x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended 30 September 2017
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from
to
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7201 Hamilton Boulevard
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State of incorporation: Delaware
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Allentown, Pennsylvania, 18195-1501
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I.R.S. identification number: 23-1274455
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Tel. (610) 481-4911
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Title of Each Class:
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Registered on:
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Common Stock, par value $1.00 per share
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New York Stock Exchange
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2.0% Euro Notes due 2020
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New York Stock Exchange
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0.375% Euro Notes due 2021
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New York Stock Exchange
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1.0% Euro Notes due 2025
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New York Stock Exchange
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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
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YES
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x
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NO
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¨
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Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
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YES
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¨
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NO
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x
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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YES
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x
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NO
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¨
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Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
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YES
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x
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NO
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¨
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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
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x
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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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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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¨
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
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YES
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¨
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NO
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x
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ITEM 1.
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ITEM 1A.
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ITEM 1B.
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ITEM 2.
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ITEM 3.
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ITEM 4.
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ITEM 5.
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ITEM 6.
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ITEM 7.
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ITEM 7A.
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ITEM 8.
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ITEM 9.
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ITEM 9A.
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ITEM 9B.
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ITEM 10.
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ITEM 11.
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ITEM 12.
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ITEM 13.
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ITEM 14.
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ITEM 15.
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Name
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Age
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Office
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M. Scott Crocco
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53
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Executive Vice President and Chief Financial Officer (became Executive Vice President and Chief Financial Officer in 2016; Senior Vice President and Chief Financial Officer in 2013; and Vice President and Corporate Controller in 2008).
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Russell A. Flugel
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48
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Vice President, Corporate Controller and Principal Accounting Officer (became Vice President, Corporate Controller and Principal Accounting Officer in 2015; Corporate Controller in 2014; Director, Accounting and Corporate Decision Support in 2013; and Director, Corporate Decision Support, Technical Accounting and Consolidation in 2011).
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Seifi Ghasemi
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73
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Chairman, President, and Chief Executive Officer (became Chairman, President and Chief Executive Officer in 2014 and previously served as Chairman and Chief Executive Officer of Rockwood Holdings, Inc. beginning in 2001). Mr. Ghasemi is a member and Chairman of the Board of Directors and the Chairman of the Executive Committee of the Board of Directors.
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Jennifer L. Grant
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45
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Vice President and Chief Human Resources Officer (became Vice President and Chief Human Resources Officer in 2013). Prior to joining Air Products, was Vice President of Human Resources for Pfizer Inc. Specialty Products and Oncology Divisions from 2009-2013.
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Sean D. Major
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53
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Executive Vice President and General Counsel (since May, 2017). Previously, Mr. Major served as Executive Vice President, General Counsel and Secretary for Joy Global since 2007.
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Corning F. Painter
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55
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Executive Vice President Industrial Gases (became Executive Vice President Industrial Gases in 2015; Senior Vice President and General Manager –Merchant Gases in 2014; Senior Vice President – Supply Chain in 2012; and Senior Vice President –Corporate Strategy and Technology in 2011.
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Dr. Samir Serhan
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56
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Executive Vice President (since December, 2016). Previously, Dr. Serhan served as President, Global HyCO, since 2014 for Praxair Inc. From 2000-2014, he worked in leadership positions in the U.S. and Germany for The Linde Group.
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2017
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High
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Low
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Close
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Dividend
|
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||||
First
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$
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150.45
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$
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129.00
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$
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143.82
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$
|
.86
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Second
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149.46
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|
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133.63
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135.29
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|
|
.95
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||||
Third
|
|
147.66
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134.09
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143.06
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|
|
.95
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||||
Fourth
|
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152.26
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141.88
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151.22
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|
.95
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||||
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$
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3.71
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2016
|
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High
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|
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Low
|
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Close
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Dividend
|
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||||
First
|
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$
|
133.78
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|
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$
|
117.80
|
|
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$
|
121.02
|
|
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$
|
.81
|
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Second
|
|
136.88
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|
|
106.63
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|
|
133.99
|
|
|
.86
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||||
Third
|
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141.53
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124.78
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|
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132.12
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|
|
.86
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||||
Fourth
|
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146.82
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127.72
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139.84
|
|
|
.86
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||||
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$
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3.39
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|
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Sept 2012
|
Sept 2013
|
Sept 2014
|
Sept 2015
|
Sept 2016
|
Sept 2017
|
Air Products
|
100
|
133
|
170
|
164
|
200
|
223
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S&P 500 Index
|
100
|
120
|
143
|
139
|
163
|
194
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S&P 500 Materials Index
|
100
|
117
|
142
|
113
|
140
|
171
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(Millions of dollars, except for share and per share data)
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2017
(A)
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2016
(A)
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2015
(A)
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2014
(A)
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2013
(A)
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|||||
Operating Results
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||||||||||
Sales
|
$
|
8,188
|
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$
|
7,504
|
|
$
|
7,824
|
|
$
|
8,384
|
|
$
|
8,313
|
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Cost of sales
|
5,753
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|
5,177
|
|
5,598
|
|
6,208
|
|
6,138
|
|
|||||
Selling and administrative
|
716
|
|
685
|
|
773
|
|
892
|
|
896
|
|
|||||
Research and development
|
58
|
|
72
|
|
76
|
|
79
|
|
74
|
|
|||||
Business restructuring and cost reduction actions
|
151
|
|
35
|
|
180
|
|
11
|
|
98
|
|
|||||
Operating income
|
1,428
|
|
1,530
|
|
1,233
|
|
924
|
|
1,149
|
|
|||||
Equity affiliates’ income
(B)
|
80
|
|
147
|
|
152
|
|
149
|
|
165
|
|
|||||
Income from continuing operations attributable to Air Products
|
1,134
|
|
1,100
|
|
933
|
|
697
|
|
869
|
|
|||||
Net income attributable to Air Products
(C)
|
3,000
|
|
631
|
|
1,278
|
|
992
|
|
994
|
|
|||||
Basic earnings per common share attributable to Air Products:
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
5.20
|
|
5.08
|
|
4.34
|
|
3.28
|
|
4.14
|
|
|||||
Net income
(C)
|
13.76
|
|
2.92
|
|
5.95
|
|
4.66
|
|
4.74
|
|
|||||
Diluted earnings per common share attributable to Air Products:
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
5.16
|
|
5.04
|
|
4.29
|
|
3.24
|
|
4.09
|
|
|||||
Net income
(C)
|
13.65
|
|
2.89
|
|
5.88
|
|
4.61
|
|
4.68
|
|
|||||
Year-End Financial Position
|
|
|
|
|
|
||||||||||
Plant and equipment, at cost
|
$
|
19,548
|
|
$
|
18,660
|
|
$
|
17,999
|
|
$
|
18,180
|
|
$
|
17,676
|
|
Total assets
(C)(D)(E)
|
18,467
|
|
18,029
|
|
17,317
|
|
17,648
|
|
17,740
|
|
|||||
Working capital
(C)
|
3,388
|
|
1,034
|
|
(851
|
)
|
199
|
|
100
|
|
|||||
Total debt
(E)(F)
|
3,963
|
|
5,211
|
|
5,856
|
|
6,081
|
|
6,231
|
|
|||||
Redeemable noncontrolling interest
|
—
|
|
—
|
|
—
|
|
287
|
|
376
|
|
|||||
Air Products shareholders’ equity
(C)
|
10,086
|
|
7,080
|
|
7,249
|
|
7,366
|
|
7,042
|
|
|||||
Total equity
(C)
|
10,186
|
|
7,213
|
|
7,381
|
|
7,521
|
|
7,199
|
|
|||||
Financial Ratios
|
|
|
|
|
|
||||||||||
Return on average Air Products shareholders’ equity
(G)
|
13.2
|
%
|
15.4
|
%
|
12.7
|
%
|
9.5
|
%
|
13.3
|
%
|
|||||
Operating margin
|
17.4
|
%
|
20.4
|
%
|
15.8
|
%
|
11.0
|
%
|
13.8
|
%
|
|||||
Selling and administrative as a percentage of sales
|
8.7
|
%
|
9.1
|
%
|
9.9
|
%
|
10.6
|
%
|
10.8
|
%
|
|||||
Total debt to total capitalization
(E)(F)(H)
|
28.0
|
%
|
41.9
|
%
|
44.2
|
%
|
43.8
|
%
|
45.1
|
%
|
|||||
Other Data
|
|
|
|
|
|
||||||||||
Income from continuing operations including noncontrolling interests
|
$
|
1,155
|
|
$
|
1,122
|
|
$
|
966
|
|
$
|
691
|
|
$
|
900
|
|
Adjusted EBITDA
(I)
|
2,795
|
|
2,622
|
|
2,399
|
|
2,275
|
|
2,247
|
|
|||||
Depreciation and amortization
|
866
|
|
855
|
|
859
|
|
876
|
|
825
|
|
|||||
Capital expenditures on a GAAP basis
(J)
|
1,056
|
|
908
|
|
1,201
|
|
1,297
|
|
1,400
|
|
|||||
Capital expenditures on a non-GAAP basis
(J)
|
1,066
|
|
935
|
|
1,575
|
|
1,498
|
|
1,642
|
|
|||||
Cash provided by operating activities
|
2,534
|
|
2,259
|
|
2,047
|
|
1,862
|
|
1,313
|
|
|||||
Cash used for investing activities
|
(1,418
|
)
|
(865
|
)
|
(1,147
|
)
|
(1,257
|
)
|
(1,354
|
)
|
|||||
Cash (used for) provided by financing activities
|
(2,041
|
)
|
(860
|
)
|
(960
|
)
|
(524
|
)
|
112
|
|
|||||
Dividends declared per common share
|
3.71
|
|
3.39
|
|
3.20
|
|
3.02
|
|
2.77
|
|
|||||
Weighted Average Common Shares – Basic (in millions)
|
218
|
|
216
|
|
215
|
|
213
|
|
210
|
|
|||||
Weighted Average Common Shares – Diluted (in millions)
|
220
|
|
218
|
|
217
|
|
215
|
|
212
|
|
|||||
Book value per common share at year-end
|
$
|
46.19
|
|
$
|
32.57
|
|
$
|
33.66
|
|
$
|
34.49
|
|
$
|
33.35
|
|
Shareholders at year-end
|
5,700
|
|
6,000
|
|
6,400
|
|
6,600
|
|
7,000
|
|
|||||
Employees at year-end
(K)
|
15,300
|
|
18,600
|
|
19,700
|
|
21,200
|
|
21,600
|
|
(A)
|
Unless otherwise stated, selected financial data is presented on a GAAP basis. Our operating results were impacted by certain items which management does not believe to be indicative of ongoing business trends and are excluded from the non-GAAP measure. Refer to
pages 31-37
for reconciliations of the GAAP to non-GAAP measures for fiscal year
2017
,
2016
, and
2015
. Descriptions of the excluded items appear on
pages 24-26
. For
2014
, these items include: (i) a charge to operating income of $11 ($7 after-tax, or $.03 per share) related to business restructuring and cost reduction actions, (ii) pension settlement losses of $5 ($3 after-tax, or $.02 per share), and (iii) a goodwill and intangible asset impairment charge of $310 ($275 attributable to Air Products, after-tax, or $1.27 per share). For
2013
, these items include: (i) a charge to operating income of $98 ($71 after-tax, or $.33 per share) related to business restructuring and cost reduction actions, and (ii) expenses of $10 ($6 after-tax, or $.03 per share) related to advisory costs.
|
(B)
|
For 2017, includes the impact of a noncash impairment charge of
$79.5
(
$.36
per share) on our investment in Abdullah Hashim Industrial Gases & Equipment Co., Ltd. (AHG), a 25%‑owned equity affiliate in our Industrial Gases – EMEA segment.
|
(C)
|
Information presented on a total company basis, which includes both continuing and discontinued operations.
|
(D)
|
Reflects adoption of guidance on the presentation of deferred income taxes on a retrospective basis. Refer to Note 2, New Accounting Guidance, for additional information.
|
(E)
|
Reflects adoption of guidance on the presentation of deferred financing costs on a retrospective basis. Refer to Note 2, New Accounting Guidance, for additional information.
|
(F)
|
Total debt includes long-term debt, current portion of long-term debt, and short-term borrowings as of the end of the year for continuing operations.
|
(G)
|
Calculated using income from continuing operations attributable to Air Products and five-quarter average Air Products shareholders’ equity.
|
(H)
|
Total capitalization includes total debt for continuing operations plus total equity plus redeemable noncontrolling interest as of the end of the year.
|
(I)
|
A reconciliation of Income from Continuing Operations on a GAAP basis to Adjusted EBITDA is presented on
pages 34-36
.
|
(J)
|
Capital expenditures presented on a GAAP basis include additions to plant and equipment, investment in and advances to unconsolidated affiliates, and acquisitions. The Company utilizes a non-GAAP measure in the computation of capital expenditures and includes spending associated with facilities accounted for as capital leases and purchases of noncontrolling interests. Refer to
page 39
for a reconciliation of the GAAP to non-GAAP measures for
2017
,
2016
, and
2015
. For
2014
, the GAAP measure was adjusted by $200 for spending associated with facilities accounted for as capital leases. For
2013
, the GAAP measure was adjusted by $228 and $14 for spending associated with facilities accounted for as capital leases and purchases of noncontrolling interests, respectively.
|
(K)
|
Includes full- and part-time employees from continuing and discontinued operations.
|
•
|
Sales of
$8,187.6
increased
9%
, or
$683.9
as underlying sales growth of
7%
and higher energy and natural gas cost pass‑through to customers of
3%
were partially offset by unfavorable currency impacts of
1%
. Underlying sales increased primarily from higher volumes across the industrial gases businesses, including the Jazan project, partially offset by lower LNG sales in the corporate and other segment.
|
•
|
Operating income of
$1,427.6
decreased
7%
, or
$102.1
, primarily due to a noncash goodwill and intangible asset impairment charge and higher cost reduction and asset actions, partially offset by favorable volumes and lower other costs. Operating margin of
17.4%
decreased
300
bp. On a non‑GAAP basis, adjusted operating income of
$1,769.6
increased
9%
, or
$149.7
, and adjusted operating margin of
21.6%
was flat
.
|
•
|
Adjusted EBITDA of
$2,795.0
increased
7%
, or
$173.5
. Adjusted EBITDA margin of
34.1%
decreased
80
bp and was negatively impacted by 90 bp from higher contractual energy pass-through to customers. Excluding this impact, adjusted EBITDA margin was up 10 bp.
|
•
|
Income from continuing operations of
$1,134.4
increased
3%
, or
$34.9
, and diluted EPS of
$5.16
increased
2%
, or
$.12
. On a non-GAAP basis, adjusted income from continuing operations of
$1,385.9
increased
13%
, or
$155.6
, and adjusted diluted EPS of
$6.31
increased
12%
, or
$.67
. A summary table of changes in diluted earnings per share, including a non‑GAAP reconciliation, is presented below.
