☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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23-1274455
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(State or Other Jurisdiction of Incorporation or Organization)
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(I.R.S. Employer Identification No.)
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7201 Hamilton Boulevard
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,
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Allentown
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,
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Pennsylvania
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18195-1501
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(Address of Principal Executive Offices)
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(Zip Code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, par value $1.00 per share
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APD
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New York Stock Exchange
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2.0% Euro Notes due 2020
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APD20
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New York Stock Exchange
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0.375% Euro Notes due 2021
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APD21B
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New York Stock Exchange
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1.0% Euro Notes due 2025
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APD25
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New York Stock Exchange
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Large accelerated
filer ☒
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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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•
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changes in global or regional economic conditions, supply and demand dynamics in the market segments we serve, or in the financial markets;
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•
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risks associated with having extensive international operations, including political risks, risks associated with unanticipated government actions and risks of investing in developing markets;
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•
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project delays, contract terminations, customer cancellations, or postponement of projects and sales;
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•
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the future financial and operating performance of major customers and joint venture partners;
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•
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our ability to develop, implement, and operate new technologies, or to execute the projects in our backlog;
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•
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tariffs, economic sanctions and regulatory activities in jurisdictions in which we and our affiliates and joint ventures operate;
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•
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the impact of environmental, tax or other legislation, as well as regulations affecting our business and related compliance requirements, including regulations related to global climate change;
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•
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changes in tax rates and other changes in tax law;
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•
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the timing, impact, and other uncertainties relating to acquisitions and divestitures, including our ability to integrate acquisitions and separate divested businesses, respectively;
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•
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risks relating to cybersecurity incidents, including risks from the interruption, failure or compromise of our information systems;
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•
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catastrophic events, such as natural disasters, acts of war, or terrorism;
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•
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the impact of price fluctuations in natural gas and disruptions in markets and the economy due to oil price volatility;
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•
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costs and outcomes of legal or regulatory proceedings and investigations;
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•
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asset impairments due to economic conditions or specific events;
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•
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significant fluctuations in interest rates and foreign currency exchange rates from those currently anticipated;
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•
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damage to facilities, pipelines or delivery systems, including those we own or operate for third parties;
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•
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availability and cost of raw materials; and
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•
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the success of productivity and operational improvement programs.
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Three Months Ended
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Nine Months Ended
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||||||||||
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30 June
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30 June
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||||||||||
(Millions of dollars, except for share and per share data)
|
2019
|
2018
|
2019
|
2018
|
||||||||
Sales
|
|
$2,224.0
|
|
|
$2,259.0
|
|
|
$6,635.7
|
|
|
$6,631.3
|
|
Cost of sales
|
1,466.0
|
|
1,545.4
|
|
4,484.7
|
|
4,623.7
|
|
||||
Facility closure
|
—
|
|
—
|
|
29.0
|
|
—
|
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||||
Selling and administrative
|
188.5
|
|
188.6
|
|
568.1
|
|
574.8
|
|
||||
Research and development
|
18.1
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|
15.0
|
|
50.0
|
|
44.1
|
|
||||
Cost reduction actions
|
25.5
|
|
—
|
|
25.5
|
|
—
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|
||||
Gain on exchange of equity affiliate investments
|
29.1
|
|
—
|
|
29.1
|
|
—
|
|
||||
Other income (expense), net
|
14.7
|
|
5.8
|
|
33.7
|
|
43.2
|
|
||||
Operating Income
|
569.7
|
|
515.8
|
|
1,541.2
|
|
1,431.9
|
|
||||
Equity affiliates' income
|
56.4
|
|
58.1
|
|
155.5
|
|
115.6
|
|
||||
Interest expense
|
34.2
|
|
34.9
|
|
106.9
|
|
95.1
|
|
||||
Other non-operating income (expense), net
|
17.6
|
|
12.8
|
|
49.8
|
|
33.7
|
|
||||
Income From Continuing Operations Before Taxes
|
609.5
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|
551.8
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|
1,639.6
|
|
1,486.1
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|
||||
Income tax provision
|
109.3
|
|
107.1
|
|
348.9
|
|
455.1
|
|
||||
Income From Continuing Operations
|
500.2
|
|
444.7
|
|
1,290.7
|
|
1,031.0
|
|
||||
Income From Discontinued Operations, net of tax
|
—
|
|
43.2
|
|
—
|
|
42.2
|
|
||||
Net Income
|
500.2
|
|
487.9
|
|
1,290.7
|
|
1,073.2
|
|
||||
Net Income Attributable to Noncontrolling Interests of Continuing Operations
|
12.2
|
|
14.0
|
|
33.9
|
|
28.3
|
|
||||
Net Income Attributable to Air Products
|
|
$488.0
|
|
|
$473.9
|
|
|
$1,256.8
|
|
|
$1,044.9
|
|
Net Income Attributable to Air Products
|
|
|
|
|
||||||||
Income from continuing operations
|
|
$488.0
|
|
|
$430.7
|
|
|
$1,256.8
|
|
|
$1,002.7
|
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Income from discontinued operations
|
—
|
|
43.2
|
|
—
|
|
42.2
|
|
||||
Net Income Attributable to Air Products
|
|
$488.0
|
|
|
$473.9
|
|
|
$1,256.8
|
|
|
$1,044.9
|
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Basic Earnings Per Common Share Attributable to Air Products
|
|
|
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|
||||||||
Income from continuing operations
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$2.21
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$1.96
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$5.71
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$4.57
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Income from discontinued operations
|
—
|
|
.20
|
|
—
|
|
.19
|
|
||||
Net Income Attributable to Air Products
|
|
$2.21
|
|
|
$2.16
|
|
|
$5.71
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|
|
$4.76
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Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
||||||||
Income from continuing operations
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$2.20
|
|
|
$1.95
|
|
|
$5.68
|
|
|
$4.54
|
|
Income from discontinued operations
|
—
|
|
.20
|
|
—
|
|
.19
|
|
||||
Net Income Attributable to Air Products
|
|
$2.20
|
|
|
$2.15
|
|
|
$5.68
|
|
|
$4.73
|
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Weighted Average Common Shares – Basic (in millions)
|
220.6
|
|
219.5
|
|
220.2
|
|
219.3
|
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||||
Weighted Average Common Shares – Diluted (in millions)
|
221.9
|
|
220.9
|
|
221.4
|
|
220.7
|
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Three Months Ended
|
||||||
|
|
30 June
|
||||||
(Millions of dollars)
|
|
2019
|
|
2018
|
||||
Net Income
|
|
|
$500.2
|
|
|
|
$487.9
|
|
Other Comprehensive Loss, net of tax:
|
|
|
|
|
||||
Translation adjustments, net of tax of ($3.3) and $5.2
|
|
(48.8
|
)
|
|
(392.4
|
)
|
||
Net gain on derivatives, net of tax of $4.5 and $8.8
|
|
7.5
|
|
|
27.1
|
|
||
Reclassification adjustments:
|
|
|
|
|
||||
Currency translation adjustment
|
|
(2.6
|
)
|
|
—
|
|
||
Derivatives, net of tax of ($3.5) and ($5.5)
|
|
(13.1
|
)
|
|
(17.7
|
)
|
||
Pension and postretirement benefits, net of tax of $4.8 and $7.8
|
|
14.8
|
|
|
26.0
|
|
||
Total Other Comprehensive Loss
|
|
(42.2
|
)
|
|
(357.0
|
)
|
||
Comprehensive Income
|
|
458.0
|
|
|
130.9
|
|
||
Net Income Attributable to Noncontrolling Interests
|
|
12.2
|
|
|
14.0
|
|
||
Other Comprehensive Loss Attributable to Noncontrolling Interests
|
|
(5.6
|
)
|
|
(14.5
|
)
|
||
Comprehensive Income Attributable to Air Products
|
|
|
$451.4
|
|
|
|
$131.4
|
|
|
|
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|
||||
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Nine Months Ended
|
||||||
|
|
30 June
|
||||||
(Millions of dollars)
|
|
2019
