
10.0
|
|
||
Pension and postretirement benefits, net of tax of $12.8 and $10.5
|
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27.7
|
|
|
21.6
|
|
||
Total Other Comprehensive Income (Loss)
|
|
176.8
|
|
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(79.7
|
)
|
||
Comprehensive Income
|
|
280.9
|
|
|
274.4
|
|
||
Net Income Attributable to Noncontrolling Interests
|
|
2.2
|
|
|
7.3
|
|
||
Other Comprehensive Income (Loss) Attributable to Noncontrolling Interests
|
|
.2
|
|
|
(.7
|
)
|
||
Comprehensive Income Attributable to Air Products
|
|
$
|
278.5
|
|
|
$
|
267.8
|
|
|
|
|
|
|
||||
|
|
Nine Months Ended
|
||||||
|
|
30 June
|
||||||
(Millions of dollars)
|
|
2017
|
|
2016
|
||||
Net Income
|
|
$
|
2,546.2
|
|
|
$
|
260.6
|
|
Other Comprehensive Income, net of tax:
|
|
|
|
|
||||
Translation adjustments, net of tax of ($8.8) and ($14.3)
|
|
9.8
|
|
|
(52.0
|
)
|
||
Net gain (loss) on derivatives, net of tax of ($6.8) and $7.9
|
|
(2.2
|
)
|
|
6.6
|
|
||
Pension and postretirement benefits, net of tax of $1.2
|
|
3.9
|
|
|
—
|
|
||
Reclassification adjustments:
|
|
|
|
|
||||
Currency translation adjustment
|
|
57.3
|
|
|
2.7
|
|
||
Derivatives, net of tax of $5.4 and ($4.5)
|
|
7.8
|
|
|
(20.4
|
)
|
||
Pension and postretirement benefits, net of tax of $39.4 and $31.9
|
|
85.2
|
|
|
65.4
|
|
||
Total Other Comprehensive Income
|
|
161.8
|
|
|
2.3
|
|
||
Comprehensive Income
|
|
2,708.0
|
|
|
262.9
|
|
||
Net Income Attributable to Noncontrolling Interests
|
|
14.5
|
|
|
23.5
|
|
||
Other Comprehensive Income Attributable to Noncontrolling Interests
|
|
2.1
|
|
|
2.1
|
|
||
Comprehensive Income Attributable to Air Products
|
|
$
|
2,691.4
|
|
|
$
|
237.3
|
|
|
|
30 June
|
|
30 September
|
||||
(Millions of dollars, except for share data)
|
|
2017
|
|
2016
|
||||
Assets
|
|
|
|
|
||||
Current Assets
|
|
|
|
|
||||
Cash and cash items
|
|
$
|
2,332.6
|
|
|
$
|
1,293.2
|
|
Short-term investments
|
|
1,016.1
|
|
|
—
|
|
||
Trade receivables, net
|
|
1,101.2
|
|
|
1,146.2
|
|
||
Inventories
|
|
293.3
|
|
|
255.0
|
|
||
Contracts in progress, less progress billings
|
|
83.3
|
|
|
64.6
|
|
||
Prepaid expenses
|
|
79.0
|
|
|
93.9
|
|
||
Other receivables and current assets
|
|
431.7
|
|
|
538.2
|
|
||
Current assets of discontinued operations
|
|
9.8
|
|
|
926.2
|
|
||
Total Current Assets
|
|
5,347.0
|
|
|
4,317.3
|
|
||
Investment in net assets of and advances to equity affiliates
|
|
1,244.7
|
|
|
1,283.6
|
|
||
Plant and equipment, at cost
|
|
19,176.3
|
|
|
18,660.2
|
|
||
Less: accumulated depreciation
|
|
10,859.3
|
|
|
10,400.5
|
|
||
Plant and equipment, net
|
|
8,317.0
|
|
|
8,259.7
|
|
||
Goodwill, net
|
|
705.1
|
|
|
845.1
|
|
||
Intangible assets, net
|
|
363.8
|
|
|
387.9
|
|
||
Noncurrent capital lease receivables
|
|
1,139.3
|
|
|
1,221.7
|
|
||
Other noncurrent assets
|
|
736.9
|
|
|
671.0
|
|
||
Noncurrent assets of discontinued operations
|
|
—
|
|
|
1,042.3
|
|
||
Total Noncurrent Assets
|
|
12,506.8
|
|
|
13,711.3
|
|
||
Total Assets
|
|
$
|
17,853.8
|
|
|
$
|
18,028.6
|
|
Liabilities and Equity
|
|
|
|
|
||||
Current Liabilities
|
|
|
|
|
||||
Payables and accrued liabilities
|
|
$
|
1,534.3
|
|
|
$
|
1,652.2
|
|
Accrued income taxes
|
|
323.0
|
|
|
117.9
|
|
||
Short-term borrowings
|
|
143.4
|
|
|
935.8
|
|
||
Current portion of long-term debt
|
|
416.0
|
|
|
365.4
|
|
||
Current liabilities of discontinued operations
|
|
16.5
|
|
|
211.8
|
|
||
Total Current Liabilities
|
|
2,433.2
|
|
|
3,283.1
|
|
||
Long-term debt
|
|
3,366.6
|
|
|
3,909.7
|
|
||
Other noncurrent liabilities
|
|
1,910.0
|
|
|
1,816.5
|
|
||
Deferred income taxes
|
|
634.1
|
|
|
710.4
|
|
||
Noncurrent liabilities of discontinued operations
|
|
—
|
|
|
1,095.5
|
|
||
Total Noncurrent Liabilities
|
|
5,910.7
|
|
|
7,532.1
|
|
||
Total Liabilities
|
|
8,343.9
|
|
|
10,815.2
|
|
||
Commitments and Contingencies - See Note 13
|
|
|
|
|
||||
Air Products Shareholders’ Equity
|
|
|
|
|
||||
Common stock (par value $1 per share; issued 2017 and 2016 - 249,455,584 shares)
|
|
249.4
|
|
|
249.4
|
|
||
Capital in excess of par value
|
|
986.4
|
|
|
970.0
|
|
||
Retained earnings
|
|
12,584.2
|
|
|
10,475.5
|
|
||
Accumulated other comprehensive loss
|
|
(2,217.1
|
)
|
|
(2,388.3
|
)
|
||
Treasury stock, at cost (2017 - 31,498,215 shares; 2016 - 32,104,759 shares)
|
|
(2,190.5
|
)
|
|
(2,227.0
|
)
|
||
Total Air Products Shareholders’ Equity
|
|
9,412.4
|
|
|
7,079.6
|
|
||
Noncontrolling Interests
|
|
97.5
|
|
|
133.8
|
|
||
Total Equity
|
|
9,509.9
|
|
|
7,213.4
|
|
||
Total Liabilities and Equity
|
|
$
|
17,853.8
|
|
|
$
|
18,028.6
|
|
|
Nine Months Ended
|
|||||
|
30 June
|
|||||
(Millions of dollars)
|
2017
|
2016
|
||||
Operating Activities
|
|
|
||||
Net income
|
$
|
2,546.2
|
|
$
|
260.6
|
|
Less: Net income attributable to noncontrolling interests of continuing operations
|
14.5
|
|
17.5
|
|
||
Less: Net income attributable to noncontrolling interests of discontinued operations
|
—
|
|
6.0
|
|
||
Net income attributable to Air Products
|
2,531.7
|
|
237.1
|
|
||
(Income) Loss from discontinued operations
|
(1,871.5
|
)
|
573.0
|
|
||
Income from continuing operations attributable to Air Products
|
660.2
|
|
810.1
|
|
||
Adjustments to reconcile income to cash provided by operating activities:
|
|
|
||||
Depreciation and amortization
|
634.8
|
|
642.1
|
|
||
Deferred income taxes
|
(78.1
|
)
|
75.6
|
|
||
Undistributed earnings of unconsolidated affiliates
|
(34.4
|
)
|
(34.2
|
)
|
||
Gain on sale of assets and investments
|
(7.9
|
)
|
(1.4
|
)
|
||
Share-based compensation
|
27.4
|
|
23.9
|
|
||
Noncurrent capital lease receivables
|
69.4
|
|
61.5
|
|
||
Goodwill and intangible asset impairment charge
|
162.1
|
|
—
|
|
||
Equity method investment impairment charge
|
79.5
|
|
—
|
|
||
Write-down of long-lived assets associated with cost reduction actions
|
59.1
|
|
—
|
|
||
Other adjustments
|
110.7
|
|
107.3
|
|
||
Working capital changes that provided (used) cash, excluding effects of acquisitions and divestitures:
|
|
|
||||
Trade receivables
|
(25.7
|
)
|
(173.8
|
)
|
||
Inventories
|
44.8
|
|
13.6
|
|
||
Contracts in progress, less progress billings
|
(18.6
|
)
|
(6.0
|
)
|
||
Other receivables
|
80.0
|
|
(70.4
|
)
|
||
Payables and accrued liabilities
|
(99.9
|
)
|
61.0
|
|
||
Other working capital
|
(50.0
|
)
|
12.9
|
|
||
Cash Provided by Operating Activities
|
1,613.4
|
|
1,522.2
|
|
||
Investing Activities
|
|
|
||||
Additions to plant and equipment
|
(806.8
|
)
|
(700.9
|
)
|
||
Investment in and advances to unconsolidated affiliates
|
(8.1
|
)
|
—
|
|
||
Proceeds from sale of assets and investments
|
20.7
|
|
44.1
|
|
||
Purchases of investments
|
(2,488.6
|
)
|
—
|
|
||
Proceeds from investments
|
1,473.5
|
|
—
|
|
||
Other investing activities
|
(1.5
|
)
|
(1.7
|
)
|
||
Cash Used for Investing Activities
|
(1,810.8
|
)
|
(658.5
|
)
|
||
Financing Activities
|
|
|
||||
Long-term debt proceeds
|
2.2
|
|
388.3
|
|
||
Payments on long-term debt
|
(483.5
|
)
|
(121.7
|
)
|
||
Net decrease in commercial paper and short-term borrowings
|
(799.2
|
)
|
(434.3
|
)
|
||
Dividends paid to shareholders
|
(580.9
|
)
|
(534.9
|
)
|
||
Proceeds from stock option exercises
|
38.2
|
|
76.2
|
|
||
Other financing activities
|
(31.2
|
)
|
(29.5
|
)
|
||
Cash Used for Financing Activities
|
(1,854.4
|
)
|
(655.9
|
)
|
||
Discontinued Operations
|
|
|
||||
Cash (used for) provided by operating activities
|
(768.0
|
)
|
269.2
|
|
||
Cash provided by (used for) investing activities
|
3,750.6
|
|
(160.9
|
)
|
||
Cash provided by (used for) financing activities
|
69.5
|
|
(11.4
|
)
|
||
Cash Provided by Discontinued Operations
|
3,052.1
|
|
96.9
|
|
||
Effect of Exchange Rate Changes on Cash
|
1.5
|
|
3.7
|
|
||
Increase in Cash and Cash Items
|
1,001.8
|
|
308.4
|
|
||
Cash and Cash Items – Beginning of Year
|
1,330.8
|
|
206.4
|
|
||
Cash and Cash Items – End of Period
|
$
|
2,332.6
|
|
$
|
514.8
|
|
Less: Cash and Cash Items – Discontinued Operations
|
—
|
|
76.3
|
|
||
Cash and Cash Items – Continuing Operations
|
$
|
2,332.6
|
|
$
|
438.5
|
|
1.
|
BASIS OF PRESENTATION AND MAJOR ACCOUNTING POLICIES
|
2.
|
NEW ACCOUNTING GUIDANCE
|
3.
|
DISCONTINUED OPERATIONS
|
|
|
Asset
Actions
|
|
Contract
Actions/Other
|
|
Total
|
||||||
Loss on disposal of business
|
|
$
|
913.5
|
|
|
$
|
32.2
|
|
|
$
|
945.7
|
|
Noncash expenses
|
|
(913.5
|
)
|
|
—
|
|
|
(913.5
|
)
|
|||
Cash expenditures
|
|
—
|
|
|
(18.6
|
)
|
|
(18.6
|
)
|
|||
Currency translation adjustment
|
|
—
|
|
|
(1.4
|
)
|
|
(1.4
|
)
|
|||
30 September 2016
|
|
$
|
—
|
|
|
$
|
12.2
|
|
|
$
|
12.2
|
|
Loss on disposal of business
|
|
6.3
|
|
|
53.0
|
|
|
59.3
|
|
|||
Noncash expenses
|
|
(6.3
|
)
|
|
—
|
|
|
(6.3
|
)
|
|||
Amount reflected in other noncurrent liabilities
|
|
—
|
|
|
(61.5
|
)
|
|
(61.5
|
)
|
|||
Cash expenditures
|
|
—
|
|
|
(1.4
|
)
|
|
(1.4
|
)
|
|||
Currency translation adjustments
|
|
—
|
|
|
3.4
|
|
|
3.4
|
|
|||
30 June 2017
|
|
$
|
—
|
|
|
$
|
5.7
|
|
|
$
|
5.7
|
|
|
Three Months Ended
|
||
|
30 June 2017
|
||
|
Total Discontinued
|
||
|
Operations
(A)
|
||
Cost of sales
|
$
|
2.3
|
|
Selling and administrative
|
.3
|
|
|
Other income (expense), net
|
(.8
|
)
|
|
Loss Before Taxes
|
(3.4
|
)
|
|
Income tax provision
|
(1.1
|
)
|
|
Loss from Discontinued Operations, net of tax
|
$
|
(2.3
|
)
|
(A)
|
Activity primarily relates to EfW.