|
•
|
We completed the spin-off of EMD as Versum on 1 October 2016.
|
•
|
We completed the sale of PMD to Evonik on 3 January 2017.
|
•
|
We entered into an agreement to form a $1.3 billion joint venture in China with Lu’An Clean Energy Company.
|
•
|
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.
|
|
|
|
|
|
|
Increase
|
||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
||||||
Diluted Earnings per Share
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
13.65
|
|
|
$
|
2.89
|
|
|
$
|
10.76
|
|
Income (Loss) from discontinued operations
|
|
8.49
|
|
|
(2.15
|
)
|
|
10.64
|
|
|||
Income from Continuing Operations – GAAP Basis
|
|
$
|
5.16
|
|
|
$
|
5.04
|
|
|
$
|
.12
|
|
Operating Income Impact (after-tax)
|
|
|
|
|
|
|
||||||
Underlying business
|
|
|
|
|
|
|
||||||
Volume
|
|
|
|
|
|
$
|
.29
|
|
||||
Price/raw materials
|
|
|
|
|
|
.03
|
|
|||||
Costs
|
|
|
|
|
|
.24
|
|
|||||
Currency
|
|
|
|
|
|
(.03
|
)
|
|||||
Business separation costs
|
|
|
|
|
|
.09
|
|
|||||
Business restructuring and cost reduction actions
|
|
|
|
|
|
(.38
|
)
|
|||||
Pension settlement loss
|
|
|
|
|
|
(.01
|
)
|
|||||
Goodwill and intangible asset impairment charge
|
|
|
|
|
|
(.70
|
)
|
|||||
Gain on land sale
|
|
|
|
|
|
.03
|
|
|||||
Total Operating Income Impact (after-tax)
|
|
|
|
|
|
$
|
(.44
|
)
|
||||
Other Impact (after-tax)
|
|
|
|
|
|
|
||||||
Equity affiliates' income
|
|
|
|
|
|
.04
|
|
|||||
Equity method investment impairment charge
|
|
|
|
|
|
(.36
|
)
|
|||||
Interest expense
|
|
|
|
|
|
(.02
|
)
|
|||||
Other non-operating income (expense), net
|
|
|
|
|
|
.10
|
|
|||||
Loss on extinguishment of debt
|
|
|
|
|
|
.02
|
|
|||||
Income tax
|
|
|
|
|
|
.07
|
|
|||||
Tax costs associated with business separation
|
|
|
|
|
|
.26
|
|
|||||
Tax election benefit
|
|
|
|
|
|
.50
|
|
|||||
Noncontrolling interests
|
|
|
|
|
|
(.01
|
)
|
|||||
Weighted average diluted shares
|
|
|
|
|
|
(.04
|
)
|
|||||
Total Other Impact (after-tax)
|
|
|
|
|
|
$
|
.56
|
|
||||
Total Change in Diluted Earnings per Share from Continuing Operations – GAAP Basis
|
|
|
|
|
|
$
|
.12
|
|
|
|
|
|
|
|
Increase
|
||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
||||||
Income from Continuing Operations – GAAP Basis
|
|
$
|
5.16
|
|
|
$
|
5.04
|
|
|
$
|
.12
|
|
Business separation costs
|
|
.12
|
|
|
.21
|
|
|
(.09
|
)
|
|||
Tax (benefit) costs associated with business separation
|
|
(.02
|
)
|
|
.24
|
|
|
(.26
|
)
|
|||
Business restructuring and cost reduction actions
|
|
.49
|
|
|
.11
|
|
|
.38
|
|
|||
Pension settlement loss
|
|
.03
|
|
|
.02
|
|
|
.01
|
|
|||
Goodwill and intangible asset impairment charge
|
|
.70
|
|
|
—
|
|
|
.70
|
|
|||
Gain on land sale
|
|
(.03
|
)
|
|
—
|
|
|
(.03
|
)
|
|||
Equity method investment impairment charge
|
|
.36
|
|
|
—
|
|
|
.36
|
|
|||
Loss on extinguishment of debt
|
|
—
|
|
|
.02
|
|
|
(.02
|
)
|
|||
Tax election benefit
|
|
(.50
|
)
|
|
—
|
|
|
(.50
|
)
|
|||
Income from Continuing Operations – Non-GAAP Basis
|
|
$
|
6.31
|
|
|
$
|
5.64
|
|
|
$
|
.67
|
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Sales
|
$
|
8,187.6
|
|
$
|
7,503.7
|
|
$
|
7,824.3
|
|
Operating income
|
1,427.6
|
|
1,529.7
|
|
1,233.2
|
|
|||
Operating margin
|
17.4
|
%
|
20.4
|
%
|
15.8
|
%
|
|||
Equity affiliates’ income
|
80.1
|
|
147.0
|
|
152.3
|
|
|||
Non-GAAP Measures
|
|
|
|
||||||
Adjusted EBITDA
|
$
|
2,795.0
|
|
$
|
2,621.5
|
|
$
|
2,399.4
|
|
Adjusted EBITDA margin
|
34.1
|
%
|
34.9
|
%
|
30.7
|
%
|
|||
Adjusted operating income
|
1,769.6
|
|
1,619.9
|
|
1,388.6
|
|
|||
Adjusted operating margin
|
21.6
|
%
|
21.6
|
%
|
17.7
|
%
|
|||
Adjusted equity affiliates' income
|
159.6
|
|
147.0
|
|
152.3
|
|
|
% Change from Prior Year
|
|||
|
2017
|
|
2016
|
|
Underlying business
|
|
|
||
Volume
|
6
|
%
|
3
|
%
|
Price
|
1
|
%
|
—
|
%
|
Energy and raw material cost pass-through
|
3
|
%
|
(4
|
)%
|
Currency
|
(1
|
)%
|
(3
|
)%
|
Total Consolidated Change
|
9
|
%
|
(4
|
)%
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Interest incurred
|
$
|
139.6
|
|
$
|
147.9
|
|
$
|
151.9
|
|
Less: Capitalized interest
|
19.0
|
|
32.7
|
|
49.1
|
|
|||
Interest Expense
|
$
|
120.6
|
|
$
|
115.2
|
|
$
|
102.8
|
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Sales
|
$
|
3,637.0
|
|
$
|
3,344.1
|
|
$
|
3,694.5
|
|
Operating income
|
950.6
|
|
893.2
|
|
806.1
|
|
|||
Operating margin
|
26.1
|
%
|
26.7
|
%
|
21.8
|
%
|
|||
Equity affiliates’ income
|
58.1
|
|
52.7
|
|
64.6
|
|
|||
Adjusted EBITDA
|
1,473.1
|
|
1,389.5
|
|
1,288.2
|
|
|||
Adjusted EBITDA margin
|
40.5
|
%
|
41.6
|
%
|
34.9
|
%
|
|
% Change from Prior Year
|
|||
|
2017
|
|
2016
|
|
Underlying business
|
|
|
||
Volume
|
2
|
%
|
(2
|
)%
|
Price
|
—
|
%
|
1
|
%
|
Energy and raw material cost pass-through
|
6
|
%
|
(6
|
)%
|
Currency
|
1
|
%
|
(2
|
)%
|
Total Industrial Gases – Americas Change
|
9
|
%
|
(9
|
)%
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Sales
|
$
|
1,780.4
|
|
$
|
1,704.4
|
|
$
|
1,866.4
|
|
Operating income
|
387.1
|
|
384.6
|
|
331.3
|
|
|||
Operating margin
|
21.7
|
%
|
22.6
|
%
|
17.8
|
%
|
|||
Equity affiliates’ income
|
47.1
|
|
36.5
|
|
42.4
|
|
|||
Adjusted EBITDA
|
611.3
|
|
606.8
|
|
568.0
|
|
|||
Adjusted EBITDA margin
|
34.3
|
%
|
35.6
|
%
|
30.4
|
%
|
|
% Change from Prior Year
|
|||
|
2017
|
|
2016
|
|
Underlying business
|
|
|
||
Volume
|
6
|
%
|
(2
|
)%
|
Price
|
—
|
%
|
1
|
%
|
Energy and raw material cost pass-through
|
1
|
%
|
(4
|
)%
|
Currency
|
(3
|
)%
|
(4
|
)%
|
Total Industrial Gases – EMEA Change
|
4
|
%
|
(9
|
)%
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Sales
|
$
|
1,964.7
|
|
$
|
1,720.4
|
|
$
|
1,661.3
|
|
Operating income
|
531.2
|
|
451.0
|
|
389.3
|
|
|||
Operating margin
|
27.0
|
%
|
26.2
|
%
|
23.4
|
%
|
|||
Equity affiliates’ income
|
53.5
|
|
57.8
|
|
46.1
|
|
|||
Adjusted EBITDA
|
787.9
|
|
706.7
|
|
645.3
|
|
|||
Adjusted EBITDA margin
|
40.1
|
%
|
41.1
|
%
|
38.8
|
%
|
|
% Change from Prior Year
|
|||
|
2017
|
|
2016
|
|
Underlying business
|
|
|
||
Volume
|
14
|
%
|
10
|
%
|
Price
|
1
|
%
|
(1
|
)%
|
Energy and raw material cost pass-through
|
—
|
%
|
—
|
%
|
Currency
|
(1
|
)%
|
(5
|
)%
|
Total Industrial Gases – Asia Change
|
14
|
%
|
4
|
%
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Sales
|
$
|
722.9
|
|
$
|
498.8
|
|
$
|
286.7
|
|
Operating income (loss)
|
71.3
|
|
(21.3
|
)
|
(51.6
|
)
|
|||
Adjusted EBITDA
|
81.1
|
|
(13.4
|
)
|
(35.9
|
)
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Sales
|
$
|
82.6
|
|
$
|
236.0
|
|
$
|
315.4
|
|
Operating loss
|
(170.6
|
)
|
(87.6
|
)
|
(86.5
|
)
|
|||
Adjusted EBITDA
|
(158.4
|
)
|
(68.1
|
)
|
(66.2
|
)
|
|
Continuing Operations
|
||||||||||||||||
|
Operating
Income
|
Operating
Margin
(A)
|
Equity Affiliates' Income
|
Income Tax
Provision
(B)
|
Net
Income
|
Diluted
EPS
|
|||||||||||
2017 GAAP
|
$
|
1,427.6
|
|
17.4
|
%
|
$
|
80.1
|
|
$
|
260.9
|
|
$
|
1,134.4
|
|
$
|
5.16
|
|
2016 GAAP
|
1,529.7
|
|
20.4
|
%
|
147.0
|
|
432.6
|
|
1,099.5
|
|
5.04
|
|
|||||
Change GAAP
|
$
|
(102.1
|
)
|
(300
|
)bp
|
$
|
(66.9
|
)
|
$
|
(171.7
|
)
|
$
|
34.9
|
|
$
|
.12
|
|
% Change GAAP
|
(7
|
)%
|
|
(46
|
)%
|
(40
|
)%
|
3
|
%
|
2
|
%
|
||||||
2017 GAAP
|
$
|
1,427.6
|
|
17.4
|
%
|
$
|
80.1
|
|
$
|
260.9
|
|
$
|
1,134.4
|
|
$
|
5.16
|
|
Business separation costs
(C)
|
30.2
|
|
.4
|
%
|
—
|
|
3.7
|
|
26.5
|
|
.12
|
|
|||||
Tax benefit associated with business separation
(C)
|
—
|
|
—
|
%
|
—
|
|
5.5
|
|
(5.5
|
)
|
(.02
|
)
|
|||||
Business restructuring and cost reduction actions
(D)
|
151.4
|
|
1.8
|
%
|
—
|
|
41.6
|
|
109.3
|
|
.49
|
|
|||||
Pension settlement loss
|
10.5
|
|
.1
|
%
|
—
|
|
3.9
|
|
6.6
|
|
.03
|
|
|||||
Goodwill and intangible asset impairment charge
(E)
|
162.1
|
|
2.0
|
%
|
—
|
|
4.6
|
|
154.1
|
|
.70
|
|
|||||
Gain on land sale
(F)
|
(12.2
|
)
|
(.1
|
)%
|
—
|
|
(4.6
|
)
|
(7.6
|
)
|
(.03
|
)
|
|||||
Equity method investment impairment charge
|
—
|
|
—
|
%
|
79.5
|
|
—
|
|
79.5
|
|
.36
|
|
|||||
Tax election benefit
|
—
|
|
—
|
%
|
—
|
|
111.4
|
|
(111.4
|
)
|
(.50
|
)
|
|||||
2017 Non-GAAP Measure
|
$
|
1,769.6
|
|
21.6
|
%
|
$
|
159.6
|
|
$
|
427.0
|
|
$
|
1,385.9
|
|
$
|
6.31
|
|
2016 GAAP
|
$
|
1,529.7
|
|
20.4
|
%
|
$
|
147.0
|
|
$
|
432.6
|
|
$
|
1,099.5
|
|
$
|
5.04
|
|
Business separation costs
(C)
|
50.6
|
|
.7
|
%
|
—
|
|
3.9
|
|
46.7
|
|
.21
|
|
|||||
Tax costs associated with business separation
(C)
|
—
|
|
—
|
%
|
—
|
|
(51.8
|
)
|
51.8
|
|
.24
|
|
|||||
Business restructuring and cost reduction actions
|
34.5
|
|
.4
|
%
|
—
|
|
9.8
|
|
24.7
|
|
.11
|
|
|||||
Pension settlement loss
|
5.1
|
|
.1
|
%
|
—
|
|
1.8
|
|
3.3
|
|
.02
|
|
|||||
Loss on extinguishment of debt
(G)
|
—
|
|
—
|
%
|
—
|
|
2.6
|
|
4.3
|
|
.02
|
|
|||||
2016 Non-GAAP Measure
|
$
|
1,619.9
|
|
21.6
|
%
|
$
|
147.0
|
|
$
|
398.9
|
|
$
|
1,230.3
|
|
$
|
5.64
|
|
Change Non-GAAP Measure
|
$
|
149.7
|
|
—
|
|
$
|
12.6
|
|
$
|
28.1
|
|
$
|
155.6
|
|
$
|
.67
|
|
% Change Non-GAAP Measure
|
9
|
%
|
|
9
|
%
|
7
|
%
|
13
|
%
|
12
|
%
|
|
Continuing Operations
|
||||||||||||||||
|
Operating
Income
|
Operating
Margin
(A)
|
Equity Affiliates' Income
|
Income Tax
Provision
(B)
|
Net
Income
|
Diluted
EPS
|
|||||||||||
2016 GAAP
|
$
|
1,529.7
|
|
20.4
|
%
|
$
|
147.0
|
|
$
|
432.6
|
|
$
|
1,099.5
|
|
$
|
5.04
|
|
2015 GAAP
|
1,233.2
|
|
15.8
|
%
|
152.3
|
|
300.2
|
|
933.3
|
|
4.29
|
|
|||||
Change GAAP
|
$
|
296.5
|
|
460
|
bp
|
$
|
(5.3
|
)
|
$
|
132.4
|
|
$
|
166.2
|
|
$
|
.75
|
|
% Change GAAP
|
24
|
%
|
|
(3
|
)%
|
44
|
%
|
18
|
%
|
17
|
%
|
||||||
2016 GAAP
|
$
|
1,529.7
|
|
20.4
|
%
|
$
|
147.0
|
|
$
|
432.6
|
|
$
|
1,099.5
|
|
$
|
5.04
|
|
Business separation costs
(C)
|
50.6
|
|
.7
|
%
|
—
|
|
3.9
|
|
46.7
|
|
.21
|
|
|||||
Tax costs associated with business separation
(C)
|
—
|
|
—
|
%
|
—
|
|
(51.8
|
)
|
51.8
|
|
.24
|
|
|||||
Business restructuring and cost reduction actions
|
34.5
|
|
.4
|
%
|
—
|
|
9.8
|
|
24.7
|
|
.11
|
|
|||||
Pension settlement loss
|
5.1
|
|
.1
|
%
|
—
|
|
1.8
|
|
3.3
|
|
.02
|
|
|||||
Loss on extinguishment of debt
(G)
|
—
|
|
—
|
%
|
—
|
|
2.6
|
|
4.3
|
|
.02
|
|
|||||
2016 Non-GAAP Measure
|
$
|
1,619.9
|
|
21.6
|
%
|
$
|
147.0
|
|
$
|
398.9
|
|
$
|
1,230.3
|
|
$
|
5.64
|
|
2015 GAAP
|
$
|
1,233.2
|
|
15.8
|
%
|
$
|
152.3
|
|
$
|
300.2
|
|
$
|
933.3
|
|
$
|
4.29
|
|
Business separation costs
(C)
|
7.5
|
|
.1
|
%
|
—
|
|
—
|
|
7.5
|
|
.03
|
|
|||||
Business restructuring and cost reduction actions
|
180.1
|
|
2.3
|
%
|
—
|
|
47.2
|
|
132.9
|
|
.61
|
|
|||||
Pension settlement loss
|
19.3
|
|
.2
|
%
|
—
|
|
6.9
|
|
12.4
|
|
.06
|
|
|||||
Gain on previously held equity interest
|
(17.9
|
)
|
(.3
|
)%
|
—
|
|
(6.7
|
)
|
(11.2
|
)
|
(.05
|
)
|
|||||
Gain on land sales
(F)
|
(33.6
|
)
|
(.4
|
)%
|
—
|
|
(5.3
|
)
|
(28.3
|
)
|
(.13
|
)
|
|||||
Loss on extinguishment of debt
(G)
|
—
|
|
—
|
%
|
—
|
|
2.4
|
|
14.2
|
|
.07
|
|
|||||
2015 Non-GAAP Measure
|
$
|
1,388.6
|
|
17.7
|
%
|
$
|
152.3
|
|
$
|
344.7
|
|
$
|
1,060.8
|
|
$
|
4.88
|
|
Change Non-GAAP Measure
|
$
|
231.3
|
|
390
|
bp
|
$
|
(5.3
|
)
|
$
|
54.2
|
|
$
|
169.5
|
|
$
|
.76
|
|
% Change Non-GAAP Measure
|
17
|
%
|
|
(3
|
)%
|
16
|
%
|
16
|
%
|
16
|
%
|
(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)
|
Refer to Note
4
,
Materials Technologies Separation
, to the consolidated financial statements for additional information.
|
(D)
|
Noncontrolling interests impact of
$.5
in fiscal year 2017.
|
(E)
|
Noncontrolling interests impact of
$3.4
in fiscal year 2017.
|
(F)
|
Reflected on the consolidated income statements in “Other income (expense), net.”
|
(G)
|
Income from continuing operations before taxes impact of
$6.9
and
$16.6
in 2016 and 2015, respectively.
|
|
2017
|
2016
|
2015
|
2014
|
2013
|
||||||||||
Income from Continuing Operations
(A)
|
$
|
1,155.2
|
|
$
|
1,122.0
|
|
$
|
965.9
|
|
$
|
691.0
|
|
$
|
900.0
|
|
Add: Interest expense
|
120.6
|
|
115.2
|
|
102.8
|
|
124.0
|
|
138.8
|
|
|||||
Less: Other non-operating income (expense), net
|
29.0
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Add: Income tax provision
|
260.9
|
|
432.6
|
|
300.2
|
|
258.1
|
|
275.1
|
|
|||||
Add: Depreciation and amortization
|
865.8
|
|
854.6
|
|
858.5
|
|
875.6
|
|
824.6
|
|
|||||
Add: Business separation costs
|
30.2
|
|
50.6
|
|
7.5
|
|
—
|
|
—
|
|
|||||
Add: Business restructuring and cost reduction actions
|
151.4
|
|
34.5
|
|
180.1
|
|
11.1
|
|
98.3
|
|
|||||
Add: Pension settlement loss
|
10.5
|
|
5.1
|
|
19.3
|
|
5.2
|
|
—
|
|
|||||
Add: Goodwill and intangible asset impairment charge
|
162.1
|
|
—
|
|
—
|
|
310.1
|
|
—
|
|
|||||
Less: Gain on previously held equity interest
|
—
|
|
—
|
|
17.9
|
|
—
|
|
—
|
|
|||||
Add: Advisory costs
|
—
|
|
—
|
|
—
|
|
—
|
|
10.1
|
|
|||||
Less: Gain on land sales
(B)
|
12.2
|
|
—
|
|
33.6
|
|
—
|
|
—
|
|
|||||
Add: Equity method investment impairment charge
|
79.5
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Add: Loss on extinguishment of debt
|
—
|
|
6.9
|
|
16.6
|
|
—
|
|
—
|
|
|||||
Adjusted EBITDA
|
$
|
2,795.0
|
|
$
|
2,621.5
|
|
$
|
2,399.4
|
|
$
|
2,275.1
|
|
$
|
2,246.9
|
|
Change GAAP
|
|
|
|
|
|
||||||||||
Income from continuing operations change
|
$
|
33.2
|
|
$
|
156.1
|
|
$
|
274.9
|
|
$
|
(209.0
|
)
|
|
||
Income from continuing operations % change
|
3
|
%
|
16
|
%
|
40
|
%
|
(23
|
)%
|
|
||||||
Change Non-GAAP
|
|
|
|
|
|
||||||||||
Adjusted EBITDA change
|
$
|
173.5
|
|
$
|
222.1
|
|
$
|
124.3
|
|
$
|
28.2
|
|
|
||
Adjusted EBITDA % change
|
7
|
%
|
9
|
%
|
5
|
%
|
1
|
%
|
|
|
Industrial
Gases–
Americas
|
Industrial
Gases–
EMEA
|
Industrial
Gases–
Asia
|
Industrial
Gases–
Global
|
Corporate
and other
|
Segment
Total
|
||||||||||||
GAAP Measure
|
|
|
|
|
|
|
||||||||||||
Twelve Months Ended 30 September 2017
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
$
|
950.6
|
|
$
|
387.1
|
|
$
|
531.2
|
|
$
|
71.3
|
|
$
|
(170.6
|
)
|
$
|
1,769.6
|
|
Operating margin
|
26.1
|
%
|
21.7
|
%
|
27.0
|
%
|
|
|
21.6
|
%
|
||||||||
Twelve Months Ended 30 September 2016
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
$
|
893.2
|
|
$
|
384.6
|
|
$
|
451.0
|
|
$
|
(21.3
|
)
|
$
|
(87.6
|
)
|
$
|
1,619.9
|
|
Operating margin
|
26.7
|
%
|
22.6
|
%
|
26.2
|
%
|
|
|
21.6
|
%
|
||||||||
Twelve Months Ended 30 September 2015
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
$
|
806.1
|
|
$
|
331.3
|
|
$
|
389.3
|
|
$
|
(51.6
|
)
|
$
|
(86.5
|
)
|
$
|
1,388.6
|
|
Operating margin
|
21.8
|
%
|
17.8
|
%
|
23.4
|
%
|
|
|
17.7
|
%
|
||||||||
2017 vs. 2016
|
|
|
|
|
|
|
||||||||||||
Operating income (loss) change
|
$
|
57.4
|
|
$
|
2.5
|
|
$
|
80.2
|
|
$
|
92.6
|
|
$
|
(83.0
|
)
|
$
|
149.7
|
|
Operating income (loss) % change
|
6
|
%
|
1
|
%
|
18
|
%
|
435
|
%
|
(95
|
)%
|
9
|
%
|
||||||
Operating margin change
|
(60
|
) bp
|
(90
|
) bp
|
80
|
bp
|
|
|
—
|
|
||||||||
2016 vs. 2015
|
|
|
|
|
|
|
||||||||||||
Operating income (loss) change
|
$
|
87.1
|
|
$
|
53.3
|
|
$
|
61.7
|
|
$
|
30.3
|
|
$
|
(1.1
|
)
|
$
|
231.3
|
|
Operating income (loss) % change
|
11
|
%
|
16
|
%
|
16
|
%
|
59
|
%
|
(1
|
)%
|
17
|
%
|
||||||
Operating margin change
|
490
|
bp
|
480
|
bp
|
280
|
bp
|
|
|
390
|
bp
|
|
Industrial
Gases–
Americas
|
Industrial
Gases–
EMEA
|
Industrial
Gases–
Asia
|
Industrial
Gases–
Global
|
Corporate
and other
|
Segment
Total
|
||||||||||||
Non-GAAP Measure
|
|
|
|
|
|
|
||||||||||||
Twelve Months Ended 30 September 2017
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
$
|
950.6
|
|
$
|
387.1
|
|
$
|
531.2
|
|
$
|
71.3
|
|
$
|
(170.6
|
)
|
$
|
1,769.6
|
|
Add: Depreciation and amortization
|
464.4
|
|
177.1
|
|
203.2
|
|
8.9
|
|
12.2
|
|
865.8
|
|
||||||
Add: Equity affiliates' income
|
58.1
|
|
47.1
|
|
53.5
|
|
.9
|
|
—
|
|
159.6
|
|
||||||
Adjusted EBITDA
|
$
|
1,473.1
|
|
$
|
611.3
|
|
$
|
787.9
|
|
$
|
81.1
|
|
$
|
(158.4
|
)
|
$
|
2,795.0
|
|
Adjusted EBITDA margin
(A)
|
40.5
|
%
|
34.3
|
%
|
40.1
|
%
|
|
|
34.1
|
%
|
||||||||
Twelve Months Ended 30 September 2016
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
$
|
893.2
|
|
$
|
384.6
|
|
$
|
451.0
|
|
$
|
(21.3
|
)
|
$
|
(87.6
|
)
|
$
|
1,619.9
|
|
Add: Depreciation and amortization
|
443.6
|
|
185.7
|
|
197.9
|
|
7.9
|
|
19.5
|
|
854.6
|
|
||||||
Add: Equity affiliates' income
|
52.7
|
|
36.5
|
|
57.8
|
|
—
|
|
—
|
|
147.0
|
|
||||||
Adjusted EBITDA
|
$
|
1,389.5
|
|
$
|
606.8
|
|
$
|
706.7
|
|
$
|
(13.4
|
)
|
$
|
(68.1
|
)
|
$
|
2,621.5
|
|
Adjusted EBITDA margin
(A)
|
41.6
|
%
|
35.6
|
%
|
41.1
|
%
|
|
|
34.9
|
%
|
||||||||
Twelve Months Ended 30 September 2015
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
$
|
806.1
|
|
$
|
331.3
|
|
$
|
389.3
|
|
$
|
(51.6
|
)
|
$
|
(86.5
|
)
|
$
|
1,388.6
|
|
Add: Depreciation and amortization
|
417.5
|
|
194.3
|
|
209.9
|
|
16.5
|
|
20.3
|
|
858.5
|
|
||||||
Add: Equity affiliates' income (loss)
|
64.6
|
|
42.4
|
|
46.1
|
|
(.8
|
)
|
—
|
|
152.3
|
|
||||||
Adjusted EBITDA
|
$
|
1,288.2
|
|
$
|
568.0
|
|
$
|
645.3
|
|
$
|
(35.9
|
)
|
$
|
(66.2
|
)
|
$
|
2,399.4
|
|
Adjusted EBITDA margin
(A)
|
34.9
|
%
|
30.4
|
%
|
38.8
|
%
|
|
|
30.7
|
%
|
||||||||
2017 vs. 2016
|
|
|
|
|
|
|
||||||||||||
Adjusted EBITDA change
|
$
|
83.6
|
|
$
|
4.5
|
|
$
|
81.2
|
|
$
|
94.5
|
|
$
|
(90.3
|
)
|
$
|
173.5
|
|
Adjusted EBITDA % change
|
6
|
%
|
1
|
%
|
11
|
%
|
705
|
%
|
(133
|
)%
|
7
|
%
|
||||||
Adjusted EBITDA margin change
|
(110
|
) bp
|
(130
|
) bp
|
(100
|
) bp
|
|
|
(80
|
) bp
|
||||||||
2016 vs. 2015
|
|
|
|
|
|
|
||||||||||||
Adjusted EBITDA change
|
$
|
101.3
|
|
$
|
38.8
|
|
$
|
61.4
|
|
$
|
22.5
|
|
$
|
(1.9
|
)
|
$
|
222.1
|
|
Adjusted EBITDA % change
|
8
|
%
|
7
|
%
|
10
|
%
|
63
|
%
|
(3
|
)%
|
9
|
%
|
||||||
Adjusted EBITDA margin change
|
670
|
bp
|
520
|
bp
|
230
|
bp
|
|
|
420
|
bp
|
|
Effective Tax Rate
|
||||||||
|
2017
|
2016
|
2015
|
||||||
Income Tax Provision—GAAP
|
$
|
260.9
|
|
$
|
432.6
|
|
$
|
300.2
|
|
Income from Continuing Operations before Taxes—GAAP
|
$
|
1,416.1
|
|
$
|
1,554.6
|
|
$
|
1,266.1
|
|
Effective Tax Rate—GAAP
|
18.4
|
%
|
27.8
|
%
|
23.7
|
%
|
|||
Income Tax Provision—GAAP
|
$
|
260.9
|
|
$
|
432.6
|
|
$
|
300.2
|
|
Business separation costs
|
3.7
|
|
3.9
|
|
—
|
|
|||
Tax benefit (costs) associated with business separation
|
5.5
|
|
(51.8
|
)
|
—
|
|
|||
Business restructuring and cost reduction actions
|
41.6
|
|
9.8
|
|
47.2
|
|
|||
Pension settlement loss
|
3.9
|
|
1.8
|
|
6.9
|
|
|||
Goodwill and intangible asset impairment charge
|
4.6
|
|
—
|
|
—
|
|
|||
Gain on previously held equity interest
|
—
|
|
—
|
|
(6.7
|
)
|
|||
Gain on land sales
|
(4.6
|
)
|
—
|
|
(5.3
|
)
|
|||
Equity method investment impairment charge
|
—
|
|
—
|
|
—
|
|
|||
Loss on extinguishment of debt
|
—
|
|
2.6
|
|
2.4
|
|
|||
Tax election benefit
|
111.4
|
|
—
|
|
—
|
|
|||
Income Tax Provision—Non-GAAP Measure
|
$
|
427.0
|
|
$
|
398.9
|
|
$
|
344.7
|
|
Income from Continuing Operations before Taxes—GAAP
|
$
|
1,416.1
|
|
$
|
1,554.6
|
|
$
|
1,266.1
|
|
Business separation costs
|
30.2
|
|
50.6
|
|
7.5
|
|
|||
Business restructuring and cost reduction actions
|
151.4
|
|
34.5
|
|
180.1
|
|
|||
Pension settlement loss
|
10.5
|
|
5.1
|
|
19.3
|
|
|||
Goodwill and intangible asset impairment charge
|
162.1
|
|
—
|
|
—
|
|
|||
Gain on previously held equity interest
|
—
|
|
—
|
|
(17.9
|
)
|
|||
Gain on land sales
|
(12.2
|
)
|
—
|
|
(33.6
|
)
|
|||
Equity method investment impairment charge
|
79.5
|
|
—
|
|
—
|
|
|||
Loss on extinguishment of debt
|
—
|
|
6.9
|
|
16.6
|
|
|||
Income from Continuing Operations Before Taxes—Non-GAAP Measure
|
$
|
1,837.6
|
|
$
|
1,651.7
|
|
$
|
1,438.1
|
|
Effective Tax Rate—Non-GAAP Measure
|
23.2
|
%
|
24.2
|
%
|
24.0
|
%
|
Cash provided by (used for)
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Operating activities
|
|
$
|
2,534.1
|
|
|
$
|
2,258.8
|
|
|
$
|
2,047.0
|
|
Investing activities
|
|
(1,417.7
|
)
|
|
(864.8
|
)
|
|
(1,146.7
|
)
|
|||
Financing activities
|
|
(2,040.9
|
)
|
|
(860.2
|
)
|
|
(960.4
|
)
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Additions to plant and equipment
|
$
|
1,039.7
|
|
$
|
907.7
|
|
$
|
1,162.4
|
|
Acquisitions, less cash acquired
|
8.2
|
|
—
|
|
34.5
|
|
|||
Investments in and advances to unconsolidated affiliates
|
8.1
|
|
—
|
|
4.3
|
|
|||
Capital Expenditures on a GAAP Basis
|
$
|
1,056.0
|
|
$
|
907.7
|
|
$
|
1,201.2
|
|
Capital lease expenditures
(A)
|
9.9
|
|
27.2
|
|
95.6
|
|
|||
Purchase of noncontrolling interests in a subsidiary
(A)
|
—
|
|
—
|
|
278.4
|
|
|||
Capital Expenditures on a Non-GAAP Basis
|
$
|
1,065.9
|
|
$
|
934.9
|
|
$
|
1,575.2
|
|
(A)
|
We utilize a non-GAAP measure in the computation of capital expenditures and include spending associated with facilities accounted for as capital leases and purchases of noncontrolling interests. 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 in the consolidated statements of cash flows within "Cash Provided by Operating Activities" if the arrangement qualifies as a capital lease. Additionally, the purchase of subsidiary shares from noncontrolling interests is accounted for as a financing activity in the statement of cash flows. 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.