|
|
2018
|
||||
Net Income
|
|
|
$1,290.7
|
|
|
|
$1,073.2
|
|
Other Comprehensive Loss, net of tax:
|
|
|
|
|
||||
Translation adjustments, net of tax of $9.6 and ($14.6)
|
|
(65.6
|
)
|
|
(130.4
|
)
|
||
Net gain (loss) on derivatives, net of tax of ($4.9) and $7.5
|
|
(38.2
|
)
|
|
35.4
|
|
||
Pension and postretirement benefits, net of tax of ($0.8) and $–
|
|
(3.9
|
)
|
|
—
|
|
||
Reclassification adjustments:
|
|
|
|
|
||||
Currency translation adjustment
|
|
(2.6
|
)
|
|
3.1
|
|
||
Derivatives, net of tax of $7.2 and ($7.1)
|
|
20.7
|
|
|
(24.4
|
)
|
||
Pension and postretirement benefits, net of tax of $15.8 and $26.7
|
|
48.7
|
|
|
75.5
|
|
||
Total Other Comprehensive Loss
|
|
(40.9
|
)
|
|
(40.8
|
)
|
||
Comprehensive Income
|
|
1,249.8
|
|
|
1,032.4
|
|
||
Net Income Attributable to Noncontrolling Interests
|
|
33.9
|
|
|
28.3
|
|
||
Other Comprehensive Loss Attributable to Noncontrolling Interests
|
|
(1.4
|
)
|
|
(10.4
|
)
|
||
Comprehensive Income Attributable to Air Products
|
|
|
$1,217.3
|
|
|
|
$1,014.5
|
|
|
|
30 June
|
|
30 September
|
||||
(Millions of dollars, except for share and per share data)
|
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
|
||||
Current Assets
|
|
|
|
|
||||
Cash and cash items
|
|
|
$2,696.8
|
|
|
|
$2,791.3
|
|
Short-term investments
|
|
—
|
|
|
184.7
|
|
||
Trade receivables, net
|
|
1,340.7
|
|
|
1,207.2
|
|
||
Inventories
|
|
408.3
|
|
|
396.1
|
|
||
Prepaid expenses
|
|
97.2
|
|
|
129.6
|
|
||
Other receivables and current assets
|
|
372.2
|
|
|
373.3
|
|
||
Total Current Assets
|
|
4,915.2
|
|
|
5,082.2
|
|
||
Investment in net assets of and advances to equity affiliates
|
|
1,290.4
|
|
|
1,277.2
|
|
||
Plant and equipment, at cost
|
|
22,425.6
|
|
|
21,490.2
|
|
||
Less: accumulated depreciation
|
|
11,998.0
|
|
|
11,566.5
|
|
||
Plant and equipment, net
|
|
10,427.6
|
|
|
9,923.7
|
|
||
Goodwill, net
|
|
820.4
|
|
|
788.9
|
|
||
Intangible assets, net
|
|
441.1
|
|
|
438.5
|
|
||
Noncurrent capital lease receivables
|
|
938.4
|
|
|
1,013.3
|
|
||
Other noncurrent assets
|
|
698.8
|
|
|
654.5
|
|
||
Total Noncurrent Assets
|
|
14,616.7
|
|
|
14,096.1
|
|
||
Total Assets
|
|
|
$19,531.9
|
|
|
|
$19,178.3
|
|
Liabilities and Equity
|
|
|
|
|
||||
Current Liabilities
|
|
|
|
|
||||
Payables and accrued liabilities
|
|
|
$1,543.2
|
|
|
|
$1,817.8
|
|
Accrued income taxes
|
|
65.6
|
|
|
59.6
|
|
||
Short-term borrowings
|
|
79.9
|
|
|
54.3
|
|
||
Current portion of long-term debt
|
|
466.5
|
|
|
406.6
|
|
||
Total Current Liabilities
|
|
2,155.2
|
|
|
2,338.3
|
|
||
Long-term debt
|
|
2,951.7
|
|
|
2,967.4
|
|
||
Long-term debt – related party
|
|
321.6
|
|
|
384.3
|
|
||
Other noncurrent liabilities
|
|
1,553.6
|
|
|
1,536.9
|
|
||
Deferred income taxes
|
|
823.2
|
|
|
775.1
|
|
||
Total Noncurrent Liabilities
|
|
5,650.1
|
|
|
5,663.7
|
|
||
Total Liabilities
|
|
7,805.3
|
|
|
8,002.0
|
|
||
Commitments and Contingencies - See Note 12
|
|
|
|
|
||||
Air Products Shareholders’ Equity
|
|
|
|
|
||||
Common stock (par value $1 per share; issued 2019 and 2018 - 249,455,584 shares)
|
|
249.4
|
|
|
249.4
|
|
||
Capital in excess of par value
|
|
1,059.9
|
|
|
1,029.3
|
|
||
Retained earnings
|
|
13,891.9
|
|
|
13,409.9
|
|
||
Accumulated other comprehensive loss
|
|
(1,781.4
|
)
|
|
(1,741.9
|
)
|
||
Treasury stock, at cost (2019 - 29,100,445 shares; 2018 - 29,940,339 shares)
|
|
(2,033.7
|
)
|
|
(2,089.2
|
)
|
||
Total Air Products Shareholders’ Equity
|
|
11,386.1
|
|
|
10,857.5
|
|
||
Noncontrolling Interests
|
|
340.5
|
|
|
318.8
|
|
||
Total Equity
|
|
11,726.6
|
|
|
11,176.3
|
|
||
Total Liabilities and Equity
|
|
|
$19,531.9
|
|
|
|
$19,178.3
|
|
|
Nine Months Ended
|
|||||
|
30 June
|
|||||
(Millions of dollars)
|
2019
|
2018
|
||||
Operating Activities
|
|
|
||||
Net income
|
|
$1,290.7
|
|
|
$1,073.2
|
|
Less: Net income attributable to noncontrolling interests of continuing operations
|
33.9
|
|
28.3
|
|
||
Net income attributable to Air Products
|
1,256.8
|
|
1,044.9
|
|
||
Income from discontinued operations
|
—
|
|
(42.2
|
)
|
||
Income from continuing operations attributable to Air Products
|
1,256.8
|
|
1,002.7
|
|
||
Adjustments to reconcile income to cash provided by operating activities:
|
|
|
||||
Depreciation and amortization
|
789.2
|
|
713.5
|
|
||
Deferred income taxes
|
37.8
|
|
(86.9
|
)
|
||
Tax reform repatriation
|
49.4
|
|
310.3
|
|
||
Facility closure
|
29.0
|
|
—
|
|
||
Undistributed earnings of unconsolidated affiliates
|
(56.9
|
)
|
(34.8
|
)
|
||
Gain on sale of assets and investments
|
(17.5
|
)
|
(5.2
|
)
|
||
Share-based compensation
|
31.0
|
|
30.4
|
|
||
Noncurrent capital lease receivables
|
71.7
|
|
73.7
|
|
||
Other adjustments
|
(.7
|
)
|
(23.2
|
)
|
||
Working capital changes that provided (used) cash, excluding effects of acquisitions:
|
|
|
||||
Trade receivables
|
(139.5
|
)
|
(50.5
|
)
|
||
Inventories
|
(13.5
|
)
|
16.0
|
|
||
Other receivables
|
70.6
|
|
85.5
|
|
||
Payables and accrued liabilities
|
(94.8
|
)
|
(164.9
|
)
|
||
Other working capital
|
(9.2
|
)
|
(10.4
|
)
|
||
Cash Provided by Operating Activities
|
2,003.4
|
|
1,856.2
|
|
||
Investing Activities
|
|
|
||||
Additions to plant and equipment
|
(1,507.6
|
)
|
(1,158.1
|
)
|
||
Acquisitions, less cash acquired
|
(107.0
|
)
|
(320.2
|
)
|
||
Investment in and advances to unconsolidated affiliates
|
(15.7
|
)
|
—
|
|
||
Proceeds from sale of assets and investments
|
8.8
|
|
45.8
|
|
||
Purchases of investments
|
(5.3
|
)
|
(349.8
|
)
|
||
Proceeds from investments
|
190.5
|
|
745.2
|
|
||
Other investing activities
|
.8
|
|
5.3
|
|
||
Cash Used for Investing Activities
|
(1,435.5
|
)
|
(1,031.8
|
)
|
||
Financing Activities
|
|
|
||||
Long-term debt proceeds
|
—
|
|
.5
|
|
||
Payments on long-term debt
|
(5.4
|
)
|
(418.2
|
)
|
||
Net increase (decrease) in commercial paper and short-term borrowings
|
37.7
|
|
(46.1
|
)
|
||
Dividends paid to shareholders
|
(738.4
|
)
|
(656.6
|
)
|
||
Proceeds from stock option exercises
|
63.3
|
|
58.2
|
|
||
Other financing activities
|
(18.0
|
)
|
(35.6
|
)
|
||
Cash Used for Financing Activities
|
(660.8
|
)
|
(1,097.8
|
)
|
||
Discontinued Operations
|
|
|
||||
Cash used for operating activities
|
—
|
|
(12.8
|
)
|
||
Cash provided by investing activities
|
—
|
|
18.6
|
|
||
Cash provided by financing activities
|
—
|
|
—
|
|
||
Cash Provided by Discontinued Operations
|
—
|
|
5.8
|
|
||
Effect of Exchange Rate Changes on Cash
|
(1.6
|
)
|
(19.5
|
)
|
||
Decrease in cash and cash items
|
(94.5
|
)
|
(287.1
|
)
|
||
Cash and Cash items – Beginning of Year
|
2,791.3
|
|
3,273.6
|
|
||
Cash and Cash Items – End of Period
|
|
$2,696.8
|
|
|
$2,986.5
|
|
|
Nine Months Ended
|
|||||||||||||||||||||||
|
30 June 2019
|
|||||||||||||||||||||||
(Millions of dollars, except for per share data)
|
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 at 30 September 2018
|
|
$249.4
|
|
|
$1,029.3
|
|
|
$13,409.9
|
|
|
($1,741.9
|
)
|
|
($2,089.2
|
)
|
|
$10,857.5
|
|
|
$318.8
|
|
|
$11,176.3
|
|
Net income
|
—
|
|
—
|
|
1,256.8
|
|
—
|
|
—
|
|
1,256.8
|
|
33.9
|
|
1,290.7
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
—
|
|
—
|
|
(39.5
|
)
|
—
|
|
(39.5
|
)
|
(1.4
|
)
|
(40.9
|
)
|
||||||||
Dividends on common stock (per share $3.42)
|
—
|
|
—
|
|
(752.6
|
)
|
—
|
|
—
|
|
(752.6
|
)
|
—
|
|
(752.6
|
)
|
||||||||
Dividends to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(10.0
|
)
|
(10.0
|
)
|
||||||||
Share-based compensation
|
—
|
|
30.5
|
|
—
|
|
—
|
|
—
|
|
30.5
|
|
—
|
|
30.5
|
|
||||||||
Issuance of treasury shares for stock option and award plans
|
—
|
|
1.5
|
|
—
|
|
—
|
|
55.5
|
|
57.0
|
|
—
|
|
57.0
|
|
||||||||
Cumulative change in accounting principle
|
—
|
|
—
|
|
(17.1
|
)
|
—
|
|
—
|
|
(17.1
|
)
|
—
|
|
(17.1
|
)
|
||||||||
Other equity transactions
|
—
|
|
(1.4
|
)
|
(5.1
|
)
|
—
|
|
—
|
|
(6.5
|
)
|
(.8
|
)
|
(7.3
|
)
|
||||||||
Balance at 30 June 2019
|
|
$249.4
|
|
|
$1,059.9
|
|
|
$13,891.9
|
|
|
($1,781.4
|
)
|
|
($2,033.7
|
)
|
|
$11,386.1
|
|
|
$340.5
|
|
|
$11,726.6
|
|
|
Nine Months Ended
|
|||||||||||||||||||||||
|
30 June 2018
|
|||||||||||||||||||||||
(Millions of dollars, except for per share data)
|
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 at 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
|
|
Net income attributable to Air Products
|
—
|
|
—
|
|
1,044.9
|
|
—
|
|
—
|
|
1,044.9
|
|
28.3
|
|
1,073.2
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
—
|
|
—
|
|
(30.4
|
)
|
—
|
|
(30.4
|
)
|
(10.4
|
)
|
(40.8
|
)
|
||||||||
Dividends on common stock (per share $3.15)
|
—
|
|
—
|
|
(690.3
|
)
|
—
|
|
—
|
|
(690.3
|
)
|
—
|
|
(690.3
|
)
|
||||||||
Dividends to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(26.0
|
)
|
(26.0
|
)
|
||||||||
Share-based compensation
|
—
|
|
29.7
|
|
—
|
|
—
|
|
—
|
|
29.7
|
|
—
|
|
29.7
|
|
||||||||
Issuance of treasury shares for stock option and award plans
|
—
|
|
(12.3
|
)
|
—
|
|
—
|
|
57.8
|
|
45.5
|
|
—
|
|
45.5
|
|
||||||||
Lu'An joint venture
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
227.4
|
|
227.4
|
|
||||||||
Other equity transactions
|
—
|
|
1.3
|
|
(.9
|
)
|
—
|
|
—
|
|
.4
|
|
5.4
|
|
5.8
|
|
||||||||
Balance at 30 June 2018
|
|
$249.4
|
|
|
$1,019.8
|
|
|
$13,200.3
|
|
|
($1,877.8
|
)
|
|
($2,105.7
|
)
|
|
$10,486.0
|
|
|
$324.0
|
|
|
$10,810.0
|
|
|
Three Months Ended
|
|||||||||||||||||||||||
|
30 June 2019
|
|||||||||||||||||||||||
(Millions of dollars, except for per share data)
|
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 at 31 March 2019
|
|
$249.4
|
|
|
$1,047.7
|
|
|
$13,662.0
|
|
|
($1,744.8
|
)
|
|
($2,048.6
|
)
|
|
$11,165.7
|
|
|
$337.7
|
|
|
$11,503.4
|
|
Net income
|
—
|
|
—
|
|
488.0
|
|
—
|
|
—
|
|
488.0
|
|
12.2
|
|
500.2
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
—
|
|
—
|
|
(36.6
|
)
|
—
|
|
(36.6
|
)
|
(5.6
|
)
|
(42.2
|
)
|
||||||||
Dividends on common stock (per share $1.16)
|
—
|
|
—
|
|
(255.1
|
)
|
—
|
|
—
|
|
(255.1
|
)
|
—
|
|
(255.1
|
)
|
||||||||
Dividends to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(3.0
|
)
|
(3.0
|
)
|
||||||||
Share-based compensation
|
—
|
|
9.8
|
|
—
|
|
—
|
|
—
|
|
9.8
|
|
—
|
|
9.8
|
|
||||||||
Issuance of treasury shares for stock option and award plans
|
—
|
|
2.4
|
|
—
|
|
—
|
|
14.9
|
|
17.3
|
|
—
|
|
17.3
|
|
||||||||
Other equity transactions
|
—
|
|
—
|
|
(3.0
|
)
|
—
|
|
—
|
|
(3.0
|
)
|
(.8
|
)
|
(3.8
|
)
|
||||||||
Balance at 30 June 2019
|
|
$249.4
|
|
|
$1,059.9
|
|
|
$13,891.9
|
|
|
($1,781.4
|
)
|
|
($2,033.7
|
)
|
|
$11,386.1
|
|
|
$340.5
|
|
|
$11,726.6
|
|
|
Three Months Ended
|
|||||||||||||||||||||||
|
30 June 2018
|
|||||||||||||||||||||||
(Millions of dollars, except for per share data)
|
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 at 31 March 2018
|
|
$249.4
|
|
|
$1,011.2
|
|
|
$12,966.6
|
|
|
($1,535.3
|
)
|
|
($2,111.1
|
)
|
|
$10,580.8
|
|
|
$112.4
|
|
|
$10,693.2
|
|
Net income
|
—
|
|
—
|
|
473.9
|
|
—
|
|
—
|
|
473.9
|
|
14.0
|
|
487.9
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
—
|
|
—
|
|
(342.5
|
)
|
—
|
|
(342.5
|
)
|
(14.5
|
)
|
(357.0
|
)
|
||||||||