|
|
Nine Months Ended
|
||||||||
|
30 June 2017
|
||||||||
|
|
|
Total
|
||||||
|
Performance
|
Energy-
|
Discontinued
|
||||||
|
Materials
|
from-Waste
(A)
|
Operations
|
||||||
Sales
|
$
|
254.8
|
|
$
|
—
|
|
$
|
254.8
|
|
Cost of sales
|
182.3
|
|
11.9
|
|
194.2
|
|
|||
Selling and administrative
|
22.5
|
|
.5
|
|
23.0
|
|
|||
Research and development
|
5.1
|
|
—
|
|
5.1
|
|
|||
Other income (expense), net
|
.3
|
|
(.9
|
)
|
(.6
|
)
|
|||
Operating Income (Loss)
|
45.2
|
|
(13.3
|
)
|
31.9
|
|
|||
Equity affiliates’ income
|
.3
|
|
—
|
|
.3
|
|
|||
Income (Loss) Before Taxes
|
45.5
|
|
(13.3
|
)
|
32.2
|
|
|||
Income tax provision
(B)
|
(50.8
|
)
|
(3.1
|
)
|
(53.9
|
)
|
|||
Income (Loss) From Operations of Discontinued Operations, net of tax
|
96.3
|
|
(10.2
|
)
|
86.1
|
|
|||
Gain (Loss) on Disposal, net of tax
(C)
|
1,832.5
|
|
(47.1
|
)
|
1,785.4
|
|
|||
Income (Loss) from Discontinued Operations, net of tax
|
$
|
1,928.8
|
|
$
|
(57.3
|
)
|
$
|
1,871.5
|
|
(A)
|
The loss from operations of discontinued operations for EfW primarily relates to land lease obligations, administrative costs, and costs incurred for ongoing project exit activities.
|
(B)
|
As a result of the expected gain on sale of PMD, we released valuation allowances related to capital loss and net operating loss carryforwards during the first quarter of 2017 that favorably impacted our income tax provision within discontinued operations by approximately $
66
.
|
(C)
|
After-tax gain on sale of
$1,832.5
includes expense for income tax reserves for uncertain tax positions of
$26.1
gross (
$19.1
net) in various jurisdictions.
|
|
Three Months Ended
|
|||||||||||
|
30 June 2016
|
|||||||||||
|
|
|
|
Total
|
||||||||
|
Electronic
|
Performance
|
Energy-
|
Discontinued
|
||||||||
|
Materials
|
Materials
|
from-Waste
(A)
|
Operations
|
||||||||
Sales
|
$
|
240.0
|
|
$
|
279.9
|
|
$
|
—
|
|
$
|
519.9
|
|
Cost of sales
|
130.9
|
|
188.2
|
|
17.6
|
|
336.7
|
|
||||
Selling and administrative
|
22.8
|
|
20.7
|
|
.7
|
|
44.2
|
|
||||
Research and development
|
10.6
|
|
4.9
|
|
.1
|
|
15.6
|
|
||||
Other income (expense), net
|
(.8
|
)
|
(.6
|
)
|
8.2
|
|
6.8
|
|
||||
Operating Income (Loss)
|
74.9
|
|
65.5
|
|
(10.2
|
)
|
130.2
|
|
||||
Equity affiliates’ income
|
—
|
|
.5
|
|
—
|
|
.5
|
|
||||
Income (Loss) Before Taxes
(B)
|
74.9
|
|
66.0
|
|
(10.2
|
)
|
130.7
|
|
||||
Income tax provision
|
16.8
|
|
16.8
|
|
(1.3
|
)
|
32.3
|
|
||||
Income (Loss) from Operations of Discontinued Operations, net of tax
|
58.1
|
|
49.2
|
|
(8.9
|
)
|
98.4
|
|
||||
Net Income Attributable to Noncontrolling Interests of Discontinued Operations
|
1.9
|
|
—
|
|
—
|
|
1.9
|
|
||||
Net Income (Loss) From Discontinued Operations, net of tax
|
$
|
56.2
|
|
$
|
49.2
|
|
$
|
(8.9
|
)
|
$
|
96.5
|
|
|
Nine Months Ended
|
|||||||||||
|
30 June 2016
|
|||||||||||
|
|
|
|
Total
|
||||||||
|
Electronic
|
Performance
|
Energy-
|
Discontinued
|
||||||||
|
Materials
|
Materials
|
from-Waste
(A)
|
Operations
|
||||||||
Sales
|
$
|
713.3
|
|
$
|
789.9
|
|
$
|
—
|
|
$
|
1,503.2
|
|
Cost of sales
|
385.8
|
|
539.1
|
|
22.9
|
|
947.8
|
|
||||
Selling and administrative
|
61.2
|
|
59.2
|
|
2.3
|
|
122.7
|
|
||||
Research and development
|
30.2
|
|
14.8
|
|
.8
|
|
45.8
|
|
||||
Other income (expense), net
|
4.2
|
|
3.1
|
|
(5.5
|
)
|
1.8
|
|
||||
Operating Income (Loss)
|
240.3
|
|
179.9
|
|
(31.5
|
)
|
388.7
|
|
||||
Equity affiliates’ income
|
.2
|
|
.9
|
|
—
|
|
1.1
|
|
||||
Income (Loss) Before Taxes
(B)
|
240.5
|
|
180.8
|
|
(31.5
|
)
|
389.8
|
|
||||
Income tax provision
|
58.4
|
|
53.7
|
|
(1.9
|
)
|
110.2
|
|
||||
Income (Loss) From Operations of Discontinued Operations
|
182.1
|
|
127.1
|
|
(29.6
|
)
|
279.6
|
|
||||
Loss on Disposal, net of tax
|
—
|
|
—
|
|
(846.6
|
)
|
(846.6
|
)
|
||||
Income (Loss) from Operations of Discontinued Operations, net of tax
|
182.1
|
|
127.1
|
|
(876.2
|
)
|
(567.0
|
)
|
||||
Net Income Attributable to Noncontrolling Interests of Discontinued Operations
|
6.0
|
|
—
|
|
—
|
|
6.0
|
|
||||
Net Income (Loss) From Discontinued Operations, net of tax
|
$
|
176.1
|
|
$
|
127.1
|
|
$
|
(876.2
|
)
|
$
|
(573.0
|
)
|
(A)
|
The loss from operations of discontinued operations for EfW primarily relates to project suspension costs, land lease obligations, and administrative costs.
|
(B)
|
For the
three and nine
months ended
30 June 2016
, income before taxes from operations of discontinued operations attributable to Air Products was $
128.3
and
$382.4
, respectively.
|
|
30 June 2017
|
||||||||
|
|
|
Total
|
||||||
|
Performance
|
Energy-
|
Discontinued
|
||||||
|
Materials
|
from-Waste
|
Operations
|
||||||
Assets
|
|
|
|
||||||
Current Assets
|
|
|
|
||||||
Plant and equipment, net
|
$
|
—
|
|
$
|
9.8
|
|
$
|
9.8
|
|
Total Current Assets
|
—
|
|
9.8
|
|
9.8
|
|
|||
Total Assets
|
$
|
—
|
|
$
|
9.8
|
|
$
|
9.8
|
|
Liabilities
|
|
|
|
||||||
Current Liabilities
|
|
|
|
||||||
Payables and accrued liabilities
(A)
|
$
|
10.4
|
|
$
|
6.1
|
|
$
|
16.5
|
|
Total Current Liabilities
|
10.4
|
|
6.1
|
|
16.5
|
|
|||
Total Liabilities
|
$
|
10.4
|
|
$
|
6.1
|
|
$
|
16.5
|
|
(A)
|
Includes reserves associated with disposition of businesses.
|
|
30 September 2016
|
|||||||||||
|
|
|
|
Total
|
||||||||
|
Electronic
|
Performance
|
Energy-
|
Discontinued
|
||||||||
|
Materials
|
Materials
|
from-Waste
|
Operations
|
||||||||
Assets
|
|
|
|
|
||||||||
Current Assets
|
|
|
|
|
||||||||
Cash and cash items
|
$
|
170.6
|
|
$
|
37.5
|
|
$
|
—
|
|
$
|
208.1
|
|
Trade receivables, net
|
134.7
|
|
159.0
|
|
—
|
|
293.7
|
|
||||
Inventories
|
138.1
|
|
226.8
|
|
—
|
|
364.9
|
|
||||
Plant and equipment, net
|
—
|
|
—
|
|
18.2
|
|
18.2
|
|
||||
Other receivables and current assets
|
34.5
|
|
5.6
|
|
1.2
|
|
41.3
|
|
||||
Total Current Assets
|
477.9
|
|
428.9
|
|
19.4
|
|
926.2
|
|
||||
Plant and equipment, net
|
296.5
|
|
296.5
|
|
—
|
|
593.0
|
|
||||
Goodwill, net
|
180.0
|
|
125.0
|
|
—
|
|
305.0
|
|
||||
Intangible assets, net
|
75.1
|
|
25.0
|
|
—
|
|
100.1
|
|
||||
Other noncurrent assets
|
37.5
|
|
6.7
|
|
—
|
|
44.2
|
|
||||
Total Noncurrent Assets
|
589.1
|
|
453.2
|
|
—
|
|
1,042.3
|
|
||||
Total Assets
|
$
|
1,067.0
|
|
$
|
882.1
|
|
$
|
19.4
|
|
$
|
1,968.5
|
|
Liabilities
|
|
|
|
|
||||||||
Current Liabilities
|
|
|
|
|
||||||||
Payables and accrued liabilities
|
$
|
85.8
|
|
$
|
72.5
|
|
$
|
19.0
|
|
$
|
177.3
|
|
Accrued income taxes
|
22.7
|
|
6.0
|
|
—
|
|
28.7
|
|
||||
Current portion of long-term debt
|
5.8
|
|
—
|
|
—
|
|
5.8
|
|
||||
Total Current Liabilities
|
114.3
|
|
78.5
|
|
19.0
|
|
211.8
|
|
||||
Long-term debt
|
981.8
|
|
—
|
|
—
|
|
981.8
|
|
||||
Deferred income taxes
|
50.3
|
|
6.4
|
|
—
|
|
56.7
|
|
||||
Other noncurrent liabilities
|
47.4
|
|
9.6
|
|
—
|
|
57.0
|
|
||||
Total Noncurrent Liabilities
|
1,079.5
|
|
16.0
|
|
—
|
|
1,095.5
|
|
||||
Total Liabilities
|
$
|
1,193.8
|
|
$
|
94.5
|
|
$
|
19.0
|
|
$
|
1,307.3
|
|
4.
|
BUSINESS SEPARATION COSTS
|
5.
|
COST REDUCTION AND ASSET ACTIONS
|
|
|
Severance and
Other Benefits
|
|
Asset
Actions/Other
|
|
Total
|
||||||
2016 Charge
|
|
$
|
34.5
|
|
|
$
|
—
|
|
|
$
|
34.5
|
|
Amount reflected in pension liability
|
|
(.9
|
)
|
|
—
|
|
|
(.9
|
)
|
|||
Cash expenditures
|
|
(21.6
|
)
|
|
—
|
|
|
(21.6
|
)
|
|||
Currency translation adjustment
|
|
.3
|
|
|
—
|
|
|
.3
|
|
|||
30 September 2016
|
|
$
|
12.3
|
|
|
$
|
—
|
|
|
$
|
12.3
|
|
2017 Charge
|
|
27.5
|
|
|
78.9
|
|
|
106.4
|
|
|||
Noncash expenses
|
|
—
|
|
|
(74.6
|
)
|
|
(74.6
|
)
|
|||
Amount reflected in pension liability
|
|
(1.0
|
)
|
|
—
|
|
|
(1.0
|
)
|
|||
Amount reflected in other noncurrent liabilities
|
|
—
|
|
|
(2.2
|
)
|
|
(2.2
|
)
|
|||
Cash expenditures
|
|
(27.0
|
)
|
|
(.9
|
)
|
|
(27.9
|
)
|
|||
Currency translation adjustment
|
|
(.4
|
)
|
|
—
|
|
|
(.4
|
)
|
|||
30 June 2017
|
|
$
|
11.4
|
|
|
$
|
1.2
|
|
|
$
|
12.6
|
|
6.
|
INVENTORIES
|
|
|
30 June
|
|
30 September
|
||||
|
|
2017
|
|
2016
|
||||
Finished goods
|
|
$
|
113.2
|
|
|
$
|
131.3
|
|
Work in process
|
|
15.0
|
|
|
18.3
|
|
||
Raw materials, supplies and other
|
|
180.2
|
|
|
117.1
|
|
||
Total FIFO cost
|
|
$
|
308.4
|
|
|
$
|
266.7
|
|
Less: Excess of FIFO cost over LIFO cost
|
|
(15.1
|
)
|
|
(11.7
|
)
|
||
Inventories
|
|
$
|
293.3
|
|
|
$
|
255.0
|
|
7.
|
EQUITY AFFILIATES
|
8.
|
GOODWILL
|
|
|
Industrial
Gases–
Americas
|
|
Industrial
Gases–
EMEA
|
|
Industrial
Gases–
Asia
|
|
Industrial
Gases–
Global
|
|
Total
|
||||||||||
Goodwill, net at 30 September 2016
|
|
$
|
309.1
|
|
|
$
|
380.6
|
|
|
$
|
135.2
|
|
|
$
|
20.2
|
|
|
$
|
845.1
|
|
Impairment loss
|
|
(145.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(145.3
|
)
|
|||||
Currency translation
|
|
(2.3
|
)
|
|
8.1
|
|
|
(.3
|
)
|
|
(.2
|
)
|
|
5.3
|
|
|||||
Goodwill, net at 30 June 2017
|
|
$
|
161.5
|
|
|
$
|
388.7
|
|
|
$
|
134.9
|
|
|
$
|
20.0
|
|
|
$
|
705.1
|
|
|
|
30 June
|
|
30 September
|
||||
|
|
2017
|
|
2016
|
||||
Goodwill, gross
|
|
$
|
1,106.5
|
|
|
$
|
1,103.7
|
|
Accumulated impairment losses
|
|
(401.4
|
)
|
|
(258.6
|
)
|
||
Goodwill, net
|
|
$
|
705.1
|
|
|
$
|
845.1
|
|
9.