|
|
Total
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
Thereafter
|
|
|||||||
Long-term debt obligations
|
|
|
|
|
|
|
|
||||||||||||||
Debt maturities
|
$
|
3,837
|
|
$
|
416
|
|
$
|
409
|
|
$
|
356
|
|
$
|
433
|
|
$
|
401
|
|
$
|
1,822
|
|
Contractual interest
|
438
|
|
76
|
|
75
|
|
57
|
|
49
|
|
37
|
|
144
|
|
|||||||
Capital leases
|
30
|
|
2
|
|
2
|
|
2
|
|
3
|
|
1
|
|
20
|
|
|||||||
Operating leases
|
314
|
|
57
|
|
46
|
|
35
|
|
27
|
|
23
|
|
126
|
|
|||||||
Pension obligations
|
698
|
|
52
|
|
47
|
|
47
|
|
46
|
|
48
|
|
458
|
|
|||||||
Unconditional purchase obligations
|
6,533
|
|
822
|
|
234
|
|
275
|
|
309
|
|
285
|
|
4,608
|
|
|||||||
Obligation for future contribution to an equity affiliate
|
100
|
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|||||||
Total Contractual Obligations
|
$
|
11,950
|
|
$
|
1,425
|
|
$
|
813
|
|
$
|
872
|
|
$
|
867
|
|
$
|
795
|
|
$
|
7,178
|
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Pension expense – Continuing operations
|
$
|
72.0
|
|
$
|
55.8
|
|
$
|
115.0
|
|
Special terminations, settlements, and curtailments (included above)
|
15.0
|
|
6.0
|
|
30.5
|
|
|||
Weighted average discount rate
(A)
|
3.0
|
%
|
4.1
|
%
|
4.0
|
%
|
|||
Weighted average expected rate of return on plan assets
|
7.4
|
%
|
7.5
|
%
|
7.4
|
%
|
|||
Weighted average expected rate of compensation increase
|
3.5
|
%
|
3.5
|
%
|
3.5
|
%
|
(A)
|
Effective in 2016, the Company began to measure the service cost and interest cost components of pension expense by applying spot rates along the yield curve to the relevant projected cash flows, as we believe this provides a better measurement of these costs. The Company accounted for this as a change in accounting estimate and, accordingly, accounted for it prospectively. This change did not affect the measurement of the total benefit obligation.
|
|
|
Decrease Life
By 1 Year
|
|
|
Increase Life
By 1 Year
|
|
||
Industrial Gases – Regional
|
|
$
|
40
|
|
|
$
|
(35
|
)
|
(i)
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
|
(ii)
|
provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and
|
(iii)
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.
|
/s/ Seifi Ghasemi
|
|
|
|
/s/ M. Scott Crocco
|
Seifi Ghasemi
|
|
|
|
M. Scott Crocco
|
Chairman, President, and
|
|
|
|
Executive Vice President and
|
Chief Executive Officer
|
|
|
|
Chief Financial Officer
|
16 November 2017
|
|
|
|
16 November 2017
|
Year ended 30 September (Millions of dollars, except for share and per share data)
|
2017
|
|
2016
|
|
2015
|
|
|||
Sales
|
$
|
8,187.6
|
|
$
|
7,503.7
|
|
$
|
7,824.3
|
|
Cost of sales
|
5,753.4
|
|
5,176.6
|
|
5,598.2
|
|
|||
Selling and administrative
|
715.6
|
|
685.0
|
|
773.0
|
|
|||
Research and development
|
57.8
|
|
71.6
|
|
76.4
|
|
|||
Business separation costs
|
30.2
|
|
50.6
|
|
7.5
|
|
|||
Business restructuring and cost reduction actions
|
151.4
|
|
34.5
|
|
180.1
|
|
|||
Pension settlement loss
|
10.5
|
|
5.1
|
|
19.3
|
|
|||
Goodwill and intangible asset impairment charge
|
162.1
|
|
—
|
|
—
|
|
|||
Gain on previously held equity interest
|
—
|
|
—
|
|
17.9
|
|
|||
Other income (expense), net
|
121.0
|
|
49.4
|
|
45.5
|
|
|||
Operating Income
|
1,427.6
|
|
1,529.7
|
|
1,233.2
|
|
|||
Equity affiliates' income
|
80.1
|
|
147.0
|
|
152.3
|
|
|||
Interest expense
|
120.6
|
|
115.2
|
|
102.8
|
|
|||
Other non-operating income (expense), net
|
29.0
|
|
—
|
|
—
|
|
|||
Loss on extinguishment of debt
|
—
|
|
6.9
|
|
16.6
|
|
|||
Income From Continuing Operations Before Taxes
|
1,416.1
|
|
1,554.6
|
|
1,266.1
|
|
|||
Income tax provision
|
260.9
|
|
432.6
|
|
300.2
|
|
|||
Income From Continuing Operations
|
1,155.2
|
|
1,122.0
|
|
965.9
|
|
|||
Income (Loss) From Discontinued Operations, net of tax
|
1,866.0
|
|
(460.5
|
)
|
351.7
|
|
|||
Net Income
|
3,021.2
|
|
661.5
|
|
1,317.6
|
|
|||
Net Income Attributable to Noncontrolling Interests of Continuing Operations
|
20.8
|
|
22.5
|
|
32.6
|
|
|||
Net Income Attributable to Noncontrolling Interests of Discontinued Operations
|
—
|
|
7.9
|
|
7.1
|
|
|||
Net Income Attributable to Air Products
|
$
|
3,000.4
|
|
$
|
631.1
|
|
$
|
1,277.9
|
|
|
|
|
|
||||||
Net Income Attributable to Air Products
|
|
|
|
||||||
Income from continuing operations
|
$
|
1,134.4
|
|
$
|
1,099.5
|
|
$
|
933.3
|
|
Income (Loss) from discontinued operations
|
1,866.0
|
|
(468.4
|
)
|
344.6
|
|
|||
Net Income Attributable to Air Products
|
$
|
3,000.4
|
|
$
|
631.1
|
|
$
|
1,277.9
|
|
Basic Earnings Per Common Share Attributable to Air Products
|
|
|
|
||||||
Income from continuing operations
|
$
|
5.20
|
|
$
|
5.08
|
|
$
|
4.34
|
|
Income (Loss) from discontinued operations
|
8.56
|
|
(2.16
|
)
|
1.61
|
|
|||
Net Income Attributable to Air Products
|
$
|
13.76
|
|
$
|
2.92
|
|
$
|
5.95
|
|
Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
|
||||||
Income from continuing operations
|
$
|
5.16
|
|
$
|
5.04
|
|
$
|
4.29
|
|
Income (Loss) from discontinued operations
|
8.49
|
|
(2.15
|
)
|
1.59
|
|
|||
Net Income Attributable to Air Products
|
$
|
13.65
|
|
$
|
2.89
|
|
$
|
5.88
|
|
Weighted Average Common Shares — Basic
(in millions)
|
218.0
|
|
216.4
|
|
214.9
|
|
|||
Weighted Average Common Shares — Diluted
(in millions)
|
219.8
|
|
218.3
|
|
217.3
|
|
Year ended 30 September (Millions of dollars)
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Net Income
|
|
$
|
3,021.2
|
|
|
$
|
661.5
|
|
|
$
|
1,317.6
|
|
Other Comprehensive Income (Loss), net of tax:
|
|
|
|
|
|
|
||||||
Translation adjustments, net of tax of ($19.3), ($19.8), and $45.2
|
|
101.9
|
|
|
9.9
|
|
|
(699.3
|
)
|
|||
Net gain (loss) on derivatives, net of tax of ($11.0), $9.1, and ($16.0)
|
|
(12.6
|
)
|
|
13.7
|
|
|
(35.0
|
)
|
|||
Pension and postretirement benefits, net of tax of $109.0, ($157.4), and ($148.5)
|
|
251.6
|
|
|
(335.1
|
)
|
|
(278.5
|
)
|
|||
Reclassification adjustments:
|
|
|
|
|
|
|
||||||
Currency translation adjustment
|
|
57.3
|
|
|
2.7
|
|
|
—
|
|
|||
Derivatives, net of tax of $11.7, ($9.4), and $7.0
|
|
24.2
|
|
|
(36.0
|
)
|
|
20.8
|
|
|||
Pension and postretirement benefits, net of tax of $50.7, $43.0, and $47.7
|
|
110.7
|
|
|
87.2
|
|
|
97.0
|
|
|||
Total Other Comprehensive Income (Loss)
|
|
533.1
|
|
|
(257.6
|
)
|
|
(895.0
|
)
|
|||
Comprehensive Income
|
|
3,554.3
|
|
|
403.9
|
|
|
422.6
|
|
|||
Net Income Attributable to Noncontrolling Interests
|
|
20.8
|
|
|
30.4
|
|
|
39.7
|
|
|||
Other Comprehensive Income (Loss) Attributable to Noncontrolling Interests
|
|
3.7
|
|
|
4.8
|
|
|
(11.0
|
)
|
|||
Comprehensive Income Attributable to Air Products
|
|
$
|
3,529.8
|
|
|
$
|
368.7
|
|
|
$
|
393.9
|
|
30 September (Millions of dollars, except for share data)
|
2017
|
|
2016
|
|
||
Assets
|
|
|
||||
Current Assets
|
|
|
||||
Cash and cash items
|
$
|
3,273.6
|
|
$
|
1,293.2
|
|
Short-term investments
|
404.0
|
|
—
|
|
||
Trade receivables, net
|
1,174.0
|
|
1,146.2
|
|
||
Inventories
|
335.4
|
|
255.0
|
|
||
Contracts in progress, less progress billings
|
84.8
|
|
64.6
|
|
||
Prepaid expenses
|
191.4
|
|
93.9
|
|
||
Other receivables and current assets
|
403.3
|
|
538.2
|
|
||
Current assets of discontinued operations
|
10.2
|
|
926.2
|
|
||
Total Current Assets
|
5,876.7
|
|
4,317.3
|
|
||
Investment in net assets of and advances to equity affiliates
|
1,286.9
|
|
1,283.6
|
|
||
Plant and equipment, net
|
8,440.2
|
|
8,259.7
|
|
||
Goodwill, net
|
721.5
|
|
845.1
|
|
||
Intangible assets, net
|
368.3
|
|
387.9
|
|
||
Noncurrent capital lease receivables
|
1,131.8
|
|
1,221.7
|
|
||
Other noncurrent assets
|
641.8
|
|
671.0
|
|
||
Noncurrent assets of discontinued operations
|
—
|
|
1,042.3
|
|
||
Total Noncurrent Assets
|
12,590.5
|
|
13,711.3
|
|
||
Total Assets
|
$
|
18,467.2
|
|
$
|
18,028.6
|
|
Liabilities and Equity
|
|
|
||||
Current Liabilities
|
|
|
||||
Payables and accrued liabilities
|
$
|
1,814.3
|
|
$
|
1,652.2
|
|
Accrued income taxes
|
98.6
|
|
117.9
|
|
||
Short-term borrowings
|
144.0
|
|
935.8
|
|
||
Current portion of long-term debt
|
416.4
|
|
365.4
|
|
||
Current liabilities of discontinued operations
|
15.7
|
|
211.8
|
|
||
Total Current Liabilities
|
2,489.0
|
|
3,283.1
|
|
||
Long-term debt
|
3,402.4
|
|
3,909.7
|
|
||
Other noncurrent liabilities
|
1,611.9
|
|
1,816.5
|
|
||
Deferred income taxes
|
778.4
|
|
710.4
|
|
||
Noncurrent liabilities of discontinued operations
|
—
|
|
1,095.5
|
|
||
Total Noncurrent Liabilities
|
5,792.7
|
|
7,532.1
|
|
||
Total Liabilities
|
8,281.7
|
|
10,815.2
|
|
||
Commitments and Contingencies –
See Note 17
|
|
|
||||
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
|
1,001.1
|
|
970.0
|
|
||
Retained earnings
|
12,846.6
|
|
10,475.5
|
|
||
Accumulated other comprehensive loss
|
(1,847.4
|
)
|
(2,388.3
|
)
|
||
Treasury stock, at cost (2017 - 31,109,510 shares; 2016 - 32,104,759 shares)
|
(2,163.5
|
)
|
(2,227.0
|
)
|
||
Total Air Products Shareholders' Equity
|
10,086.2
|
|
7,079.6
|
|
||
Noncontrolling Interests
|
99.3
|
|
133.8
|
|
||
Total Equity
|
10,185.5
|
|
7,213.4
|
|
||
Total Liabilities and Equity
|
$
|
18,467.2
|
|
$
|
18,028.6
|
|
Year ended 30 September (Millions of dollars)
|
2017
|
2016
|
2015
|
||||||
Operating Activities
|
|
|
|
||||||
Net income
|
$
|
3,021.2
|
|
$
|
661.5
|
|
$
|
1,317.6
|
|
Less: Net income attributable to noncontrolling interests of continuing operations
|
20.8
|
|
22.5
|
|
32.6
|
|
|||
Less: Net income attributable to noncontrolling interests of discontinued operations
|
—
|
|
7.9
|
|
7.1
|
|
|||
Net income attributable to Air Products
|
3,000.4
|
|
631.1
|
|
1,277.9
|
|
|||
(Income) Loss from discontinued operations attributable to Air Products
|
(1,866.0
|
)
|
468.4
|
|
(344.6
|
)
|
|||
Income from continuing operations attributable to Air Products
|
1,134.4
|
|
1,099.5
|
|
933.3
|
|
|||
Adjustments to reconcile income to cash provided by operating activities:
|
|
|
|
||||||
Depreciation and amortization
|
865.8
|
|
854.6
|
|
858.5
|
|
|||
Deferred income taxes
|
(38.0
|
)
|
61.8
|
|
9.4
|
|
|||
Loss on extinguishment of debt
|
—
|
|
6.9
|
|
16.6
|
|
|||
Gain on previously held equity interest
|
—
|
|
—
|
|
(17.9
|
)
|
|||
Undistributed earnings of unconsolidated affiliates
|
(60.1
|
)
|
(51.1
|
)
|
(101.8
|
)
|
|||
Gain on sale of assets and investments
|
(24.3
|
)
|
(7.3
|
)
|
(29.7
|
)
|
|||
Share-based compensation
|
39.9
|
|
31.0
|
|
39.5
|
|
|||
Noncurrent capital lease receivables
|
92.2
|
|
85.5
|
|
(10.1
|
)
|
|||
Goodwill and intangible asset impairment charge
|
162.1
|
|
—
|
|
—
|
|
|||
Equity method investment impairment charge
|
79.5
|
|
—
|
|
—
|
|
|||
Write-down of long-lived assets associated with restructuring
|
69.2
|
|
—
|
|
40.2
|
|
|||
Other adjustments
|
165.4
|
|
156.7
|
|
53.0
|
|
|||
Working capital changes that provided (used) cash, excluding effects of acquisitions and divestitures:
|
|
|
|
||||||
Trade receivables
|
(73.6
|
)
|
(44.8
|
)
|
(40.7
|
)
|
|||
Inventories
|
6.4
|
|
32.2
|
|
38.0
|
|
|||
Contracts in progress, less progress billings
|
(19.3
|
)
|
28.2
|
|
16.9
|
|
|||
Other receivables
|
124.7
|
|
(6.7
|
)
|
48.9
|
|
|||
Payables and accrued liabilities
|
163.8
|
|
60.1
|
|
134.9
|
|
|||
Other working capital
|
(154.0
|
)
|
(47.8
|
)
|
58.0
|
|
|||
Cash Provided by Operating Activities
|
2,534.1
|
|
2,258.8
|
|
2,047.0
|
|
|||
Investing Activities
|
|
|
|
||||||
Additions to plant and equipment
|
(1,039.7
|
)
|
(907.7
|
)
|
(1,162.4
|
)
|
|||
Acquisitions, less cash acquired
|
(8.2
|
)
|
—
|
|
(34.5
|
)
|
|||
Investment in and advances to unconsolidated affiliates
|
(8.1
|
)
|
—
|
|
(4.3
|
)
|
|||
Proceeds from sale of assets and investments
|
42.5
|
|
44.6
|
|
55.3
|
|
|||
Purchases of investments
|
(2,692.6
|
)
|
—
|
|
—
|
|
|||
Proceeds from investments
|
2,290.7
|
|
—
|
|
—
|
|
|||
Other investing activities
|
(2.3
|
)
|
(1.7
|
)
|
(.8
|
)
|
|||
Cash Used for Investing Activities
|
(1,417.7
|
)
|
(864.8
|
)
|
(1,146.7
|
)
|
|||
Financing Activities
|
|
|
|
||||||
Long-term debt proceeds
|
2.4
|
|
386.9
|
|
340.3
|
|
|||
Payments on long-term debt
|
(483.9
|
)
|
(480.4
|
)
|
(699.4
|
)
|
|||
Net (decrease) increase in commercial paper and short-term borrowings
|
(798.6
|
)
|
(144.2
|
)
|
285.2
|
|
|||
Dividends paid to shareholders
|
(787.9
|
)
|
(721.2
|
)
|
(677.5
|
)
|
|||
Proceeds from stock option exercises
|
68.4
|
|
141.3
|
|
121.3
|
|
|||
Payment for subsidiary shares to noncontrolling interests
|
—
|
|
—
|
|
(278.4
|
)
|
|||
Other financing activities
|
(41.3
|
)
|
(42.6
|
)
|
(51.9
|
)
|
|||
Cash Used for Financing Activities
|
(2,040.9
|
)
|
(860.2
|
)
|
(960.4
|
)
|
|||
Discontinued Operations
|
|
|
|
||||||
Cash (used for) provided by operating activities
|
(966.2
|
)
|
401.9
|
|
422.7
|
|
|||
Cash provided by (used for) investing activities
|
3,750.6
|
|
(204.2
|
)
|
(453.0
|
)
|
|||
Cash provided by (used for) financing activities
|
69.5
|
|
555.9
|
|
(16.9
|
)
|
|||
Cash (Used for) Provided by Discontinued Operations
|
2,853.9
|
|
753.6
|
|
(47.2
|
)
|
|||
Effect of Exchange Rate Changes on Cash
|
13.4
|
|
7.5
|
|
(22.9
|
)
|
|||
Increase (Decrease) in cash and cash items
|
1,942.8
|
|
1,294.9
|
|
(130.2
|
)
|
|||
Cash and Cash items – Beginning of Year
|
1,330.8
|
|
206.4
|
|
336.6
|
|
|||
Cash and Cash Items
–
End of Period
|
$
|
3,273.6
|
|
$
|
1,501.3
|
|
$
|
206.4
|
|
Less: Cash and Cash Items
–
Discontinued Operations
|
$
|
—
|
|
$
|
208.1
|
|
$
|
23.3
|
|
Cash and Cash Items
–
Continuing Operations
|
$
|
3,273.6
|
|
$
|
1,293.2
|
|
$
|
183.1
|
|
Year ended 30 September
(Millions of dollars)
|
Common
Stock
|
|
Capital
in Excess
of Par
Value
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Treasury
Stock
|
|
Air Products
Shareholders’
Equity
|
|
Non-
controlling
Interests
|
|
Total
Equity
|
|
||||||||
Balance 30 September 2014
|
$
|
249.4
|
|
$
|
842.0
|
|
$
|
9,993.2
|
|
$
|
(1,241.9
|
)
|
$
|
(2,476.9
|
)
|
$
|
7,365.8
|
|
$
|
155.6
|
|
$
|
7,521.4
|
|
Net income
|
|
|
1,277.9
|
|
|
|
1,277.9
|
|
28.2
|
|
1,306.1
|
|
||||||||||||
Other comprehensive loss
|
|
|
|
(884.0
|
)
|
|
(884.0
|
)
|
(11.0
|
)
|
(895.0
|
)
|
||||||||||||
Cash dividends ($3.20 per share)
|
|
|
(687.9
|
)
|
|
|
(687.9
|
)
|
|
(687.9
|
)
|
|||||||||||||
Share-based compensation expense
|
|
43.7
|
|
|
|
|
43.7
|
|
|
43.7
|
|
|||||||||||||
Issuance of treasury shares for stock option and award plans
|
|
(15.1
|
)
|
|
|
117.3
|
|
102.2
|
|
|
102.2
|
|
||||||||||||
Tax benefit of stock option and award plans
|
|
32.0
|
|
|
|
|
32.0
|
|
|
32.0
|
|
|||||||||||||
Dividends to noncontrolling interests
|
|
|
|
|
|
|
(38.0
|
)
|
(38.0
|
)
|
||||||||||||||
Purchase of noncontrolling interests
|
|
(.3
|
)
|
|
|
|
(.3
|
)
|
(.2
|
)
|
(.5
|
)
|
||||||||||||
Other
|
|
2.4
|
|
(2.8
|
)
|
|
|
(.4
|
)
|
(2.5
|
)
|
(2.9
|
)
|
|||||||||||
Balance 30 September 2015
|
$
|
249.4
|
|
$
|
904.7
|
|
$
|
10,580.4
|
|
$
|
(2,125.9
|
)
|
$
|
(2,359.6
|
)
|
$
|
7,249.0
|
|
$
|
132.1
|
|
$
|
7,381.1
|
|
Net income
|
|
|
631.1
|
|
|
|
631.1
|
|
30.4
|
|
661.5
|
|
||||||||||||
Other comprehensive income (loss)
|
|
|
|
(262.4
|
)
|
|
(262.4
|
)
|
4.8
|
|
(257.6
|
)
|
||||||||||||
Cash dividends ($3.39 per share)
|
|
|
(733.7
|
)
|
|
|
(733.7
|
)
|
|
(733.7
|
)
|
|||||||||||||
Share-based compensation expense
|
|
37.6
|
|
|
|
|
37.6
|
|
|
37.6
|
|
|||||||||||||
Issuance of treasury shares for stock option and award plans
|
|
(5.5
|
)
|
|
|
132.6
|
|
127.1
|
|
|
127.1
|
|
||||||||||||
Tax benefit of stock option and award plans
|
|
33.2
|
|
|
|
|
33.2
|
|
|
33.2
|
|
|||||||||||||
Dividends to noncontrolling interests
|
|
|
|
|
|
|
(33.6
|
)
|
(33.6
|
)
|
||||||||||||||
Other
|
|
|
|
(2.3
|
)
|
|
|
(2.3
|
)
|
.1
|
|
(2.2
|
)
|
|||||||||||
Balance 30 September 2016
|
$
|
249.4
|
|
$
|
970.0
|
|
$
|
10,475.5
|
|
$
|
(2,388.3
|
)
|
$
|
(2,227.0
|
)
|
$
|
7,079.6
|
|
$
|
133.8
|
|
$
|
7,213.4
|
|
Net income
|
|
|
3,000.4
|
|
|
|
3,000.4
|
|
20.8
|
|
3,021.2
|
|
||||||||||||
Other comprehensive income
|
|
|
|
529.4
|
|
|
529.4
|
|
3.7
|
|
533.1
|
|
||||||||||||
Cash dividends ($3.71 per share)
|
|
|
(808.5
|
)
|
|
|
(808.5
|
)
|
|
(808.5
|
)
|
|||||||||||||
Share-based compensation expense
|
|
40.7
|
|
|
|
|
40.7
|
|
|
40.7
|
|
|||||||||||||
Issuance of treasury shares for stock option and award plans
|
|
(9.6
|
)
|
|
|
63.5
|
|
53.9
|
|
|
53.9
|
|
||||||||||||
Dividends to noncontrolling interests
|
|
|
|
|
|
|
(28.0
|
)
|
(28.0
|
)
|
||||||||||||||
Spin-off of Versum
|
|
|
175.0
|
|
11.5
|
|
|
186.5
|
|
(33.9
|
)
|
152.6
|
|
|||||||||||
Cumulative change in accounting principle
|
|
|
8.8
|
|
|
|
8.8
|
|
|
|
8.8
|
|
||||||||||||
Other
|
|
|
(4.6
|
)
|
|
|
(4.6
|
)
|
2.9
|
|
(1.7
|
)
|
||||||||||||
Balance 30 September 2017
|
$
|
249.4
|
|
$
|
1,001.1
|
|
$
|
12,846.6
|
|
$
|
(1,847.4
|
)
|
$
|
(2,163.5
|
)
|
$
|
10,086.2
|
|
$
|
99.3
|
|
$
|
10,185.5
|
|
1
|
.