Dividends on common stock (per share $1.10)
|
—
|
|
—
|
|
(241.2
|
)
|
—
|
|
—
|
|
(241.2
|
)
|
—
|
|
(241.2
|
)
|
||||||||
Dividends to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(15.4
|
)
|
(15.4
|
)
|
||||||||
Share-based compensation
|
—
|
|
7.9
|
|
—
|
|
—
|
|
—
|
|
7.9
|
|
—
|
|
7.9
|
|
||||||||
Issuance of treasury shares for stock option and award plans
|
—
|
|
—
|
|
—
|
|
—
|
|
5.4
|
|
5.4
|
|
—
|
|
5.4
|
|
||||||||
Lu'An joint venture
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
227.4
|
|
227.4
|
|
||||||||
Other equity transactions
|
—
|
|
.7
|
|
1.0
|
|
—
|
|
—
|
|
1.7
|
|
.1
|
|
1.8
|
|
||||||||
Balance at 30 June 2018
|
|
$249.4
|
|
|
$1,019.8
|
|
|
$13,200.3
|
|
|
($1,877.8
|
)
|
|
($2,105.7
|
)
|
|
$10,486.0
|
|
|
$324.0
|
|
|
$10,810.0
|
|
|
Industrial
Gases– Americas |
Industrial
Gases– EMEA |
Industrial
Gases– Asia |
Industrial
Gases– Global |
Corporate
and other |
Total
|
%
|
|||||||||||||
Three Months Ended 30 June 2019
|
|
|
|
|
|
|
|
|||||||||||||
On-site
|
|
$537.1
|
|
|
$165.0
|
|
|
$402.9
|
|
|
$—
|
|
|
$—
|
|
|
$1,105.0
|
|
50
|
%
|
Merchant
|
418.2
|
|
329.6
|
|
276.5
|
|
—
|
|
—
|
|
1,024.3
|
|
46
|
%
|
||||||
Sale of Equipment
|
—
|
|
—
|
|
—
|
|
57.9
|
|
36.8
|
|
94.7
|
|
4
|
%
|
||||||
Total
|
|
$955.3
|
|
|
$494.6
|
|
|
$679.4
|
|
|
$57.9
|
|
|
$36.8
|
|
|
$2,224.0
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Industrial
Gases– Americas |
Industrial
Gases– EMEA |
Industrial
Gases– Asia |
Industrial
Gases– Global |
Corporate
and other |
Total
|
%
|
|||||||||||||
Nine Months Ended 30 June 2019
|
|
|
|
|
|
|
|
|||||||||||||
On-site
|
|
$1,714.0
|
|
|
$565.8
|
|
|
$1,169.9
|
|
|
$—
|
|
|
$—
|
|
|
$3,449.7
|
|
52
|
%
|
Merchant
|
1,222.2
|
|
947.4
|
|
761.7
|
|
—
|
|
—
|
|
2,931.3
|
|
44
|
%
|
||||||
Sale of Equipment
|
—
|
|
—
|
|
—
|
|
179.9
|
|
74.8
|
|
254.7
|
|
4
|
%
|
||||||
Total
|
|
$2,936.2
|
|
|
$1,513.2
|
|
|
$1,931.6
|
|
|
$179.9
|
|
|
$74.8
|
|
|
$6,635.7
|
|
100
|
%
|
|
30 September 2018
|
|
New Revenue Standard Adjustments
|
|
1 October 2018
|
|
|||
Assets
|
|
|
|
||||||
Current Assets
|
|
|
|
||||||
Cash and cash items
|
|
$2,791.3
|
|
|
$—
|
|
|
$2,791.3
|
|
Short-term investments
|
184.7
|
|
—
|
|
184.7
|
|
|||
Trade receivables, net
|
1,207.2
|
|
—
|
|
1,207.2
|
|
|||
Inventories
|
396.1
|
|
—
|
|
396.1
|
|
|||
Contracts in progress, less progress billings
|
77.5
|
|
(77.5
|
)
|
—
|
|
|||
Prepaid expenses
|
129.6
|
|
—
|
|
129.6
|
|
|||
Other receivables and current assets
|
295.8
|
|
103.7
|
|
399.5
|
|
|||
Total Current Assets
|
5,082.2
|
|
26.2
|
|
5,108.4
|
|
|||
Total Noncurrent Assets
|
14,096.1
|
|
—
|
|
14,096.1
|
|
|||
Total Assets
|
|
$19,178.3
|
|
|
$26.2
|
|
|
$19,204.5
|
|
Liabilities and Equity
|
|
|
|
||||||
Current Liabilities
|
|
|
|
||||||
Payables and accrued liabilities
|
|
$1,817.8
|
|
|
$26.2
|
|
|
$1,844.0
|
|
Accrued income taxes
|
59.6
|
|
—
|
|
59.6
|
|
|||
Short-term borrowings
|
54.3
|
|
—
|
|
54.3
|
|
|||
Current portion of long-term debt
|
406.6
|
|
—
|
|
406.6
|
|
|||
Total Current Liabilities
|
2,338.3
|
|
26.2
|
|
2,364.5
|
|
|||
Total Noncurrent Liabilities
|
5,663.7
|
|
—
|
|
5,663.7
|
|
|||
Total Liabilities
|
8,002.0
|
|
26.2
|
|
8,028.2
|
|
|||
Total Equity
|
11,176.3
|
|
—
|
|
11,176.3
|
|
|||
Total Liabilities and Equity
|
|
$19,178.3
|
|
|
$26.2
|
|
|
$19,204.5
|
|
|
30 June 2019
|
1 October 2018
|
||||
Assets
|
|
|
||||
Contract assets – current
|
|
$43.0
|
|
|
$53.0
|
|
Contract fulfillment costs – current
|
66.4
|
|
50.7
|
|
||
Liabilities
|
|
|
||||
Contract liabilities – current
|
181.1
|
|
174.5
|
|
||
Contract liabilities – noncurrent
|
52.8
|
|
53.5
|
|
|
|
||
2019 Charge
|
|
$25.5
|
|
Cash expenditures
|
(4.7
|
)
|
|
Amount reflected in pension liability
|
(.3
|
)
|
|
Currency translation adjustment
|
.1
|
|
|
30 June 2019
|
|
$20.6
|
|
|
|
30 June
|
|
30 September
|
||||
|
|
2019
|
|
2018
|
||||
Finished goods
|
|
|
$135.1
|
|
|
|
$125.4
|
|
Work in process
|
|
29.9
|
|
|
21.2
|
|
||
Raw materials, supplies and other
|
|
243.3
|
|
|
249.5
|
|
||
Inventories
|
|
|
$408.3
|
|
|
|
$396.1
|
|
|
|
Industrial
Gases–
Americas
|
|
Industrial
Gases–
EMEA
|
|
Industrial
Gases–
Asia
|
|
Industrial
Gases–
Global
|
|
Corporate and other
|
|
Total
|
||||||||||||
Goodwill, net at 30 September 2018
|
|
|
$162.1
|
|
|
|
$424.4
|
|
|
|
$171.9
|
|
|
|
$20.1
|
|
|
|
$10.4
|
|
|
|
$788.9
|
|
Acquisitions
|
|
—
|
|
|
38.0
|
|
|
4.2
|
|
|
—
|
|
|
—
|
|
|
42.2
|
|
||||||
Currency translation and other
|
|
(1.9
|
)
|
|
(7.5
|
)
|
|
(1.1
|
)
|
|
(.2
|
)
|
|
—
|
|
|
(10.7
|
)
|
||||||
Goodwill, net at 30 June 2019
|
|
|
$160.2
|
|
|
|
$454.9
|
|
|
|
$175.0
|
|
|
|
$19.9
|
|
|
|
$10.4
|
|
|
|
$820.4
|
|
|
|
30 June
|
|
30 September
|
||||
|
|
2019
|
|
2018
|
||||
Goodwill, gross
|
|
|
$1,212.9
|
|
|
|
$1,194.7
|
|
Accumulated impairment losses(A)
|
|
(392.5
|
)
|
|
(405.8
|
)
|
||
Goodwill, net
|
|
|
$820.4
|
|
|
|
$788.9
|
|
(A)
|
Accumulated impairment losses are attributable to our Latin America reporting unit (LASA) within the Industrial Gases – Americas segment and include the impacts of currency translation.
|
|
|
30 June 2019
|
|
30 September 2018
|
||||||||
|
|
US$
Notional
|
|
Years
Average
Maturity
|
|
US$
Notional
|
|
Years
Average
Maturity
|
||||
Forward Exchange Contracts:
|
|
|
|
|
|
|
|
|
||||
Cash flow hedges
|
|
|
$2,656.2
|
|
|
0.4
|
|
|
$2,489.1
|
|
|
0.4
|
Net investment hedges
|
|
553.0
|
|
|
1.0
|
|
457.5
|
|
|
1.7
|
||
Not designated
|
|
921.7
|
|
|
0.9
|
|
1,736.1
|
|
|
0.8
|
||
Total Forward Exchange Contracts
|
|
|
$4,130.9
|
|
|
0.6
|
|
|
$4,682.7
|
|
|
0.7
|
|
|
30 June 2019
|
|
30 September 2018
|
||||||||||||||||||||
|
|
US$
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
|
|
|
2.60
|
%
|
|
0.9
|
|
|
$600.0
|
|
|
LIBOR
|
|
|
2.60
|
%
|
|
1.6
|
Cross currency interest rate swaps
(net investment hedge)
|
|
|
$246.6
|
|
|
4.55
|
%
|
|
3.09
|
%
|
|
2.9
|
|
|
$201.7
|
|
|
4.42
|
%
|
|
2.97
|
%
|
|
3.1
|
Cross currency interest rate swaps
(cash flow hedge)
|
|
|
$1,063.5
|
|
|
4.85
|
%
|
|
2.94
|
%
|
|
2.2
|
|
|
$1,052.7
|
|
|
4.99
|
%
|
|
2.89
|
%
|
|
2.3
|
Cross currency interest rate swaps
(not designated)
|
|
|
$29.6
|
|
|
4.17
|
%
|
|
3.61
|
%
|
|
4.6
|
|
|
$80.2
|
|
|
4.88
|
%
|
|
3.43
|
%
|
|
3.9
|
|
Balance Sheet
Location
|
30 June 2019
|
30 September 2018
|
Balance Sheet
Location
|
30 June 2019
|
30 September 2018
|
||||||||
Derivatives Designated as Hedging Instruments:
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
Other receivables
|
|
$28.3
|
|
|
$24.9
|
|
Accrued liabilities
|
|
$32.3
|
|
|
$37.0
|
|
Interest rate management contracts
|
Other receivables
|
14.0
|
|
24.3
|
|
Accrued liabilities
|
.6
|
|
2.3
|
|
||||
Forward exchange contracts
|
Other noncurrent
assets
|
27.9
|
|
19.8
|
|
Other noncurrent
liabilities
|
.8
|
|
4.6
|
|
||||
Interest rate management contracts
|
Other noncurrent
assets
|
36.1
|
|
48.7
|
|
Other noncurrent
liabilities
|
7.3
|
|
11.6
|
|
||||
Total Derivatives Designated as Hedging Instruments
|
|
|
$106.3
|
|
|
$117.7
|
|
|
|
$41.0
|
|
|
$55.5
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
Other receivables
|
|
$7.9
|
|
|
$7.9
|
|
Accrued liabilities
|
|
$13.4
|
|
|
$14.9
|
|
Interest rate management contracts
|
Other receivables
|
—
|
|
4.0
|
|
Accrued liabilities
|
—
|
|
—
|
|
||||
Forward exchange contracts
|
Other noncurrent
assets
|
22.8
|
|
16.2
|
|
Other noncurrent
liabilities
|
26.1
|
|
23.7
|
|
||||
Interest rate management contracts
|
Other noncurrent
assets
|
.7
|
|
.3
|
|
Other noncurrent
liabilities
|
—
|
|
—
|
|
||||
Total Derivatives Not Designated as Hedging Instruments
|
|
|
$31.4
|
|
|
$28.4
|
|
|
|
$39.5
|
|
|
$38.6
|
|
Total Derivatives
|
|
|
$137.7
|
|
|
$146.1
|
|
|
|
$80.5
|
|
|
$94.1
|
|
|
Three Months Ended 30 June
|
|||||||||||||||||||||||
|
Forward
Exchange Contracts
|
Foreign Currency
Debt
|
Other (A)
|
Total
|
||||||||||||||||||||
|
2019
|
2018
|
2019
|
2018
|
2019
|
2018
|
2019
|
2018
|
||||||||||||||||
Cash Flow Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI (effective portion)
|
|
$1.7
|
|
|
($34.4
|
)
|
|
$—
|
|
|
$—
|
|
|
$5.8
|
|
|
$61.5
|
|
|
$7.5
|
|
|
$27.1
|
|
Net (gain) loss reclassified from OCI to sales/cost of sales (effective portion)
|
—
|
|
1.9
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1.9
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (effective portion)
|
(6.9
|
)
|
33.7
|
|
—
|
|
—
|
|
(9.7
|
)
|
(55.6
|
)
|
(16.6
|
)
|
(21.9
|
)
|
||||||||
Net (gain) loss reclassified from OCI to interest expense (effective portion)
|
3.1
|
|
.8
|
|
—
|
|
—
|
|
.7
|
|
2.0
|
|
3.8
|
|
2.8
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (ineffective portion)
|
(.2
|
)
|
—
|
|
—
|
|
—
|
|
(.1
|
)
|
(.5
|
)
|
(.3
|
)
|
(.5
|
)
|
||||||||
Fair Value Hedges:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in interest expense(B)
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$2.0
|
|
|
($2.1
|
)
|
|
$2.0
|
|
|
($2.1
|
)
|
Net Investment Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI
|
|
($2.1
|
)
|
|
$16.2
|
|
|
($11.3
|
)
|
|
$44.2
|
|
|
$3.4
|
|
|
$36.9
|
|
|
($10.0
|
)
|
|
$97.3
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in other income (expense), net(C)
|
|
($.8
|
)
|
|
($.3
|
)
|
|
$—
|
|
|
$—
|
|
|
$.7
|
|
|
$2.2
|
|
|
($.1
|
)
|
|
$1.9
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Nine Months Ended 30 June
|
|||||||||||||||||||||||
|
Forward
Exchange Contracts
|
Foreign Currency
Debt
|
Other (A)
|
Total
|
||||||||||||||||||||
|
2019
|
2018
|
2019
|
2018
|
2019
|
2018
|
2019
|
2018
|
||||||||||||||||
Cash Flow Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI (effective portion)
|
|
($14.1
|
)
|
|
$5.0
|
|
|
$—
|
|
|
$—
|
|
|
($24.1
|
)
|
|
$30.4
|
|
|
($38.2
|
)
|
|
$35.4
|
|
Net (gain) loss reclassified from OCI to sales/cost of sales (effective portion)
|
.4
|
|
6.9
|
|
—
|
|
—
|
|
—
|
|
—
|
|
.4
|
|
6.9
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (effective portion)
|
2.6
|
|
(13.2
|
)
|
—
|
|
—
|
|
6.5
|
|
(23.4
|
)
|
9.1
|
|
(36.6
|
)
|
||||||||
Net (gain) loss reclassified from OCI to interest expense (effective portion)
|
9.4
|
|
3.0
|
|
—
|
|
—
|
|
2.0
|
|
3.3
|
|
11.4
|
|
6.3
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (ineffective portion)
|
(.1
|
)
|
(.5
|
)
|
—
|
|
—
|
|
(.1
|
)
|
(.5
|
)
|
(.2
|
)
|
(1.0
|
)
|
||||||||
Fair Value Hedges:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in interest expense(B)
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$4.6
|
|
|
($8.9
|
)
|
|
$4.6
|
|
|
($8.9
|
)
|
Net Investment Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI
|
|
$15.9
|
|
|
($6.5
|
)
|
|
$15.5
|
|
|
$4.7
|
|
|
$1.3
|
|
|
$2.4
|
|
|
$32.7
|
|
|
$.6
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in other income (expense), net(C)
|
|
($3.1
|
)
|
|
($.2
|
)
|
|
$—
|
|
|
$—
|
|
|
$.2
|
|
|
($1.3
|
)
|
|
($2.9
|
)
|
|
($1.5
|
)
|
(A)
|
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 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 was largely offset by recognized gains and losses resulting from the impact of changes in exchange rates on assets and liabilities denominated in non-functional currencies.