|
INTANGIBLE ASSETS
|
|
30 June 2017
|
|
30 September 2016
|
||||||||||||||||
|
Gross
|
|
Accumulated
Amortization/
Impairment
|
|
Net
|
|
|
Gross
|
|
Accumulated
Amortization/ Impairment |
|
Net
|
|
||||||
Customer relationships
|
$
|
412.8
|
|
$
|
(134.3
|
)
|
$
|
278.5
|
|
|
$
|
400.6
|
|
$
|
(118.2
|
)
|
$
|
282.4
|
|
Patents and technology
|
13.6
|
|
(10.5
|
)
|
3.1
|
|
|
13.6
|
|
(10.1
|
)
|
3.5
|
|
||||||
Other
|
72.5
|
|
(35.6
|
)
|
36.9
|
|
|
73.0
|
|
(33.7
|
)
|
39.3
|
|
||||||
Total finite-lived intangible assets
|
498.9
|
|
(180.4
|
)
|
318.5
|
|
|
487.2
|
|
(162.0
|
)
|
325.2
|
|
||||||
Trade names and trademarks, indefinite-lived
|
65.6
|
|
(20.3
|
)
|
45.3
|
|
|
66.2
|
|
(3.5
|
)
|
62.7
|
|
||||||
Total Intangible Assets
|
$
|
564.5
|
|
$
|
(200.7
|
)
|
$
|
363.8
|
|
|
$
|
553.4
|
|
$
|
(165.5
|
)
|
$
|
387.9
|
|
10.
|
FINANCIAL INSTRUMENTS
|
|
|
30 June 2017
|
|
30 September 2016
|
||||||||
|
|
US$
Notional
|
|
Years
Average
Maturity
|
|
US$
Notional
|
|
Years
Average
Maturity
|
||||
Forward Exchange Contracts:
|
|
|
|
|
|
|
|
|
||||
Cash flow hedges
|
|
$
|
3,209.4
|
|
|
0.4
|
|
$
|
4,130.3
|
|
|
0.5
|
Net investment hedges
|
|
707.5
|
|
|
3.0
|
|
968.2
|
|
|
2.7
|
||
Not designated
|
|
1,220.4
|
|
|
0.1
|
|
2,648.3
|
|
|
0.4
|
||
Total Forward Exchange Contracts
|
|
$
|
5,137.3
|
|
|
0.7
|
|
$
|
7,746.8
|
|
|
0.7
|
|
|
30 June 2017
|
|
30 September 2016
|
||||||||||||||||||||
|
|
US$
Notional
|
|
Average
Pay %
|
|
Average
Receive
%
|
|
Years
Average
Maturity
|
|
US$
Notional
|
|
Average
Pay %
|
|
Average
Receive
%
|
|
Years
Average
Maturity
|
||||||||
Interest rate swaps
(fair value hedge)
|
|
$
|
600.0
|
|
|
LIBOR
|
|
|
2.28
|
%
|
|
1.5
|
|
$
|
600.0
|
|
|
LIBOR
|
|
|
2.28
|
%
|
|
2.3
|
Cross currency interest rate swaps
(net investment hedge)
|
|
$
|
493.9
|
|
|
3.24
|
%
|
|
2.39
|
%
|
|
1.8
|
|
$
|
517.7
|
|
|
3.24
|
%
|
|
2.43
|
%
|
|
2.6
|
Cross currency interest rate swaps
(cash flow hedge)
|
|
$
|
1,095.7
|
|
|
4.96
|
%
|
|
2.78
|
%
|
|
2.7
|
|
$
|
1,088.9
|
|
|
4.77
|
%
|
|
2.72
|
%
|
|
3.3
|
Cross currency interest rate swaps
(not designated)
|
|
$
|
51.2
|
|
|
3.38
|
%
|
|
1.91
|
%
|
|
1.7
|
|
$
|
27.4
|
|
|
3.62
|
%
|
|
.81
|
%
|
|
1.8
|
|
Balance Sheet
Location
|
30 June 2017
|
30 September 2016
|
Balance Sheet
Location
|
30 June 2017
|
30 September 2016
|
||||||||
Derivatives Designated as Hedging Instruments:
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
Other receivables
|
$
|
86.1
|
|
$
|
72.3
|
|
Accrued liabilities
|
$
|
60.8
|
|
$
|
44.0
|
|
Interest rate management contracts
|
Other receivables
|
32.3
|
|
19.9
|
|
Accrued liabilities
|
.1
|
|
—
|
|
||||
Forward exchange contracts
|
Other noncurrent
assets
|
39.1
|
|
44.4
|
|
Other noncurrent
liabilities
|
3.9
|
|
9.1
|
|
||||
Interest rate management contracts
|
Other noncurrent
assets
|
128.0
|
|
160.0
|
|
Other noncurrent
liabilities
|
22.5
|
|
12.0
|
|
||||
Total Derivatives Designated as Hedging Instruments
|
|
$
|
285.5
|
|
$
|
296.6
|
|
|
$
|
87.3
|
|
$
|
65.1
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
Other receivables
|
$
|
17.9
|
|
$
|
77.1
|
|
Accrued liabilities
|
$
|
7.4
|
|
$
|
29.5
|
|
Interest rate management contracts
|
Other noncurrent
assets
|
4.4
|
|
—
|
|
Other noncurrent
liabilities
|
.9
|
|
.7
|
|
||||
Total Derivatives Not Designated as Hedging Instruments
|
|
$
|
22.3
|
|
$
|
77.1
|
|
|
$
|
8.3
|
|
$
|
30.2
|
|
Total Derivatives
|
|
$
|
307.8
|
|
$
|
373.7
|
|
|
$
|
95.6
|
|
$
|
95.3
|
|
|
Three Months Ended 30 June
|
|||||||||||||||||||||||
|
Forward
Exchange Contracts
|
Foreign Currency
Debt
|
Other
(A)
|
Total
|
||||||||||||||||||||
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
||||||||||||||||
Cash Flow Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI (effective portion)
|
$
|
41.2
|
|
$
|
(33.7
|
)
|
$
|
—
|
|
$
|
—
|
|
$
|
(18.2
|
)
|
$
|
11.5
|
|
$
|
23.0
|
|
$
|
(22.2
|
)
|
Net (gain) loss reclassified from OCI to sales/cost of sales (effective portion)
|
4.3
|
|
1.0
|
|
—
|
|
—
|
|
—
|
|
—
|
|
4.3
|
|
1.0
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (effective portion)
|
(37.9
|
)
|
24.2
|
|
—
|
|
—
|
|
10.7
|
|
(18.8
|
)
|
(27.2
|
)
|
5.4
|
|
||||||||
Net (gain) loss reclassified from OCI to interest expense (effective portion)
|
.4
|
|
2.6
|
|
—
|
|
—
|
|
.7
|
|
.9
|
|
1.1
|
|
3.5
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (ineffective portion)
|
(1.8
|
)
|
.1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1.8
|
)
|
.1
|
|
||||||||
Fair Value Hedges:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in interest expense
(B)
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
(.6
|
)
|
$
|
(.2
|
)
|
$
|
(.6
|
)
|
$
|
(.2
|
)
|
Net Investment Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI
|
$
|
(23.2
|
)
|
$
|
28.2
|
|
$
|
(44.4
|
)
|
$
|
8.4
|
|
$
|
(9.8
|
)
|
$
|
25.1
|
|
$
|
(77.4
|
)
|
$
|
61.7
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in other income (expense), net
(C)
|
$
|
3.7
|
|
$
|
(2.4
|
)
|
$
|
—
|
|
$
|
—
|
|
$
|
(.7
|
)
|
$
|
(.2
|
)
|
$
|
3.0
|
|
$
|
(2.6
|
)
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Nine Months Ended 30 June
|
|||||||||||||||||||||||
|
Forward
Exchange Contracts
|
Foreign Currency
Debt
|
Other
(A)
|
Total
|
||||||||||||||||||||
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
||||||||||||||||
Cash Flow Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI (effective portion)
|
$
|
(7.1
|
)
|
$
|
(5.9
|
)
|
$
|
—
|
|
$
|
—
|
|
$
|
4.9
|
|
$
|
12.5
|
|
$
|
(2.2
|
)
|
$
|
6.6
|
|
Net (gain) loss reclassified from OCI to sales/cost of sales (effective portion)
|
10.1
|
|
2.4
|
|
—
|
|
—
|
|
—
|
|
—
|
|
10.1
|
|
2.4
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (effective portion)
|
.8
|
|
(7.8
|
)
|
—
|
|
—
|
|
(1.7
|
)
|
(22.5
|
)
|
(.9
|
)
|
(30.3
|
)
|
||||||||
Net (gain) loss reclassified from OCI to interest expense (effective portion)
|
(2.0
|
)
|
5.2
|
|
—
|
|
—
|
|
2.1
|
|
2.5
|
|
.1
|
|
7.7
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (ineffective portion)
|
(1.5
|
)
|
(.2
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(1.5
|
)
|
(.2
|
)
|
||||||||
Fair Value Hedges:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in interest expense
(B)
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
(12.5
|
)
|
$
|
(2.0
|
)
|
$
|
(12.5
|
)
|
$
|
(2.0
|
)
|
Net Investment Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI
|
$
|
3.9
|
|
$
|
21.8
|
|
$
|
(10.4
|
)
|
$
|
(1.9
|
)
|
$
|
(3.2
|
)
|
$
|
33.5
|
|
$
|
(9.7
|
)
|
$
|
53.4
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in other income (expense), net
(C)
|
$
|
3.3
|
|
$
|
(2.6
|
)
|
$
|
—
|
|
$
|
—
|
|
$
|
(.5
|
)
|
$
|
(.8
|
)
|
$
|
2.8
|
|
$
|
(3.4
|
)
|
(A)
|
Other includes the impact on other comprehensive income (OCI) and earnings primarily related to interest rate and cross currency interest rate swaps.
|
(B)
|
The impact of fair value hedges noted above was largely offset by recognized gains and losses resulting from the impact of changes in related interest rates on outstanding debt.
|
(C)
|
The impact of the non-designated hedges noted above was largely offset by recognized gains and losses resulting from the impact of changes in exchange rates on assets and liabilities denominated in non-functional currencies.
|
11.
|
FAIR VALUE MEASUREMENTS
|
Level 1
|
— Quoted prices (unadjusted) in active markets for identical assets or liabilities.
|
Level 2
|
— Inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the asset or liability.
|
Level 3
|
— Inputs that are unobservable for the asset or liability based on our own assumptions (about the assumptions market participants would use in pricing the asset or liability).
|
|
|
30 June 2017
|
|
30 September 2016
|
||||||||||||
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
$
|
143.1
|
|
|
$
|
143.1
|
|
|
$
|
193.8
|
|
|
$
|
193.8
|
|
Interest rate management contracts
|
|
164.7
|
|
|
164.7
|
|
|
179.9
|
|
|
179.9
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
$
|
72.1
|
|
|
$
|
72.1
|
|
|
$
|
82.6
|
|
|
$
|
82.6
|
|
Interest rate management contracts
|
|
23.5
|
|
|
23.5
|
|
|
12.7
|
|
|
12.7
|
|
||||
Long-term debt, including current portion
|
|
3,782.6
|
|
|
3,884.6
|
|
|
4,275.1
|
|
|
4,474.0
|
|
|
30 June 2017
|
|
30 September 2016
|
||||||||||||||||||||||
|
Total
|
Level 1
|
Level 2
|
Level 3
|
|
Total
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||||||
Assets at Fair Value
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Forward exchange contracts
|
$
|
143.1
|
|
$
|
—
|
|
$
|
143.1
|
|
$
|
—
|
|
|
$
|
193.8
|
|
$
|
—
|
|
$
|
193.8
|
|
$
|
—
|
|
Interest rate management contracts
|
164.7
|
|
—
|
|
164.7
|
|
—
|
|
|
179.9
|
|
—
|
|
179.9
|
|
—
|
|
||||||||
Total Assets at Fair Value
|
$
|
307.8
|
|
$
|
—
|
|
$
|
307.8
|
|
$
|
—
|
|
|
$
|
373.7
|
|
$
|
—
|
|
$
|
373.7
|
|
$
|
—
|
|
Liabilities at Fair Value
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Forward exchange contracts
|
$
|
72.1
|
|
$
|
—
|
|
$
|
72.1
|
|
$
|
—
|
|
|
$
|
82.6
|
|
$
|
—
|
|
$
|
82.6
|
|
$
|
—
|
|
Interest rate management contracts
|
23.5
|
|
—
|
|
23.5
|
|
—
|
|
|
12.7
|
|
—
|
|
12.7
|
|
—
|
|
||||||||
Total Liabilities at Fair Value
|
$
|
95.6
|
|
$
|
—
|
|
$
|
95.6
|
|
$
|
—
|
|
|
$
|
95.3
|
|
$
|
—
|
|
$
|
95.3
|
|
$
|
—
|
|
|
31 December 2016
|
2017 Loss
|
||||||||||||||
|
Total
|
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||
Plant and Equipment – Continuing operations
(A)
|
$
|
1.4
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
1.4
|
|
$
|
45.7
|
|
Plant and Equipment – Discontinued operations
(A)
|
$
|
11.0
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
11.0
|
|
$
|
6.3
|
|
(A)
|
We assessed the recoverability of the carrying value of assets associated with the EfW discontinued operation, including the air separation unit within continuing operations of our Industrial Gases – EMEA segment. We based our estimates primarily on an orderly liquidation valuation which resulted in losses for the difference between the orderly liquidation value and net book value of the assets as of 31 December 2016. There have been no significant updates to our estimates as of
30 June 2017
. For additional information, see Note
3
,
Discontinued Operations
, and Note
5
,
Cost Reduction and Asset Actions
.
|
|
30 June 2017
|
2017 Loss
|
||||||||||||||
|
Total
|
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||
Investment in Equity Affiliate
(A)
|
$
|
68.5
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
68.5
|
|
$
|
79.5
|
|
(A)
|
We assessed the recoverability of the carrying value of our equity investment in AHG. We estimated the fair value of our investment using weighting of the results of the income and market approaches. An impairment loss was recognized for the difference between the carrying amount and the fair value of the investment as of 30 June 2017. For additional information, see Note
7
, Equity Affiliates.
|
12.
|
RETIREMENT BENEFITS
|
|
Pension Benefits
|
|
Other Benefits
|
||||||||||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||||||||||
Three Months Ended 30 June
|
U.S.
|
|
International
|
|
U.S.