|
|
|
||
2
|
.
|
|
|
||
3
|
.
|
|
|
||
4
|
.
|
|
|
||
5
|
.
|
|
|
||
6
|
.
|
|
|
||
7
|
.
|
|
|
||
8
|
.
|
|
|
||
9
|
.
|
|
|
||
10
|
.
|
|
|
||
11
|
.
|
|
|
||
12
|
.
|
|
|
||
13
|
.
|
|
|
||
14
|
.
|
|
|
||
15
|
.
|
|
|
||
16
|
.
|
|
|
||
17
|
.
|
|
|
||
18
|
.
|
|
|
||
19
|
.
|
|
|
||
20
|
.
|
|
|
||
21
|
.
|
|
|
||
22
|
.
|
|
|
||
23
|
.
|
|
|
||
24
|
.
|
|
|
||
25
|
.
|
|
|
•
|
Changes in the fair value of a derivative that is designated as and meets the cash flow hedge criteria are recorded in accumulated other comprehensive loss (AOCL) to the extent effective and then recognized in earnings when the hedged items affect earnings.
|
•
|
Changes in the fair value of a derivative that is designated as and meets all the required criteria for a fair value hedge, along with the gain or loss on the hedged asset or liability that is attributable to the hedged risk, are recorded in current period earnings.
|
•
|
Changes in the fair value of a derivative and foreign currency debt that are designated as and meet all the required criteria for a hedge of a net investment are recorded as translation adjustments in AOCL.
|
•
|
Changes in the fair value of a derivative that is not designated as a hedge are recorded immediately in earnings.
|
|
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
|
)
|
|||
Cash expenditures
|
—
|
|
(1.4
|
)
|
(1.4
|
)
|
|||
Currency translation adjustment
|
—
|
|
7.3
|
|
7.3
|
|
|||
Amount reflected in other noncurrent liabilities
|
—
|
|
(65.3
|
)
|
(65.3
|
)
|
|||
30 September 2017
|
$
|
—
|
|
$
|
5.8
|
|
$
|
5.8
|
|
|
|
|
Total
|
||||||
|
Performance
|
Energy-from-
|
Discontinued
|
||||||
Year Ended 30 September 2017
|
Materials
|
Waste
(A)
|
Operations
|
||||||
Sales
|
$
|
254.8
|
|
$
|
—
|
|
$
|
254.8
|
|
Cost of sales
|
182.3
|
|
13.8
|
|
196.1
|
|
|||
Selling and administrative
|
22.5
|
|
.7
|
|
23.2
|
|
|||
Research and development
|
5.1
|
|
—
|
|
5.1
|
|
|||
Other income (expense), net
|
.3
|
|
(2.0
|
)
|
(1.7
|
)
|
|||
Operating Income (Loss)
|
45.2
|
|
(16.5
|
)
|
28.7
|
|
|||
Equity affiliates’ income
|
.3
|
|
—
|
|
.3
|
|
|||
Income (Loss) Before Taxes
|
45.5
|
|
(16.5
|
)
|
29.0
|
|
|||
Income tax benefit
(B)
|
(50.8
|
)
|
(5.7
|
)
|
(56.5
|
)
|
|||
Income (Loss) From Operations of Discontinued Operations, net of tax
|
96.3
|
|
(10.8
|
)
|
85.5
|
|
|||
Gain (Loss) on Disposal, net of tax
(C)
|
1,827.6
|
|
(47.1
|
)
|
1,780.5
|
|
|||
Income (Loss) From Discontinued Operations, net of tax
|
$
|
1,923.9
|
|
$
|
(57.9
|
)
|
$
|
1,866.0
|
|
(A)
|
The loss from operations of discontinued operations for EfW primarily relates to costs incurred for ongoing project exit activities, administrative costs, and land lease obligations.
|
(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 primarily during the first quarter of 2017 that favorably impacted our income tax provision within discontinued operations by approximately
$69
.
|
(C)
|
After-tax gain on sale of
$1,827.6
includes expense for income tax reserves for uncertain tax positions of
$28.0
gross (
$21.0
net) in various jurisdictions.
|
|
|
|
|
Total
|
||||||||
|
Electronic
|
Performance
|
Energy-from-
|
Discontinued
|
||||||||
Year Ended 30 September 2016
|
Materials
|
Materials
|
Waste
(A)
|
Operations
|
||||||||
Sales
|
$
|
961.6
|
|
$
|
1,059.1
|
|
$
|
—
|
|
$
|
2,020.7
|
|
Cost of sales
|
521.6
|
|
704.5
|
|
24.6
|
|
1,250.7
|
|
||||
Selling and administrative
|
87.7
|
|
76.6
|
|
2.8
|
|
167.1
|
|
||||
Research and development
|
40.8
|
|
19.6
|
|
.9
|
|
61.3
|
|
||||
Other income (expense), net
|
2.2
|
|
4.2
|
|
(12.7
|
)
|
(6.3
|
)
|
||||
Operating Income (Loss)
|
313.7
|
|
262.6
|
|
(41.0
|
)
|
535.3
|
|
||||
Equity affiliates’ income
|
.2
|
|
1.4
|
|
—
|
|
1.6
|
|
||||
Interest expense
|
.3
|
|
—
|
|
—
|
|
.3
|
|
||||
Income (Loss) Before Taxes
(B)
|
313.6
|
|
264.0
|
|
(41.0
|
)
|
536.6
|
|
||||
Income tax provision (benefit)
|
73.4
|
|
80.5
|
|
(3.4
|
)
|
150.5
|
|
||||
Income (Loss) From Operations of Discontinued Operations, net of tax
|
240.2
|
|
183.5
|
|
(37.6
|
)
|
386.1
|
|
||||
Loss on Disposal, net of tax
|
—
|
|
—
|
|
(846.6
|
)
|
(846.6
|
)
|
||||
Income (Loss) From Discontinued Operations, net of tax
|
240.2
|
|
183.5
|
|
(884.2
|
)
|
(460.5
|
)
|
||||
Net Income Attributable to Noncontrolling Interests of Discontinued Operations
|
7.9
|
|
—
|
|
—
|
|
7.9
|
|
||||
Net Income (Loss) From Discontinued Operations
|
$
|
232.3
|
|
$
|
183.5
|
|
$
|
(884.2
|
)
|
$
|
(468.4
|
)
|
(A)
|
The loss from operations of discontinued operations for EfW primarily relates to project suspension costs, land lease obligations, and administrative costs.
|
(B)
|
In fiscal year
2016
, income before taxes from operations of discontinued operations attributable to Air Products was
$527.1
.
|
|
|
|
|
Total
|
||||||||
|
Electronic
|
Performance
|
Energy-from-
|
Discontinued
|
||||||||
Year Ended 30 September 2015
|
Materials
|
Materials
|
Waste
(A)
|
Operations
|
||||||||
Sales
|
$
|
984.1
|
|
$
|
1,086.5
|
|
$
|
—
|
|
$
|
2,070.6
|
|
Cost of sales
|
586.8
|
|
754.0
|
|
5.1
|
|
1,345.9
|
|
||||
Selling and administrative
|
86.4
|
|
79.9
|
|
2.4
|
|
168.7
|
|
||||
Research and development
|
37.5
|
|
23.2
|
|
1.7
|
|
62.4
|
|
||||
Other income (expense), net
(B)
|
(18.5
|
)
|
(9.2
|
)
|
—
|
|
(27.7
|
)
|
||||
Operating Income (Loss)
|
254.9
|
|
220.2
|
|
(9.2
|
)
|
465.9
|
|
||||
Equity affiliates’ income
|
1.0
|
|
1.2
|
|
—
|
|
2.2
|
|
||||
Interest expense
|
.1
|
|
.6
|
|
—
|
|
.7
|
|
||||
Income (Loss) Before Taxes
(C)
|
255.8
|
|
220.8
|
|
(9.2
|
)
|
467.4
|
|
||||
Income tax provision (benefit)
|
49.7
|
|
68.4
|
|
(2.4
|
)
|
115.7
|
|
||||
Income (Loss) From Discontinued Operations, net of tax
|
206.1
|
|
152.4
|
|
(6.8
|
)
|
351.7
|
|
||||
Net Income Attributable to Noncontrolling Interests of Discontinued Operations
|
7.1
|
|
—
|
|
—
|
|
7.1
|
|
||||
Net Income (Loss) From Discontinued Operations
|
$
|
199.0
|
|
$
|
152.4
|
|
$
|
(6.8
|
)
|
$
|
344.6
|
|
(A)
|
The loss from operations of discontinued operations for EfW primarily relates to land lease obligations and administrative costs.
|
(B)
|
Primarily includes business restructuring and cost reduction actions.
|
(C)
|
In fiscal year
2015
, income before taxes from operations of discontinued operations attributable to Air Products was
$458.9
.
|
|
|
|
|
Total
|
||||||
|
|
Performance
|
Energy-from-
|
Discontinued
|
||||||
30 September 2017
|
|
Materials
|
Waste
|
Operations
|
||||||
Assets
|
|
|
|
|
||||||
Current Assets
|
|
|
|
|
||||||
Plant and equipment, net
|
|
$
|
—
|
|
$
|
10.2
|
|
$
|
10.2
|
|
Total Current Assets
|
|
—
|
|
10.2
|
|
10.2
|
|
|||
Total Assets
|
|
$
|
—
|
|
$
|
10.2
|
|
$
|
10.2
|
|
Liabilities
|
|
|
|
|
||||||
Current Liabilities
|
|
|
|
|
||||||
Payables and accrued liabilities
|
|
$
|
9.2
|
|
$
|
6.5
|
|
$
|
15.7
|
|
Total Current Liabilities
|
|
9.2
|
|
6.5
|
|
15.7
|
|
|||
Total Liabilities
|
|
$
|
9.2
|
|
$
|
6.5
|
|
$
|
15.7
|
|
|
|
|
|
Total
|
||||||||
|
Electronic
|
Performance
|
Energy-from-
|
Discontinued
|
||||||||
30 September 2016
|
Materials
|
Materials
|
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
|
|
|
|
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
|
|
66.3
|
|
|
88.5
|
|
|
154.8
|
|
|||
Noncash expenses
|
|
—
|
|
|
(84.2
|
)
|
|
(84.2
|
)
|
|||
Amount reflected in pension liability
|
|
(2.0
|
)
|
|
—
|
|
|
(2.0
|
)
|
|||
Amount reflected in other noncurrent liabilities
|
|
—
|
|
|
(2.2
|
)
|
|
(2.2
|
)
|
|||
Cash expenditures
|
|
(35.7
|
)
|
|
(1.2
|
)
|
|
(36.9
|
)
|
|||
Currency translation adjustment
|
|
(.3
|
)
|
|
—
|
|
|
(.3
|
)
|
|||
30 September 2017
|
|
$
|
40.6
|
|
|
$
|
.9
|
|
|
$
|
41.5
|
|
|
|
Severance and
Other Benefits
|
|
Asset
Actions/Other
|
|
Total
|
||||||
2014 Charge
|
|
$
|
11.1
|
|
|
$
|
—
|
|
|
$
|
11.1
|
|
Cash expenditures
|
|
(1.7
|
)
|
|
—
|
|
|
(1.7
|
)
|
|||
30 September 2014
|
|
$
|
9.4
|
|
|
$
|
—
|
|
|
$
|
9.4
|
|
2015 Charge
|
|
131.5
|
|
|
48.6
|
|
|
180.1
|
|
|||
Amount reflected in pension liability
|
|
(11.2
|
)
|
|
—
|
|
|
(11.2
|
)
|
|||
Noncash expenses
|
|
—
|
|
|
(40.2
|
)
|
|
(40.2
|
)
|
|||
Cash expenditures
|
|
(100.3
|
)
|
|
(1.2
|
)
|
|
(101.5
|
)
|
|||
Currency translation adjustment
|
|
(.4
|
)
|
|
—
|
|
|
(.4
|
)
|
|||
30 September 2015
|
|
$
|
29.0
|
|
|
$
|
7.2
|
|
|
$
|
36.2
|
|
Cash expenditures
|
|
(28.6
|
)
|
|
(3.8
|
)
|
|
(32.4
|
)
|
|||
Currency translation adjustment
|
|
(.4
|
)
|
|
—
|
|
|
(.4
|
)
|
|||
30 September 2016
|
|
$
|
—
|
|
|
$
|
3.4
|
|
|
$
|
3.4
|
|
Accrual settlement
|
|
—
|
|
|
(3.4
|
)
|
|
(3.4
|
)
|
|||
30 September 2017
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
30 September
|
|
2017
|
|
|
2016
|
|
||
Finished goods
|
|
$
|
120.0
|
|
|
$
|
131.3
|
|
Work in process
|
|
15.7
|
|
|
18.3
|
|
||
Raw materials, supplies and other
|
|
223.0
|
|
|
117.1
|
|
||
Total FIFO Cost
|
|
358.7
|
|
|
266.7
|
|
||
Less: Excess of FIFO cost over LIFO cost
|
|
(23.3
|
)
|
|
(11.7
|
)
|
||
Inventories
|
|
$
|
335.4
|
|
|
$
|
255.0
|
|
Abdullah Hashim Industrial Gases & Equipment Co., Ltd. (25%);
|
|
INOX Air Products Limited (50%);
|
Air Products South Africa (Proprietary) Limited (50%);
|
|
Jazan Gas Projects Company (25%);
|
Bangkok Cogeneration Company Limited (49%);
|
|
Kulim Industrial Gases Sdn. Bhd. (50%);
|
Bangkok Industrial Gases Co., Ltd. (49%);
|
|
Sapio Produzione Idrogeno Ossigeno S.r.l. (49%);
|
Chengdu Air & Gas Products Ltd. (50%);
|
|
Tecnologia en Nitrogeno S. de R.L. de C.V. (50%);
|
Helios S.p.A. (49%);
|
|
Tyczka Industrie-Gases GmbH (50%);
|
High-Tech Gases (Beijing) Co., Ltd. (50%);
|
|
WuXi Hi-Tech Gas Co., Ltd. (50%);
|
INFRA Group (40%);
|
|
and principally, other industrial gas producers.
|
30 September
|
|
|
|
2017
|
|
|
2016
|
|
||||
Current assets
|
|
|
|
$
|
1,333.2
|
|
|
$
|
1,436.7
|
|
||
Noncurrent assets
|
|
|
|
4,026.9
|
|
|
3,063.3
|
|
||||
Current liabilities
|
|
|
|
666.8
|
|
|
694.8
|
|
||||
Noncurrent liabilities
|
|
|
|
2,194.3
|
|
|
1,540.4
|
|
||||
|
|
|
|
|
|
|
||||||
Year Ended 30 September
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Net sales
|
|
$
|
2,343.3
|
|
|
$
|
2,271.6
|
|
|
$
|
2,460.5
|
|
Sales less cost of sales
|
|
878.6
|
|
|
871.5
|
|
|
922.7
|
|
|||
Operating income
|
|
509.5
|
|
|
482.1
|
|
|
512.4
|
|
|||
Net income
|
|
343.5
|
|
|
334.1
|
|
|
343.5
|
|
30 September
|
|
Useful Life
in years
|
|
|
2017
|
|
|
2016
|
|
||
Land
|
|
|
|
$
|
231.0
|
|
|
$
|
202.9
|
|
|
Buildings
|
|
30
|
|
|
977.8
|
|
|
918.6
|
|
||
Production facilities
(A)
|
|
10 to 20
|
|
|
13,577.1
|
|
|
12,391.9
|
|
||
Distribution and other machinery and equipment
(B)
|
|
5 to 25
|
|
|
3,944.0
|
|
|
3,821.0
|
|
||
Construction in progress
|
|
|
|
817.9
|
|
|
1,325.8
|
|
|||
Plant and equipment, at cost
|
|
|
|
19,547.8
|
|
|
18,660.2
|
|
|||
Less: accumulated depreciation
|
|
|
|
11,107.6
|
|
|
10,400.5
|
|
|||
Plant and equipment, net
|
|
|
|
$
|
8,440.2
|
|
|
$
|
8,259.7
|
|
(A)
|
Depreciable lives of production facilities related to long-term customer supply contracts are matched to the contract lives.
|
(B)
|
The depreciable lives for various types of distribution equipment are
10
to
25 years
for cylinders, depending on the nature and properties of the product;
20 years
for tanks;
7.5 years
for customer stations; and
5
to
15 years
for tractors and trailers.