|
Level 1
|
— Quoted prices (unadjusted) in active markets for identical assets or liabilities.
|
Level 2
|
— Inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the asset or liability.
|
Level 3
|
— Inputs that are unobservable for the asset or liability based on our own assumptions about the assumptions market participants would use in pricing the asset or liability.
|
|
|
30 June 2019
|
|
30 September 2018
|
||||||||||||
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
|
$86.9
|
|
|
|
$86.9
|
|
|
|
$68.8
|
|
|
|
$68.8
|
|
Interest rate management contracts
|
|
50.8
|
|
|
50.8
|
|
|
77.3
|
|
|
77.3
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
|
$72.6
|
|
|
|
$72.6
|
|
|
|
$80.2
|
|
|
|
$80.2
|
|
Interest rate management contracts
|
|
7.9
|
|
|
7.9
|
|
|
13.9
|
|
|
13.9
|
|
||||
Long-term debt, including current portion and related party
|
|
3,739.8
|
|
|
3,816.9
|
|
|
3,758.3
|
|
|
3,788.2
|
|
|
30 June 2019
|
|
30 September 2018
|
||||||||||||||||||||||
|
Total
|
Level 1
|
Level 2
|
Level 3
|
|
Total
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||||||
Assets at Fair Value
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Forward exchange contracts
|
|
$86.9
|
|
|
$—
|
|
|
$86.9
|
|
|
$—
|
|
|
|
$68.8
|
|
|
$—
|
|
|
$68.8
|
|
|
$—
|
|
Interest rate management contracts
|
50.8
|
|
—
|
|
50.8
|
|
—
|
|
|
77.3
|
|
—
|
|
77.3
|
|
—
|
|
||||||||
Total Assets at Fair Value
|
|
$137.7
|
|
|
$—
|
|
|
$137.7
|
|
|
$—
|
|
|
|
$146.1
|
|
|
$—
|
|
|
$146.1
|
|
|
$—
|
|
Liabilities at Fair Value
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Forward exchange contracts
|
|
$72.6
|
|
|
$—
|
|
|
$72.6
|
|
|
$—
|
|
|
|
$80.2
|
|
|
$—
|
|
|
$80.2
|
|
|
$—
|
|
Interest rate management contracts
|
7.9
|
|
—
|
|
7.9
|
|
—
|
|
|
13.9
|
|
—
|
|
13.9
|
|
—
|
|
||||||||
Total Liabilities at Fair Value
|
|
$80.5
|
|
|
$—
|
|
|
$80.5
|
|
|
$—
|
|
|
|
$94.1
|
|
|
$—
|
|
|
$94.1
|
|
|
$—
|
|
|
Pension Benefits
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
Three Months Ended 30 June
|
U.S.
|
|
International
|
|
U.S.
|
|
International
|
||||||||
Service cost
|
|
$5.4
|
|
|
|
$4.8
|
|
|
|
$6.4
|
|
|
|
$6.5
|
|
Interest cost
|
28.2
|
|
|
9.0
|
|
|
26.8
|
|
|
9.4
|
|
||||
Expected return on plan assets
|
(43.2
|
)
|
|
(18.9
|
)
|
|
(50.4
|
)
|
|
(20.6
|
)
|
||||
Prior service cost amortization
|
.3
|
|
|
—
|
|
|
.4
|
|
|
—
|
|
||||
Actuarial loss amortization
|
16.3
|
|
|
2.7
|
|
|
21.8
|
|
|
10.2
|
|
||||
Settlements
|
.3
|
|
|
—
|
|
|
1.5
|
|
|
—
|
|
||||
Special termination benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Other
|
—
|
|
|
.2
|
|
|
—
|
|
|
.3
|
|
||||
Net Periodic Benefit Cost
|
|
$7.3
|
|
|
|
($2.2
|
)
|
|
|
$6.5
|
|
|
|
$5.8
|
|
|
|
|
|
|
|
|
|
||||||||
|
Pension Benefits
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
Nine Months Ended 30 June
|
U.S.
|
|
International
|
|
U.S.
|
|
International
|
||||||||
Service cost
|
|
$16.1
|
|
|
|
$14.6
|
|
|
|
$19.2
|
|
|
|
$19.4
|
|
Interest cost
|
85.0
|
|
|
27.0
|
|
|
80.3
|
|
|
28.2
|
|
||||
Expected return on plan assets
|
(129.4
|
)
|
|
(57.0
|
)
|
|
(151.2
|
)
|
|
(61.9
|
)
|
||||
Prior service cost amortization
|
.9
|
|
|
.1
|
|
|
1.2
|
|
|
—
|
|
||||
Actuarial loss amortization
|
48.9
|
|
|
8.3
|
|
|
65.7
|
|
|
30.5
|
|
||||
Settlements
|
6.1
|
|
|
.2
|
|
|
4.8
|
|
|
—
|
|
||||
Special termination benefits
|
.7
|
|
|
—
|
|
|
.4
|
|
|
—
|
|
||||
Other
|
—
|
|
|
.6
|
|
|
—
|
|
|
.9
|
|
||||
Net Periodic Benefit Cost
|
|
$28.3
|
|
|
|
($6.2
|
)
|
|
|
$20.4
|
|
|
|
$17.1
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
30 June
|
|
30 June
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Before-tax share-based compensation cost
|
|
|
$9.8
|
|
|
|
$7.9
|
|
|
|
$31.0
|
|
|
|
$30.4
|
|
Income tax benefit
|
|
(2.3
|
)
|
|
(1.9
|
)
|
|
(7.3
|
)
|
|
(7.2
|
)
|
||||
After-tax share-based compensation cost
|
|
|
$7.5
|
|
|
|
$6.0
|
|
|
|
$23.7
|
|
|
|
$23.2
|
|
Expected volatility
|
|
17.5
|
%
|
Risk-free interest rate
|
|
2.8
|
%
|
Expected dividend yield
|
|
2.6
|
%
|
|
Derivatives
qualifying as
hedges
|
|
Foreign
currency
translation
adjustments
|
|
Pension and
postretirement
benefits
|
|
Total
|
|
||||
Balance at 31 March 2019
|
|
($49.5
|
)
|
|
($1,030.8
|
)
|
|
($664.5
|
)
|
|
($1,744.8
|
)
|
Other comprehensive income (loss) before reclassifications
|
7.5
|
|
(48.8
|
)
|
—
|
|
(41.3
|
)
|
||||
Amounts reclassified from AOCL
|
(13.1
|
)
|
(2.6
|
)
|
14.8
|
|
(.9
|
)
|
||||
Net current period other comprehensive income (loss)
|
(5.6
|
)
|
(51.4
|
)
|
14.8
|
|
(42.2
|
)
|
||||
Amount attributable to noncontrolling interests
|
.1
|
|
(5.7
|
)
|
—
|
|
(5.6
|
)
|
||||
Balance at 30 June 2019
|
|
($55.2
|
)
|
|
($1,076.5
|
)
|
|
($649.7
|
)
|
|
($1,781.4
|
)
|
|
|
|
|
|
||||||||
|
Derivatives
qualifying
as hedges
|
|
Foreign
currency
translation
adjustments
|
|
Pension and
postretirement
benefits
|
|
Total
|
|
||||
Balance at 30 September 2018
|
|
($37.6
|
)
|
|
($1,009.8
|
)
|
|
($694.5
|
)
|
|
($1,741.9
|
)
|
Other comprehensive loss before reclassifications
|
(38.2
|
)
|
(65.6
|
)
|
(3.9
|
)
|
(107.7
|
)
|
||||
Amounts reclassified from AOCL
|
20.7
|
|
(2.6
|
)
|
48.7
|
|
66.8
|
|
||||
Net current period other comprehensive income (loss)
|
(17.5
|
)
|
(68.2
|
)
|
44.8
|
|
(40.9
|
)
|
||||
Amount attributable to noncontrolling interests
|
.1
|
|
(1.5
|
)
|
—
|
|
(1.4
|
)
|
||||
Balance at 30 June 2019
|
|
($55.2
|
)
|
|
($1,076.5
|
)
|
|
($649.7
|
)
|
|
($1,781.4
|
)
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
|
2019
|
2018
|
2019
|
2018
|
||||||||
(Gain) Loss on Cash Flow Hedges, net of tax
|
|
|
|
|
||||||||
Sales/Cost of sales
|
|
$—
|
|
|
$1.9
|
|
|
$.4
|
|
|
$6.9
|
|
Other income/expense, net
|
(16.9
|
)
|
(22.4
|
)
|
8.9
|
|
(37.6
|
)
|
||||
Interest expense
|
3.8
|
|
2.8
|
|
11.4
|
|
6.3
|
|
||||
Total (Gain) Loss on Cash Flow Hedges, net of tax
|
|
($13.1
|
)
|
|
($17.7
|
)
|
|
$20.7
|
|
|
($24.4
|
)
|
|
|
|
|
|
||||||||
Currency Translation Adjustment
|
|
|
|
|
||||||||
Cost of sales(A)
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$3.1
|
|
Gain on exchange of equity affiliate investments(B)
|
(2.6
|
)
|
—
|
|
(2.6
|
)
|
—
|
|
||||
Total Currency Translation Adjustment
|
|
($2.6
|
)
|
|
$—
|
|
|
($2.6
|
)
|
|
$3.1
|
|
|
|
|
|
|
||||||||
Pension and Postretirement Benefits, net of tax(C)
|
|
$14.8
|
|
|
$26.0
|
|
|
$48.7
|
|
|
$75.5
|
|
(A)
|
The fiscal year 2018 impact relates to an equipment sale resulting from the termination of a contract in the Industrial Gases – Asia segment during the first quarter.
|
(B)
|
The fiscal year 2019 impact relates to a net gain on the exchange of two equity affiliates with a joint venture partner. Refer to Note 6, Acquisitions, for additional information.
|
(C)
|
The components of net periodic benefit cost reclassified out of AOCL include items such as prior service cost amortization, actuarial loss amortization, and settlements and are included in “Other non-operating income (expense), net” on the consolidated income statements. Refer to Note 11, Retirement Benefits, for additional information.