|
|
International
|
|
|
|
|
||||||||||||
Service cost
|
$
|
7.0
|
|
|
$
|
6.5
|
|
|
$
|
9.1
|
|
|
$
|
6.1
|
|
|
$
|
.2
|
|
|
$
|
.5
|
|
Interest cost
|
27.5
|
|
|
8.2
|
|
|
27.7
|
|
|
11.2
|
|
|
.4
|
|
|
.5
|
|
||||||
Expected return on plan assets
|
(51.6
|
)
|
|
(18.9
|
)
|
|
(50.5
|
)
|
|
(19.8
|
)
|
|
—
|
|
|
—
|
|
||||||
Prior service cost amortization
|
.6
|
|
|
—
|
|
|
.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Actuarial loss amortization
|
20.9
|
|
|
13.5
|
|
|
21.3
|
|
|
8.9
|
|
|
—
|
|
|
.2
|
|
||||||
Settlements
|
5.5
|
|
|
—
|
|
|
1.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Special termination benefits
|
.8
|
|
|
—
|
|
|
1.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other
|
—
|
|
|
.2
|
|
|
—
|
|
|
.6
|
|
|
—
|
|
|
—
|
|
||||||
Net Periodic Benefit Cost (Total)
|
$
|
10.7
|
|
|
$
|
9.5
|
|
|
$
|
10.7
|
|
|
$
|
7.0
|
|
|
$
|
.6
|
|
|
$
|
1.2
|
|
Less: Discontinued Operations
|
—
|
|
|
—
|
|
|
(1.9
|
)
|
|
(.2
|
)
|
|
—
|
|
|
(.1
|
)
|
||||||
Net Periodic Benefit Cost (Continuing Operations)
|
$
|
10.7
|
|
|
$
|
9.5
|
|
|
$
|
8.8
|
|
|
$
|
6.8
|
|
|
$
|
.6
|
|
|
$
|
1.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Pension Benefits
|
|
Other Benefits
|
||||||||||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||||||||||
Nine Months Ended 30 June
|
U.S.
|
|
International
|
|
U.S.
|
|
International
|
|
|
|
|
||||||||||||
Service cost
|
$
|
22.2
|
|
|
$
|
19.5
|
|
|
$
|
27.4
|
|
|
$
|
18.4
|
|
|
$
|
.9
|
|
|
$
|
1.6
|
|
Interest cost
|
80.0
|
|
|
23.7
|
|
|
83.1
|
|
|
33.9
|
|
|
1.2
|
|
|
1.5
|
|
||||||
Expected return on plan assets
|
(156.0
|
)
|
|
(55.7
|
)
|
|
(151.5
|
)
|
|
(60.1
|
)
|
|
—
|
|
|
—
|
|
||||||
Prior service cost amortization
|
1.8
|
|
|
(.1
|
)
|
|
2.2
|
|
|
(.1
|
)
|
|
—
|
|
|
—
|
|
||||||
Actuarial loss amortization
|
67.9
|
|
|
40.6
|
|
|
63.9
|
|
|
27.2
|
|
|
.2
|
|
|
.5
|
|
||||||
Settlements
|
9.6
|
|
|
1.7
|
|
|
3.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Curtailment
|
4.3
|
|
|
(1.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Special termination benefits
|
1.8
|
|
|
.5
|
|
|
2.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other
|
—
|
|
|
.7
|
|
|
—
|
|
|
1.6
|
|
|
—
|
|
|
—
|
|
||||||
Net Periodic Benefit Cost (Total)
|
$
|
31.6
|
|
|
$
|
29.6
|
|
|
$
|
30.7
|
|
|
$
|
20.9
|
|
|
$
|
2.3
|
|
|
$
|
3.6
|
|
Less: Discontinued Operations
|
(.7
|
)
|
|
(4.1
|
)
|
|
(5.8
|
)
|
|
(1.8
|
)
|
|
—
|
|
|
(.1
|
)
|
||||||
Net Periodic Benefit Cost (Continuing Operations)
|
$
|
30.9
|
|
|
$
|
25.5
|
|
|
$
|
24.9
|
|
|
$
|
19.1
|
|
|
$
|
2.3
|
|
|
$
|
3.5
|
|
13.
|
COMMITMENTS AND CONTINGENCIES
|
14.
|
SHARE-BASED COMPENSATION
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
30 June
|
|
30 June
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Before-Tax Share-Based Compensation Cost
|
|
$
|
8.9
|
|
|
$
|
7.5
|
|
|
$
|
27.4
|
|
|
$
|
23.9
|
|
Income Tax Benefit
|
|
(3.2
|
)
|
|
(2.9
|
)
|
|
(9.5
|
)
|
|
(8.4
|
)
|
||||
After-Tax Share-Based Compensation Cost
|
|
$
|
5.7
|
|
|
$
|
4.6
|
|
|
$
|
17.9
|
|
|
$
|
15.5
|
|
Expected volatility
|
|
20.6
|
%
|
Risk-free interest rate
|
|
1.4
|
%
|
Expected dividend yield
|
|
2.5
|
%
|
15.
|
EQUITY
|
|
Three Months Ended 30 June
|
||||||||||||||||||
|
2017
|
|
2016
|
||||||||||||||||
|
Air
Products
|
Non-
controlling
Interests
|
Total
Equity
|
|
Air
Products
|
Non-
controlling
Interests
|
Total
Equity
|
||||||||||||
Balance at 31 March
|
$
|
9,317.4
|
|
$
|
102.8
|
|
$
|
9,420.2
|
|
|
$
|
6,916.6
|
|
$
|
136.5
|
|
$
|
7,053.1
|
|
Net income
|
101.9
|
|
2.2
|
|
104.1
|
|
|
346.8
|
|
7.3
|
|
354.1
|
|
||||||
Other comprehensive income (loss)
|
176.6
|
|
.2
|
|
176.8
|
|
|
(79.0
|
)
|
(.7
|
)
|
(79.7
|
)
|
||||||
Dividends on common stock (per share $0.95, $0.86)
|
(207.0
|
)
|
—
|
|
(207.0
|
)
|
|
(186.2
|
)
|
—
|
|
(186.2
|
)
|
||||||
Dividends to noncontrolling interests
|
—
|
|
(7.9
|
)
|
(7.9
|
)
|
|
—
|
|
(8.4
|
)
|
(8.4
|
)
|
||||||
Share-based compensation
|
8.9
|
|
—
|
|
8.9
|
|
|
7.5
|
|
—
|
|
7.5
|
|
||||||
Treasury shares for stock option and award plans
|
17.8
|
|
—
|
|
17.8
|
|
|
32.0
|
|
—
|
|
32.0
|
|
||||||
Tax benefit of stock option and award plans
(A)
|
—
|
|
—
|
|
—
|
|
|
6.8
|
|
—
|
|
6.8
|
|
||||||
Other equity transactions
|
(3.2
|
)
|
.2
|
|
(3.0
|
)
|
|
.9
|
|
.1
|
|
1.0
|
|
||||||
Balance at 30 June
|
$
|
9,412.4
|
|
$
|
97.5
|
|
$
|
9,509.9
|
|
|
$
|
7,045.4
|
|
$
|
134.8
|
|
$
|
7,180.2
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Nine Months Ended 30 June
|
||||||||||||||||||
|
2017
|
|
2016
|
||||||||||||||||
|
Air
Products
|
Non-
controlling
Interests
|
Total
Equity
|
|
Air
Products
|
Non-
controlling
Interests
|
Total
Equity
|
||||||||||||
Balance at 30 September
|
$
|
7,079.6
|
|
$
|
133.8
|
|
$
|
7,213.4
|
|
|
$
|
7,249.0
|
|
$
|
132.1
|
|
$
|
7,381.1
|
|
Net income
|
2,531.7
|
|
14.5
|
|
2,546.2
|
|
|
237.1
|
|
23.5
|
|
260.6
|
|
||||||
Other comprehensive income
|
159.7
|
|
2.1
|
|
161.8
|
|
|
.2
|
|
2.1
|
|
2.3
|
|
||||||
Dividends on common stock (per share $2.76, $2.53)
|
(601.0
|
)
|
—
|
|
(601.0
|
)
|
|
(546.7
|
)
|
—
|
|
(546.7
|
)
|
||||||
Dividends to noncontrolling interests
|
—
|
|
(19.5
|
)
|
(19.5
|
)
|
|
—
|
|
(23.2
|
)
|
(23.2
|
)
|
||||||
Share-based compensation
|
27.4
|
|
—
|
|
27.4
|
|
|
23.9
|
|
—
|
|
23.9
|
|
||||||
Treasury shares for stock option and award plans
|
25.5
|
|
—
|
|
25.5
|
|
|
62.8
|
|
—
|
|
62.8
|
|
||||||
Tax benefit of stock option and award plans
(A)
|
—
|
|
—
|
|
—
|
|
|
16.5
|
|
—
|
|
16.5
|
|
||||||
Spin-off of Versum
|
186.5
|
|
(33.9
|
)
|
152.6
|
|
|
—
|
|
—
|
|
—
|
|
||||||
Cumulative change in accounting principle
(A)
|
8.8
|
|
—
|
|
8.8
|
|
|
—
|
|
—
|
|
—
|
|
||||||
Other equity transactions
|
(5.8
|
)
|
.5
|
|
(5.3
|
)
|
|
2.6
|
|
.3
|
|
2.9
|
|
||||||
Balance at 30 June
|
$
|
9,412.4
|
|
$
|
97.5
|
|
$
|
9,509.9
|
|
|
$
|
7,045.4
|
|
$
|
134.8
|
|
$
|
7,180.2
|
|
(A)
|
Refer to Note 2, New Accounting Guidance, for information concerning the implementation and impact of new accounting guidance.
|
16.
|
ACCUMULATED OTHER COMPREHENSIVE LOSS
|
|
Derivatives
qualifying as
hedges
|
|
Foreign
currency
translation
adjustments
|
|
Pension and
postretirement
benefits
|
|
Total
|
|
||||
Balance at 31 March 2017
|
$
|
(58.5
|
)
|
$
|
(1,027.7
|
)
|
$
|
(1,307.5
|
)
|
$
|
(2,393.7
|
)
|
Other comprehensive income before reclassifications
|
23.0
|
|
141.4
|
|
.1
|
|
164.5
|
|
||||
Amounts reclassified from AOCL
|
(23.6
|
)
|
8.2
|
|
27.7
|
|
12.3
|
|
||||
Net current period other comprehensive income (loss)
|
(.6
|
)
|
149.6
|
|
27.8
|
|
176.8
|
|
||||
Amount attributable to noncontrolling interests
|
—
|
|
.2
|
|
—
|
|
.2
|
|
||||
Balance at 30 June 2017
|
$
|
(59.1
|
)
|
$
|
(878.3
|
)
|
$
|
(1,279.7
|
)
|
$
|
(2,217.1
|
)
|
|
|
|
|
|
||||||||
|
Derivatives
qualifying
as hedges
|
|
Foreign
currency
translation
adjustments
|
|
Pension and
postretirement
benefits
|
|
Total
|
|
||||
Balance at 30 September 2016
|
$
|
(65.0
|
)
|
$
|
(949.3
|
)
|
$
|
(1,374.0
|
)
|
$
|
(2,388.3
|
)
|
Other comprehensive income (loss) before reclassifications
|
(2.2
|
)
|
9.8
|
|
3.9
|
|
11.5
|
|
||||
Amounts reclassified from AOCL
|
7.8
|
|
57.3
|
|
85.2
|
|
150.3
|
|
||||
Net current period other comprehensive income
|
5.6
|
|
67.1
|
|
89.1
|
|
161.8
|
|
||||
Spin-off of Versum
|
.2
|
|
6.0
|
|
5.3
|
|
11.5
|
|
||||
Amount attributable to noncontrolling interests
|
(.1
|
)
|
2.1
|
|
.1
|
|
2.1
|
|
||||
Balance at 30 June 2017
|
$
|
(59.1
|
)
|
$
|
(878.3
|
)
|
$
|
(1,279.7
|
)
|
$
|
(2,217.1
|
)
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
|
2017
|
2016
|
2017
|
2016
|
||||||||
(Gain) Loss on Cash Flow Hedges, net of tax
|
|
|
|
|
||||||||
Sales/Cost of sales
|
$
|
4.3
|
|
$
|
1.0
|
|
$
|
10.1
|
|
$
|
2.4
|
|
Other income (expense), net
|
(29.0
|
)
|
5.5
|
|
(2.4
|
)
|
(30.5
|
)
|
||||
Interest expense
|
1.1
|
|
3.5
|
|
.1
|
|
7.7
|
|
||||
Total (Gain) Loss on Cash Flow Hedges, net of tax
|
$
|
(23.6
|
)
|
$
|
10.0
|
|
$
|
7.8
|
|
$
|
(20.4
|
)
|
|
|
|
|
|
||||||||
Currency Translation Adjustment
|
|
|
|
|
||||||||
Cost reduction and asset actions
(A)
|
$
|
8.2
|
|
$
|
—
|
|
$
|
8.2
|
|
$
|
—
|
|
Income (loss) from discontinued operations, net of tax
(B)
|
—
|
|
(.1
|
)
|
49.1
|
|
2.7
|
|
||||
Total Currency Translation Adjustment
|
$
|
8.2
|
|
$
|
(.1
|
)
|
$
|
57.3
|
|
$
|
2.7
|
|
|
|
|
|
|
||||||||
Pension and Postretirement Benefits, net of tax
(C)
|
$
|
27.7
|
|
$
|
21.6
|
|
$
|
85.2
|
|
$
|
65.4
|
|
(A)
|
Impact relates to the planned sale of a non-industrial gas hardgoods business in the Industrial Gases – Americas segment.
|
(B)
|
The fiscal year 2017 impact relates to the sale of PMD during the second quarter. The fiscal year 2016 impact primarily relates to the sale of an equity affiliate in the first quarter.
|
(C)
|
The components include items such as prior service cost amortization, actuarial loss amortization, and settlements and are reflected in net periodic benefit cost. Refer to Note
12
,
Retirement Benefits
.
|
17.