|
|
Industrial
Gases–
Americas
|
Industrial
Gases–
EMEA
|
Industrial
Gases–
Asia
|
Industrial
Gases–
Global
|
Total
|
||||||||||
Goodwill, net at 30 September 2015
|
$
|
297.6
|
|
$
|
386.5
|
|
$
|
133.1
|
|
$
|
19.9
|
|
$
|
837.1
|
|
Currency translation
|
11.5
|
|
(5.9
|
)
|
2.1
|
|
.3
|
|
8.0
|
|
|||||
Goodwill, net at 30 September 2016
|
$
|
309.1
|
|
$
|
380.6
|
|
$
|
135.2
|
|
$
|
20.2
|
|
$
|
845.1
|
|
Impairment loss
|
(145.3
|
)
|
—
|
|
—
|
|
—
|
|
(145.3
|
)
|
|||||
Acquisitions
|
—
|
|
3.5
|
|
—
|
|
—
|
|
3.5
|
|
|||||
Currency translation
|
(.1
|
)
|
18.3
|
|
—
|
|
—
|
|
18.2
|
|
|||||
Goodwill, net at 30 September 2017
|
$
|
163.7
|
|
$
|
402.4
|
|
$
|
135.2
|
|
$
|
20.2
|
|
$
|
721.5
|
|
30 September
|
2017
|
|
2016
|
|
2015
|
|
|||
Goodwill, gross
|
$
|
1,138.7
|
|
$
|
1,103.7
|
|
$
|
1,080.8
|
|
Accumulated impairment losses
|
(417.2
|
)
|
(258.6
|
)
|
(243.7
|
)
|
|||
Goodwill, net
|
$
|
721.5
|
|
$
|
845.1
|
|
$
|
837.1
|
|
|
|
30 September 2017
|
|
30 September 2016
|
||||||||||||||||||||
|
|
Gross
|
|
|
Accumulated
Amortization/
Impairment
|
|
|
Net
|
|
|
Gross
|
|
|
Accumulated
Amortization/
Impairment
|
|
|
Net
|
|
||||||
Customer relationships
|
|
$
|
424.1
|
|
|
$
|
(142.3
|
)
|
|
$
|
281.8
|
|
|
$
|
400.6
|
|
|
$
|
(118.2
|
)
|
|
$
|
282.4
|
|
Patents and technology
|
|
13.4
|
|
|
(10.6
|
)
|
|
2.8
|
|
|
13.6
|
|
|
(10.1
|
)
|
|
3.5
|
|
||||||
Other
|
|
73.4
|
|
|
(36.6
|
)
|
|
36.8
|
|
|
73.0
|
|
|
(33.7
|
)
|
|
39.3
|
|
||||||
Total finite-lived intangibles
|
|
510.9
|
|
|
(189.5
|
)
|
|
321.4
|
|
|
487.2
|
|
|
(162.0
|
)
|
|
325.2
|
|
||||||
Trade names and trademarks, indefinite-lived
|
|
67.8
|
|
|
(20.9
|
)
|
|
46.9
|
|
|
66.2
|
|
|
(3.5
|
)
|
|
62.7
|
|
||||||
Total Intangible Assets
|
|
$
|
578.7
|
|
|
$
|
(210.4
|
)
|
|
$
|
368.3
|
|
|
$
|
553.4
|
|
|
$
|
(165.5
|
)
|
|
$
|
387.9
|
|
2018
|
$
|
22.1
|
|
2019
|
21.8
|
|
|
2020
|
21.6
|
|
|
2021
|
20.1
|
|
|
2022
|
17.4
|
|
|
Thereafter
|
218.4
|
|
|
Total
|
$
|
321.4
|
|
|
|
Capital
Leases
|
|
Operating
Leases
|
||||
2018
|
|
$
|
2.2
|
|
|
$
|
56.6
|
|
2019
|
|
1.8
|
|
|
45.8
|
|
||
2020
|
|
1.6
|
|
|
35.2
|
|
||
2021
|
|
3.0
|
|
|
27.1
|
|
||
2022
|
|
1.5
|
|
|
22.9
|
|
||
Thereafter
|
|
19.9
|
|
|
126.6
|
|
||
Total
|
|
$
|
30.0
|
|
|
$
|
314.2
|
|
30 September
|
|
2017
|
|
|
2016
|
|
||
Gross minimum lease payments receivable
|
|
$
|
1,897.0
|
|
|
$
|
2,072.6
|
|
Unearned interest income
|
|
(671.9
|
)
|
|
(762.7
|
)
|
||
Lease Receivables, net
|
|
$
|
1,225.1
|
|
|
$
|
1,309.9
|
|
2018
|
$
|
182.0
|
|
2019
|
176.4
|
|
|
2020
|
171.4
|
|
|
2021
|
165.5
|
|
|
2022
|
154.1
|
|
|
Thereafter
|
1,047.6
|
|
|
Total
|
$
|
1,897.0
|
|
|
|
30 September 2017
|
|
30 September 2016
|
||||||||
|
|
US$
Notional
|
|
|
Years
Average
Maturity
|
|
US$
Notional
|
|
|
Years
Average
Maturity
|
||
Forward Exchange Contracts
|
|
|
|
|
|
|
|
|
||||
Cash flow hedges
|
|
$
|
3,150.2
|
|
|
.4
|
|
$
|
4,130.3
|
|
|
.5
|
Net investment hedges
|
|
675.5
|
|
|
3.0
|
|
968.2
|
|
|
2.7
|
||
Not designated
|
|
273.8
|
|
|
.1
|
|
2,648.3
|
|
|
.4
|
||
Total Forward Exchange Contracts
|
|
$
|
4,099.5
|
|
|
.8
|
|
$
|
7,746.8
|
|
|
.7
|
|
|
30 September 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
|
%
|
|
1.3
|
|
$
|
600.0
|
|
|
LIBOR
|
|
|
2.28
|
%
|
|
2.3
|
Cross currency interest rate swaps (net investment hedge)
|
|
$
|
539.7
|
|
|
3.27
|
%
|
|
2.59
|
%
|
|
1.9
|
|
$
|
517.7
|
|
|
3.24
|
%
|
|
2.43
|
%
|
|
2.6
|
Cross currency interest rate swaps (cash flow hedge)
|
|
$
|
1,095.7
|
|
|
4.96
|
%
|
|
2.78
|
%
|
|
2.4
|
|
$
|
1,088.9
|
|
|
4.77
|
%
|
|
2.72
|
%
|
|
3.3
|
Cross currency interest rate swaps (not designated)
|
|
$
|
41.6
|
|
|
3.28
|
%
|
|
2.32
|
%
|
|
1.7
|
|
$
|
27.4
|
|
|
3.62
|
%
|
|
.81
|
%
|
|
1.8
|
|
|
Balance Sheet
|
|
30 September
|
|
Balance Sheet
|
|
30 September
|
||||||||||||
|
|
Location
|
|
2017
|
|
|
2016
|
|
|
Location
|
|
2017
|
|
|
2016
|
|
||||
Derivatives Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
Other receivables
|
|
$
|
81.7
|
|
|
$
|
72.3
|
|
|
Accrued liabilities
|
|
$
|
82.0
|
|
|
$
|
44.0
|
|
Interest rate management contracts
|
|
Other receivables
|
|
11.1
|
|
|
19.9
|
|
|
Accrued liabilities
|
|
10.7
|
|
|
—
|
|
||||
Forward exchange contracts
|
|
Other noncurrent assets
|
|
27.1
|
|
|
44.4
|
|
|
Other noncurrent
liabilities
|
|
13.8
|
|
|
9.1
|
|
||||
Interest rate management contracts
|
|
Other noncurrent assets
|
|
102.6
|
|
|
160.0
|
|
|
Other noncurrent
liabilities |
|
22.2
|
|
|
12.0
|
|
||||
Total Derivatives Designated as Hedging Instruments
|
|
|
|
$
|
222.5
|
|
|
$
|
296.6
|
|
|
|
|
$
|
128.7
|
|
|
$
|
65.1
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
Other receivables
|
|
1.1
|
|
|
77.1
|
|
|
Accrued liabilities
|
|
$
|
2.2
|
|
|
$
|
29.5
|
|
||
Interest rate management contracts
|
|
Other receivables
|
|
—
|
|
|
—
|
|
|
Accrued liabilities
|
|
1.0
|
|
|
—
|
|
||||
Interest rate management contracts
|
|
Other noncurrent assets
|
|
4.2
|
|
|
—
|
|
|
Other noncurrent
liabilities |
|
—
|
|
|
.7
|
|
||||
Total Derivatives Not Designated as Hedging Instruments
|
|
|
|
$
|
5.3
|
|
|
$
|
77.1
|
|
|
|
|
$
|
3.2
|
|
|
$
|
30.2
|
|
Total Derivatives
|
|
|
|
$
|
227.8
|
|
|
$
|
373.7
|
|
|
|
|
$
|
131.9
|
|
|
$
|
95.3
|
|
|
|
Year Ended 30 September
|
||||||||||||||||||||||||||||||
|
|
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)
|
|
$
|
.3
|
|
|
$
|
10.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(12.9
|
)
|
|
$
|
3.2
|
|
|
$
|
(12.6
|
)
|
|
$
|
13.7
|
|
Net (gain) loss reclassified from OCI to sales/cost of sales (effective portion)
|
|
18.3
|
|
|
.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18.3
|
|
|
.2
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (effective portion)
|
|
(3.8
|
)
|
|
(25.7
|
)
|
|
—
|
|
|
—
|
|
|
10.5
|
|
|
(20.3
|
)
|
|
6.7
|
|
|
(46.0
|
)
|
||||||||
Net (gain) loss reclassified from OCI to interest expense (effective portion)
|
|
(2.1
|
)
|
|
6.7
|
|
|
—
|
|
|
—
|
|
|
2.9
|
|
|
3.3
|
|
|
.8
|
|
|
10.0
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (ineffective portion)
|
|
(1.6
|
)
|
|
(.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.6
|
)
|
|
(.2
|
)
|
||||||||
Fair Value Hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in interest expense
(B)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(14.7
|
)
|
|
$
|
(8.8
|
)
|
|
$
|
(14.7
|
)
|
|
$
|
(8.8
|
)
|
Net Investment Hedges, net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI
|
|
$
|
(11.1
|
)
|
|
$
|
17.4
|
|
|
$
|
(32.8
|
)
|
|
$
|
(9.6
|
)
|
|
$
|
(15.6
|
)
|
|
$
|
35.0
|
|
|
$
|
(59.5
|
)
|
|
$
|
42.8
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in other income (expense), net
(C)
|
|
$
|
4.1
|
|
|
$
|
(1.8
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(2.4
|
)
|
|
$
|
(1.6
|
)
|
|
$
|
1.7
|
|
|
$
|
(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 nonfunctional currencies.
|
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 September 2017
|
|
30 September 2016
|
||||||||||||
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
$
|
109.9
|
|
|
$
|
109.9
|
|
|
$
|
193.8
|
|
|
$
|
193.8
|
|
Interest rate management contracts
|
|
117.9
|
|
|
117.9
|
|
|
179.9
|
|
|
179.9
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
$
|
98.0
|
|
|
$
|
98.0
|
|
|
$
|
82.6
|
|
|
$
|
82.6
|
|
Interest rate management contracts
|
|
33.9
|
|
|
33.9
|
|
|
12.7
|
|
|
12.7
|
|
||||
Long-term debt, including current portion
|
|
3,818.8
|
|
|
3,928.2
|
|
|
4,275.1
|
|
|
4,474.0
|
|
|
|
30 September 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
|
|
$
|
109.9
|
|
|
$
|
—
|
|
|
$
|
109.9
|
|
|
$
|
—
|
|
|
$
|
193.8
|
|
|
$
|
—
|
|
|
$
|
193.8
|
|
|
$
|
—
|
|
Interest rate management contracts
|
|
117.9
|
|
|
—
|
|
|
117.9
|
|
|
—
|
|
|
179.9
|
|
|
—
|
|
|
179.9
|
|
|
—
|
|
||||||||
Total Assets at Fair Value
|
|
$
|
227.8
|
|
|
$
|
—
|
|
|
$
|
227.8
|
|
|
$
|
—
|
|
|
$
|
373.7
|
|
|
$
|
—
|
|
|
$
|
373.7
|
|
|
$
|
—
|
|
Liabilities at Fair Value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Forward exchange contracts
|
|
$
|
98.0
|
|
|
$
|
—
|
|
|
$
|
98.0
|
|
|
$
|
—
|
|
|
$
|
82.6
|
|
|
$
|
—
|
|
|
$
|
82.6
|
|
|
$
|
—
|
|
Interest rate management contracts
|
|
33.9
|
|
|
—
|
|
|
33.9
|
|
|
—
|
|
|
12.7
|
|
|
—
|
|
|
12.7
|
|
|
—
|
|
||||||||
Total Liabilities at Fair Value
|
|
$
|
131.9
|
|
|
$
|
—
|
|
|
$
|
131.9
|
|
|
$
|
—
|
|
|
$
|
95.3
|
|
|
$
|
—
|
|
|
$
|
95.3
|
|
|
$
|
—
|
|
|
|
31 December 2016
|
|
|
|
||||||||||||||||||
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
2017 Loss
|
2016 Loss
|
||||||||||||
Plant and Equipment – Continuing operations
(A)
|
|
$
|
1.4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1.4
|
|
|
$
|
45.7
|
|
$
|
—
|
|
Plant and Equipment—Discontinued operations
(A)
|
|
$
|
11.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11.0
|
|
|
$
|
6.3
|
|
$
|
913.5
|
|
(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 during fiscal year 2017. There have been no significant updates to our estimates as of
30 September 2017
. For additional information, see Note
3
,
Discontinued Operations
, and Note
5
,
Business Restructuring and Cost Reduction 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. There have been no updates to our estimates as of
30 September 2017
. For additional information, see Note
8
,
Summarized Financial Information of Equity Affiliates
.
|
30 September
|
|
2017
|
|
|
2016
|
|
||
Short-term borrowings
|
|
$
|
144.0
|
|
|
$
|
935.8
|
|
Current portion of long-term debt
|
|
416.4
|
|
|
365.4
|
|
||
Long-term debt
|
|
3,402.4
|
|
|
3,909.7
|
|
||
Total Debt
|
|
$
|
3,962.8
|
|
|
$
|
5,210.9
|
|
30 September
|
|
2017
|
|
|
2016
|
|
||
Bank obligations
|
|
$
|
144.0
|
|
|
$
|
133.1
|
|
Commercial paper
|
|
—
|
|
|
802.7
|
|
||
Total Short-term Borrowings
|
|
$
|
144.0
|
|
|
$
|
935.8
|
|
30 September
|
|
Fiscal Year
Maturities
|
|
2017
|
|
|
2016
|
|
||
Payable in U.S. Dollars
|
|
|
|
|
|
|
||||
Debentures
|
|
|
|
|
|
|
||||
8.75%
|
|
2021
|
|
$
|
18.4
|
|
|
$
|
18.4
|
|
Medium-term Notes (weighted average rate)
|
|
|
|
|
|
|
||||
Series E 7.6%
|
|
2026
|
|
17.2
|
|
|
17.2
|
|
||
Senior Notes
|
|
|
|
|
|
|
||||
Note 1.2%
|
|
2018
|
|
400.0
|
|
|
400.0
|
|
||
Note 4.375%
|
|
2019
|
|
400.0
|
|
|
400.0
|
|
||
Note 3.0%
|
|
2022
|
|
400.0
|
|
|
400.0
|
|
||
Note 2.75%
|
|
2023
|
|
400.0
|
|
|
400.0
|
|
||
Note 3.35%
|
|
2024
|
|
400.0
|
|
|
400.0
|
|
||
Other
(weighted average rate)
|
|
|
|
|
|
|
||||
Variable-rate industrial revenue bonds .87%
|
|
2035 to 2050
|
|
631.9
|
|
|
769.9
|
|
||
Other .89%
|
|
2018 to 2019
|
|
10.9
|
|
|
25.7
|
|
||
Payable in Other Currencies
|
|
|
|
|
|
|
||||
Eurobonds 4.625%
|
|
2017
|
|
—
|
|
|
337.0
|
|
||
Eurobonds 2.0%
|
|
2020
|
|
354.4
|
|
|
337.0
|
|
||
Eurobonds 1.0%
|
|
2025
|
|
354.4
|
|
|
337.0
|
|
||
Eurobonds .375%
|
|
2021
|
|
413.5
|
|
|
393.2
|
|
||
Other 4.3%
|
|
2018 to 2022
|
|
25.8
|
|
|
52.9
|
|
||
Capital Lease Obligations
|
|
|
|
|
|
|
||||
United States 5.0%
|
|
2018
|
|
.2
|
|
|
.5
|
|
||
Foreign 10.7%
|
|
2018 to 2036
|
|
10.6
|
|
|
9.7
|
|
||
Total Principal Amount
|
|
|
|
3,837.3
|
|
|
4,298.5
|
|
||
Less: Unamortized Discount and Debt Issuance Costs
|
|
|
|
(18.5
|
)
|
|
(23.4
|
)
|
||
Total Long-term Debt
|
|
|
|
3,818.8
|
|
|
4,275.1
|
|
||
Less: Current portion of long-term debt
|
|
|
|
(416.4
|
)
|
|
(365.4
|
)
|
||
Long-term Debt
|
|
|
|
$
|
3,402.4
|
|
|
$
|
3,909.7
|
|
2018
|
$
|
416.4
|
|
2019
|
409.0
|
|
|
2020
|
356.1
|
|
|
2021
|
433.3
|
|
|
2022
|
401.0
|
|
|
Thereafter
|
1,821.5
|
|
|
Total
|
$
|
3,837.3
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
||||||
Service cost
|
$
|
29.0
|
|
$
|
25.9
|
|
|
$
|
36.5
|
|
$
|
24.3
|
|
|
$
|
42.2
|
|
$
|
31.3
|
|
Interest cost
|
107.5
|
|
32.2
|
|
|
110.7
|
|
44.3
|
|
|
124.7
|
|
57.8
|
|
||||||
Expected return on plan assets
|
(207.7
|
)
|
(75.2
|
)
|
|
(202.0
|
)
|
(78.3
|
)
|
|
(202.0
|
)
|
(79.8
|
)
|
||||||
Amortization
|
|
|
|
|
|
|
|
|
||||||||||||
Net actuarial loss
|
88.7
|
|
54.7
|
|
|
85.3
|
|
35.6
|
|
|
78.9
|
|
41.4
|
|
||||||
Prior service cost
|
2.3
|
|
(.1
|
)
|
|
2.8
|
|
(.2
|
)
|
|
2.8
|
|
—
|
|
||||||
Settlements
|
10.5
|
|
1.7
|
|
|
5.1
|
|
1.3
|
|
|
18.9
|
|
2.3
|
|
||||||
Curtailments
|
4.3
|
|
(1.3
|
)
|
|
—
|
|
(1.1
|
)
|
|
5.3
|
|
—
|
|
||||||
Special termination benefits
|
2.8
|
|
.4
|
|
|
2.0
|
|
—
|
|
|
7.2
|
|
1.5
|
|
||||||
Other
|
—
|
|
1.1
|
|
|
(.3
|
)
|
2.1
|
|
|
1.0
|
|
2.1
|
|
||||||
Net Periodic Benefit Cost – Total
|
$
|
37.4
|
|
$
|
39.4
|
|
|
$
|
40.1
|
|
$
|
28.0
|
|
|
$
|
79.0
|
|
$
|
56.6
|
|
Less: Discontinued Operations
|
(.7
|
)
|
(4.1
|
)
|
|
(7.9
|
)
|
(4.4
|
)
|
|
(12.9
|
)
|
(7.7
|
)
|
||||||
Net Periodic Benefit Cost – Continuing Operations
|
$
|
36.7
|
|
$
|
35.3
|
|
|
$
|
32.2
|
|
$
|
23.6
|
|
|
$
|
66.1
|
|
$
|
48.9
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||||
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
Discount rate
(A)
|
3.5
|
%
|
2.0
|
%
|
|
4.3
|
%
|
3.3
|
%
|
|
4.3
|
%
|
3.6
|
%
|
Expected return on plan assets
|
8.0
|
%
|
6.1
|
%
|
|
8.0
|
%
|
6.3
|
%
|
|
8.3
|
%
|
6.1
|
%
|
Rate of compensation increase
|
3.5
|
%
|
3.5
|
%
|
|
3.5
|
%
|
3.5
|
%
|
|
3.5
|
%
|
3.6
|
%
|
(A)
|
Effective in 2016, the Company began to measure the service cost and interest cost components of pension expense by applying spot rates along the yield curve to the relevant projected cash flows, as we believe this provides a better measurement of these costs. The Company accounted for this in 2016 as a change in accounting estimate and, accordingly, accounted for it on a prospective basis. This change did not affect the measurement of the total benefit obligation. The
2017
discount rates used to measure the service cost and interest cost of our U.S. pension plans were
3.6%
and
3.0%
, respectively. The rates used to measure the service cost and interest cost of our major International pension plans were
2.1%
and
1.8%
, respectively. The previous method would have used a single discount rate for both service and interest costs.
|
|
|
2017
|
|
2016
|
||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
Discount rate
|
|
3.8
|
%
|
|
2.4
|
%
|
|
3.5
|
%
|
|
2.0
|
%
|
Rate of compensation increase
|
|
3.5
|
%
|
|
3.6
|
%
|
|
3.5
|
%
|
|
3.5
|
%
|
|
|
2017
|
|
2016
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Change in Projected Benefit Obligation
|
|
|
|
|
|
|
|
|
||||||||
Obligation at beginning of year
|
|
$
|
3,477.7
|
|
|
$
|
1,849.6
|
|
|
$
|
3,139.9
|
|
|
$
|
1,647.9
|
|
Service cost
|
|
29.0
|
|
|
25.9
|
|
|
36.5
|
|
|
24.3
|
|
||||
Interest cost
|
|
107.5
|
|
|
32.2
|
|
|
110.7
|
|
|
44.3
|
|
||||
Amendments
|
|
1.9
|
|
|
—
|
|
|
1.2
|
|
|
—
|
|
||||
Actuarial (gain) loss
|
|
(68.0
|
)
|
|
(132.4
|
)
|
|
380.2
|
|
|
376.4
|
|
||||
Divestitures
|
|
—
|
|
|
(34.1
|
)
|
|
—
|
|
|
—
|
|
||||
Curtailments
|
|
(17.3
|
)
|
|
(4.2
|
)
|
|
(.4
|
)
|
|
(1.2
|
)
|
||||
Settlement (gain) loss
|
|
7.0
|
|
|
—
|
|
|
5.4
|
|
|
(3.4
|
)
|
||||
Special termination benefits
|
|
2.8
|
|
|
—
|
|
|
2.0
|
|
|
—
|
|
||||
Participant contributions
|
|
—
|
|
|
1.4
|
|
|
—
|
|
|
1.6
|
|
||||
Benefits paid
|
|
(182.9
|
)
|
|
(46.5
|
)
|
|
(197.4
|
)
|
|
(46.6
|
)
|
||||
Currency translation/other
|
|
—
|
|
|
57.6
|
|
|
(.4
|
)
|
|
(193.7
|
)
|
||||
Obligation at End of Year
|
|
$
|
3,357.7
|
|
|
$
|
1,749.5
|
|
|
$
|
3,477.7
|
|
|
$
|
1,849.6
|
|
|
|
2017
|
|
2016
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Change in Plan Assets
|
|
|
|
|
|
|
|
|
||||||||
Fair value at beginning of year
|
|
$
|
2,705.3
|
|
|
$
|
1,411.1
|
|
|
$
|
2,613.6
|
|
|
$
|
1,302.8
|
|
Actual return on plan assets
|
|
319.6
|
|
|
87.9
|
|
|
275.2
|
|
|
273.2
|
|
||||
Company contributions
|
|
27.2
|
|
|
42.2
|
|
|
13.9
|
|
|
65.4
|
|
||||
Participant contributions
|
|
—
|
|
|
1.4
|
|
|
—
|
|
|
1.6
|
|
||||
Divestitures
|
|
—
|
|
|
(3.0
|
)
|
|
—
|
|
|
—
|
|
||||
Benefits paid
|
|
(182.9
|
)
|
|
(46.5
|
)
|
|
(197.4
|
)
|
|
(46.6
|
)
|
||||
Settlements
|
|
—
|
|
|
(5.3
|
)
|
|
—
|
|
|
(3.4
|
)
|
||||
Currency translation/other
|
|
—
|
|
|
52.2
|
|
|
—
|
|
|
(181.9
|
)
|
||||
Fair Value at End of Year
|
|
$
|
2,869.2
|
|
|
$
|
1,540.0
|
|
|
$
|
2,705.3
|
|
|
$
|
1,411.1
|
|
Funded Status at End of Year
|
|
$
|
(488.5
|
)
|
|
$
|
(209.5
|
)
|
|
$
|
(772.4
|
)
|
|
$
|
(438.5
|
)
|
Amounts Recognized
|
|
|
|
|
|
|
|
|
||||||||
Noncurrent assets
|
|
$
|
5.3
|
|
|
$
|
13.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Accrued liabilities
|
|
(12.6
|
)
|
|
—
|
|
|
(24.1
|
)
|
|
—
|
|
||||
Noncurrent liabilities
|
|
(481.2
|
)
|
|
(222.6
|
)
|
|
(748.3
|
)
|
|
(438.5
|
)
|
||||
Net Amount Recognized
|
|
$
|
(488.5
|
)
|
|
$
|
(209.5
|
)
|
|
$
|
(772.4
|
)
|
|
$
|
(438.5
|
)
|
|
|
2017
|
|
2016
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Net actuarial (gain) loss arising during the period
|
|
$
|
(189.8
|
)
|
|
$
|
(162.0
|
)
|
|
$
|
311.8
|
|
|
$
|
172.1
|
|
Amortization of net actuarial loss
|
|
(103.3
|
)
|
|
(55.7
|
)
|
|
(90.4
|
)
|
|
(36.5
|
)
|
||||
Prior service cost (credit) arising during the period
|
|
1.9
|
|
|
—
|
|
|
1.2
|
|
|
(.1
|
)
|
||||
Amortization of prior service cost
|
|
(2.3
|
)
|
|
.1
|
|
|
(2.8
|
)
|
|
.2
|
|
||||
Total
|
|
$
|
(293.5
|
)
|
|
$
|
(217.6
|
)
|
|
$
|
219.8
|
|
|
$
|
135.7
|
|
|
|
2017
|
|
2016
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Net actuarial loss
|
|
$
|
980.5
|
|
|
$
|
551.9
|
|
|
$
|
1,273.6
|
|
|
$
|
769.6
|
|
Prior service cost (credit)
|
|
8.1
|
|
|
(1.8
|
)
|
|
8.5
|
|
|
(1.9
|
)
|
||||
Net transition liability
|
|
—
|
|
|
.4
|
|
|
—
|
|
|
.4
|
|
||||
Total
|
|
$
|
988.6
|
|
|
$
|
550.5
|
|
|
$
|
1,282.1
|
|
|
$
|
768.1
|
|
|
|
U.S.