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
30 June
|
|
30 June
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Numerator
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
|
$488.0
|
|
|
|
$430.7
|
|
|
|
$1,256.8
|
|
|
|
$1,002.7
|
|
Income from discontinued operations
|
|
—
|
|
|
43.2
|
|
|
—
|
|
|
42.2
|
|
||||
Net Income Attributable to Air Products
|
|
|
$488.0
|
|
|
|
$473.9
|
|
|
|
$1,256.8
|
|
|
|
$1,044.9
|
|
Denominator (in millions)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares — Basic
|
|
220.6
|
|
|
219.5
|
|
|
220.2
|
|
|
219.3
|
|
||||
Effect of dilutive securities
|
|
|
|
|
|
|
|
|
||||||||
Employee stock option and other award plans
|
|
1.3
|
|
|
1.4
|
|
|
1.2
|
|
|
1.4
|
|
||||
Weighted average common shares — Diluted
|
|
221.9
|
|
|
220.9
|
|
|
221.4
|
|
|
220.7
|
|
||||
Basic EPS Attributable to Air Products
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
|
$2.21
|
|
|
|
$1.96
|
|
|
|
$5.71
|
|
|
|
$4.57
|
|
Income from discontinued operations
|
|
—
|
|
|
.20
|
|
|
—
|
|
|
.19
|
|
||||
Net Income Attributable to Air Products
|
|
|
$2.21
|
|
|
|
$2.16
|
|
|
|
$5.71
|
|
|
|
$4.76
|
|
Diluted EPS Attributable to Air Products
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
|
$2.20
|
|
|
|
$1.95
|
|
|
|
$5.68
|
|
|
|
$4.54
|
|
Income from discontinued operations
|
|
—
|
|
|
.20
|
|
|
—
|
|
|
.19
|
|
||||
Net Income Attributable to Air Products
|
|
|
$2.20
|
|
|
|
$2.15
|
|
|
|
$5.68
|
|
|
|
$4.73
|
|
•
|
Industrial Gases – Americas
|
•
|
Industrial Gases – EMEA (Europe, Middle East, and Africa)
|
•
|
Industrial Gases – Asia
|
•
|
Industrial Gases – Global
|
•
|
Corporate and other
|
|
Industrial
Gases –
Americas
|
Industrial
Gases –
EMEA
|
Industrial
Gases –
Asia
|
Industrial
Gases –
Global
|
Corporate
and other
|
Segment
Total
|
||||||||||||
Three Months Ended 30 June 2019
|
||||||||||||||||||
Sales
|
|
$955.3
|
|
|
$494.6
|
|
|
$679.4
|
|
|
$57.9
|
|
|
$36.8
|
|
|
$2,224.0
|
|
Operating income (loss)
|
262.2
|
|
123.4
|
|
231.4
|
|
(9.6
|
)
|
(41.3
|
)
|
566.1
|
|
||||||
Depreciation and amortization
|
126.3
|
|
47.8
|
|
87.9
|
|
2.2
|
|
4.9
|
|
269.1
|
|
||||||
Equity affiliates' income
|
21.7
|
|
18.8
|
|
14.9
|
|
1.0
|
|
—
|
|
56.4
|
|
||||||
Three Months Ended 30 June 2018
|
||||||||||||||||||
Sales
|
|
$948.7
|
|
|
$561.1
|
|
|
$623.8
|
|
|
$101.1
|
|
|
$24.3
|
|
|
$2,259.0
|
|
Operating income (loss)
|
237.1
|
|
118.8
|
|
185.5
|
|
19.8
|
|
(45.4
|
)
|
515.8
|
|
||||||
Depreciation and amortization
|
120.5
|
|
49.8
|
|
69.5
|
|
2.3
|
|
3.5
|
|
245.6
|
|
||||||
Equity affiliates' income
|
24.1
|
|
17.5
|
|
15.1
|
|
1.4
|
|
—
|
|
58.1
|
|
|
|
|
|
|
|
|
||||||||||||
|
Industrial
Gases –
Americas
|
Industrial
Gases –
EMEA
|
Industrial
Gases –
Asia
|
Industrial
Gases –
Global
|
Corporate
and other
|
Segment
Total
|
||||||||||||
Nine Months Ended 30 June 2019
|
||||||||||||||||||
Sales
|
|
$2,936.2
|
|
|
$1,513.2
|
|
|
$1,931.6
|
|
|
$179.9
|
|
|
$74.8
|
|
|
$6,635.7
|
|
Operating income (loss)
|
737.0
|
|
351.5
|
|
632.9
|
|
(17.9
|
)
|
(136.9
|
)
|
1,566.6
|
|
||||||
Depreciation and amortization
|
376.8
|
|
140.4
|
|
252.7
|
|
6.3
|
|
13.0
|
|
789.2
|
|
||||||
Equity affiliates' income
|
62.1
|
|
45.8
|
|
44.9
|
|
2.7
|
|
—
|
|
155.5
|
|
||||||
Nine Months Ended 30 June 2018
|
||||||||||||||||||
Sales
|
|
$2,771.7
|
|
|
$1,638.6
|
|
|
$1,825.0
|
|
|
$335.8
|
|
|
$60.2
|
|
|
$6,631.3
|
|
Operating income (loss)
|
676.6
|
|
340.0
|
|
509.7
|
|
41.4
|
|
(135.8
|
)
|
1,431.9
|
|
||||||
Depreciation and amortization
|
360.6
|
|
149.6
|
|
188.9
|
|
5.8
|
|
8.6
|
|
713.5
|
|
||||||
Equity affiliates' income
|
59.6
|
|
41.7
|
|
44.7
|
|
2.1
|
|
—
|
|
148.1
|
|
||||||
Total Assets
|
||||||||||||||||||
30 June 2019
|
|
$5,896.6
|
|
|
$3,399.7
|
|
|
$6,357.6
|
|
|
$284.3
|
|
|
$3,593.7
|
|
|
$19,531.9
|
|
30 September 2018
|
5,904.0
|
|
3,280.4
|
|
5,899.5
|
|
240.1
|
|
3,854.3
|
|
19,178.3
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
Operating Income
|
2019
|
2018
|
2019
|
2018
|
||||||||
Segment total
|
|
$566.1
|
|
|
$515.8
|
|
|
$1,566.6
|
|
|
$1,431.9
|
|
Facility closure
|
—
|
|
—
|
|
(29.0
|
)
|
—
|
|
||||
Cost reduction actions
|
(25.5
|
)
|
—
|
|
(25.5
|
)
|
—
|
|
||||
Gain on exchange of equity affiliate investments
|
29.1
|
|
—
|
|
29.1
|
|
—
|
|
||||
Consolidated Total
|
|
$569.7
|
|
|
$515.8
|
|
|
$1,541.2
|
|
|
$1,431.9
|
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
Equity Affiliates' Income
|
2019
|
2018
|
2019
|
2018
|
||||||||
Segment total
|
|
$56.4
|
|
|
$58.1
|
|
|
$155.5
|
|
|
$148.1
|
|
Tax reform repatriation - equity method investment
|
—
|
|
—
|
|
—
|
|
(32.5
|
)
|
||||
Consolidated Total
|
|
$56.4
|
|
|
$58.1
|
|
|
$155.5
|
|
|
$115.6
|
|
•
|
Sales of $2,224.0 decreased 2%, or $35.0, as positive underlying sales of 6% were more than offset by unfavorable currency impacts of 4%, a contract modification to a tolling arrangement in India of 3%, and lower energy and natural gas cost pass-through to customers of 1%.
|
•
|
Operating income of $569.7 increased 10%, or $53.9, and operating margin of 25.6% increased 280 basis points (bp). On a non-GAAP basis, adjusted operating income of $566.1 increased 10%, or $50.3, and adjusted operating margin of 25.5% increased 270 bp.
|
•
|
Income from continuing operations of $488.0 increased 13%, or $57.3. On a non-GAAP basis, adjusted income from continuing operations of $480.9 increased 12%, or $50.2.
|
•
|
Adjusted EBITDA of $891.6 increased 9%, or $72.1. Adjusted EBITDA margin of 40.1% increased 380 bp.
|
•
|
Diluted EPS of $2.20 increased 13%, or $.25. On a non-GAAP basis, adjusted diluted EPS of $2.17 increased 11%, or $.22. A summary table of changes in diluted EPS is presented on the following page.