|
EARNINGS PER SHARE
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
30 June
|
|
30 June
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Numerator
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
$
|
104.2
|
|
|
$
|
250.3
|
|
|
$
|
660.2
|
|
|
$
|
810.1
|
|
Income (Loss) from discontinued operations
|
|
(2.3
|
)
|
|
96.5
|
|
|
1,871.5
|
|
|
(573.0
|
)
|
||||
Net Income Attributable to Air Products
|
|
$
|
101.9
|
|
|
$
|
346.8
|
|
|
$
|
2,531.7
|
|
|
$
|
237.1
|
|
Denominator
(in millions)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares — Basic
|
|
218.1
|
|
|
216.6
|
|
|
217.9
|
|
|
216.1
|
|
||||
Effect of dilutive securities
|
|
|
|
|
|
|
|
|
||||||||
Employee stock option and other award plans
|
|
1.7
|
|
|
1.9
|
|
|
1.9
|
|
|
1.9
|
|
||||
Weighted average common shares — Diluted
|
|
219.8
|
|
|
218.5
|
|
|
219.8
|
|
|
218.0
|
|
||||
Basic Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
$
|
.48
|
|
|
$
|
1.16
|
|
|
$
|
3.03
|
|
|
$
|
3.75
|
|
Income (Loss) from discontinued operations
|
|
(.01
|
)
|
|
.44
|
|
|
8.59
|
|
|
(2.65
|
)
|
||||
Net Income Attributable to Air Products
|
|
$
|
.47
|
|
|
$
|
1.60
|
|
|
$
|
11.62
|
|
|
$
|
1.10
|
|
Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
$
|
.47
|
|
|
$
|
1.15
|
|
|
$
|
3.00
|
|
|
$
|
3.72
|
|
Income (Loss) from discontinued operations
|
|
(.01
|
)
|
|
.44
|
|
|
8.52
|
|
|
(2.63
|
)
|
||||
Net Income Attributable to Air Products
|
|
$
|
.46
|
|
|
$
|
1.59
|
|
|
$
|
11.52
|
|
|
$
|
1.09
|
|
18.
|
SUPPLEMENTAL INFORMATION
|
19.
|
BUSINESS SEGMENT INFORMATION
|
•
|
Industrial Gases – Americas
|
•
|
Industrial Gases – EMEA (Europe, Middle East, and Africa)
|
•
|
Industrial Gases – Asia
|
•
|
Industrial Gases – Global
|
•
|
Corporate and other
|
|
Industrial
Gases–
Americas
|
Industrial
Gases–
EMEA
|
Industrial
Gases–
Asia
|
Industrial
Gases–
Global
|
Corporate
and other
|
Segment
Total
|
||||||||||||
Three Months Ended 30 June 2017
|
||||||||||||||||||
Sales
|
$
|
930.1
|
|
$
|
451.7
|
|
$
|
538.3
|
|
$
|
187.4
|
|
$
|
14.4
|
|
$
|
2,121.9
|
|
Operating income (loss)
|
236.2
|
|
94.1
|
|
149.1
|
|
27.9
|
|
(44.4
|
)
|
462.9
|
|
||||||
Depreciation and amortization
|
117.0
|
|
45.1
|
|
49.6
|
|
2.3
|
|
2.9
|
|
216.9
|
|
||||||
Equity affiliates' income
|
14.1
|
|
15.7
|
|
12.5
|
|
.3
|
|
—
|
|
42.6
|
|
||||||
Three Months Ended 30 June 2016
|
||||||||||||||||||
Sales
|
$
|
832.3
|
|
$
|
428.7
|
|
$
|
449.0
|
|
$
|
150.8
|
|
$
|
53.7
|
|
$
|
1,914.5
|
|
Operating income (loss)
|
234.0
|
|
104.0
|
|
118.7
|
|
(13.9
|
)
|
(24.5
|
)
|
418.3
|
|
||||||
Depreciation and amortization
|
112.1
|
|
45.1
|
|
49.5
|
|
2.0
|
|
4.8
|
|
213.5
|
|
||||||
Equity affiliates' income
|
16.0
|
|
11.3
|
|
14.8
|
|
—
|
|
—
|
|
42.1
|
|
|
|
|
|
|
|
|
||||||||||||
Nine Months Ended 30 June 2017
|
||||||||||||||||||
Sales
|
$
|
2,684.1
|
|
$
|
1,265.6
|
|
$
|
1,412.5
|
|
$
|
551.8
|
|
$
|
70.5
|
|
$
|
5,984.5
|
|
Operating income (loss)
|
684.5
|
|
268.6
|
|
379.2
|
|
58.9
|
|
(114.4
|
)
|
1,276.8
|
|
||||||
Depreciation and amortization
|
344.8
|
|
128.9
|
|
145.6
|
|
6.0
|
|
9.5
|
|
634.8
|
|
||||||
Equity affiliates' income
|
41.8
|
|
33.5
|
|
38.9
|
|
.6
|
|
—
|
|
114.8
|
|
||||||
Nine Months Ended 30 June 2016
|
||||||||||||||||||
Sales
|
$
|
2,466.7
|
|
$
|
1,290.1
|
|
$
|
1,271.5
|
|
$
|
341.7
|
|
$
|
188.2
|
|
$
|
5,558.2
|
|
Operating income (loss)
|
669.1
|
|
286.3
|
|
341.0
|
|
(44.0
|
)
|
(57.9
|
)
|
1,194.5
|
|
||||||
Depreciation and amortization
|
330.9
|
|
140.1
|
|
150.2
|
|
5.9
|
|
15.0
|
|
642.1
|
|
||||||
Equity affiliates' income (loss)
|
38.2
|
|
26.1
|
|
43.9
|
|
(.5
|
)
|
—
|
|
107.7
|
|
||||||
Total Assets
|
||||||||||||||||||
30 June 2017
|
$
|
5,765.6
|
|
$
|
3,205.4
|
|
$
|
4,262.6
|
|
$
|
283.6
|
|
$
|
4,326.8
|
|
$
|
17,844.0
|
|
30 September 2016
|
5,896.7
|
|
3,178.6
|
|
4,232.7
|
|
367.6
|
|
2,384.5
|
|
16,060.1
|
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
Operating Income
|
2017
|
2016
|
2017
|
2016
|
||||||||
Segment total
|
$
|
462.9
|
|
$
|
418.3
|
|
$
|
1,276.8
|
|
$
|
1,194.5
|
|
Business separation costs
|
—
|
|
(9.5
|
)
|
(30.2
|
)
|
(28.9
|
)
|
||||
Cost reduction and asset actions
|
(42.7
|
)
|
(13.2
|
)
|
(103.0
|
)
|
(23.9
|
)
|
||||
Pension settlement loss
|
(5.5
|
)
|
(1.0
|
)
|
(9.6
|
)
|
(3.0
|
)
|
||||
Goodwill and intangible asset impairment charge
|
(162.1
|
)
|
—
|
|
(162.1
|
)
|
—
|
|
||||
Consolidated Total
|
$
|
252.6
|
|
$
|
394.6
|
|
$
|
971.9
|
|
$
|
1,138.7
|
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
Equity Affiliates' Income (Loss)
|
2017
|
2016
|
2017
|
2016
|
||||||||
Segment total
|
$
|
42.6
|
|
$
|
42.1
|
|
$
|
114.8
|
|
$
|
107.7
|
|
Equity method investment impairment charge
|
(79.5
|
)
|
—
|
|
(79.5
|
)
|
—
|
|
||||
Consolidated Total
|
$
|
(36.9
|
)
|
$
|
42.1
|
|
$
|
35.3
|
|
$
|
107.7
|
|
|
30 June
|
30 September
|
||||
Total Assets
|
2017
|
2016
|
||||
Segment total
|
$
|
17,844.0
|
|
$
|
16,060.1
|
|
Discontinued operations
|
9.8
|
|
1,968.5
|
|
||
Consolidated Total
|
$
|
17,853.8
|
|
$
|
18,028.6
|
|
•
|
Sales of
$2,121.9
increased
11%
, or
$207.4
, from higher volumes of
8%
and higher energy contractual pass-through to customers of
5%
, partially offset by
2%
of unfavorable currency impacts.
|
•
|
Operating income of
$252.6
decreased
36%
, or
$142.0
, and operating margin of
11.9%
decreased
870
basis points (bp). On a non-GAAP basis, operating income of
$462.9
increased
11%
, or
$44.6
, and operating margin of
21.8%
was flat
versus the prior year.
|
•
|
During the third quarter of fiscal year 2017, we recorded noncash impairment charges, of which
$162.1
impacted operating income and related to the impairment of goodwill and intangible assets associated with our Latin America reporting unit and
$79.5
impacted equity affiliates' income and related to an other-than-temporary impairment of our investment in an equity affiliate in Saudi Arabia.
|
•
|
Adjusted EBITDA of
$722.4
increased
7%
, or
$48.5
. Adjusted EBITDA margin of
34.0%
decreased
120
bp.
|
•
|
Income from continuing operations of
$104.2
decreased
58%
, or
$146.1
, and diluted earnings per share of
$.47
decreased
59%
, or
$.68
. On a non-GAAP basis, income from continuing operations of
$363.0
increased
16%
, or
$49.2
, and diluted earnings per share of
$1.65
increased
15%
, or
$.21
. A summary table of changes in diluted earnings per share is presented below.
|
Changes in Diluted Earnings per Share Attributable to Air Products
|
||||||||||||
|
|
|
|
|
|
|
||||||
|
|
Three Months Ended
|
|
|
||||||||
|
|
30 June
|
|
Increase
|
||||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
||||||
Diluted Earnings per Share
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
.46
|
|
|
$
|
1.59
|
|
|
$
|
(1.13
|
)
|
Income (Loss) from discontinued operations
|
|
(.01
|
)
|
|
.44
|
|
|
(.45
|
)
|
|||
Income from Continuing Operations – GAAP Basis
|
|
$
|
.47
|
|
|
$
|
1.15
|
|
|
$
|
(.68
|
)
|
Operating Income Impact (after-tax)
|
|
|
|
|
|
|
||||||
Underlying business
|
|
|
|
|
|
|
||||||
Volume
|
|
|
|
|
|
$
|
.19
|
|
||||
Price/raw materials
|
|
|
|
|
|
(.01
|
)
|
|||||
Costs
|
|
|
|
|
|
(.02
|
)
|
|||||
Currency
|
|
|
|
|
|
(.01
|
)
|
|||||
Business separation costs
|
|
|
|
|
|
.03
|
|
|||||
Cost reduction and asset actions
|
|
|
|
|
|
(.10
|
)
|
|||||
Pension settlement loss
|
|
|
|
|
|
(.02
|
)
|
|||||
Goodwill and intangible asset impairment charge
|
|
|
|
|
|
(.70
|
)
|
|||||
Operating Income
|
|
|
|
|
|
$
|
(.64
|
)
|
||||
Other (after-tax)
|
|
|
|
|
|
|
||||||
Equity affiliates' income
|
|
|
|
|
|
$
|
—
|
|
||||
Equity method investment impairment charge
|
|
|
|
|
|
(.36
|
)
|
|||||
Interest expense
|
|
|
|
|
|
.02
|
|
|||||
Other non-operating income (expense), net
|
|
|
|
|
|
.03
|
|
|||||
Income tax
|
|
|
|
|
|
.02
|
|
|||||
Tax benefit associated with business separation
|
|
|
|
|
|
.26
|
|
|||||
Weighted average diluted shares
|
|
|
|
|
|
(.01
|
)
|
|||||
Other
|
|
|
|
|
|
$
|
(.04
|
)
|
||||
Total Change in Diluted Earnings per Share from Continuing Operations – GAAP Basis
|
|
|
|
|
|
$
|
(.68
|
)
|
|
|
Three Months Ended
|
|
|
||||||||
|
|
30 June
|
|
Increase
|
|
|||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
|
|||||
Income from Continuing Operations – GAAP Basis
|
|
$
|
.47
|
|
|
$
|
1.15
|
|
|
$
|
(.68
|
)
|
Business separation costs
|
|
—
|
|
|
.03
|
|
|
(.03
|
)
|
|||
Tax (benefit) costs associated with business separation
|
|
(.04
|
)
|
|
.22
|
|
|
(.26
|
)
|
|||
Cost reduction and asset actions
|
|
.14
|
|
|
.04
|
|
|
.10
|
|
|||
Pension settlement loss
|
|
.02
|
|
|
—
|
|
|
.02
|
|
|||
Goodwill and intangible asset impairment charge
|
|
.70
|
|
|
—
|
|
|
.70
|
|
|||
Equity method investment impairment charge
|
|
.36
|
|
|
—
|
|
|
.36
|
|
|||
Income from Continuing Operations – Non-GAAP Basis
|
|
$
|
1.65
|
|
|
$
|
1.44
|
|
|
$
|
.21
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
Change
|
|||||||
Sales
|
|
$
|
2,121.9
|
|
|
$
|
1,914.5
|
|
|
$
|
207.4
|
|
|
11
|
%
|
Operating income
|
|
252.6
|
|
|
394.6
|
|
|
(142.0
|
)
|
|
(36
|
)%
|
|||
Operating margin
|
|
11.9
|
%
|
|
20.6
|
%
|
|
|
|
|
(870 bp)
|
|
|||
Equity affiliates’ income
|
|
(36.9
|
)
|
|
42.1
|
|
|
(79.0
|
)
|
|
(188
|
)%
|
|||
Non-GAAP Basis
|
|
|
|
|
|
|
|
|
|||||||
Adjusted EBITDA
|
|
$
|
722.4
|
|
|
$
|
673.9
|
|
|
$
|
48.5
|
|
|
7
|
%
|
Adjusted EBITDA margin
|
|
34.0
|
%
|
|
35.2
|
%
|
|
|
|
(120 bp)
|
|
||||
Adjusted operating income
|
|
462.9
|
|
|
418.3
|
|
|
44.6
|
|
|
11
|
%
|
|||
Adjusted operating margin
|
|
21.8
|
%
|
|
21.8
|
%
|
|
|
|
— bp
|
|
||||
Adjusted equity affiliates' income
|
|
42.6
|
|
|
42.1
|
|
|
.5
|
|
|
1
|
%
|
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
8
|
%
|
Price
|
—
|
%
|
Currency
|
(2
|
)%
|
Energy and natural gas cost pass-through
|
5
|
%
|
Total Consolidated Change
|
11
|
%
|
|
|
Three Months Ended
|
||||||
|
|
30 June
|
||||||
|
|
2017
|
|
2016
|
||||
Interest incurred
|
|
$
|
32.9
|
|
|
$
|
39.0
|
|
Less: capitalized interest
|
|
3.1
|
|
|
3.9
|
|
||
Interest expense
|
|
$
|
29.8
|
|
|
$
|
35.1
|
|
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
|
30 June
|
|
|
|
|
||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
||||||
Sales
|
|
$
|
930.1
|
|
|
$
|
832.3
|
|
|
$
|
97.8
|
|
|
12%
|
Operating income
|
|
236.2
|
|
|
234.0
|
|
|
2.2
|
|
|
1%
|
|||
Operating margin
|
|
25.4
|
%
|
|
28.1
|
%
|
|
|
|
(270 bp)
|
||||
Equity affiliates’ income
|
|
14.1
|
|
|
16.0
|
|
|
(1.9
|
)
|
|
(12)%
|
|||
Adjusted EBITDA
|
|
367.3
|
|
|
362.1
|
|
|
5.2
|
|
|
1%
|
|||
Adjusted EBITDA margin
|
|
39.5
|
%
|
|
43.5
|
%
|
|
|
|
(400 bp)
|
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
3
|
%
|
Price
|
—
|
%
|
Currency
|
—
|
%
|
Energy and natural gas cost pass-through
|
9
|
%
|
Total Industrial Gases – Americas Sales Change
|
12
|
%
|
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
|
30 June
|
|
|
|
|
||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
||||||
Sales
|
|
$
|
451.7
|
|
|
$
|
428.7
|
|
|
$
|
23.0
|
|
|
5%
|
Operating income
|
|
94.1
|
|
|
104.0
|
|
|
(9.9
|
)
|
|
(10)%
|
|||
Operating margin
|
|
20.8
|
%
|
|
24.3
|
%
|
|
|
|
(350 bp)
|
||||
Equity affiliates’ income
|
|
15.7
|
|
|
11.3
|
|
|
4.4
|
|
|
39%
|
|||
Adjusted EBITDA
|
|
154.9
|
|
|
160.4
|
|
|
(5.5
|
)
|
|
(3)%
|
|||
Adjusted EBITDA margin
|
|
34.3
|
%
|
|
37.4
|
%
|
|
|
|
(310 bp)
|
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
6
|
%
|
Price
|
(1
|
)%
|
Currency
|
(4
|
)%
|
Energy and natural gas cost pass-through
|
4
|
%
|
Total Industrial Gases – EMEA Sales Change
|
5
|
%
|
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
|
30 June
|
|
|
|
|
||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
||||||
Sales
|
|
$
|
538.3
|
|
|
$
|
449.0
|
|
|
$
|
89.3
|
|
|
20%
|
Operating income
|
|
149.1
|
|
|
118.7
|
|
|
30.4
|
|
|
26%
|
|||
Operating margin
|
|
27.7
|
%
|
|
26.4
|
%
|
|
|
|
130 bp
|
||||
Equity affiliates’ income
|
|
12.5
|
|
|
14.8
|
|
|
(2.3
|
)
|
|
(16)%
|
|||
Adjusted EBITDA
|
|
211.2
|
|
|
183.0
|
|
|
28.2
|
|
|
15%
|
|||
Adjusted EBITDA margin
|
|
39.2
|
%
|
|
40.8
|
%
|
|
|
|
(160 bp)
|
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
20
|
%
|
Price
|
2
|
%
|
Currency
|
(2
|
)%
|
Energy and natural gas cost pass-through
|
—
|
%
|
Total Industrial Gases – Asia Sales Change
|
20
|
%
|
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
|
30 June
|
|
|
|
|
||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
||||||
Sales
|
|
$
|
187.4
|
|
|
$
|
150.8
|
|
|
$
|
36.6
|
|
|
24%
|
Operating income (loss)
|
|
27.9
|
|
|
(13.9
|
)
|
|
41.8
|
|
|
301%
|
|||
Adjusted EBITDA
|
|
30.5
|
|
|
(11.9
|
)
|
|
42.4
|
|
|
356%
|
•
|
Sales of
$5,984.5
increased
8%
, or
$426.3
, as underlying sales growth of
6%
and higher energy and natural gas cost pass‑through to customers of
4%
were partially offset by unfavorable currency impacts of
2%
. The underlying sales growth was primarily from higher volumes in the Industrial Gases – Asia and Industrial Gases – Global segments.