|
|
|
International
|
|
||
Net actuarial loss
|
|
$
|
88.5
|
|
|
$
|
39.9
|
|
Prior service cost (credit)
|
|
1.5
|
|
|
(.1
|
)
|
|
30 September 2017
|
|
30 September 2016
|
||||||||||
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
||||
Pension Plans with PBO in Excess of Plan Assets:
|
|
|
|
|
|
||||||||
PBO
|
$
|
3,116.7
|
|
$
|
465.7
|
|
|
$
|
3,477.7
|
|
$
|
1,849.6
|
|
Fair value of plan assets
|
2,623.0
|
|
243.1
|
|
|
2,705.3
|
|
1,411.1
|
|
||||
Pension Plans with ABO in Excess of Plan Assets:
|
|
|
|
|
|
||||||||
ABO
|
$
|
2,951.0
|
|
$
|
365.6
|
|
|
$
|
3,242.5
|
|
$
|
1,673.6
|
|
Fair value of plan assets
|
2,623.0
|
|
197.1
|
|
|
2,705.3
|
|
1,370.1
|
|
|
|
2017 Target Allocation
|
|
2017 Actual Allocation
|
|
2016 Actual Allocation
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
Asset Category
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity securities
|
|
46-66%
|
|
|
46-57%
|
|
|
58
|
%
|
|
53
|
%
|
|
65
|
%
|
|
60
|
%
|
Debt securities
|
|
32-42%
|
|
|
41-53%
|
|
|
34
|
%
|
|
46
|
%
|
|
28
|
%
|
|
38
|
%
|
Real estate/other
|
|
0-10%
|
|
|
0-2%
|
|
|
7
|
%
|
|
1
|
%
|
|
7
|
%
|
|
1
|
%
|
Cash
|
|
—
|
|
|
—
|
|
|
1
|
%
|
|
—
|
%
|
|
—
|
%
|
|
1
|
%
|
Total
|
|
|
|
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
30 September 2017
|
|
30 September 2016
|
||||||||||||||||||||||
|
Total
|
Level 1
|
Level 2
|
Level 3
|
|
Total
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||||||
U.S. Qualified Pension Plans
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Cash and cash equivalents
|
$
|
13.6
|
|
$
|
13.6
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
12.7
|
|
$
|
12.7
|
|
$
|
—
|
|
$
|
—
|
|
Equity securities
|
598.6
|
|
598.6
|
|
—
|
|
—
|
|
|
637.0
|
|
637.0
|
|
—
|
|
—
|
|
||||||||
Equity mutual funds
|
276.5
|
|
276.5
|
|
—
|
|
—
|
|
|
300.2
|
|
300.2
|
|
—
|
|
—
|
|
||||||||
Equity pooled funds
|
787.0
|
|
—
|
|
787.0
|
|
—
|
|
|
815.5
|
|
—
|
|
815.5
|
|
—
|
|
||||||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Bonds (government
and corporate)
|
985.7
|
|
—
|
|
985.7
|
|
—
|
|
|
747.8
|
|
—
|
|
747.8
|
|
—
|
|
||||||||
Real estate pooled funds
|
207.8
|
|
—
|
|
—
|
|
207.8
|
|
|
192.1
|
|
—
|
|
—
|
|
192.1
|
|
||||||||
Total U.S. Qualified Pension Plans
|
$
|
2,869.2
|
|
$
|
888.7
|
|
$
|
1,772.7
|
|
$
|
207.8
|
|
|
$
|
2,705.3
|
|
$
|
949.9
|
|
$
|
1,563.3
|
|
$
|
192.1
|
|
International Pension Plans
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Cash and cash equivalents
|
$
|
7.3
|
|
$
|
7.3
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
6.6
|
|
$
|
6.6
|
|
$
|
—
|
|
$
|
—
|
|
Equity pooled funds
|
821.4
|
|
—
|
|
821.4
|
|
—
|
|
|
854.8
|
|
—
|
|
854.8
|
|
—
|
|
||||||||
Fixed income pooled funds
|
651.3
|
|
—
|
|
651.3
|
|
—
|
|
|
486.9
|
|
—
|
|
486.9
|
|
—
|
|
||||||||
Other pooled funds
|
18.6
|
|
—
|
|
10.8
|
|
7.8
|
|
|
17.0
|
|
—
|
|
9.7
|
|
7.3
|
|
||||||||
Insurance contracts
|
41.4
|
|
—
|
|
—
|
|
41.4
|
|
|
45.8
|
|
—
|
|
—
|
|
45.8
|
|
||||||||
Total International Pension Plans
|
$
|
1,540.0
|
|
$
|
7.3
|
|
$
|
1,483.5
|
|
$
|
49.2
|
|
|
$
|
1,411.1
|
|
$
|
6.6
|
|
$
|
1,351.4
|
|
$
|
53.1
|
|
|
|
Real Estate
Pooled Funds
|
|
|
Other
Pooled Funds
|
|
|
Insurance
Contracts
|
|
|
Total
|
|
||||
30 September 2015
|
|
$
|
174.2
|
|
|
$
|
6.6
|
|
|
$
|
45.3
|
|
|
$
|
226.1
|
|
Actual return on plan assets:
|
|
|
|
|
|
|
|
|
||||||||
Assets held at end of year
|
|
17.9
|
|
|
.1
|
|
|
3.2
|
|
|
21.2
|
|
||||
Assets sold during the period
|
|
—
|
|
|
.3
|
|
|
—
|
|
|
.3
|
|
||||
Purchases, sales, and settlements, net
|
|
—
|
|
|
.3
|
|
|
(2.7
|
)
|
|
(2.4
|
)
|
||||
30 September 2016
|
|
$
|
192.1
|
|
|
$
|
7.3
|
|
|
$
|
45.8
|
|
|
$
|
245.2
|
|
Actual return on plan assets:
|
|
|
|
|
|
|
|
|
||||||||
Assets held at end of year
|
|
15.7
|
|
|
1.2
|
|
|
(1.0
|
)
|
|
15.9
|
|
||||
Assets sold during the period
|
|
—
|
|
|
.3
|
|
|
—
|
|
|
.3
|
|
||||
Purchases, sales, and settlements, net
|
|
—
|
|
|
(1.0
|
)
|
|
(3.4
|
)
|
|
(4.4
|
)
|
||||
30 September 2017
|
|
$
|
207.8
|
|
|
$
|
7.8
|
|
|
$
|
41.4
|
|
|
$
|
257.0
|
|
|
|
U.S.
|
|
|
International
|
|
||
2018
|
|
$
|
158.5
|
|
|
$
|
50.9
|
|
2019
|
|
163.4
|
|
|
53.4
|
|
||
2020
|
|
167.3
|
|
|
53.8
|
|
||
2021
|
|
171.4
|
|
|
56.8
|
|
||
2022
|
|
177.2
|
|
|
59.3
|
|
||
2023-2027
|
|
938.5
|
|
|
333.3
|
|
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Service cost
|
|
$
|
1.1
|
|
|
$
|
2.2
|
|
|
$
|
2.8
|
|
Interest cost
|
|
1.6
|
|
|
2.0
|
|
|
2.2
|
|
|||
Amortization of net actuarial loss
|
|
.2
|
|
|
.7
|
|
|
.8
|
|
|||
Net Periodic Postretirement Cost
|
|
$
|
2.9
|
|
|
$
|
4.9
|
|
|
$
|
5.8
|
|
Less: Discontinued Operations
|
|
$
|
—
|
|
|
$
|
(.4
|
)
|
|
$
|
(.7
|
)
|
Net Periodic Postretirement Cost – Continuing Operations
|
|
$
|
2.9
|
|
|
$
|
4.5
|
|
|
$
|
5.1
|
|
|
|
2017
|
|
|
2016
|
|
||
Obligation at beginning of year
|
|
$
|
86.3
|
|
|
$
|
86.9
|
|
Service cost
|
|
1.1
|
|
|
2.2
|
|
||
Interest cost
|
|
1.6
|
|
|
2.0
|
|
||
Actuarial loss (gain)
|
|
(7.2
|
)
|
|
7.5
|
|
||
Curtailment gain
|
|
(3.5
|
)
|
|
—
|
|
||
Benefits paid
|
|
(11.3
|
)
|
|
(12.3
|
)
|
||
Obligation at End of Year
|
|
$
|
67.0
|
|
|
$
|
86.3
|
|
Amounts Recognized
|
|
|
|
|
||||
Accrued liabilities
|
|
$
|
10.0
|
|
|
$
|
11.4
|
|
Noncurrent liabilities
|
|
57.0
|
|
|
74.9
|
|
|
|
2017
|
|
|
2016
|
|
||
Net actuarial loss (gain) arising during the period
|
|
$
|
(10.7
|
)
|
|
$
|
7.5
|
|
Amortization of net actuarial loss
|
|
(.2
|
)
|
|
(.7
|
)
|
||
Total
|
|
$
|
(10.9
|
)
|
|
$
|
6.8
|
|
2018
|
$
|
10.1
|
|
2019
|
9.5
|
|
|
2020
|
9.0
|
|
|
2021
|
8.4
|
|
|
2022
|
7.7
|
|
|
2023-2027
|
24.2
|
|
Balance at 30 September 2015
|
$
|
109.4
|
|
Additional accruals
|
10.4
|
|
|
Liabilities settled
|
(4.4
|
)
|
|
Accretion expense
|
5.4
|
|
|
Currency translation adjustment
|
(.9
|
)
|
|
Balance at 30 September 2016
|
$
|
119.9
|
|
Additional accruals
|
22.7
|
|
|
Liabilities settled
|
(4.1
|
)
|
|
Accretion expense
|
5.8
|
|
|
Currency translation adjustment
|
.4
|
|
|
Balance at 30 September 2017
|
$
|
144.7
|
|
2018
|
$
|
822
|
|
2019
|
234
|
|
|
2020
|
275
|
|
|
2021
|
309
|
|
|
2022
|
285
|
|
|
Thereafter
|
4,608
|
|
|
Total
|
$
|
6,533
|
|
Year ended 30 September
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
Number of Common Shares Outstanding
|
|
|
|
|
|
|
|||
Balance, beginning of year
|
|
217,350,825
|
|
|
215,359,113
|
|
|
213,538,144
|
|
Issuance of treasury shares for stock option and award plans
|
|
995,249
|
|
|
1,991,712
|
|
|
1,820,969
|
|
Balance, end of year
|
|
218,346,074
|
|
|
217,350,825
|
|
|
215,359,113
|
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Before-Tax Share-Based Compensation Cost – Total
|
$
|
40.7
|
|
$
|
37.6
|
|
$
|
45.7
|
|
Before-Tax Share-Based Compensation Cost – Discontinued Operations
|
.8
|
|
6.6
|
|
6.2
|
|
|||
Before-Tax Share-Based Compensation Cost – Continuing Operations
|
$
|
39.9
|
|
$
|
31.0
|
|
$
|
39.5
|
|
Income tax benefit – Continuing Operations
|
(14.0
|
)
|
(10.8
|
)
|
(13.8
|
)
|
|||
After-Tax Share-Based Compensation Cost – Continuing Operations
|
$
|
25.9
|
|
$
|
20.2
|
|
$
|
25.7
|
|
|
2017
|
|
2016
|
|
2015
|
|
|||
Deferred stock units
|
$
|
34.5
|
|
$
|
29.9
|
|
$
|
28.8
|
|
Stock options
|
1.4
|
|
4.2
|
|
12.6
|
|
|||
Restricted stock
|
4.8
|
|
3.5
|
|
4.3
|
|
|||
Before-Tax Share-Based Compensation Cost – Total
|
$
|
40.7
|
|
$
|
37.6
|
|
$
|
45.7
|
|
|
|
2017
|
|
2016
|
||
Expected volatility
|
|
20.6
|
%
|
|
20.5
|
%
|
Risk-free interest rate
|
|
1.4
|
%
|
|
1.2
|
%
|
Expected dividend yield
|
|
2.5
|
%
|
|
2.2
|
%
|
Deferred Stock Units
|
|
Shares (000)
|
|
|
Weighted Average
Grant-Date Fair Value
|
|
|
Outstanding at 30 September 2016
|
|
1,001
|
|
|
$
|
119.44
|
|
Equitable adjustment upon separation
(A)
|
|
65
|
|
|
—
|
|
|
Surrender upon separation
(B)
|
|
(89
|
)
|
|
132.88
|
|
|
Granted
|
|
283
|
|
|
148.89
|
|
|
Paid out
|
|
(235
|
)
|
|
83.65
|
|
|
Forfeited/adjustments
|
|
(50
|
)
|
|
121.99
|
|
|
Outstanding at 30 September 2017
|
|
975
|
|
|
$
|
127.29
|
|
(A)
|
Applicable deferred stock units have been adjusted by the conversion ratio of
1.071
to preserve the intrinsic value immediately before and after the spin-off of Versum.
|
(B)
|
In connection with the spin-off of Versum, EMD employees surrendered their outstanding Air Products equity awards, which were converted into Versum equity awards of equivalent fair value.
|
|
|
2015
|
|
Expected volatility
|
|
30.3
|
%
|
Expected dividend yield
|
|
2.6
|
%
|
Expected life (in years)
|
|
7.5
|
|
Risk-free interest rate
|
|
2.2
|
%
|
Stock Options
|
|
Shares (000)
|
|
|
Weighted Average
Exercise Price
|
|
|
Outstanding at 30 September 2016
|
|
3,916
|
|
|
$
|
90.28
|
|
Equitable adjustment upon separation
(A)
|
|
277
|
|
|
—
|
|
|
Surrender upon separation
(B)
|
|
(102
|
)
|
|
97.63
|
|
|
Exercised
|
|
(886
|
)
|
|
80.76
|
|
|
Forfeited
|
|
(3
|
)
|
|
105.28
|
|
|
Outstanding at 30 September 2017
|
|
3,202
|
|
|
$
|
84.85
|
|
Exercisable at 30 September 2017
|
|
3,149
|
|
|
$
|
84.00
|
|
Stock Options
|
|
Weighted Average Remaining Contractual Term (in years)
|
|
Aggregate Intrinsic Value
|
|
|
Outstanding at 30 September 2017
|
|
4.3
|
|
$
|
213
|
|
Exercisable at 30 September 2017
|
|
4.3
|
|
$
|
212
|
|
(A)
|
Applicable deferred stock units have been adjusted by the conversion ratio of
1.071
to preserve the intrinsic value immediately before and after the spin-off of Versum.
|
(B)
|
In connection with the spin-off of Versum, EMD employees surrendered their outstanding Air Products equity awards, which were converted into Versum equity awards of equivalent fair value.
|
Restricted Stock
|
|
Shares (000)
|
|
|
Weighted Average
Grant-Date Fair Value
|
|
|
Outstanding at 30 September 2016
|
|
85
|
|
|
$
|
128.16
|
|
Vested
|
|
(29
|
)
|
|
113.50
|
|
|
Outstanding at 30 September 2017
|
|
56
|
|
|
$
|
135.74
|
|
|
|
Derivatives
qualifying
as hedges
|
|
Foreign
currency
translation
adjustments
|
|
Pension and
postretirement
benefits
|
|
Total
|
||||||||
Balance at 30 September 2014
|
|
$
|
(28.5
|
)
|
|
$
|
(268.7
|
)
|
|
$
|
(944.7
|
)
|
|
$
|
(1,241.9
|
)
|
Other comprehensive loss before reclassifications
|
|
(35.0
|
)
|
|
(699.3
|
)
|
|
(278.5
|
)
|
|
(1,012.8
|
)
|
||||
Amounts reclassified from AOCL
|
|
20.8
|
|
|
—
|
|
|
97.0
|
|
|
117.8
|
|
||||
Net current period other comprehensive loss
|
|
$
|
(14.2
|
)
|
|
$
|
(699.3
|
)
|
|
$
|
(181.5
|
)
|
|
$
|
(895.0
|
)
|
Amount attributable to noncontrolling interest
|
|
.2
|
|
|
(11.5
|
)
|
|
.3
|
|
|
(11.0
|
)
|
||||
Balance at 30 September 2015
|
|
$
|
(42.9
|
)
|
|
$
|
(956.5
|
)
|
|
$
|
(1,126.5
|
)
|
|
$
|
(2,125.9
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
13.7
|
|
|
9.9
|
|
|
(335.1
|
)
|
|
(311.5
|
)
|
||||
Amounts reclassified from AOCL
|
|
(36.0
|
)
|
|
2.7
|
|
|
87.2
|
|
|
53.9
|
|
||||
Net current period other comprehensive income (loss)
|
|
$
|
(22.3
|
)
|
|
$
|
12.6
|
|
|
$
|
(247.9
|
)
|
|
$
|
(257.6
|
)
|
Amount attributable to noncontrolling interest
|
|
(.2
|
)
|
|
5.4
|
|
|
(.4
|
)
|
|
4.8
|
|
||||
Balance at 30 September 2016
|
|
$
|
(65.0
|
)
|
|
$
|
(949.3
|
)
|
|
$
|
(1,374.0
|
)
|
|
$
|
(2,388.3
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
(12.6
|
)
|
|
101.9
|
|
|
251.6
|
|
|
340.9
|
|
||||
Amounts reclassified from AOCL
|
|
24.2
|
|
|
57.3
|
|
|
110.7
|
|
|
192.2
|
|
||||
Net current period other comprehensive income
|
|
$
|
11.6
|
|
|
$
|
159.2
|
|
|
$
|
362.3
|
|
|
$
|
533.1
|
|
Spin-off of Versum
|
|
.2
|
|
|
6.0
|
|
|
5.3
|
|
|
11.5
|
|
||||
Amount attributable to noncontrolling interest
|
|
(.1
|
)
|
|
3.0
|
|
|
.8
|
|
|
3.7
|
|
||||
Balance at 30 September 2017
|
|
$
|
(53.1
|
)
|
|
$
|
(787.1
|
)
|
|
$
|
(1,007.2
|
)
|
|
$
|
(1,847.4
|
)
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
(Gain) Loss on Cash Flow Hedges, net of tax
|
|
|
|
|
|
|
||||||
Sales/Cost of sales
|
|
$
|
18.3
|
|
|
$
|
.2
|
|
|
$
|
.6
|
|
Other income (expense), net
|
|
5.1
|
|
|
(46.2
|
)
|
|
16.9
|
|
|||
Interest expense
|
|
.8
|
|
|
10.0
|
|
|
3.3
|
|
|||
Total (Gain) Loss on Cash Flow Hedges, net of tax
|
|
$
|
24.2
|
|
|
$
|
(36.0
|
)
|
|
$
|
20.8
|
|
|
|
|
|
|
|
|
||||||
Currency Translation Adjustment
|
|
|
|
|
|
|
||||||
Business restructuring and cost reduction actions
(A)
|
|
$
|
8.2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Income from discontinued operations, net of tax
(B)
|
|
49.1
|
|
|
2.7
|
|
|
—
|
|
|||
Total Currency Translation Adjustment
|
|
$
|
57.3
|
|
|
$
|
2.7
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
||||||
Pension and Postretirement Benefits, net of tax
(C)
|
|
$
|
110.7
|
|
|
$
|
87.2
|
|
|
$
|
97.0
|
|
(A)
|
The fiscal year 2017 impact relates to the planned sale of a non-industrial gas hardgoods business in the Industrial Gases – Americas segment recorded in the third quarter.
|
(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
16
,
Retirement Benefits
.