|
Changes in Diluted EPS Attributable to Air Products
|
|||||||||
|
|
|
|
||||||
|
Three Months Ended
|
|
|||||||
|
30 June
|
Increase
|
|||||||
|
2019
|
2018
|
(Decrease)
|
||||||
Diluted EPS from Continuing Operations – GAAP
|
|
$2.20
|
|
|
$1.95
|
|
|
$.25
|
|
Operating Income Impact (after-tax)
|
|
|
|
||||||
Underlying business
|
|
|
|
||||||
Volume
|
|
|
|
($.04
|
)
|
||||
Price, net of variable costs
|
|
|
.30
|
|
|||||
Other costs
|
|
|
(.02
|
)
|
|||||
Currency
|
|
|
(.05
|
)
|
|||||
Cost reduction actions
|
|
|
(.08
|
)
|
|||||
Gain on exchange of equity affiliate investments
|
|
|
.13
|
|
|||||
Total Operating Income Impact (after-tax)
|
|
|
|
$.24
|
|
||||
Other Impact (after-tax)
|
|
|
|
||||||
Equity affiliates' income
|
|
|
|
($.01
|
)
|
||||
Other non-operating income (expense), net
|
|
|
.02
|
|
|||||
Income tax
|
|
|
.02
|
|
|||||
Tax reform repatriation
|
|
|
(.02
|
)
|
|||||
Noncontrolling interests
|
|
|
.01
|
|
|||||
Weighted average diluted shares
|
|
|
(.01
|
)
|
|||||
Total Other Impact (after-tax)
|
|
|
|
$.01
|
|
||||
Total Change in Diluted EPS from Continuing Operations – GAAP
|
|
|
|
$.25
|
|
|
Three Months Ended
|
|
|||||||
|
30 June
|
Increase
|
|||||||
|
2019
|
2018
|
(Decrease)
|
||||||
Diluted EPS from Continuing Operations – GAAP
|
|
$2.20
|
|
|
$1.95
|
|
|
$.25
|
|
Cost reduction and asset actions
|
.08
|
|
—
|
|
.08
|
|
|||
Gain on exchange of equity affiliate investments
|
(.13
|
)
|
—
|
|
(.13
|
)
|
|||
Tax reform repatriation
|
.02
|
|
—
|
|
.02
|
|
|||
Diluted EPS from Continuing Operations – Non-GAAP Measure
|
|
$2.17
|
|
|
$1.95
|
|
|
$.22
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
Change
|
|||||||
Sales
|
|
|
$2,224.0
|
|
|
|
$2,259.0
|
|
|
|
($35.0
|
)
|
|
(2
|
)%
|
Operating income
|
|
569.7
|
|
|
515.8
|
|
|
53.9
|
|
|
10
|
%
|
|||
Operating margin
|
|
25.6
|
%
|
|
22.8
|
%
|
|
|
|
|
280
|
bp
|
|||
Equity affiliates’ income
|
|
56.4
|
|
|
58.1
|
|
|
(1.7
|
)
|
|
(3
|
)%
|
|||
Income from continuing operations
|
|
488.0
|
|
|
430.7
|
|
|
57.3
|
|
|
13
|
%
|
|||
Non-GAAP Measures
|
|
|
|
|
|
|
|
|
|||||||
Adjusted EBITDA
|
|
|
$891.6
|
|
|
|
$819.5
|
|
|
|
$72.1
|
|
|
9
|
%
|
Adjusted EBITDA margin
|
|
40.1
|
%
|
|
36.3
|
%
|
|
|
|
380 bp
|
|
||||
Adjusted operating income
|
|
566.1
|
|
|
515.8
|
|
|
50.3
|
|
|
10
|
%
|
|||
Adjusted operating margin
|
|
25.5
|
%
|
|
22.8
|
%
|
|
|
|
270 bp
|
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
2
|
%
|
Price
|
4
|
%
|
Energy and natural gas cost pass-through
|
(1
|
)%
|
Currency
|
(4
|
)%
|
Other
|
(3
|
)%
|
Total Consolidated Sales Change
|
(2
|
)%
|
|
Three Months Ended
|
|||||
|
30 June
|
|||||
|
2019
|
2018
|
||||
Interest incurred
|
|
$37.8
|
|
|
$42.4
|
|
Less: capitalized interest
|
3.6
|
|
7.5
|
|
||
Interest expense
|
|
$34.2
|
|
|
$34.9
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
|
$955.3
|
|
|
|
$948.7
|
|
|
|
$6.6
|
|
|
1
|
%
|
Operating income
|
|
262.2
|
|
|
237.1
|
|
|
25.1
|
|
|
11
|
%
|
|||
Operating margin
|
|
27.4
|
%
|
|
25.0
|
%
|
|
|
|
240 bp
|
|
||||
Equity affiliates’ income
|
|
21.7
|
|
|
24.1
|
|
|
(2.4
|
)
|
|
(10
|
)%
|
|||
Adjusted EBITDA
|
|
410.2
|
|
|
381.7
|
|
|
28.5
|
|
|
7
|
%
|
|||
Adjusted EBITDA margin
|
|
42.9
|
%
|
|
40.2
|
%
|
|
|
|
270 bp
|
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
—
|
%
|
Price
|
4
|
%
|
Energy and natural gas cost pass-through
|
(1
|
)%
|
Currency
|
(2
|
)%
|
Total Industrial Gases – Americas Sales Change
|
1
|
%
|
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
|
30 June
|
|
|
|
|
||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
||||||
Sales
|
|
|
$494.6
|
|
|
|
$561.1
|
|
|
|
($66.5
|
)
|
|
(12)%
|
Operating income
|
|
123.4
|
|
|
118.8
|
|
|
4.6
|
|
|
4%
|
|||
Operating margin
|
|
24.9
|
%
|
|
21.2
|
%
|
|
|
|
370 bp
|
||||
Equity affiliates’ income
|
|
18.8
|
|
|
17.5
|
|
|
1.3
|
|
|
7%
|
|||
Adjusted EBITDA
|
|
190.0
|
|
|
186.1
|
|
|
3.9
|
|
|
2%
|
|||
Adjusted EBITDA margin
|
|
38.4
|
%
|
|
33.2
|
%
|
|
|
|
520 bp
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
2
|
%
|
Price
|
4
|
%
|
Energy and natural gas cost pass-through
|
(2
|
)%
|
Currency
|
(5
|
)%
|
Other
|
(11
|
)%
|
Total Industrial Gases – EMEA Sales Change
|
(12
|
)%
|
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
|
30 June
|
|
|
|
|
||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
||||||
Sales
|
|
|
$679.4
|
|
|
|
$623.8
|
|
|
|
$55.6
|
|
|
9%
|
Operating income
|
|
231.4
|
|
|
185.5
|
|
|
45.9
|
|
|
25%
|
|||
Operating margin
|
|
34.1
|
%
|
|
29.7
|
%
|
|
|
|
440 bp
|
||||
Equity affiliates’ income
|
|
14.9
|
|
|
15.1
|
|
|
(.2
|
)
|
|
(1)%
|
|||
Adjusted EBITDA
|
|
334.2
|
|
|
270.1
|
|
|
64.1
|
|
|
24%
|
|||
Adjusted EBITDA margin
|
|
49.2
|
%
|
|
43.3
|
%
|
|
|
|
590 bp
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
10
|
%
|
Price
|
5
|
%
|
Energy and natural gas cost pass-through
|
—
|
%
|
Currency
|
(6
|
)%
|
Total Industrial Gases – Asia Sales Change
|
9
|
%
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
|
$57.9
|
|
|
|
$101.1
|
|
|
|
($43.2
|
)
|
|
(43
|
)%
|
Operating income (loss)
|
|
(9.6
|
)
|
|
19.8
|
|
|
(29.4
|
)
|
|
(148
|
)%
|
|||
Adjusted EBITDA
|
|
(6.4
|
)
|
|
23.5
|
|
|
(29.9
|
)
|
|
(127
|
)%
|
•
|
Sales of $6,635.7 were flat as positive underlying sales of 4% and higher energy and natural gas cost pass-through to customers of 1% were offset by unfavorable currency impacts of 3% and the impact of a contract modification to a tolling arrangement in India of 2%.
|
•
|
Operating income of $1,541.2 increased 8%, or $109.3, and operating margin of 23.2% increased 160 bp. On a non-GAAP basis, adjusted operating income of $1,566.6 increased 9%, or $134.7, and adjusted operating margin of 23.6% increased 200 bp.
|
•
|
Income from continuing operations of $1,256.8 increased 25%, or $254.1. On a non-GAAP basis, adjusted income from continuing operations of $1,316.2 increased 9%, or $113.3.
|
•
|
Adjusted EBITDA of $2,511.3 increased 9%, or $217.8. Adjusted EBITDA margin of 37.8% increased 320 bp.
|
•
|
Diluted EPS of $5.68 increased 25%, or $1.14. On a non-GAAP basis, adjusted diluted EPS of $5.94 increased 9%, or $.49. A summary table of changes in diluted earnings per share is presented below.
|
•
|
We increased our quarterly dividend by 5% from $1.10 to $1.16 per share, or $4.64 per share annually. This is the 37th consecutive year that we have increased our dividend payment, reflecting continued confidence in our financial strength, significant cash flows, and growth outlook.
|
Changes in Diluted EPS Attributable to Air Products
|
|||||||||
|
|
|
|
||||||
|
Nine Months Ended
|
|
|||||||
|
30 June
|
Increase
|
|||||||
|
2019
|
2018
|
(Decrease)
|
||||||
Diluted EPS from Continuing Operations – GAAP
|
|
$5.68
|
|
|
$4.54
|
|
|
$1.14
|
|
Operating Income Impact (after-tax)
|
|
|
|
||||||
Underlying business
|
|
|
|
||||||
Volume
|
|
|
|
$.25
|
|
||||
Price, net of variable costs
|
|
|
.56
|
|
|||||
Other costs
|
|
|
(.15
|
)
|
|||||
Currency
|
|
|
(.17
|
)
|
|||||
Facility closure
|
|
|
(.10
|
)
|
|||||
Cost reduction actions
|
|
|
(.08
|
)
|
|||||
Gain on exchange of equity affiliate investments
|
|
|
.13
|
|
|||||
Total Operating Income Impact (after-tax)
|
|
|
|
$.44
|
|
||||
Other Impact (after-tax)
|
|
|
|
||||||
Equity affiliates' income
|
|
|
.03
|
|
|||||
Other non-operating income (expense), net
|
|
|
.06
|
|
|||||
Interest expense
|
|
|
(.04
|
)
|
|||||
Income tax
|
|
|
(.02
|
)
|
|||||
Tax reform repatriation
|
|
|
2.12
|
|
|||||
Tax reform adjustment related to deemed foreign dividends
|
|
|
(.25
|
)
|
|||||
Tax reform rate change and other
|
|
|
(.97
|
)
|
|||||
Tax restructuring
|
|
|
(.18
|
)
|
|||||
Noncontrolling interests
|
|
|
(.03
|
)
|
|||||
Weighted average diluted shares
|
|
|
(.02
|
)
|
|||||
Total Other Impact (after-tax)
|
|
|
|
$.70
|
|
||||
Total Change in Diluted EPS from Continuing Operations – GAAP
|
|
|
|
$1.14
|
|
|
Nine Months Ended
|
|
|||||||
|
30 June
|
Increase
|
|||||||
|
2019
|
2018
|
(Decrease)
|
||||||
Diluted EPS from Continuing Operations – GAAP
|
|
$5.68
|
|
|
$4.54
|
|
|
$1.14
|
|
Facility closure
|
.10
|
|
—
|
|
.10
|
|
|||
Cost reduction actions
|
.08
|
|
—
|
|
.08
|
|
|||
Gain on exchange of equity affiliate investments
|
(.13
|
)
|
—
|
|
(.13
|
)
|
|||
Pension settlement loss
|
.02
|
|
—
|
|
.02
|
|
|||
Tax reform repatriation
|
(.06
|
)
|
2.06
|
|
(2.12
|
)
|
|||
Tax reform adjustment related to deemed foreign dividends
|
.25
|
|
—
|
|
.25
|
|
|||
Tax reform rate change and other
|
—
|
|
(.97
|
)
|
.97
|
|
|||
Tax restructuring
|
—
|
|
(.18
|
)
|
.18
|
|
|||
Diluted EPS from Continuing Operations – Non-GAAP Measure
|
|
$5.94
|
|
|
$5.45
|
|
|
$.49
|
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
Change
|
|||||||
Sales
|
|
|
$6,635.7
|
|
|
|
$6,631.3
|
|
|
|
$4.4
|
|
|
—
|
%
|
Operating income
|
|
1,541.2
|
|
|
1,431.9
|
|
|
109.3
|
|
|
8
|
%
|
|||
Operating margin
|
|
23.2
|
%
|
|
21.6
|
%
|
|
|
|
160 bp
|
|
||||
Equity affiliates’ income
|
|
155.5
|
|
|
115.6
|
|
|
39.9
|
|
|
35
|
%
|
|||
Income from continuing operations
|
|
1,256.8
|
|
|
1,002.7
|
|
|
254.1
|
|
|
25
|
%
|
|||
Non-GAAP Measures