|
•
|
Operating income of
$971.9
decreased
15%
, or
$166.8
, and operating margin of
16.2%
decreased
430
bp. On a non-GAAP basis, operating income of
$1,276.8
increased
7%
, or
$82.3
, and operating margin of
21.3%
decreased
20 bp
.
|
•
|
During the third quarter of fiscal year 2017, we recorded noncash impairment charges, of which
$162.1
impacted operating income and related to the impairment of goodwill and intangible assets associated with our Latin America reporting unit and
$79.5
impacted equity affiliates' income and related to an other-than-temporary impairment of our investment in an equity affiliate in Saudi Arabia.
|
•
|
Adjusted EBITDA of
$2,026.4
increased
4%
, or
$82.1
. Adjusted EBITDA margin of
33.9%
decreased
110 bp
.
|
•
|
Income from continuing operations of
$660.2
decreased
19%
, or
$149.9
, and diluted earnings per share of
$3.00
decreased
19%
, or
$.72
. On a non-GAAP basis, income from continuing operations of
$999.2
increased
10%
, or
$94.6
, and diluted earnings per share of
$4.55
increased
10%
, or
$.40
. A summary table of changes in diluted earnings per share is presented below.
|
•
|
We completed the spin-off of EMD as Versum Materials, Inc. on 1 October 2016.
|
•
|
We completed the sale of PMD to Evonik Industries AG on 3 January 2017.
|
•
|
We
increased
our quarterly dividend by
10%
from
$.86
to
$.95
per share. This represents the 35
th
consecutive year that we have increased our dividend payment.
|
|
|
Nine Months Ended
|
|
|
||||||||
|
|
30 June
|
|
Increase
|
||||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
||||||
Diluted Earnings per Share
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
11.52
|
|
|
$
|
1.09
|
|
|
$
|
10.43
|
|
Income (Loss) from discontinued operations
|
|
8.52
|
|
|
(2.63
|
)
|
|
11.15
|
|
|||
Income from Continuing Operations – GAAP Basis
|
|
$
|
3.00
|
|
|
$
|
3.72
|
|
|
$
|
(.72
|
)
|
Operating Income Impact (after-tax)
|
|
|
|
|
|
|
||||||
Underlying business
|
|
|
|
|
|
|
||||||
Volume
|
|
|
|
|
|
$
|
.20
|
|
||||
Price/raw materials
|
|
|
|
|
|
(.04
|
)
|
|||||
Costs
|
|
|
|
|
|
.18
|
|
|||||
Currency
|
|
|
|
|
|
(.05
|
)
|
|||||
Business separation costs
|
|
|
|
|
|
—
|
|
|||||
Cost reduction and asset actions
|
|
|
|
|
|
(.28
|
)
|
|||||
Pension settlement loss
|
|
|
|
|
|
(.02
|
)
|
|||||
Goodwill and intangible asset impairment charge
|
|
|
|
|
|
(.70
|
)
|
|||||
Operating Income
|
|
|
|
|
|
$
|
(.71
|
)
|
||||
Other (after-tax)
|
|
|
|
|
|
|
||||||
Equity affiliates' income
|
|
|
|
|
|
.02
|
|
|||||
Equity method investment impairment charge
|
|
|
|
|
|
(.36
|
)
|
|||||
Interest expense
|
|
|
|
|
|
(.02
|
)
|
|||||
Other non-operating income (expense), net
|
|
|
|
|
|
.07
|
|
|||||
Income tax
|
|
|
|
|
|
.08
|
|
|||||
Tax costs associated with business separation
|
|
|
|
|
|
.24
|
|
|||||
Weighted average diluted shares
|
|
|
|
|
|
(.04
|
)
|
|||||
Other
|
|
|
|
|
|
$
|
(.01
|
)
|
||||
Total Change in Diluted Earnings per Share from Continuing Operations – GAAP Basis
|
|
|
|
|
|
$
|
(.72
|
)
|
|
|
Nine Months Ended
|
|
|
||||||||
|
|
30 June
|
|
Increase
|
||||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
||||||
Income from Continuing Operations – GAAP Basis
|
|
$
|
3.00
|
|
|
$
|
3.72
|
|
|
$
|
(.72
|
)
|
Business separation costs
|
|
.12
|
|
|
.12
|
|
|
—
|
|
|||
Tax (benefit) costs associated with business separation
|
|
(.02
|
)
|
|
.22
|
|
|
(.24
|
)
|
|||
Cost reduction and asset actions
|
|
.36
|
|
|
.08
|
|
|
.28
|
|
|||
Pension settlement loss
|
|
.03
|
|
|
.01
|
|
|
.02
|
|
|||
Goodwill and intangible asset impairment charge
|
|
.70
|
|
|
—
|
|
|
.70
|
|
|||
Equity method investment impairment charge
|
|
.36
|
|
|
—
|
|
|
.36
|
|
|||
Income from Continuing Operations – Non-GAAP Basis
|
|
$
|
4.55
|
|
|
$
|
4.15
|
|
|
$
|
.40
|
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
Change
|
|||||||
Sales
|
|
$
|
5,984.5
|
|
|
$
|
5,558.2
|
|
|
$
|
426.3
|
|
|
8
|
%
|
Operating income
|
|
971.9
|
|
|
1,138.7
|
|
|
(166.8
|
)
|
|
(15
|
)%
|
|||
Operating margin
|
|
16.2
|
%
|
|
20.5
|
%
|
|
|
|
(430 bp)
|
|
||||
Equity affiliates’ income
|
|
35.3
|
|
|
107.7
|
|
|
(72.4
|
)
|
|
(67
|
)%
|
|||
Non-GAAP Basis
|
|
|
|
|
|
|
|
|
|||||||
Adjusted EBITDA
|
|
2,026.4
|
|
|
1,944.3
|
|
|
82.1
|
|
|
4
|
%
|
|||
Adjusted EBITDA margin
|
|
33.9
|
%
|
|
35.0
|
%
|
|
|
|
(110 bp)
|
|
||||
Adjusted operating income
|
|
1,276.8
|
|
|
1,194.5
|
|
|
82.3
|
|
|
7
|
%
|
|||
Adjusted operating margin
|
|
21.3
|
%
|
|
21.5
|
%
|
|
|
|
(20 bp)
|
|
||||
Adjusted equity affiliates' income
|
|
114.8
|
|
|
107.7
|
|
|
7.1
|
|
|
7
|
%
|
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
6
|
%
|
Price
|
—
|
|
Currency
|
(2
|
)%
|
Energy and natural gas cost pass-through
|
4
|
%
|
Total Consolidated Change
|
8
|
%
|
|
|
Nine Months Ended
|
||||||
|
|
30 June
|
||||||
|
|
2017
|
|
2016
|
||||
Interest incurred
|
|
$
|
105.1
|
|
|
$
|
111.0
|
|
Less: capitalized interest
|
|
15.3
|
|
|
28.0
|
|
||
Interest expense
|
|
$
|
89.8
|
|
|
$
|
83.0
|
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
$
|
2,684.1
|
|
|
$
|
2,466.7
|
|
|
$
|
217.4
|
|
|
9
|
%
|
Operating income
|
|
684.5
|
|
|
669.1
|
|
|
15.4
|
|
|
2
|
%
|
|||
Operating margin
|
|
25.5
|
%
|
|
27.1
|
%
|
|
|
|
(160 bp)
|
|
||||
Equity affiliates’ income
|
|
41.8
|
|
|
38.2
|
|
|
3.6
|
|
|
9
|
%
|
|||
Adjusted EBITDA
|
|
1,071.1
|
|
|
1,038.2
|
|
|
32.9
|
|
|
3
|
%
|
|||
Adjusted EBITDA margin
|
|
39.9
|
%
|
|
42.1
|
%
|
|
|
|
(220 bp)
|
|
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
1
|
%
|
Price
|
—
|
%
|
Currency
|
—
|
%
|
Energy and natural gas cost pass-through
|
8
|
%
|
Total Industrial Gases – Americas Sales Change
|
9
|
%
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
$
|
1,265.6
|
|
|
$
|
1,290.1
|
|
|
$
|
(24.5
|
)
|
|
(2
|
)%
|
Operating income
|
|
268.6
|
|
|
286.3
|
|
|
(17.7
|
)
|
|
(6
|
)%
|
|||
Operating margin
|
|
21.2
|
%
|
|
22.2
|
%
|
|
|
|
(100 bp)
|
|
||||
Equity affiliates’ income
|
|
33.5
|
|
|
26.1
|
|
|
7.4
|
|
|
28
|
%
|
|||
Adjusted EBITDA
|
|
431.0
|
|
|
452.5
|
|
|
(21.5
|
)
|
|
(5
|
)%
|
|||
Adjusted EBITDA margin
|
|
34.1
|
%
|
|
35.1
|
%
|
|
|
|
(100 bp)
|
|
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
1
|
%
|
Price
|
—
|
%
|
Currency
|
(5
|
)%
|
Energy and natural gas cost pass-through
|
2
|
%
|
Total Industrial Gases – EMEA Sales Change
|
(2
|
)%
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
$
|
1,412.5
|
|
|
$
|
1,271.5
|
|
|
$
|
141.0
|
|
|
11
|
%
|
Operating income
|
|
379.2
|
|
|
341.0
|
|
|
38.2
|
|
|
11
|
%
|
|||
Operating margin
|
|
26.8
|
%
|
|
26.8
|
%
|
|
|
|
— bp
|
|
||||
Equity affiliates’ income
|
|
38.9
|
|
|
43.9
|
|
|
(5.0
|
)
|
|
(11
|
)%
|
|||
Adjusted EBITDA
|
|
563.7
|
|
|
535.1
|
|
|
28.6
|
|
|
5
|
%
|
|||
Adjusted EBITDA margin
|
|
39.9
|
%
|
|
42.1
|
%
|
|
|
|