|
30 September
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Numerator
|
|
|
|
|
|
|
||||||
Income from continuing operations
|
|
$
|
1,134.4
|
|
|
$
|
1,099.5
|
|
|
$
|
933.3
|
|
Income (Loss) from discontinued operations
|
|
1,866.0
|
|
|
(468.4
|
)
|
|
344.6
|
|
|||
Net Income Attributable to Air Products
|
|
$
|
3,000.4
|
|
|
$
|
631.1
|
|
|
$
|
1,277.9
|
|
Denominator
(in millions)
|
|
|
|
|
|
|
||||||
Weighted average common shares — Basic
|
|
218.0
|
|
|
216.4
|
|
|
214.9
|
|
|||
Effect of dilutive securities
|
|
|
|
|
|
|
||||||
Employee stock option and other award plans
|
|
1.8
|
|
|
1.9
|
|
|
2.4
|
|
|||
Weighted average common shares — Diluted
|
|
219.8
|
|
|
218.3
|
|
|
217.3
|
|
|||
Basic EPS Attributable to Air Products
|
|
|
|
|
|
|
||||||
Income from continuing operations
|
|
$
|
5.20
|
|
|
$
|
5.08
|
|
|
$
|
4.34
|
|
Income (Loss) from discontinued operations
|
|
8.56
|
|
|
(2.16
|
)
|
|
1.61
|
|
|||
Net Income Attributable to Air Products
|
|
$
|
13.76
|
|
|
$
|
2.92
|
|
|
$
|
5.95
|
|
Diluted EPS Attributable to Air Products
|
|
|
|
|
|
|
||||||
Income from continuing operations
|
|
$
|
5.16
|
|
|
$
|
5.04
|
|
|
$
|
4.29
|
|
Income (Loss) from discontinued operations
|
|
8.49
|
|
|
(2.15
|
)
|
|
1.59
|
|
|||
Net Income Attributable to Air Products
|
|
$
|
13.65
|
|
|
$
|
2.89
|
|
|
$
|
5.88
|
|
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Income from Continuing Operations before Taxes
|
|
|
|
|
|
|
||||||
United States
|
|
$
|
669.8
|
|
|
$
|
631.7
|
|
|
$
|
507.5
|
|
Foreign
|
|
666.2
|
|
|
775.9
|
|
|
606.3
|
|
|||
Income from equity affiliates
|
|
80.1
|
|
|
147.0
|
|
|
152.3
|
|
|||
Total
|
|
$
|
1,416.1
|
|
|
$
|
1,554.6
|
|
|
$
|
1,266.1
|
|
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Current Tax Provision
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
62.8
|
|
|
$
|
171.0
|
|
|
$
|
117.0
|
|
State
|
|
7.0
|
|
|
21.2
|
|
|
8.1
|
|
|||
Foreign
|
|
229.1
|
|
|
178.6
|
|
|
165.7
|
|
|||
|
|
298.9
|
|
|
370.8
|
|
|
290.8
|
|
|||
Deferred Tax Provision
|
|
|
|
|
|
|
||||||
Federal
|
|
1.4
|
|
|
45.0
|
|
|
1.5
|
|
|||
State
|
|
6.0
|
|
|
2.8
|
|
|
17.8
|
|
|||
Foreign
|
|
(45.4
|
)
|
|
14.0
|
|
|
(9.9
|
)
|
|||
|
|
(38.0
|
)
|
|
61.8
|
|
|
9.4
|
|
|||
Income Tax Provision
|
|
$
|
260.9
|
|
|
$
|
432.6
|
|
|
$
|
300.2
|
|
(Percent of income before taxes)
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
U.S. federal statutory tax rate
|
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State taxes, net of federal benefit
|
|
1.0
|
|
|
1.2
|
|
|
1.1
|
|
Income from equity affiliates
|
|
(2.0
|
)
|
|
(3.3
|
)
|
|
(4.0
|
)
|
Foreign tax differentials
|
|
(7.9
|
)
|
|
(6.6
|
)
|
|
(5.9
|
)
|
U.S. taxes on foreign earnings
|
|
(2.2
|
)
|
|
(3.1
|
)
|
|
(2.1
|
)
|
Domestic production activities
|
|
(.8
|
)
|
|
(.8
|
)
|
|
(1.0
|
)
|
Non-deductible goodwill impairment charge
|
|
3.6
|
|
|
—
|
|
|
—
|
|
Non-U.S. subsidiary tax election
|
|
(7.7
|
)
|
|
—
|
|
|
—
|
|
Business separation costs
|
|
.2
|
|
|
4.2
|
|
|
.2
|
|
Share-based compensation
|
|
(1.2
|
)
|
|
—
|
|
|
—
|
|
Other
|
|
.4
|
|
|
1.2
|
|
|
.4
|
|
Effective Tax Rate
|
|
18.4
|
%
|
|
27.8
|
%
|
|
23.7
|
%
|
30 September
|
|
2017
|
|
|
2016
|
|
||
Gross Deferred Tax Assets
|
|
|
|
|
||||
Retirement benefits and compensation accruals
|
|
$
|
370.1
|
|
|
$
|
527.6
|
|
Tax loss carryforwards
|
|
64.5
|
|
|
101.1
|
|
||
Tax credits and other tax carryforwards
|
|
76.1
|
|
|
56.0
|
|
||
Reserves and accruals
|
|
88.2
|
|
|
74.9
|
|
||
Partnership and other investments
|
|
—
|
|
|
5.8
|
|
||
Currency losses
|
|
20.7
|
|
|
—
|
|
||
Other
|
|
37.2
|
|
|
19.3
|
|
||
Valuation allowance
|
|
(107.7
|
)
|
|
(165.1
|
)
|
||
Deferred Tax Assets
|
|
549.1
|
|
|
619.6
|
|
||
Gross Deferred Tax Liabilities
|
|
|
|
|
||||
Plant and equipment
|
|
1,035.6
|
|
|
985.1
|
|
||
Currency gains
|
|
—
|
|
|
46.8
|
|
||
Unremitted earnings of foreign entities
|
|
20.9
|
|
|
5.4
|
|
||
Partnership and other investments
|
|
5.4
|
|
|
—
|
|
||
Intangible assets
|
|
81.9
|
|
|
91.0
|
|
||
Other
|
|
9.2
|
|
|
16.7
|
|
||
Deferred Tax Liabilities
|
|
1,153.0
|
|
|
1,145.0
|
|
||
Net Deferred Income Tax Liability
|
|
$
|
603.9
|
|
|
$
|
525.4
|
|
|
|
2017
|
|
|
2016
|
|
||
Deferred Tax Assets
|
|
|
|
|
||||
Other noncurrent assets
|
|
$
|
174.5
|
|
|
$
|
185.0
|
|
Deferred Tax Liabilities
|
|
|
|
|
||||
Deferred income taxes
|
|
778.4
|
|
|
710.4
|
|
||
Net Deferred Income Tax Liability
|
|
$
|
603.9
|
|
|
$
|
525.4
|
|
Unrecognized Tax Benefits
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Balance at beginning of year
|
|
$
|
90.2
|
|
|
$
|
83.8
|
|
|
$
|
93.1
|
|
Additions for tax positions of the current year
|
|
47.5
|
|
|
12.5
|
|
|
4.7
|
|
|||
Additions for tax positions of prior years
|
|
16.1
|
|
|
2.9
|
|
|
3.0
|
|
|||
Reductions for tax positions of prior years
|
|
(4.0
|
)
|
|
—
|
|
|
(2.2
|
)
|
|||
Settlements
|
|
(2.0
|
)
|
|
(5.6
|
)
|
|
(.6
|
)
|
|||
Statute of limitations expiration
|
|
(3.2
|
)
|
|
(2.9
|
)
|
|
(8.3
|
)
|
|||
Foreign currency translation
|
|
1.8
|
|
|
(.5
|
)
|
|
(5.9
|
)
|
|||
Balance at End of Year
|
|
$
|
146.4
|
|
|
$
|
90.2
|
|
|
$
|
83.8
|
|
Other Receivables and Current Assets
30 September
|
2017
|
|
2016
|
|
||
Derivative instruments
|
$
|
93.9
|
|
$
|
169.3
|
|
Other receivables
|
188.0
|
|
181.7
|
|
||
Current capital lease receivables
|
93.3
|
|
88.2
|
|
||
Prepaid inventory
|
—
|
|
92.8
|
|
||
Other
|
28.1
|
|
6.2
|
|
||
Other receivables and current assets
|
$
|
403.3
|
|
$
|
538.2
|
|
Other Noncurrent Assets
30 September
|
2017
|
|
2016
|
|
||
Derivative instruments
|
$
|
133.9
|
|
$
|
204.4
|
|
Other long-term receivables
|
82.1
|
|
16.9
|
|
||
Prepaid tax
|
5.1
|
|
37.0
|
|
||
Deferred tax assets
|
174.5
|
|
185.0
|
|
||
Pension benefits
|
18.4
|
|
—
|
|
||
Deposits
|
34.8
|
|
36.5
|
|
||
Other
|
193.0
|
|
191.2
|
|
||
Other noncurrent assets
|
$
|
641.8
|
|
$
|
671.0
|
|
Payables and Accrued Liabilities
30 September
|
2017
|
|
2016
|
|
||
Trade creditors
|
$
|
659.5
|
|
$
|
578.8
|
|
Customer advances
|
438.9
|
|
371.2
|
|
||
Accrued payroll and employee benefits
|
187.1
|
|
217.1
|
|
||
Pension and postretirement benefits
|
22.6
|
|
35.5
|
|
||
Dividends payable
|
207.5
|
|
186.9
|
|
||
Outstanding payments in excess of certain cash balances
|
4.5
|
|
11.9
|
|
||
Accrued interest expense
|
42.2
|
|
47.9
|
|
||
Derivative instruments
|
95.9
|
|
73.5
|
|
||
Severance and other costs associated with business restructuring and cost reduction actions
|
41.5
|
|
15.7
|
|
||
Other
|
114.6
|
|
113.7
|
|
||
Payables and accrued liabilities
|
$
|
1,814.3
|
|
$
|
1,652.2
|
|
Other Noncurrent Liabilities
30 September
|
2017
|
|
2016
|
|
||
Pension benefits
|
$
|
703.8
|
|
$
|
1,155.1
|
|
Postretirement benefits
|
57.0
|
|
74.9
|
|
||
Other employee benefits
|
99.3
|
|
104.1
|
|
||
Contingencies related to uncertain tax positions
|
130.6
|
|
78.0
|
|
||
Advance payments
|
39.0
|
|
43.8
|
|
||
Environmental liabilities
|
72.3
|
|
70.3
|
|
||
Derivative instruments
|
36.0
|
|
21.8
|
|
||
Asset retirement obligations
|
144.0
|
|
116.1
|
|
||
Obligation for future contribution to an equity affiliate
|
94.4
|
|
94.4
|
|
||
Obligations associated with EfW
|
65.3
|
|
—
|
|
||
Other
|
170.2
|
|
58.0
|
|
||
Other noncurrent liabilities
|
$
|
1,611.9
|
|
$
|
1,816.5
|
|
Other Income (Expense), Net
30 September
|
2017
|
|
2016
|
|
2015
|
|
|||
Technology and royalty income
|
$
|
20.8
|
|
$
|
19.0
|
|
$
|
22.8
|
|
Interest income
(A)
|
1.5
|
|
6.1
|
|
4.2
|
|
|||
Foreign exchange
|
4.3
|
|
(7.2
|
)
|
(22.6
|
)
|
|||
Sale of assets and investments
|
24.3
|
|
8.8
|
|
36.3
|
|
|||
Contract settlements
|
14.3
|
|
12.6
|
|
—
|
|
|||
Transition service agreements reimbursement
(B)
|
38.4
|
|
—
|
|
—
|
|
|||
Other
|
17.4
|
|
10.1
|
|
4.8
|
|
|||
Other income (expense), net
|
$
|
121.0
|
|
$
|
49.4
|
|
$
|
45.5
|
|
(A)
|
Beginning in the second quarter of fiscal year 2017, interest income associated with our short-term investments is reflected on the consolidated income statements in "Other non-operating income (expense), net."
|
(B)
|
Reflects reimbursement for costs in support of transition services agreements with Versum for EMD and with Evonik for PMD. Refer to Note
4
,
Materials Technologies Separation
, for additional information.
|
Balance at 30 September 2014
|
$
|
287.2
|
|
Net income
|
11.5
|
|
|
Dividends
|
(2.0
|
)
|
|
Purchase of noncontrolling interest
|
(277.9
|
)
|
|
Currency translation adjustment
|
(18.8
|
)
|
|
Balance at 30 September 2015
|
$
|
—
|
|
2017
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Total
|
|
||||||||||
Sales
|
$
|
1,882.5
|
|
|
$
|
1,980.1
|
|
|
$
|
2,121.9
|
|
|
$
|
2,203.1
|
|
|
$
|
8,187.6
|
|
|
Gross profit
(A)
|
564.4
|
|
|
576.3
|
|
|
635.7
|
|
|
657.8
|
|
|
2,434.2
|
|
|
|||||
Business separation costs
(B)
|
30.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30.2
|
|
|
|||||
Business restructuring and cost reduction actions
(C)
|
50.0
|
|
|
10.3
|
|
|
42.7
|
|
|
48.4
|
|
|
151.4
|
|
|
|||||
Pension settlement loss
(D)
|
—
|
|
|
4.1
|
|
|
5.5
|
|
|
.9
|
|
|
10.5
|
|
|
|||||
Goodwill and intangible asset impairment charge
(E)
|
—
|
|
|
—
|
|
|
162.1
|
|
|
—
|
|
|
162.1
|
|
|
|||||
Gain on land sale
(F)
|
—
|
|
|
—
|
|
|
—
|
|
|
12.2
|
|
|
12.2
|
|
|
|||||
Operating income
(A)
|
328.1
|
|
|
391.2
|
|
|
252.6
|
|
|
455.7
|
|
|
1,427.6
|
|
|
|||||
Equity affiliates' income (loss)
|
38.0
|
|
|
34.2
|
|
|
(36.9
|
)
|
(G)
|
44.8
|
|
|
80.1
|
|
(G)
|
|||||
Income tax provision (benefit)
|
78.4
|
|
|
94.5
|
|
|
89.3
|
|
|
(1.3
|
)
|
(H)
|
260.9
|
|
(H)
|
|||||
Net income
|
306.4
|
|
|
2,135.7
|
|
|
104.1
|
|
|
475.0
|
|
|
3,021.2
|
|
|
|||||
Net income attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
251.6
|
|
|
304.4
|
|
|
104.2
|
|
|
474.2
|
|
|
1,134.4
|
|
|
|||||
Income (Loss) from discontinued operations
|
48.2
|
|
|
1,825.6
|
|
(I)
|
(2.3
|
)
|
|
(5.5
|
)
|
|
1,866.0
|
|
(I)
|
|||||
Net income attributable to Air Products
|
299.8
|
|
|
2,130.0
|
|
|
101.9
|
|
|
468.7
|
|
|
3,000.4
|
|
|
|||||
Basic Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
1.16
|
|
|
1.40
|
|
|
.48
|
|
|
2.17
|
|
|
5.20
|
|
|
|||||
Income (Loss) from discontinued operations
|
.22
|
|
|
8.38
|
|
|
(.01
|
)
|
|
(.02
|
)
|
|
8.56
|
|
|
|||||
Net income attributable to Air Products
|
1.38
|
|
|
9.78
|
|
|
.47
|
|
|
2.15
|
|
|
13.76
|
|
|
|||||
Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
1.15
|
|
|
1.39
|
|
|
.47
|
|
|
2.15
|
|
|
5.16
|
|
|
|||||
Income (Loss) from discontinued operations
|
.22
|
|
|
8.31
|
|
|
(.01
|
)
|
|
(.02
|
)
|
|
8.49
|
|
|
|||||
Net income attributable to Air Products
|
1.37
|
|
|
9.70
|
|
|
.46
|
|
|
2.13
|
|
|
13.65
|
|
|
|||||
Dividends declared per common share
|
.86
|
|
|
.95
|
|
|
.95
|
|
|
.95
|
|
|
3.71
|
|
|
|||||
Market price per common share – High
|
150.45
|
|
|
149.46
|
|
|
147.66
|
|
|
152.26
|
|
|
|
|
||||||
Market price per common share – Low
|
129.00
|
|
|
133.63
|
|
|
134.09
|
|
|
141.88
|
|
|
|
|
2016
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Total
|
|
||||||||||
Sales
|
$
|
1,866.3
|
|
|
$
|
1,777.4
|
|
|
$
|
1,914.5
|
|
|
$
|
1,945.5
|
|
|
$
|
7,503.7
|
|
|
Gross profit
(A)
|
570.4
|
|
|
564.4
|
|
|
594.3
|
|
|
598.0
|
|
|
2,327.1
|
|
|
|||||
Business separation costs
(B)
|
12.0
|
|
|
7.4
|
|
|
9.5
|
|
|
21.7
|
|
|
50.6
|
|
|
|||||
Business restructuring and cost reduction actions
(C)
|
—
|
|
|
10.7
|
|
|
13.2
|
|
|
10.6
|
|
|
34.5
|
|
|
|||||
Pension settlement loss
(D)
|
—
|
|
|
2.0
|
|
|
1.0
|
|
|
2.1
|
|
|
5.1
|
|
|
|||||
Operating income
(A)
|
372.5
|
|
|
371.6
|
|
|
394.6
|
|
|
391.0
|
|
|
1,529.7
|
|
|
|||||
Equity affiliates' income
|
33.3
|
|
|
32.3
|
|
|
42.1
|
|
|
39.3
|
|
|
147.0
|
|
|
|||||
Loss on extinguishment of debt
(J)
|
—
|
|
|
—
|
|
|
—
|
|
|
6.9
|
|
|
6.9
|
|
|
|||||
Income tax provision
|
96.4
|
|
|
93.5
|
|
(K)
|
145.9
|
|
(K)
|
96.8
|
|
(K)
|
432.6
|
|
(K)
|
|||||
Net income (loss)
|
372.0
|
|
|
(465.5
|
)
|
|
354.1
|
|
|
400.9
|
|
|
661.5
|
|
|
|||||
Net income attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
280.9
|
|
|
278.9
|
|
|
250.3
|
|
|
289.4
|
|
|
1,099.5
|
|
|
|||||
Income (Loss) from discontinued operations
|
82.7
|
|
|
(752.2
|
)
|
|
96.5
|
|
|
104.6
|
|
|
(468.4
|
)
|
|
|||||
Net income (loss) attributable to Air Products
|
363.6
|
|
|
(473.3
|
)
|
|
346.8
|
|
|
394.0
|
|
|
631.1
|
|
|
|||||
Basic Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
1.30
|
|
|
1.29
|
|
|
1.16
|
|
|
1.33
|
|
|
5.08
|
|
|
|||||
Income (Loss) from discontinued operations
|
.38
|
|
|
(3.48
|
)
|
|
.44
|
|
|
.48
|
|
|
(2.16
|
)
|
|
|||||
Net income (loss) attributable to Air Products
|
1.68
|
|
|
(2.19
|
)
|
|
1.60
|
|
|
1.81
|
|
|
2.92
|
|
|
|||||
Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
1.29
|
|
|
1.28
|
|
|
1.15
|
|
|
1.32
|
|
|
5.04
|
|
|
|||||
Income (Loss) from discontinued operations
|
.38
|
|
|
(3.45
|
)
|
|
.44
|
|
|
.48
|
|
|
(2.15
|
)
|
|
|||||
Net income (loss) attributable to Air Products
|
1.67
|
|
|
(2.17
|
)
|
|
1.59
|
|
|
1.80
|
|
|
2.89
|
|
|
|||||
Dividends declared per common share
|
.81
|
|
|
.86
|
|
|
.86
|
|
|
.86
|
|
|
3.39
|
|
|
|||||
Market price per common share – High
|
133.78
|
|
|
136.88
|
|
|
141.53
|
|
|
146.82
|
|
|
|
|
||||||
Market price per common share – Low
|
117.80
|
|
|
106.63
|
|
|
124.78
|
|
|
127.72
|
|
|
|
|
(A)
|
Changes in estimates on projects accounted for under the percentage of completion method favorably impacted income by approximately
$27
in fiscal year
2017
and
$20
in fiscal year
2016
, primarily during the fourth quarter. For additional information, see Note
1
,
Major Accounting Policies
(Revenue Recognition).
|
(B)
|
For additional information, see Note
4
,
Materials Technologies Separation
.
|
(C)
|
For additional information, see Note
5
,
Business Restructuring and Cost Reduction Actions
.
|
(D)
|
For additional information, see Note
16
,
Retirement Benefits
.
|
(E)
|
For additional information, see Note
10
,
Goodwill
, and Note
11
,
Intangible Assets
.
|
(F)
|
The gain is reflected on the consolidated income statements in "Other income (expense), net." For additional information, see Note
23
,
Supplemental Information
.
|
(G)
|
Includes the impact of an other-than-temporary impairment of an investment in an equity affiliate. For additional information, see Note
8
,
Summarized Financial Information of Equity Affiliates
.
|
(H)
|
Includes the impact of a tax election benefit related to a non-U.S. subsidiary. For additional information, see Note
22
,
Income Taxes
.
|
(I)
|
Includes the after-tax gain on the sale of PMD. For additional information, see Note
3
,
Discontinued Operations
.
|
(J)
|
For additional information, see Note
15
,
Debt
.
|
(K)
|
Includes income tax expense for tax costs associated with business separation. For additional information, see Note
4
,
Materials Technologies Separation
.
|
•
|
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
|
||||||||||||
2017
|
|
|
|
|
|
|
||||||||||||
Sales to external customers
|
$
|
3,637.0
|
|
$
|
1,780.4
|
|
$
|
1,964.7
|
|
$
|
722.9
|
|
$
|
82.6
|
|
$
|
8,187.6
|
|
Operating income (loss)
|
950.6
|
|
387.1
|
|
531.2
|
|
71.3
|
|
(170.6
|
)
|
1,769.6
|
|
||||||
Depreciation and amortization
|
464.4
|
|
177.1
|
|
203.2
|
|
8.9
|
|
12.2
|
|
865.8
|
|
||||||
Equity affiliates' income
|
58.1
|
|
47.1
|
|
53.5
|
|
.9
|
|
—
|
|
159.6
|
|
||||||
Expenditures for long-lived assets
|
427.2
|
|
143.2
|
|
337.8
|
|
25.6
|
|
105.9
|
|
1,039.7
|
|
||||||
Investments in net assets of and advances to equity affiliates
|
287.5
|
|
508.6
|
|
471.8
|
|
19.0
|
|
—
|
|
1,286.9
|
|
||||||
Total assets
|
5,840.8
|
|
3,276.1
|
|
4,412.1
|
|
279.6
|
|
4,648.4
|
|
18,457.0
|
|
||||||
2016
|
|
|
|
|
|
|
||||||||||||
Sales to external customers
|
$
|
3,344.1
|
|
$
|
1,704.4
|
|
$
|
1,720.4
|
|
$
|
498.8
|
|
$
|
236.0
|
|
$
|
7,503.7
|
|
Operating income (loss)
|
893.2
|
|
384.6
|
|
451.0
|
|
(21.3
|
)
|
(87.6
|
)
|
1,619.9
|
|
||||||
Depreciation and amortization
|
443.6
|
|
185.7
|
|
197.9
|
|
7.9
|
|
19.5
|
|
854.6
|
|
||||||
Equity affiliates' income
|
52.7
|
|
36.5
|
|
57.8
|
|
—
|
|
—
|
|
147.0
|
|
||||||
Expenditures for long-lived assets
|
406.6
|
|
159.5
|
|
313.3
|
|
6.0
|
|
22.3
|
|
907.7
|
|
||||||
Investments in net assets of and advances to equity affiliates
|
250.6
|
|
580.5
|
|
442.5
|
|
10.0
|
|
—
|
|
1,283.6
|
|
||||||
Total assets
|
5,896.7
|
|
3,178.6
|
|
4,232.7
|
|
367.6
|
|
2,384.5
|
|
16,060.1
|
|
||||||
2015
|
|
|
|
|
|
|
||||||||||||
Sales to external customers
|
$
|
3,694.5
|
|
$
|
1,866.4
|
|
$
|
1,661.3
|
|
$
|
286.7
|
|
$
|
315.4
|
|
$
|
7,824.3
|
|
Operating income (loss)
|
806.1
|
|
331.3
|
|
389.3
|
|
(51.6
|
)
|
(86.5
|
)
|
1,388.6
|
|
||||||
Depreciation and amortization
|
417.5
|
|
194.3
|
|
209.9
|
|
16.5
|
|
20.3
|
|
858.5
|
|
||||||
Equity affiliates' income (loss)
|
64.6
|
|
42.4
|
|
46.1
|
|
(.8
|
)
|
—
|
|
152.3
|
|
||||||
Expenditures for long-lived assets
|
414.5
|
|
215.6
|
|
402.5
|
|
94.8
|
|
35.0
|
|
1,162.4
|
|
||||||
Investments in net assets of and advances to equity affiliates
|
249.7
|
|
564.1
|
|
421.7
|
|
14.3
|
|
—
|
|
1,249.8
|
|
||||||
Total assets
|
5,782.5
|
|
3,324.1
|
|
4,159.1
|
|
370.5
|
|
1,123.8
|
|
14,760.0
|
|
Operating Income
|
2017
|
|
2016
|
|
2015
|
|
|||
Segment total
|
$
|
1,769.6
|
|
$
|
1,619.9
|
|
$
|
1,388.6
|
|
Business separation costs
|
(30.2
|
)
|
(50.6
|
)
|
(7.5
|
)
|
|||
Business restructuring and cost reduction actions
|
(151.4
|
)
|
(34.5
|
)
|
(180.1
|
)
|
|||
Pension settlement loss
|
(10.5
|
)
|
(5.1
|
)
|
(19.3
|
)
|
|||
Goodwill and intangible asset impairment charge
|
(162.1
|
)
|
—
|
|
—
|
|
|||
Gain on previously held equity interest
|
—
|
|
—
|
|
17.9
|
|
|||
Gain on land sales
(A)
|
12.2
|
|
—
|
|
33.6
|
|
|||
Consolidated Total
|
$
|
1,427.6
|
|
$
|
1,529.7
|
|
$
|
1,233.2
|
|
(A)
|
Reflected on the consolidated income statements in “Other income (expense), net.”
|
Equity Affiliates' Income
|
2017
|
2016
|
2015
|
||||||
Segment total
|
$
|
159.6
|
|
$
|
147.0
|
|
$
|
152.3
|
|
Equity method investment impairment charge
|
(79.5
|
)
|
—
|
|
—
|
|
|||
Consolidated Total
|
$
|
80.1
|
|
$
|
147.0
|
|
$
|
152.3
|
|
Total Assets
|
2017
|
|
2016
|
|
2015
|
|
|||
Segment total
|
$
|
18,457.0
|
|
$
|
16,060.1
|
|
$
|
14,760.0
|
|
Discontinued operations
|
10.2
|
|
1,968.5
|
|
2,556.6
|
|
|||
Consolidated Total
|
$
|
18,467.2
|
|
$
|
18,028.6
|
|
$
|
17,316.6
|
|
Sales to External Customers
|
2017
|
|
2016
|
|
2015
|
|
|||
United States
|
$
|
2,886.8
|
|
$
|
2,911.7
|
|
$
|
3,369.8
|
|
Europe, including Middle East
|
2,478.5
|
|
2,186.5
|
|
1,989.2
|
|
|||
Asia, excluding China and India
|
849.6
|
|
721.4
|
|
736.8
|
|
|||
China
|
1,143.4
|
|
1,020.4
|
|
957.8
|
|
|||
Other
(A)
|
829.3
|
|
663.7
|
|
770.7
|
|
|||
Total
|
$
|
8,187.6
|
|
$
|
7,503.7
|
|
$
|
7,824.3
|
|
Long-Lived Assets
(B)
|
2017
|
|
2016
|
|
2015
|
|
|||
United States
|
$
|
3,407.4
|
|
$
|
3,411.4
|
|
$
|
3,502.9
|
|
Europe, including Middle East
|
1,279.0
|
|
1,292.5
|
|
1,379.8
|
|
|||
Asia, excluding China and India
|
778.5
|
|
707.0
|
|
627.1
|
|
|||
China
|
1,737.9
|
|
1,675.8
|
|
1,682.8
|
|
|||
Other
(A)
|
1,237.4
|
|
1,173.0
|
|
1,044.7
|
|
|||
Total
|
$
|
8,440.2
|
|
$
|
8,259.7
|
|
$
|
8,237.3
|
|
(A)
|
Includes Canada, Latin America, and India.
|
(B)
|
Long-lived assets include plant and equipment, net.