|
|
|
|
|
|
|
|
|
|||||||
Adjusted EBITDA
|
|
2,511.3
|
|
|
2,293.5
|
|
|
217.8
|
|
|
9
|
%
|
|||
Adjusted EBITDA margin
|
|
37.8
|
%
|
|
34.6
|
%
|
|
|
|
320 bp
|
|
||||
Adjusted operating income
|
|
1,566.6
|
|
|
1,431.9
|
|
|
134.7
|
|
|
9
|
%
|
|||
Adjusted operating margin
|
|
23.6
|
%
|
|
21.6
|
%
|
|
|
|
200 bp
|
|
||||
Adjusted equity affiliates' income
|
|
155.5
|
|
|
148.1
|
|
|
7.4
|
|
|
5
|
%
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
1
|
%
|
Price
|
3
|
%
|
Energy and natural gas cost pass-through
|
1
|
%
|
Currency
|
(3
|
)%
|
Other
|
(2
|
)%
|
Total Consolidated Sales Change
|
—
|
%
|
|
Nine Months Ended
|
|||||
|
30 June
|
|||||
|
2019
|
2018
|
||||
Interest incurred
|
|
$116.3
|
|
|
$109.4
|
|
Less: capitalized interest
|
9.4
|
|
14.3
|
|
||
Interest expense
|
|
$106.9
|
|
|
$95.1
|
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
|
$2,936.2
|
|
|
|
$2,771.7
|
|
|
|
$164.5
|
|
|
6
|
%
|
Operating income
|
|
737.0
|
|
|
676.6
|
|
|
60.4
|
|
|
9
|
%
|
|||
Operating margin
|
|
25.1
|
%
|
|
24.4
|
%
|
|
|
|
70 bp
|
|
||||
Equity affiliates’ income
|
|
62.1
|
|
|
59.6
|
|
|
2.5
|
|
|
4
|
%
|
|||
Adjusted EBITDA
|
|
1,175.9
|
|
|
1,096.8
|
|
|
79.1
|
|
|
7
|
%
|
|||
Adjusted EBITDA margin
|
|
40.0
|
%
|
|
39.6
|
%
|
|
|
|
40 bp
|
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
2
|
%
|
Price
|
3
|
%
|
Energy and natural gas cost pass-through
|
3
|
%
|
Currency
|
(2
|
)%
|
Total Industrial Gases – Americas Sales Change
|
6
|
%
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
|
$1,513.2
|
|
|
|
$1,638.6
|
|
|
|
($125.4
|
)
|
|
(8
|
)%
|
Operating income
|
|
351.5
|
|
|
340.0
|
|
|
11.5
|
|
|
3
|
%
|
|||
Operating margin
|
|
23.2
|
%
|
|
20.7
|
%
|
|
|
|
250 bp
|
|
||||
Equity affiliates’ income
|
|
45.8
|
|
|
41.7
|
|
|
4.1
|
|
|
10
|
%
|
|||
Adjusted EBITDA
|
|
537.7
|
|
|
531.3
|
|
|
6.4
|
|
|
1
|
%
|
|||
Adjusted EBITDA margin
|
|
35.5
|
%
|
|
32.4
|
%
|
|
|
|
310 bp
|
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
1
|
%
|
Price
|
3
|
%
|
Energy and natural gas cost pass-through
|
2
|
%
|
Currency
|
(6
|
)%
|
Other
|
(8
|
)%
|
Total Industrial Gases – EMEA Sales Change
|
(8
|
)%
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
|
$1,931.6
|
|
|
|
$1,825.0
|
|
|
|
$106.6
|
|
|
6
|
%
|
Operating income
|
|
632.9
|
|
|
509.7
|
|
|
123.2
|
|
|
24
|
%
|
|||
Operating margin
|
|
32.8
|
%
|
|
27.9
|
%
|
|
|
|
490 bp
|
|
||||
Equity affiliates’ income
|
|
44.9
|
|
|
44.7
|
|
|
.2
|
|
|
—
|
%
|
|||
Adjusted EBITDA
|
|
930.5
|
|
|
743.3
|
|
|
187.2
|
|
|
25
|
%
|
|||
Adjusted EBITDA margin
|
|
48.2
|
%
|
|
40.7
|
%
|
|
|
|
750 bp
|
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
6
|
%
|
Price
|
4
|
%
|
Energy and natural gas cost pass-through
|
1
|
%
|
Currency
|
(5
|
)%
|
Total Industrial Gases – Asia Sales Change
|
6
|
%
|
|
|
Nine Months Ended
|
|
|
|
|
|||||||||
|
|
30 June
|
|
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Sales
|
|
|
$179.9
|
|
|
|
$335.8
|
|
|
|
($155.9
|
)
|
|
(46
|
)%
|
Operating income (loss)
|
|
(17.9
|
)
|
|
41.4
|
|
|
(59.3
|
)
|
|
(143
|
)%
|
|||
Adjusted EBITDA
|
|
(8.9
|
)
|
|
49.3
|
|
|
(58.2
|
)
|
|
(118
|
)%
|
|
Continuing Operations
|
||||||||||||||||
|
Three Months Ended 30 June
|
||||||||||||||||
Q3 2019 vs. Q3 2018
|
Operating
Income |
Operating
Margin(A) |
Equity Affiliates' Income
|
Income Tax
Provision |
Net
Income |
Diluted
EPS |
|||||||||||
2019 GAAP
|
|
$569.7
|
|
25.6
|
%
|
|
$56.4
|
|
|
$109.3
|
|
|
$488.0
|
|
|
$2.20
|
|
2018 GAAP
|
515.8
|
|
22.8
|
%
|
58.1
|
|
107.1
|
|
430.7
|
|
1.95
|
|
|||||
Change GAAP
|
|
$53.9
|
|
280
|
bp
|
|
($1.7
|
)
|
|
$2.2
|
|
|
$57.3
|
|
|
$.25
|
|
% Change GAAP
|
10
|
%
|
|
(3
|
)%
|
2
|
%
|
13
|
%
|
13
|
%
|
||||||
2019 GAAP
|
|
$569.7
|
|
25.6
|
%
|
|
$56.4
|
|
|
$109.3
|
|
|
$488.0
|
|
|
$2.20
|
|
Cost reduction actions
|
25.5
|
|
1.2
|
%
|
—
|
|
6.7
|
|
18.8
|
|
.08
|
|
|||||
Gain on exchange of equity affiliate investments
|
(29.1
|
)
|
(1.3
|
)%
|
—
|
|
—
|
|
(29.1
|
)
|
(.13
|
)
|
|||||
Tax reform repatriation
|
—
|
|
—
|
%
|
—
|
|
(3.2
|
)
|
3.2
|
|
.02
|
|
|||||
2019 Non-GAAP Measure
|
|
$566.1
|
|
25.5
|
%
|
|
$56.4
|
|
|
$112.8
|
|
|
$480.9
|
|
|
$2.17
|
|
2018 GAAP
|
|
$515.8
|
|
22.8
|
%
|
|
$58.1
|
|
|
$107.1
|
|
|
$430.7
|
|
|
$1.95
|
|
2018 Non-GAAP Measure
|
|
$515.8
|
|
22.8
|
%
|
|
$58.1
|
|
|
$107.1
|
|
|
$430.7
|
|
|
$1.95
|
|
Change Non-GAAP Measure
|
|
$50.3
|
|
270
|
bp
|
|
($1.7
|
)
|
|
$5.7
|
|
|
$50.2
|
|
|
$.22
|
|
% Change Non-GAAP Measure
|
10
|
%
|
|
(3
|
)%
|
5
|
%
|
12
|
%
|
11
|
%
|
|
|
|
|
|
|
|
|||||||||||
|
Continuing Operations
|
||||||||||||||||
|
Nine Months Ended 30 June
|
||||||||||||||||
2019 vs. 2018
|
Operating
Income
|
Operating
Margin(A)
|
Equity Affiliates' Income
|
Income Tax
Provision |
Net
Income
|
Diluted
EPS
|
|||||||||||
2019 GAAP
|
|
$1,541.2
|
|
23.2
|
%
|
|
$155.5
|
|
|
$348.9
|
|
|
$1,256.8
|
|
|
$5.68
|
|
2018 GAAP
|
1,431.9
|
|
21.6
|
%
|
115.6
|
|
455.1
|
|
1,002.7
|
|
4.54
|
|
|||||
Change GAAP
|
|
$109.3
|
|
160
|
bp
|
|
$39.9
|
|
|
($106.2
|
)
|
|
$254.1
|
|
|
$1.14
|
|
% Change GAAP
|
8
|
%
|
|
35
|
%
|
(23
|
)%
|
25
|
%
|
25
|
%
|
||||||
2019 GAAP
|
|
$1,541.2
|
|
23.2
|
%
|
|
$155.5
|
|
|
$348.9
|
|
|
$1,256.8
|
|
|
$5.68
|
|
Facility closure
|
29.0
|
|
.4
|
%
|
—
|
|
6.9
|
|
22.1
|
|
.10
|
|
|||||
Cost reduction actions
|
25.5
|
|
.4
|
%
|
—
|
|
6.7
|
|
18.8
|
|
.08
|
|
|||||
Gain on exchange of equity affiliate investments
|
(29.1
|
)
|
(.4
|
)%
|
—
|
|
—
|
|
(29.1
|
)
|
(.13
|
)
|
|||||
Pension settlement loss(B)
|
—
|
|
—
|
%
|
—
|
|
1.2
|
|
3.8
|
|
.02
|
|
|||||
Tax reform repatriation
|
—
|
|
—
|
%
|
—
|
|
12.4
|
|
(12.4
|
)
|
(.06
|
)
|
|||||
Tax reform adjustment related to deemed foreign dividends
|
—
|
|
—
|
%
|
—
|
|
(56.2
|
)
|
56.2
|
|
.25
|
|
|||||
2019 Non-GAAP Measure
|
|
$1,566.6
|
|
23.6
|
%
|
|
$155.5
|
|
|
$319.9
|
|
|
$1,316.2
|
|
|
$5.94
|
|
2018 GAAP
|
|
$1,431.9
|
|
21.6
|
%
|
|
$115.6
|
|
|
$455.1
|
|
|
$1,002.7
|
|
|
$4.54
|
|
Tax reform repatriation
|
—
|
|
—
|
%
|
32.5
|
|
(420.5
|
)
|
453.0
|
|
2.06
|
|
|||||
Tax reform rate change and other
|
—
|
|
—
|
%
|
—
|
|
214.0
|
|
(214.0
|
)
|
(.97
|
)
|
|||||
Tax restructuring
|
—
|
|
—
|
%
|
—
|
|
38.8
|
|
(38.8
|
)
|
(.18
|
)
|
|||||
2018 Non-GAAP Measure
|
|
$1,431.9
|
|
21.6
|
%
|
|
$148.1
|
|
|
$287.4
|
|
|
$1,202.9
|
|
|
$5.45
|
|
Change Non-GAAP Measure
|
|
$134.7
|
|
200
|
bp
|
|
$7.4
|
|
|
$32.5
|
|
|
$113.3
|
|
|
$.49
|
|
% Change Non-GAAP Measure
|
9
|
%
|
|
5
|
%
|
11
|
%
|
9
|
%
|
9
|
%
|
(A)
|
Operating margin is calculated by dividing operating income by sales.
|
(B)
|
Reflected on the consolidated income statements within "Other non-operating income (expense), net." Fiscal year 2019 includes a before-tax impact of $5.0 for the nine months ended 30 June 2019. Refer to Note 11, Retirement Benefits, to the consolidated financial statements for additional information.
|
|
|
|
|
|
||||||||
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
Operating Income
|
2019
|
2018
|
2019
|
2018
|
||||||||
Consolidated total
|
|
$569.7
|
|
|
$515.8
|
|
|
$1,541.2
|
|
|
$1,431.9
|
|
Facility closure
|
—
|
|
—
|
|
29.0
|
|
—
|
|
||||
Cost reduction actions
|
25.5
|
|
—
|
|
25.5
|
|
—
|
|
||||
Gain on exchange of equity affiliate investments
|
(29.1
|
)
|
—
|
|
(29.1
|
)
|
—
|
|
||||
Segment total
|
|
$566.1
|
|
|
$515.8
|
|
|
$1,566.6
|
|
|
$1,431.9
|
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
Equity Affiliates' Income
|
2019
|
2018
|
2019
|
2018
|
||||||||
Consolidated total
|
|
$56.4
|
|
|
$58.1
|
|
|
$155.5
|
|
|
$115.6
|
|
Tax reform repatriation - equity method investment
|
—
|
|
—
|
|
—
|
|
32.5
|
|
||||
Segment total
|
|
$56.4
|
|
|
$58.1
|
|
|
$155.5
|
|
|
$148.1
|
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
30 June
|
30 June
|
||||||||||
|
2019
|
2018
|
2019
|
2018
|
||||||||
Income From Continuing Operations(A)
|
|
$500.2
|
|
|
$444.7
|
|
|
$1,290.7
|
|
|
$1,031.0
|
|
Add: Interest expense
|
34.2
|
|
34.9
|
|
106.9
|
|
95.1
|
|
||||
Less: Other non-operating income (expense), net
|
17.6
|
|
12.8
|
|
49.8
|
|
33.7
|
|
||||
Add: Income tax provision
|
109.3
|
|
107.1
|
|
348.9
|
|
455.1
|
|
||||
Add: Depreciation and amortization
|
269.1
|
|
245.6
|
|
789.2
|
|
713.5
|
|
||||
Add: Facility closure
|
—
|
|
—
|
|
29.0
|
|
—
|
|
||||
Add: Cost reduction actions
|
25.5
|
|
—
|
|
25.5
|
|
—
|
|
||||
Less: Gain on exchange of equity affiliate investments
|
29.1
|
|
—
|
|
29.1
|
|
—
|
|
||||
Add: Tax reform repatriation - equity method investment
|
—
|
|
—
|
|
—
|
|
32.5
|
|
||||
Adjusted EBITDA
|
|
$891.6
|
|
|
$819.5
|
|
|
$2,511.3
|
|
|
$2,293.5
|
|
Adjusted EBITDA margin
|
40.1
|
%
|
36.3
|
%
|
37.8
|
%
|
34.6
|
%
|
||||
Change GAAP
|
|
|
|
|
||||||||
Income from continuing operations change
|
|
$55.5
|
|
|
|
$259.7
|
|
|
||||
Income from continuing operations % change
|
12
|
%
|
|
25
|
%
|
|
||||||
Change Non-GAAP
|
|
|
|
|
||||||||
Adjusted EBITDA change
|
|
$72.1
|
|
|
|
$217.8
|
|
|
||||
Adjusted EBITDA % change
|
9
|
%
|
|
9
|
%
|
|
||||||
Adjusted EBITDA margin change
|
380
|
bp
|
|
320
|
bp
|
|
(A)
|
Includes net income attributable to noncontrolling interests.