(220 bp)
|
|
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
13
|
%
|
Price
|
—
|
%
|
Currency
|
(2
|
)%
|
Energy and natural gas cost pass-through
|
—
|
|
Total Industrial Gases – Asia Sales Change
|
11
|
%
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
$
|
551.8
|
|
|
$
|
341.7
|
|
|
$
|
210.1
|
|
|
61
|
%
|
Operating income (loss)
|
|
58.9
|
|
|
(44.0
|
)
|
|
102.9
|
|
|
234
|
%
|
|||
Adjusted EBITDA
|
|
65.5
|
|
|
(38.6
|
)
|
|
104.1
|
|
|
270
|
%
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
$
|
70.5
|
|
|
$
|
188.2
|
|
|
$
|
(117.7
|
)
|
|
(63
|
)%
|
Operating income (loss)
|
|
(114.4
|
)
|
|
(57.9
|
)
|
|
(56.5
|
)
|
|
(98
|
)%
|
|||
Adjusted EBITDA
|
|
(104.9
|
)
|
|
(42.9
|
)
|
|
(62.0
|
)
|
|
(145
|
)%
|
|
Continuing Operations
|
||||||||||||||||
|
Three Months Ended 30 June
|
||||||||||||||||
2017 vs. 2016
|
Operating
Income
|
Operating
Margin
(A)
|
Equity Affiliates' Income (Loss)
|
Income Tax
Provision (B) |
Net
Income
|
Diluted
EPS
|
|||||||||||
2017 GAAP
|
$
|
252.6
|
|
11.9
|
%
|
$
|
(36.9
|
)
|
$
|
89.3
|
|
$
|
104.2
|
|
$
|
.47
|
|
2016 GAAP
|
394.6
|
|
20.6
|
%
|
42.1
|
|
145.9
|
|
250.3
|
|
1.15
|
|
|||||
Change GAAP
|
$
|
(142.0
|
)
|
(870
|
)bp
|
$
|
(79.0
|
)
|
$
|
(56.6
|
)
|
$
|
(146.1
|
)
|
$
|
(.68
|
)
|
% Change GAAP
|
(36
|
)%
|
|
(188
|
)%
|
(39
|
)%
|
(58
|
)%
|
(59
|
)%
|
||||||
2017 GAAP
|
$
|
252.6
|
|
11.9
|
%
|
$
|
(36.9
|
)
|
$
|
89.3
|
|
$
|
104.2
|
|
$
|
.47
|
|
Tax benefit associated with business separation
|
—
|
|
—
|
%
|
—
|
|
8.2
|
|
(8.2
|
)
|
(.04
|
)
|
|||||
Cost reduction and asset actions
(C)
|
42.7
|
|
2.0
|
%
|
—
|
|
12.2
|
|
30.0
|
|
.14
|
|
|||||
Pension settlement loss
|
5.5
|
|
.3
|
%
|
—
|
|
2.1
|
|
3.4
|
|
.02
|
|
|||||
Goodwill and intangible asset impairment charge
(D)
|
162.1
|
|
7.6
|
%
|
—
|
|
4.6
|
|
154.1
|
|
.70
|
|
|||||
Equity method investment impairment charge
|
—
|
|
—
|
%
|
79.5
|
|
—
|
|
79.5
|
|
.36
|
|
|||||
2017 Non-GAAP Measure
|
$
|
462.9
|
|
21.8
|
%
|
$
|
42.6
|
|
$
|
116.4
|
|
$
|
363.0
|
|
$
|
1.65
|
|
2016 GAAP
|
$
|
394.6
|
|
20.6
|
%
|
$
|
42.1
|
|
$
|
145.9
|
|
$
|
250.3
|
|
$
|
1.15
|
|
Business separation costs
|
9.5
|
|
.5
|
%
|
—
|
|
3.0
|
|
6.5
|
|
.03
|
|
|||||
Tax costs associated with business separation
|
—
|
|
—
|
%
|
—
|
|
(47.7
|
)
|
47.7
|
|
.22
|
|
|||||
Cost reduction and asset actions
|
13.2
|
|
.7
|
%
|
—
|
|
4.5
|
|
8.7
|
|
.04
|
|
|||||
Pension settlement loss
|
1.0
|
|
—
|
%
|
—
|
|
.4
|
|
.6
|
|
—
|
|
|||||
2016 Non-GAAP Measure
|
$
|
418.3
|
|
21.8
|
%
|
$
|
42.1
|
|
$
|
106.1
|
|
$
|
313.8
|
|
$
|
1.44
|
|
Change Non-GAAP Measure
|
$
|
44.6
|
|
—
|
|
$
|
.5
|
|
$
|
10.3
|
|
$
|
49.2
|
|
$
|
.21
|
|
% Change Non-GAAP Measure
|
11
|
%
|
|
1
|
%
|
10
|
%
|
16
|
%
|
15
|
%
|
|
|
|
|
|
|
|
|||||||||||
|
Continuing Operations
|
||||||||||||||||
|
Nine Months Ended 30 June
|
||||||||||||||||
2017 vs. 2016
|
Operating
Income
|
Operating
Margin
(A)
|
Equity Affiliates' Income
|
Income Tax
Provision (B) |
Net
Income
|
Diluted
EPS
|
|||||||||||
2017 GAAP
|
$
|
971.9
|
|
16.2
|
%
|
$
|
35.3
|
|
$
|
262.2
|
|
$
|
660.2
|
|
$
|
3.00
|
|
2016 GAAP
|
1,138.7
|
|
20.5
|
%
|
107.7
|
|
335.8
|
|
810.1
|
|
3.72
|
|
|||||
Change GAAP
|
$
|
(166.8
|
)
|
(430
|
)bp
|
$
|
(72.4
|
)
|
$
|
(73.6
|
)
|
$
|
(149.9
|
)
|
$
|
(.72
|
)
|
% Change GAAP
|
(15
|
)%
|
|
(67
|
)%
|
(22
|
)%
|
(19
|
)%
|
(19
|
)%
|
||||||
2017 GAAP
|
$
|
971.9
|
|
16.2
|
%
|
$
|
35.3
|
|
$
|
262.2
|
|
$
|
660.2
|
|
$
|
3.00
|
|
Business separation costs
|
30.2
|
|
.5
|
%
|
—
|
|
3.7
|
|
26.5
|
|
.12
|
|
|||||
Tax benefit associated with business separation
|
—
|
|
—
|
%
|
—
|
|
5.5
|
|
(5.5
|
)
|
(.02
|
)
|
|||||
Cost reduction and asset actions
(C)
|
103.0
|
|
1.7
|
%
|
—
|
|
24.1
|
|
78.4
|
|
.36
|
|
|||||
Pension settlement loss
|
9.6
|
|
.2
|
%
|
—
|
|
3.6
|
|
6.0
|
|
.03
|
|
|||||
Goodwill and intangible asset impairment charge
(D)
|
162.1
|
|
2.7
|
%
|
—
|
|
4.6
|
|
154.1
|
|
.70
|
|
|||||
Equity method investment impairment charge
|
—
|
|
—
|
%
|
79.5
|
|
—
|
|
79.5
|
|
.36
|
|
|||||
2017 Non-GAAP Measure
|
$
|
1,276.8
|
|
21.3
|
%
|
$
|
114.8
|
|
$
|
303.7
|
|
$
|
999.2
|
|
$
|
4.55
|
|
2016 GAAP
|
$
|
1,138.7
|
|
20.5
|
%
|
$
|
107.7
|
|
$
|
335.8
|
|
$
|
810.1
|
|
$
|
3.72
|
|
Business separation costs
|
28.9
|
|
.5
|
%
|
—
|
|
1.5
|
|
27.4
|
|
.12
|
|
|||||
Tax costs associated with business separation
|
—
|
|
—
|
%
|
—
|
|
(47.7
|
)
|
47.7
|
|
.22
|
|
|||||
Cost reduction and asset actions
|
23.9
|
|
.4
|
%
|
—
|
|
6.4
|
|
17.5
|
|
.08
|
|
|||||
Pension settlement loss
|
3.0
|
|
.1
|
%
|
—
|
|
1.1
|
|
1.9
|
|
.01
|
|
|||||
2016 Non-GAAP Measure
|
$
|
1,194.5
|
|
21.5
|
%
|
$
|
107.7
|
|
$
|
297.1
|
|
$
|
904.6
|
|
$
|
4.15
|
|
Change Non-GAAP Measure
|
$
|
82.3
|
|
(20
|
)bp
|
$
|
7.1
|
|
$
|
6.6
|
|
$
|
94.6
|
|
$
|
.40
|
|
% Change Non-GAAP Measure
|
7
|
%
|
|
7
|
%
|
2
|
%
|
10
|
%
|
10
|
%
|
(A)
|
Operating margin is calculated by dividing operating income by sales.
|
(B)
|
The tax impact of our non-GAAP adjustments reflects the expected current and deferred income tax expense impact of the transactions and is impacted primarily by the statutory tax rate of the various relevant jurisdictions and the taxability of the adjustments in those jurisdictions.
|
(C)
|
Noncontrolling interests impact of
$.5
for the three and nine months ended 30 June 2017.
|
(D)
|
Noncontrolling interests impact of
$3.4
for the three and nine months ended 30 June 2017.
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
|
2017
|
2016
|
2017
|
2016
|
||||||||
Income from Continuing Operations
(A)
|
$
|
106.4
|
|
$
|
255.7
|
|
$
|
674.7
|
|
$
|
827.6
|
|
Add: Interest expense
|
29.8
|
|
35.1
|
|
89.8
|
|
83.0
|
|
||||
Less: Other non-operating income (expense), net
|
9.8
|
|
—
|
|
19.5
|
|
—
|
|
||||
Add: Income tax provision
|
89.3
|
|
145.9
|
|
262.2
|
|
335.8
|
|
||||
Add: Depreciation and amortization
|
216.9
|
|
213.5
|
|
634.8
|
|
642.1
|
|
||||
Add: Business separation costs
|
—
|
|
9.5
|
|
30.2
|
|
28.9
|
|
||||
Add: Cost reduction and asset actions
|
42.7
|
|
13.2
|
|
103.0
|
|
23.9
|
|
||||
Add: Pension settlement loss
|
5.5
|
|
1.0
|
|
9.6
|
|
3.0
|
|
||||
Add: Goodwill and intangible asset impairment charge
|
162.1
|
|
—
|
|
162.1
|
|
—
|
|
||||
Add: Equity method investment impairment charge
|
79.5
|
|
—
|
|
79.5
|
|
—
|
|
||||
Adjusted EBITDA
|
$
|
722.4
|
|
$
|
673.9
|
|
$
|
2,026.4
|
|
$
|
1,944.3
|
|
Change GAAP
|
|
|
|
|
||||||||
Income from continuing operations change
|
$
|
(149.3
|
)
|
|
$
|
(152.9
|
)
|
|
||||
Income from continuing operations % change
|
(58
|
)%
|
|
(18
|
)%
|
|
||||||
Change Non-GAAP
|
|
|
|
|
||||||||
Adjusted EBITDA change
|
$
|
48.5
|
|
|
$
|
82.1
|
|
|
||||
Adjusted EBITDA % change
|
7
|
%
|
|
4
|
%
|
|
(A)
|
Includes net income attributable to noncontrolling interests.