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
Plan Category
|
Number of securities to be issued upon exercise of outstanding options, warrants, and rights
|
|
|
Weighted-average exercise price of outstanding options, warrants, and rights
|
|
Number of Securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
|
|
|
|
Equity compensation plans approved by security holders
|
4,316,028
|
|
(1)
|
$
|
85.00
|
|
4,922,382
|
|
(2)
|
Equity compensation plans not approved by security holders
|
70,304
|
|
(3)
|
$—
|
|
—
|
|
|
|
Total
|
4,386,332
|
|
|
$
|
85.00
|
|
4,922,382
|
|
|
(1)
|
Represents Long-Term Incentive Plan outstanding stock options and deferred stock units that have been granted. Deferred stock units entitle the recipient to one share of Company common stock upon vesting, which is conditioned on continued employment during a deferral period and may also be conditioned on earn-out against certain performance targets.
|
(2)
|
Represents authorized shares that were available for future grants as of 30 September 2017. These shares may be used for options, deferred stock units, restricted stock, and other stock-based awards to officers, directors, and key employees. Full value awards such as restricted stock are limited to 20% of cumulative awards after 1 October 2001.
|
(3)
|
This number represents deferred stock units issued under the Deferred Compensation Plan, which are purchased for the fair market value of the underlying shares of stock with eligible deferred compensation.
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
(a)
|
The following documents are filed as a part of this report:
|
|
|
|
|
|
|
|
(1)
|
The Company’s 2017 consolidated financial statements and the Report of the Independent Registered Public Accounting Firm are included in Part II, Item 8.
|
|
|
|
|
|
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
|
|
|
(2)
|
Financial Statement Schedules—the following additional information should be read in conjunction with the consolidated financial statements in the Company’s 2017 consolidated financial statements.
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
All other schedules are omitted because the required matter or conditions are not present or because the information required by the Schedules is submitted as part of the consolidated financial statements and notes thereto.
|
|
|
|
|
|
|
(3)
|
Exhibits—The exhibits filed as a part of this Annual Report on Form 10-K are listed in the
Index to Exhibits
located on page
127
of this Report.
|
|
Exhibit No.
|
Description
|
|
|
(2)
|
Plan of acquisition, reorganization, arrangement, liquidation or succession.
|
|
|
2.1
|
|
|
|
2.2
|
|
|
|
2.3
|
|
|
|
(3)
|
Articles of Incorporation and By-Laws.
|
|
|
3.1
|
|
|
|
3.2
|
Restated Certificate of Incorporation of the Company. (Filed as Exhibit 3.2 to the Company’s Form 10-K Report for the fiscal year ended 30 September 1987.)*
|
|
|
3.3
|
|
|
|
3.4
|
|
|
|
(4)
|
Instruments defining the rights of security holders, including indentures. Upon request of the Securities and Exchange Commission, the Company hereby undertakes to furnish copies of the instruments with respect to its long-term debt.
|
|
|
4.1
|
Indenture, dated as of January 18, 1985, between the Company and The Chase Manhattan Bank (National Association), as Trustee. (Filed as Exhibit 4(a) to the Company’s Registration Statement No. 33-36974.)*
|
|
|
4.2
|
Indenture, dated as of January 10, 1995, between the Company and The Bank of New York Trust Company, N.A. (formerly Wachovia Bank, National Association and initially First Fidelity Bank Company, National Association), as Trustee. (Filed as Exhibit 4(a) to the Company’s Registration Statement No. 33-57357.)*
|
|
|
(10)
|
Material Contracts
|
|
|
10.1
|
1990 Deferred Stock Plan of the Company, as amended and restated effective 1 October 1989. (Filed as Exhibit 10.1 to the Company’s Form 10-K Report for the fiscal year ended 30 September 1989.)*†
|
|
|
10.2
|
|
|
|
10.3
|
|
|
|
10.4
|
|
|
|
Exhibit No.
|
Description
|
10.5
|
|
|
|
10.5(a)
|
|
|
|
10.5(b)
|
|
|
|
10.5(c)
|
|
|
|
10.5(d)
|
|
|
|
10.5(e)
|
|
|
|
10.5(f)
|
|
|
|
10.5(g)
|
|
|
|
10.5(h)
|
|
|
|
10.5(i)
|
|
|
|
10.5(j)
|
|
|
|
10.6
|
|
|
|
10.6(a)
|
|
|
|
10.6(b)
|
|
|
|
10.6(c)
|
|
|
|
Exhibit No.
|
Description
|
10.7
|
|
|
|
10.7(a)
|
|
|
|
10.7(b)
|
|
|
|
10.7(c)
|
|
|
|
10.8
|
|
|
|
10.8(a)
|
|
|
|
10.8(b)
|
|
|
|
10.9
|
|
|
|
10.10
|
|
|
|
10.11
|
|
|
|
10.12
|
|
|
|
10.13
|
|
|
|
10.14
|
|
|
|
10.15
|
Retirement and Retention Agreement for an Executive Officer.†
|
|
|
10.16
|
|
|
|
12
|
|
|
|
14
|
|
|
|
21
|
|
|
|
(23)
|
Consents of Experts and Counsel.
|
|
|
Exhibit No.
|
Description
|
23.1
|
|
|
|
24
|
|
|
|
(31)
|
Rule 13a-14(a)/15d-14(a) Certifications.
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
(32)
|
Section 1350 Certifications.
|
|
|
32.1
|
|
|
|
99.1
|
|
|
|
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
|
*
|
Previously filed as indicated and incorporated herein by reference. Exhibits incorporated by reference are located in SEC File No. 001-04534 unless otherwise indicated.
|
|
|
†
|
Indicated management contract or compensatory arrangement.
|
|
|
††
|
The certification attached as Exhibit 32.1 that accompanies this Annual Report on Form 10-K, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Air Products and Chemicals, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Form 10-K, irrespective of any general incorporation language contained in such filing.
|
|
AIR PRODUCTS AND CHEMICALS, INC.
|
|
(Registrant)
|
|
|
By:
|
/s/ M. Scott Crocco
|
|
M. Scott Crocco
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
|
Date:
|
16 November 2017
|
Signature and Title
|
|
Date
|
|
|
|
/s/ Seifi Ghasemi
|
|
16 November 2017
|
(Seifi Ghasemi)
Director, Chairman, President, and
Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
/s/ Russell A. Flugel
|
|
16 November 2017
|
(Russell A. Flugel)
Vice President and Corporate Controller
(Principal Accounting Officer)
|
|
|
|
|
|
*
|
|
16 November 2017
|
(Susan K. Carter)
Director
|
|
|
|
|
|
*
|
|
16 November 2017
|
(Charles I. Cogut)
Director
|
|
|
|
|
|
*
|
|
16 November 2017
|
(Chad C. Deaton)
Director
|
|
|
|
|
|
*
|
|
16 November 2017
|
(David H. Y. Ho)
Director
|
|
|
|
|
|
*
|
|
16 November 2017
|
(Margaret G. McGlynn)
Director
|
|
|
|
|
|
Signature and Title
|
|
Date
|
*
|
|
16 November 2017
|
(Edward L. Monser)
Director
|
|
|
|
|
|
*
|
|
16 November 2017
|
(Matthew H. Paull)
Director
|
|
|
*
|
Mary T. Afflerbach, Vice President, Corporate Secretary, and Chief Governance Officer, by signing her name hereto, does sign this document on behalf of the above noted individuals, pursuant to a power of attorney duly executed by such individuals, which is filed with the Securities and Exchange Commission herewith.
|
|
/s/ Mary T. Afflerbach
|
|
Mary T. Afflerbach
|
|
Attorney-in-Fact
|
|
|
Date:
|
16 November 2017
|
|
Balance at
Beginning
of Period
|
|
Additions
Charged to
Expense
|
|
Additions
Charged to
Other Accounts
|
|
Other
Changes
(A)
|
|
Balance
at End of
Period
|
|
|||||
Year Ended 30 September 2017
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$55
|
|
|
$7
|
|
|
$39
|
|
|
($7
|
)
|
|
$94
|
|
Allowance for deferred tax assets
(B)
|
165
|
|
6
|
|
7
|
|
(70
|
)
|
108
|
|
|||||
|
|
|
|
|
|
||||||||||
Year Ended 30 September 2016
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$48
|
|
|
$9
|
|
|
$13
|
|
|
($15
|
)
|
|
$55
|
|
Allowance for deferred tax assets
(C)
|
112
|
|
1
|
|
52
|
|
—
|
|
165
|
|
|||||
|
|
|
|
|
|
||||||||||
Year Ended 30 September 2015
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$58
|
|
|
$8
|
|
|
$18
|
|
|
($36
|
)
|
|
$48
|
|
Allowance for deferred tax assets
|
106
|
|
—
|
|
9
|
|
(3
|
)
|
112
|
|
(A)
|
Other changes related to allowance for doubtful accounts primarily includes write-offs of uncollectible trade receivables, net of recoveries. Other Changes also includes the impact of foreign currency translation adjustments.
|
(B)
|
The decrease in the valuation allowance was primarily due to the utilization of federal and state loss carryforwards as a result of recognizing the gain on the sale of our PMD business. This benefit was recorded in discontinued operations. See Note 3, Discontinued Operations, for additional information.
|
(C)
|
The increase in the valuation allowance was primarily due to the loss recorded on the exit from the Energy-from-Waste business. These costs were recorded in discontinued operations. See Note
3
,
Discontinued Operations
, for additional information.
|
1.
|
General
|
(a)
|
Provide compensation for directors in the form of Air Products’ equity securities to align the interests of directors with those of Air Products’ shareholders; and
|
(b)
|
Provide directors the opportunity to defer compensation earned as a director.
|
2.
|
Effective Dates
|
3.
|
Participants
|
4.
|
Mandatory Deferrals
|
5.
|
Elective Deferrals
|
6.
|
Accounts
|
(a)
|
An Interest Account which shall be deemed to earn interest at rates established on the first business day of each calendar quarter based upon the published average long-term yields of corporate bonds of "A" rated Industrial Companies appearing in Moody's Bond Survey or an equivalent bond rating service on such day. The Company shall credit the Interest Account with Elective Deferrals which a participant directs to the Interest Account; and
|
(b)
|
(1) An Air Products Stock Account which shall be established for each participant and shall be deemed to be invested in Air Products and Chemicals, Inc. common stock,. The Company shall credit the Air Products Stock Account with that number of units (including fractions) obtained by dividing the amount of deferred compensation to be credited to such Account by the Fair Market Value of a share of Company common stock on the second business day before the date the compensation is credited to the Air Products Stock Account. The units thus calculated are herein referred to as “Air Products deferred stock units.”
|
7.
|
Earnings on Accounts
|
(a)
|
Earnings on Interest Account
. Interest shall be credited and compounded quarterly.
|
(b)
|
Earnings on Air Products Stock Account
. Each Air Products deferred stock unit credited to a participant’s Account shall be credited with earnings quarterly as of the last date of the quarter in an amount equal to the dividend payable during the quarter with respect to a share of Air Products common stock. Each Versum deferred stock unit credited to a participant’s Account shall be credited quarterly as of the last day of the quarter in an amount equal to the dividend payable during the quarter with respect to a share of Versum Materials, Inc. common stock. The amounts so credited shall then be converted into Air Products deferred stock units in the manner described under Section 6(b) above using the quarterly crediting date as the valuation date for determining Fair Market Value.
|
8.
|
Time and Manner of Making Elective Deferrals
|
(a)
|
The amount or percentage of compensation to be deferred beginning on a future date specified in the notice until such notice is revoked or modified as to future compensation; and
|
(b)
|
The percentage of the Elective Deferrals to be credited to the Interest Account and the percentage to be credited to the Air Products Stock Account.
|
9.
|
Payment of Deferred Compensation
|
(a)
|
Election of Time of Payment
. Within 30 days of commencing service as a director to the Company, a participant may make an election to receive distribution of his or her Deferred Compensation Amount in either a lump sum or in a specified number of consecutive annual installments (not to exceed ten), and may elect the date of payment in the case of a lump sum or the date payments commence in the case of installments. All such elections may be made by completing Section III of the Election Form and returning it to the Corporate Secretary. If a participant does not complete an Election Form specifying the timing of payment of his or her Deferred Compensation Amount within the first 30 days of service, such Deferred Compensation Amount will be paid as a lump sum in the first year after the year in which the director’s service as a director ends, and the director will be deemed, for purposes of the Program, to have so elected.
|
(b)
|
Changes in Election of Timing of Payment
. A participant may change his or her election in regard to the timing of payment of his or her Deferred Compensation Amount by completing a new Election Form and returning it to the Corporate Secretary. Such a change in election of timing of payment will apply only to Deferred Compensation Amounts earned in future years, except a director may change the timing of payment for previously accrued Deferred Compensation Amounts only as follows:
|
(i)
|
A completed Election Form reflecting the desired change must be received by the Corporate Secretary’s Office no later than one year prior to the first scheduled payment of such Deferred Compensation Amounts under his or her currently effective Election Form(s);
|
(ii)
|
The change must delay the first payment by at least five years from the date the first scheduled payment otherwise would have been made; and
|
(iii)
|
The change will become effective one year from the date the Election Form is received by the Company.
|
(c)
|
Payment Following Termination of Service
. The value of the Deferred Compensation Amount credited to the Interest Account of a participant's Plan account and the Fair Market Value of Versum deferred stock units credited to a participant’s Air Products Stock Account shall be paid in cash, and the value of the Air Products deferred stock units credited to a participant’s Air Products Stock Account shall be paid by delivery of a share of common stock for each unit, in each case in a lump sum or in annual installments, in accordance with the participant’s election.
|
(d)
|
Accelerated Payment
. Notwithstanding the deferral period and timing of payment determined in accordance with Sections 9(a) and (b) above, the participant’s Accounts shall be paid on an accelerated basis as follows under the circumstances described below:
|
(i)
|
Payment on Death
. In the event of a participant's death, the value of his or her Interest Account and the Fair Market Value of his or her Versum deferred stock units shall be paid in cash; the value of his or her Air Products deferred stock units shall be distributed in shares of Air Products stock. Amounts shall be determined as of the date of death and shall be paid in a single payment or distribution to the participant's estate or designated beneficiary as soon as practicable following the date of death. A participant may designate a beneficiary by completing Section IV of the Election Form and returning it to the Corporate Secretary’s Office.
|
(ii)
|
Change in Control
.
|
(A)
|
In the event of a “Change of Control” of the Company, as defined by the Plan, the value of a participant’s Air Products deferred stock units shall
|
(B)
|
In the event of a Change in Control of the Company followed by a participant’s termination of service as a director of the Company, the value of the participant’s Interest Account and the Fair Market Value of his or her Versum deferred stock units, determined as of the date of termination of service as a director following or in connection with the Change in Control, shall be immediately due and payable to the participant in a single cash lump sum.
|
(iii)
|
Other Events
. Upon the occurrence of any other event or conditions which permit an acceleration of payments under regulations implementing Section 409A of the Internal Revenue Code, the Corporate Secretary’s Office will distribute the value of the participants’ accounts in accordance with such regulations.
|
(e)
|
Miscellaneous Provisions
.
|
(i)
|
Withholding of Taxes
. The right of a participant to payments under this Program shall be subject to the Company’s obligations at any time to withhold income or other taxes from such payments including, without limitation, by reducing the number of shares of common stock to be distributed in payment of Air Products deferred stock units by the number of shares equal in value to the amount of such taxes required to be withheld.
|
(ii)
|
Rights as to Common Stock
. No participant with deferred compensation credited to the Air Products Stock Account shall have rights as a Company shareholder with respect thereto unless and until the date as of which shares of common stock are issued in payment of such deferred compensation. No shares of common stock shall be issued and delivered hereunder unless and until all legal requirements applicable to the issuance, delivery or transfer of such shares have been complied with including, without limitation, compliance with the provisions of the Act and of the Securities Act of 1993, as amended, and the applicable requirements of the exchanges on which the Company’s common stock is, at the time, listed. Distributions of shares of common stock in payment under this Program may be made either from shares of authorized but unissued common stock reserved for such purpose by the Board of Directors or from shares of authorized and issued common stock reacquired by the Company and held in its treasury, as from time to time determined by, or pursuant to delegations from, the Board of Directors.
|
(iii)
|
Adjustments to Avoid Dilution
. In the event of any change in the common stock of the Company or Versum Materials, Inc. by reason of any stock dividend or split, recapitalization, merger, consolidation, combination or exchange of shares, or a rights offering to purchase common stock at a price substantially below fair market value, or other similar corporate change, including without limitation in connection with a Change in Control of the Company or Versum Materials, Inc., respectively, the value and attributes of each deferred stock unit shall be appropriately adjusted consistent with such change to the same extent as if such deferred stock units were issued and outstanding shares of common stock of the Company or Versum Materials, Inc., respectively, so as to preserve, without increasing, the value of deferred compensation credited to each participant’s Air Products Stock Account. Such adjustments shall be made by the Board of Directors and shall be conclusive and binding for all purposes of the Program.
|
10.
|
Participant's Rights Unsecured
|
11.
|
Nonassignability
|
12.
|
Statement of Account
|
13.
|
Administration
|
14.
|
Business Days
|
15.
|
Amendment and Termination
|
16.
|
Notices
|
17.
|
Construction; Governing Law
|
o
|
Elect (or modify my prior election) to defer receipt of compensation otherwise payable to me in cash for services as a Director of the Company in the manner described below (fill in one):
|
o
|
Revoke my prior election to defer.
|
A.
|
Lump Sum Election
|
o
|
In the year my service as a Director ends.
|
o
|
In the ____ year after the year in which my service as a Director ends (not to exceed tenth).
|
B.
|
Installment Election
|
o
|
The year in which my service ends.
|
o
|
_____ year after the year in which my service ends (the last installment must be paid no later than 10 years after the year in which service ends).
|
C.
|
This election shall apply to:
|
_____
|
Future year Deferred Compensation Amounts only.
|
_____
|
All Deferred Compensation Amounts.*
|
(a)
|
an Employee who is a party to an individual employment agreement with the Employer approved by the Board of Directors of the Company or a Committee thereof;
|
(b)
|
an Employee who is eligible to receive a benefit under the Air Products and Chemicals, Inc. Executive Separation Program; or
|
(c)
|
an Employee who is entitled to receive a benefit under the Air Products and Chemicals, Inc. Special Severance Plan.
|
1.
|
A new section (v) shall be added to the end of Section 3.05(b) to read as follows:
|
2.
|
Section 4.03-A shall be amended to read as follows:
|
3.
|
In all other respects the Plan shall remain in full force and effect.
|
1.
|
The Plan Amendment Titled “AMENDMENT NO. 1 TO THE SUPPLEMENTARY PENSION PLAN OF AIR PRODUCTS AND CHEMICALS, INC.” executed on September 30, 2016 contained a scribers error and should have been titled “AMENDMENT NO. 2 TO THE SUPPLEMENTARY PENSION PLAN OF AIR PRODUCTS AND CHEMICALS, INC.”
|
2.
|
Section 3.5 (b) shall be amended to read as follows:
|
3.
|
In all other respects the Plan shall remain in full force and effect.
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
Year Ended 30 September
|
|
||||||||||||||||||
(Millions of dollars, except ratios)
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
(1)
|
|
$
|
1,155.2
|
|
|
$
|
1,122.0
|
|
|
$
|
965.9
|
|
|
$
|
691.0
|
|
|
$
|
900.0
|
|
|
Add (deduct):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for income taxes
|
|
260.9
|
|
|
432.6
|
|
|
300.2
|
|
|
258.1
|
|
|
275.1
|
|
|
|||||
Fixed charges, excluding capitalized interest
|
|
134.4
|
|
|
129.7
|
|
|
118.3
|
|
|
141.8
|
|
|
159.3
|
|
|
|||||
Capitalized interest amortized during the period
|
|
8.2
|
|
|
9.7
|
|
|
9.8
|
|
|
8.7
|
|
|
9.8
|
|
|
|||||
Undistributed earnings of equity investees
(2)
|
|
(60.1
|
)
|
|
(51.1
|
)
|
|
(101.8
|
)
|
|
(74.9
|
)
|
|
(57.1
|
)
|
|
|||||
Noncontrolling interest in pre-tax income of subsidiaries that have not incurred fixed charges
|
|
(3.1
|
)
|
|
(2.6
|
)
|
|
(3.0
|
)
|
|
(2.8
|
)
|
|
—
|
|
|
|||||
Earnings, as adjusted
|
|
$
|
1,495.5
|
|
|
$
|
1,640.3
|
|
|
$
|
1,289.4
|
|
|
$
|
1,021.9
|
|
|
$
|
1,287.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed Charges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest on indebtedness, including capital lease obligations
|
|
$
|
114.9
|
|
|
$
|
109.0
|
|
|
$
|
95.3
|
|
|
$
|
121.2
|
|
|
$
|
139.7
|
|
|
Capitalized interest
|
|
19.0
|
|
|
32.9
|
|
|
49.1
|
|
|
33.0
|
|
|
26.0
|
|
|
|||||
Amortization of debt discount/premium and expense
|
|
5.7
|
|
|
6.5
|
|
|
8.2
|
|
|
3.9
|
|
|
2.1
|
|
|
|||||
Portion of rents under operating leases representative of the interest factor
|
|
13.8
|
|
|
14.2
|
|
|
14.8
|
|
|
16.7
|
|
|
17.5
|
|
|
|||||
Fixed charges
(3)
|
|
$
|
153.4
|
|
|
$
|
162.6
|
|
|
$
|
167.4
|
|
|
$
|
174.8
|
|
|
$
|
185.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ratio of Earnings to Fixed Charges
(4)
|
|
9.7
|
|
|
10.1
|
|
|
7.7
|
|
|
5.8
|
|
|
6.9
|
|
|
(1)
|
Income from continuing operations includes income attributable to noncontrolling interests as well as business restructuring and cost reduction actions of
$151.4
(
$109.3
attributable to Air Products, after-tax) in
2017
, $34.5 ($24.7 after‑tax) in 2016, $180.1 ($132.9 after-tax) in 2015, and $98.3 ($70.6 after-tax) in 2013; 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 ($275.1 attributable to Air Products, after-tax) in 2014; and an equity method investment impairment charge of
$79.5
in
2017
.
|
(2)
|
Excludes the impact of an other-than-temporary impairment of an investment in an equity affiliate.
|
(3)
|
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.
|
(4)
|
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 (continued and discontinued operations) plus that portion of operating lease rentals representative of the interest factor (deemed to be 21% of operating lease rentals).
|
Signature
|
Title
|
Date
|
|
|
|
/s/ Susan K. Carter
|
Director
|
14 November 2017
|
Susan K. Carter
|
|
|
|
|
|
/s/ Charles I. Cogut
|
Director
|
14 November 2017
|
Charles I. Cogut
|
|
|
|
|
|
/s/ Chad C. Deaton
|
Director
|
14 November 2017
|
Chad C. Deaton
|
|
|
|
|
|
/s/ Seifi Ghasemi
|
Director and Chairman of the Board,
President and Chief Executive Officer
(Principal Executive Officer)
|
14 November 2017
|
Seifi Ghasemi
|
|
|
|
|
|
/s/ David H. Y. Ho
|
Director
|
14 November 2017
|
David H. Y. Ho
|
|
|
|
|
|
/s/ Margaret G. McGlynn
|
Director
|
14 November 2017
|
Margaret G. McGlynn
|
|
|
|
|
|
/s/ Edward L. Monser
|
Director
|
14 November 2017
|
Edward l. Monser
|
|
|
|
|
|
/s/ Matthew H. Paull
|
Director
|
14 November 2017
|
Matthew H. Paull
|
|
|
|
|
|
/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: 16 November 2017
|
|
/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
|