|
|
Industrial
Gases– Americas |
Industrial
Gases– EMEA |
Industrial
Gases– Asia |
Industrial
Gases– Global |
Corporate
and other |
Segment
Total |
||||||||||||
GAAP MEASURE
|
|
|
|
|
|
|
||||||||||||
Three Months Ended 30 June 2019
|
||||||||||||||||||
Operating income (loss)
|
|
$262.2
|
|
|
$123.4
|
|
|
$231.4
|
|
|
($9.6
|
)
|
|
($41.3
|
)
|
|
$566.1
|
|
Operating margin
|
27.4
|
%
|
24.9
|
%
|
34.1
|
%
|
|
|
25.5
|
%
|
||||||||
Three Months Ended 30 June 2018
|
||||||||||||||||||
Operating income (loss)
|
|
$237.1
|
|
|
$118.8
|
|
|
$185.5
|
|
|
$19.8
|
|
|
($45.4
|
)
|
|
$515.8
|
|
Operating margin
|
25.0
|
%
|
21.2
|
%
|
29.7
|
%
|
|
|
22.8
|
%
|
||||||||
Operating income (loss) change
|
|
$25.1
|
|
|
$4.6
|
|
|
$45.9
|
|
|
($29.4
|
)
|
|
$4.1
|
|
|
$50.3
|
|
Operating income (loss) % change
|
11
|
%
|
4
|
%
|
25
|
%
|
(148
|
)%
|
9
|
%
|
10
|
%
|
||||||
Operating margin change
|
240
|
bp
|
370
|
bp
|
440
|
bp
|
|
|
270
|
bp
|
||||||||
NON-GAAP MEASURE
|
|
|
|
|
|
|
||||||||||||
Three Months Ended 30 June 2019
|
||||||||||||||||||
Operating income (loss)
|
|
$262.2
|
|
|
$123.4
|
|
|
$231.4
|
|
|
($9.6
|
)
|
|
($41.3
|
)
|
|
$566.1
|
|
Add: Depreciation and amortization
|
126.3
|
|
47.8
|
|
87.9
|
|
2.2
|
|
4.9
|
|
269.1
|
|
||||||
Add: Equity affiliates' income
|
21.7
|
|
18.8
|
|
14.9
|
|
1.0
|
|
—
|
|
56.4
|
|
||||||
Adjusted EBITDA
|
|
$410.2
|
|
|
$190.0
|
|
|
$334.2
|
|
|
($6.4
|
)
|
|
($36.4
|
)
|
|
$891.6
|
|
Adjusted EBITDA margin
|
42.9
|
%
|
38.4
|
%
|
49.2
|
%
|
|
|
40.1
|
%
|
||||||||
Three Months Ended 30 June 2018
|
||||||||||||||||||
Operating income (loss)
|
|
$237.1
|
|
|
$118.8
|
|
|
$185.5
|
|
|
$19.8
|
|
|
($45.4
|
)
|
|
$515.8
|
|
Add: Depreciation and amortization
|
120.5
|
|
49.8
|
|
69.5
|
|
2.3
|
|
3.5
|
|
245.6
|
|
||||||
Add: Equity affiliates' income
|
24.1
|
|
17.5
|
|
15.1
|
|
1.4
|
|
—
|
|
58.1
|
|
||||||
Adjusted EBITDA
|
|
$381.7
|
|
|
$186.1
|
|
|
$270.1
|
|
|
$23.5
|
|
|
($41.9
|
)
|
|
$819.5
|
|
Adjusted EBITDA margin
|
40.2
|
%
|
33.2
|
%
|
43.3
|
%
|
|
|
36.3
|
%
|
||||||||
Adjusted EBITDA change
|
|
$28.5
|
|
|
$3.9
|
|
|
$64.1
|
|
|
($29.9
|
)
|
|
$5.5
|
|
|
$72.1
|
|
Adjusted EBITDA % change
|
7
|
%
|
2
|
%
|
24
|
%
|
(127
|
)%
|
13
|
%
|
9
|
%
|
||||||
Adjusted EBITDA margin change
|
270
|
bp
|
520
|
bp
|
590
|
bp
|
|
|
380
|
bp
|
|
|
|
|
|
|
|
||||||||||||
|
Industrial
Gases– Americas |
Industrial
Gases– EMEA |
Industrial
Gases– Asia |
Industrial
Gases– Global |
Corporate
and other |
Segment
Total |
||||||||||||
GAAP MEASURE
|
|
|
|
|
|
|
||||||||||||
Nine Months Ended 30 June 2019
|
||||||||||||||||||
Operating income (loss)
|
|
$737.0
|
|
|
$351.5
|
|
|
$632.9
|
|
|
($17.9
|
)
|
|
($136.9
|
)
|
|
$1,566.6
|
|
Operating margin
|
25.1
|
%
|
23.2
|
%
|
32.8
|
%
|
|
|
23.6
|
%
|
||||||||
Nine Months Ended 30 June 2018
|
||||||||||||||||||
Operating income (loss)
|
|
$676.6
|
|
|
$340.0
|
|
|
$509.7
|
|
|
$41.4
|
|
|
($135.8
|
)
|
|
$1,431.9
|
|
Operating margin
|
24.4
|
%
|
20.7
|
%
|
27.9
|
%
|
|
|
21.6
|
%
|
||||||||
Operating income (loss) change
|
|
$60.4
|
|
|
$11.5
|
|
|
$123.2
|
|
|
($59.3
|
)
|
|
($1.1
|
)
|
|
$134.7
|
|
Operating income (loss) % change
|
9
|
%
|
3
|
%
|
24
|
%
|
(143
|
)%
|
(1
|
)%
|
9
|
%
|
||||||
Operating margin change
|
70
|
bp
|
250
|
bp
|
490
|
bp
|
|
|
200
|
bp
|
||||||||
NON-GAAP MEASURE
|
|
|
|
|
|
|
||||||||||||
Nine Months Ended 30 June 2019
|
||||||||||||||||||
Operating income (loss)
|
|
$737.0
|
|
|
$351.5
|
|
|
$632.9
|
|
|
($17.9
|
)
|
|
($136.9
|
)
|
|
$1,566.6
|
|
Add: Depreciation and amortization
|
376.8
|
|
140.4
|
|
252.7
|
|
6.3
|
|
13.0
|
|
789.2
|
|
||||||
Add: Equity affiliates' income
|
62.1
|
|
45.8
|
|
44.9
|
|
2.7
|
|
—
|
|
155.5
|
|
||||||
Adjusted EBITDA
|
|
$1,175.9
|
|
|
$537.7
|
|
|
$930.5
|
|
|
($8.9
|
)
|
|
($123.9
|
)
|
|
$2,511.3
|
|
Adjusted EBITDA margin
|
40.0
|
%
|
35.5
|
%
|
48.2
|
%
|
|
|
37.8
|
%
|
||||||||
Nine Months Ended 30 June 2018
|
||||||||||||||||||
Operating income (loss)
|
|
$676.6
|
|
|
$340.0
|
|
|
$509.7
|
|
|
$41.4
|
|
|
($135.8
|
)
|
|
$1,431.9
|
|
Add: Depreciation and amortization
|
360.6
|
|
149.6
|
|
188.9
|
|
5.8
|
|
8.6
|
|
713.5
|
|
||||||
Add: Equity affiliates' income
|
59.6
|
|
41.7
|
|
44.7
|
|
2.1
|
|
—
|
|
148.1
|
|
||||||
Adjusted EBITDA
|
|
$1,096.8
|
|
|
$531.3
|
|
|
$743.3
|
|
|
$49.3
|
|
|
($127.2
|
)
|
|
$2,293.5
|
|
Adjusted EBITDA margin
|
39.6
|
%
|
32.4
|
%
|
40.7
|
%
|
|
|
34.6
|
%
|
||||||||
Adjusted EBITDA change
|
|
$79.1
|
|
|
$6.4
|
|
|
$187.2
|
|
|
($58.2
|
)
|
|
$3.3
|
|
|
$217.8
|
|
Adjusted EBITDA % change
|
7
|
%
|
1
|
%
|
25
|
%
|
(118
|
)%
|
3
|
%
|
9
|
%
|
||||||
Adjusted EBITDA margin change
|
40
|
bp
|
310
|
bp
|
750
|
bp
|
|
|
320
|
bp
|
|
Effective Tax Rate
|
||||||||||||
|
Three Months Ended
30 June |
|
Nine Months Ended
30 June |
||||||||||
|
2019
|
2018
|
|
2019
|
2018
|
||||||||
Income Tax Provision—GAAP
|
|
$109.3
|
|
|
$107.1
|
|
|
|
$348.9
|
|
|
$455.1
|
|
Income From Continuing Operations Before Taxes—GAAP
|
|
$609.5
|
|
|
$551.8
|
|
|
|
$1,639.6
|
|
|
$1,486.1
|
|
Effective Tax Rate—GAAP
|
17.9
|
%
|
19.4
|
%
|
|
21.3
|
%
|
30.6
|
%
|
||||
Income Tax Provision—GAAP
|
|
$109.3
|
|
|
$107.1
|
|
|
|
$348.9
|
|
|
$455.1
|
|
Facility closure
|
—
|
|
—
|
|
|
6.9
|
|
—
|
|
||||
Cost reduction actions
|
6.7
|
|
—
|
|
|
6.7
|
|
—
|
|
||||
Pension settlement loss
|
—
|
|
—
|
|
|
1.2
|
|
—
|
|
||||
Tax reform repatriation
|
(3.2
|
)
|
—
|
|
|
12.4
|
|
(420.5
|
)
|
||||
Tax reform adjustment related to deemed foreign dividends
|
—
|
|
—
|
|
|
(56.2
|
)
|
—
|
|
||||
Tax reform rate change and other
|
—
|
|
—
|
|
|
—
|
|
214.0
|
|
||||
Tax restructuring
|
—
|
|
—
|
|
|
—
|
|
38.8
|
|
||||
Income Tax Provision—Non-GAAP Measure
|
|
$112.8
|
|
|
$107.1
|
|
|
|
$319.9
|
|
|
$287.4
|
|
Income From Continuing Operations Before Taxes—GAAP
|
|
$609.5
|
|
|
$551.8
|
|
|
|
$1,639.6
|
|
|
$1,486.1
|
|
Facility closure
|
—
|
|
—
|
|
|
29.0
|
|
—
|
|
||||
Cost reduction actions
|
25.5
|
|
—
|
|
|
25.5
|
|
—
|
|
||||
Gain on exchange of equity affiliate investments
|
(29.1
|
)
|
—
|
|
|
(29.1
|
)
|
—
|
|
||||
Pension settlement loss
|
—
|
|
—
|
|
|
5.0
|
|
—
|
|
||||
Tax reform repatriation - equity method investment
|
—
|
|
—
|
|
|
—
|
|
32.5
|
|
||||
Income From Continuing Operations Before Taxes—Non-GAAP Measure
|
|
$605.9
|
|
|
$551.8
|
|
|
|
$1,670.0
|
|
|
$1,518.6
|
|
Effective Tax Rate—Non-GAAP Measure
|
18.6
|
%
|
19.4
|
%
|
|
19.2
|
%
|
18.9
|
%
|
|
Nine Months Ended
|
|||||
|
30 June
|
|||||
Cash provided by (used for)
|
2019
|
2018
|
||||
Operating activities
|
|
$2,003.4
|
|
|
$1,856.2
|
|
Investing activities
|
(1,435.5
|
)
|
(1,031.8
|
)
|
||
Financing activities
|
(660.8
|
)
|
(1,097.8
|
)
|
|
|
Nine Months Ended
|
||||||
|
|
30 June
|
||||||
|
|
2019
|
|
2018
|
||||
Additions to plant and equipment
|
|
|
$1,507.6
|
|
|
|
$1,158.1
|
|
Acquisitions, less cash acquired
|
|
107.0
|
|
|
320.2
|
|
||
Investment in and advances to unconsolidated affiliates
|
|
15.7
|
|
|
—
|
|
||
Capital expenditures
|
|
|
$1,630.3
|
|
|
|
$1,478.3
|
|
|
Exhibit No.
|
Description
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
101.INS
|
XBRL Instance Document. The XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL 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
|
|
|
|
†
|
The certification attached as Exhibit 32 that accompanies this Quarterly Report on Form 10-Q, 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-Q, irrespective of any general incorporation language contained in such filing.
|
|
Air Products and Chemicals, Inc.
|
|
|
(Registrant)
|
|
|
|
|
Date: 25 July 2019
|
By:
|
/s/ M. Scott Crocco
|
|
|
M. Scott Crocco
|
|
|
Executive Vice President and Chief Financial Officer
|
/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: 25 July 2019
|
|
/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
|