|
|
Industrial
Gases– Americas |
Industrial
Gases– EMEA |
Industrial
Gases– Asia |
Industrial
Gases– Global |
Corporate
and other |
Segment
Total |
||||||||||||
GAAP MEASURE
|
|
|
|
|
|
|
||||||||||||
Nine Months Ended 30 June 2017
|
||||||||||||||||||
Operating income (loss)
|
$
|
684.5
|
|
$
|
268.6
|
|
$
|
379.2
|
|
$
|
58.9
|
|
$
|
(114.4
|
)
|
$
|
1,276.8
|
|
Operating margin
|
25.5
|
%
|
21.2
|
%
|
26.8
|
%
|
|
|
21.3
|
%
|
||||||||
Nine Months Ended 30 June 2016
|
||||||||||||||||||
Operating income (loss)
|
$
|
669.1
|
|
$
|
286.3
|
|
$
|
341.0
|
|
$
|
(44.0
|
)
|
$
|
(57.9
|
)
|
$
|
1,194.5
|
|
Operating margin
|
27.1
|
%
|
22.2
|
%
|
26.8
|
%
|
|
|
21.5
|
%
|
||||||||
Operating income (loss) change
|
$
|
15.4
|
|
$
|
(17.7
|
)
|
$
|
38.2
|
|
$
|
102.9
|
|
$
|
(56.5
|
)
|
$
|
82.3
|
|
Operating income (loss) % change
|
2
|
%
|
(6
|
)%
|
11
|
%
|
234
|
%
|
(98
|
)%
|
7
|
%
|
||||||
Operating margin change
|
(160
|
) bp
|
(100
|
) bp
|
—
|
|
|
|
(20
|
) bp
|
||||||||
NON-GAAP MEASURE
|
|
|
|
|
|
|
||||||||||||
Nine Months Ended 30 June 2017
|
||||||||||||||||||
Operating income (loss)
|
$
|
684.5
|
|
$
|
268.6
|
|
$
|
379.2
|
|
$
|
58.9
|
|
$
|
(114.4
|
)
|
$
|
1,276.8
|
|
Add: Depreciation and amortization
|
344.8
|
|
128.9
|
|
145.6
|
|
6.0
|
|
9.5
|
|
634.8
|
|
||||||
Add: Equity affiliates' income
|
41.8
|
|
33.5
|
|
38.9
|
|
.6
|
|
—
|
|
114.8
|
|
||||||
Adjusted EBITDA
|
$
|
1,071.1
|
|
$
|
431.0
|
|
$
|
563.7
|
|
$
|
65.5
|
|
$
|
(104.9
|
)
|
$
|
2,026.4
|
|
Adjusted EBITDA margin
|
39.9
|
%
|
34.1
|
%
|
39.9
|
%
|
|
|
33.9
|
%
|
||||||||
Nine Months Ended 30 June 2016
|
||||||||||||||||||
Operating income (loss)
|
$
|
669.1
|
|
$
|
286.3
|
|
$
|
341.0
|
|
$
|
(44.0
|
)
|
$
|
(57.9
|
)
|
$
|
1,194.5
|
|
Add: Depreciation and amortization
|
330.9
|
|
140.1
|
|
150.2
|
|
5.9
|
|
15.0
|
|
642.1
|
|
||||||
Add: Equity affiliates' income (loss)
|
38.2
|
|
26.1
|
|
43.9
|
|
(.5
|
)
|
—
|
|
107.7
|
|
||||||
Adjusted EBITDA
|
$
|
1,038.2
|
|
$
|
452.5
|
|
$
|
535.1
|
|
$
|
(38.6
|
)
|
$
|
(42.9
|
)
|
$
|
1,944.3
|
|
Adjusted EBITDA margin
|
42.1
|
%
|
35.1
|
%
|
42.1
|
%
|
|
|
35.0
|
%
|
||||||||
Adjusted EBITDA change
|
$
|
32.9
|
|
$
|
(21.5
|
)
|
$
|
28.6
|
|
$
|
104.1
|
|
$
|
(62.0
|
)
|
$
|
82.1
|
|
Adjusted EBITDA % change
|
3
|
%
|
(5
|
)%
|
5
|
%
|
270
|
%
|
(145
|
)%
|
4
|
%
|
||||||
Adjusted EBITDA margin change
|
(220
|
) bp
|
(100
|
) bp
|
(220
|
) bp
|
|
|
(110
|
) bp
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
30 June
|
|
30 June
|
||||||||||||
Operating Income
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Segment total
|
|
$
|
462.9
|
|
|
$
|
418.3
|
|
|
$
|
1,276.8
|
|
|
$
|
1,194.5
|
|
Business separation costs
|
|
—
|
|
|
(9.5
|
)
|
|
(30.2
|
)
|
|
(28.9
|
)
|
||||
Cost reduction and asset actions
|
|
(42.7
|
)
|
|
(13.2
|
)
|
|
(103.0
|
)
|
|
(23.9
|
)
|
||||
Pension settlement loss
|
|
(5.5
|
)
|
|
(1.0
|
)
|
|
(9.6
|
)
|
|
(3.0
|
)
|
||||
Goodwill and intangible asset impairment charge
|
|
(162.1
|
)
|
|
—
|
|
|
(162.1
|
)
|
|
—
|
|
||||
Consolidated Total
|
|
$
|
252.6
|
|
|
$
|
394.6
|
|
|
$
|
971.9
|
|
|
$
|
1,138.7
|
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
Equity Affiliates' Income (Loss)
|
2017
|
2016
|
2017
|
2016
|
||||||||
Segment total
|
$
|
42.6
|
|
$
|
42.1
|
|
$
|
114.8
|
|
$
|
107.7
|
|
Equity method investment impairment charge
|
(79.5
|
)
|
—
|
|
(79.5
|
)
|
—
|
|
||||
Consolidated Total
|
$
|
(36.9
|
)
|
$
|
42.1
|
|
$
|
35.3
|
|
$
|
107.7
|
|
|
Effective Tax Rate
|
||||||||||||
|
Three Months Ended
30 June |
|
Nine Months Ended
30 June |
||||||||||
|
2017
|
2016
|
|
2017
|
2016
|
||||||||
Income Tax Provision—GAAP
|
$
|
89.3
|
|
$
|
145.9
|
|
|
$
|
262.2
|
|
$
|
335.8
|
|
Income From Continuing Operations Before Taxes—GAAP
|
$
|
195.7
|
|
$
|
401.6
|
|
|
$
|
936.9
|
|
$
|
1,163.4
|
|
Effective Tax Rate—GAAP
|
45.6
|
%
|
36.3
|
%
|
|
28.0
|
%
|
28.9
|
%
|
||||
Income Tax Provision—GAAP
|
$
|
89.3
|
|
$
|
145.9
|
|
|
$
|
262.2
|
|
$
|
335.8
|
|
Business separation costs
|
—
|
|
3.0
|
|
|
3.7
|
|
1.5
|
|
||||
Tax benefit (costs) associated with business separation
|
8.2
|
|
(47.7
|
)
|
|
5.5
|
|
(47.7
|
)
|
||||
Cost reduction and asset actions
|
12.2
|
|
4.5
|
|
|
24.1
|
|
6.4
|
|
||||
Pension settlement loss
|
2.1
|
|
.4
|
|
|
3.6
|
|
1.1
|
|
||||
Goodwill and intangible asset impairment charge
|
4.6
|
|
—
|
|
|
4.6
|
|
—
|
|
||||
Equity method investment impairment charge
|
—
|
|
—
|
|
|
—
|
|
—
|
|
||||
Income Tax Provision—Non-GAAP Measure
|
$
|
116.4
|
|
$
|
106.1
|
|
|
$
|
303.7
|
|
$
|
297.1
|
|
Income From Continuing Operations Before Taxes—GAAP
|
$
|
195.7
|
|
$
|
401.6
|
|
|
$
|
936.9
|
|
$
|
1,163.4
|
|
Business separation costs
|
—
|
|
9.5
|
|
|
30.2
|
|
28.9
|
|
||||
Cost reduction and asset actions
|
42.7
|
|
13.2
|
|
|
103.0
|
|
23.9
|
|
||||
Pension settlement loss
|
5.5
|
|
1.0
|
|
|
9.6
|
|
3.0
|
|
||||
Goodwill and intangible asset impairment charge
|
162.1
|
|
—
|
|
|
162.1
|
|
—
|
|
||||
Equity method investment impairment charge
|
79.5
|
|
—
|
|
|
79.5
|
|
—
|
|
||||
Income From Continuing Operations Before Taxes—Non-GAAP Measure
|
$
|
485.5
|
|
$
|
425.3
|
|
|
$
|
1,321.3
|
|
$
|
1,219.2
|
|
Effective Tax Rate—Non-GAAP Measure
|
24.0
|
%
|
24.9
|
%
|
|
23.0
|
%
|
24.4
|
%
|
|
|
Nine Months Ended
|
||||
|
|
30 June
|
||||
|
|
2017
|
|
2016
|
||
Additions to plant and equipment
|
|
$806.8
|
|
$700.9
|
||
Investment in and advances to unconsolidated affiliates
|
|
8.1
|
|
|
—
|
|
Capital expenditures on a GAAP basis
|
|
$814.9
|
|
$700.9
|
||
Capital lease expenditures
(A)
|
|
6.8
|
|
|
24.6
|
|
Capital expenditures on a Non-GAAP basis
|
|
$821.7
|
|
$725.5
|
(A)
|
We utilize a non-GAAP measure in the computation of capital expenditures and include spending associated with facilities accounted for as capital leases. Certain contracts associated with facilities that are built to provide product to a specific customer are required to be accounted for as leases, and such spending is reflected as a use of cash within cash provided by operating activities if the arrangement qualifies as a capital lease. The presentation of this non-GAAP measure is intended to enhance the usefulness of information by providing a measure that our management uses internally to evaluate and manage our expenditures.
|
10.1
|
Air Products and Chemicals, Inc. Executive Separation Program as amended effective as of 18 May 2017.
|
|
|
10.2
|
Compensation Program for Directors effective 1 July 2017.
|
|
|
12.
|
Computation of Ratios of Earnings to Fixed Charges.
|
|
|
31.1
|
Certification by the Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
31.2
|
Certification by the Principal Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.
|
Certification by the Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. †
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
|
Air Products and Chemicals, Inc.
|
|
|
(Registrant)
|
|
|
|
|
Date: 1 August 2017
|
By:
|
/s/ M. Scott Crocco
|
|
|
M. Scott Crocco
|
|
|
Executive Vice President and Chief Financial Officer
|
10.1
|
|
|
|
10.2
|
|
|
|
12.
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
32.
|
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
Witness
|
|
|
Executive
|
|
a.
|
Each director shall be paid an annual retainer of $100,000 for serving as a member of the Board of Directors and any Board Committee(s), which retainer shall be payable in quarterly installments at the end of each quarter. Payment of this retainer may be deferred under the Deferred Compensation Program for Directors.
|
b.
|
The chairman of the Audit and Finance Committee shall be paid an additional annual retainer of $25,000. The chairman of the Corporate Governance and Nominating Committee shall be paid an annual retainer of $15,000. The chairman of the Management Development and Compensation Committee shall be paid an annual retainer of $20,000. Such retainers shall be payable in quarterly installments. Payment may be deferred under the Deferred Compensation Program for Directors.
|
c.
|
The lead director shall receive an additional annual retainer of $25,000. Payment may be deferred under the Deferred Compensation Program for Directors.
|
d.
|
Deferred stock units with a targeted dollar value of $150,000 shall be credited annually to the Air Products Stock Account under the Deferred Compensation Program for Directors for each director who is continuing in office after the Annual Meeting of Shareholders, effective as of the day of the Annual Meeting. The number of units to be credited will be determined based on the Fair Market Value of a share of common stock of the Company as determined under the Program on the date credited, rounded up to the nearest whole share unit.
|
e.
|
Deferred stock units shall be credited to the Air Products Stock Account under the Deferred Compensation Program for Directors for each newly-elected director effective as of the date the director first serves on the Board. The targeted dollar value of such units shall be the amount specified in paragraph (d) above multiplied by a fraction, the numerator of which shall be the number of full or partial months remaining until the next Annual Meeting of Shareholders and the denominator of which shall be twelve. The number of units to be credited will be determined based on the Fair Market Value of a share of common stock of the Company as determined under the Program on the date credited, rounded up to the nearest whole share unit.
|
f.
|
Directors shall be reimbursed for out-of-pocket expenses incurred in attending regular and special meetings of the Board and Board Committees and any other business function of the Company at the request of the Chairman of the Board. Expenses will be reimbursed as submitted.
*
/
|
*
/
|
Directors are reimbursed at the rate of $.535 per mile or the current rate published by the Internal Revenue Service for use of their personal cars in connection with Company business. Directors using personal aircraft or private carrier will be reimbursed for such expenses at a rate equivalent to first-class airfare of scheduled carriers.
|
|
|
Nine Months Ended
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
30 June
|
|
Year Ended 30 September
|
||||||||||||||||||||
(Millions of dollars, except ratios)
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Earnings:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income from continuing operations
(1)
|
|
$
|
674.7
|
|
|
$
|
1,122.0
|
|
|
$
|
965.9
|
|
|
$
|
691.0
|
|
|
$
|
900.0
|
|
|
$
|
832.2
|
|
Add (deduct):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Provision for income taxes
|
|
262.2
|
|
|
432.6
|
|
|
300.2
|
|
|
258.1
|
|
|
275.1
|
|
|
221.1
|
|
||||||
Fixed charges, excluding capitalized interest
|
|
100.8
|
|
|
123.6
|
|
|
117.6
|
|
|
140.7
|
|
|
156.3
|
|
|
136.4
|
|
||||||
Capitalized interest amortized during the period
|
|
6.3
|
|
|
9.7
|
|
|
9.8
|
|
|
8.7
|
|
|
9.8
|
|
|
9.2
|
|
||||||
Undistributed earnings of equity investees
(4)
|
|
(34.4
|
)
|
|
(51.1
|
)
|
|
(101.8
|
)
|
|
(74.9
|
)
|
|
(57.1
|
)
|
|
(62.2
|
)
|
||||||
Noncontrolling interest in pre-tax income of subsidiaries that have not incurred fixed charges
|
|
(2.3
|
)
|
|
(2.6
|
)
|
|
(3.0
|
)
|
|
(2.8
|
)
|
|
—
|
|
|
—
|
|
||||||
Earnings, as adjusted
|
|
$
|
1,007.3
|
|
|
$
|
1,634.2
|
|
|
$
|
1,288.7
|
|
|
$
|
1,020.8
|
|
|
$
|
1,284.1
|
|
|
$
|
1,136.7
|
|
Fixed Charges:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest on indebtedness, including capital lease obligations
|
|
$
|
85.2
|
|
|
$
|
105.8
|
|
|
$
|
94.6
|
|
|
$
|
120.1
|
|
|
$
|
136.7
|
|
|
$
|
108.1
|
|
Capitalized interest
|
|
15.3
|
|
|
32.7
|
|
|
49.1
|
|
|
33.0
|
|
|
26.0
|
|
|
30.2
|
|
||||||
Amortization of debt discount/premium and expense
|
|
4.6
|
|
|
3.6
|
|
|
8.2
|
|
|
3.9
|
|
|
2.1
|
|
|
10.6
|
|
||||||
Portion of rents under operating leases representative of the interest factor
|
|
11.0
|
|
|
14.2
|
|
|
14.8
|
|
|
16.7
|
|
|
17.5
|
|
|
17.7
|
|
||||||
Fixed charges
(2)
|
|
$
|
116.1
|
|
|
$
|
156.3
|
|
|
$
|
166.7
|
|
|
$
|
173.7
|
|
|
$
|
182.3
|
|
|
$
|
166.6
|
|
Ratio of Earnings to Fixed Charges
(3)
|
|
8.7
|
|
|
10.5
|
|
|
7.7
|
|
|
5.9
|
|
|
7.0
|
|
|
6.8
|
|
(1)
|
Income from continuing operations includes income attributable to noncontrolling interests as well as business restructuring and cost reduction actions of
$103.0
(
$78.4
attributable to Air Products, after-tax) in
2017
, $34.5 ($24.7 after‑tax) in 2016, $180.1 ($132.9 after-tax) in 2015, $98.3 ($67.0 after-tax) in 2013, and $158.6 ($111.9 after-tax) in 2012, business separation costs of
$30.2
(
$26.5
after-tax) in
2017
and $50.6 ($46.7 after-tax) in 2016; a goodwill and intangible asset impairment charge of
$162.1
(
$154.1
attributable to Air Products, after-tax) in
2017
and $310.1 ($308.8 attributable to Air Products, after-tax) in 2014; and an equity method impairment charge of
$79.5
in
2017
.
|
(2)
|
We are party to certain debt guarantees of equity affiliates. Since we have not been required to satisfy the guarantees, nor is it probable that we will, interest expense related to the guaranteed debt is not included in fixed charges.
|
(3)
|
The ratio of earnings to fixed charges is determined by dividing earnings, as adjusted, by fixed charges. Fixed charges consist of interest on all indebtedness plus that portion of operating lease rentals representative of the interest factor (deemed to be 21% of operating lease rentals).
|
(4)
|
Excludes the impact of an impairment on an investment in an equity affiliate.
|
/s/ Seifi Ghasemi
|
Seifi Ghasemi
|
Chairman, President and Chief Executive Officer
|
/s/ M. Scott Crocco
|
M. Scott Crocco
|
Executive Vice President and Chief Financial Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: 1 August 2017
|
|
/s/ Seifi Ghasemi
|
|
|
Seifi Ghasemi
|
|
|
Chairman, President and Chief Executive Officer
|
|
|
|
|
|
/s/ M. Scott Crocco
|
|
|
M. Scott Crocco
|
|
|
Chief Financial Officer
|