☒
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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 2019
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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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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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Title of Each Class:
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Trading Symbol(s)
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Registered on:
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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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2.000% 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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1.000% Euro Notes due 2025
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APD25
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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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☒
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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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☒
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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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☒
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No
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☐
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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).
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Yes
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☒
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No
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☐
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Large accelerated filer
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☒
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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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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☒
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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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ITEM 16.
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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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our ability to develop and operate large scale and technically complex projects, including gasification projects;
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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 legislation or 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 oil and natural gas and disruptions in markets and the economy due to oil and natural gas 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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Name
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Age
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Office
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M. Scott Crocco
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55
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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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Seifi Ghasemi
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75
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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. from 2001 to 2014). 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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Sean D. Major
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55
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Executive Vice President, General Counsel and Secretary (Secretary since December 2017 and Executive Vice President and General Counsel since May 2017). Previously, Mr. Major served as Executive Vice President, General Counsel and Secretary for Joy Global Inc. from 2007 to 2017.
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Dr. Samir J. Serhan
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58
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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, including Managing Director of Linde Engineering from 2008-2014.
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2019
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2018
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First quarter
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$1.10
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$.95
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Second quarter
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1.16
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1.10
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Third quarter
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1.16
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1.10
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Fourth quarter
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1.16
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1.10
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Total
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$4.58
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$4.25
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Sept 2014
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Sept 2015
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Sept 2016
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Sept 2017
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Sept 2018
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Sept 2019
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Air Products
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100
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100
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120
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134
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153
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208
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S&P 500 Index
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100
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99
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115
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136
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160
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167
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S&P 500 Materials Index
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100
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82
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100
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122
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126
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130
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(Millions of dollars, except for share and per share data)
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2019
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2018
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2017
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2016
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2015
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||||||||||
Sales
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$8,919
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$8,930
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$8,188
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$7,504
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$7,824
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Operating income
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2,144
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1,966
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1,440
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1,535
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1,276
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Operating margin
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24.0
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%
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22.0
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%
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17.6
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%
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20.5
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%
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16.3
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%
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|||||
Equity affiliates’ income(A)
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215
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175
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80
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147
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152
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Net income(B)(C)
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1,809
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1,533
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3,021
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662
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1,318
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Net income margin(C)
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20.3
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%
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17.2
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%
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36.9
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%
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8.8
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%
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16.8
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%
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Income from continuing operations
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1,809
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1,491
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1,155
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1,122
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966
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Basic earnings per common share from continuing operations
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7.99
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6.64
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5.20
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5.08
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4.34
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Diluted earnings per common share from continuing operations
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7.94
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6.59
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5.16
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5.04
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4.29
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Adjusted diluted earnings per common share from continuing operations(C)
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$8.21
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$7.45
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$6.31
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$5.64
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$4.88
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Adjusted EBITDA(C)
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3,468
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3,116
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2,799
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2,622
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2,422
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Adjusted EBITDA margin(C)
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38.9
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%
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34.9
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%
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34.2
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%
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34.9
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%
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31.0
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%
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Dividends declared per common share
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4.58
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4.25
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3.71
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3.39
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3.20
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Total assets(D)
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18,943
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19,178
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18,467
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18,029
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17,317
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Total debt(E)
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3,326
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3,813
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3,963
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5,211
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5,856
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(A)
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Fiscal year 2017 included the impact of an other-than-temporary noncash impairment charge of $80 on a 25%‑owned equity affiliate in Saudi Arabia.
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(B)
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Fiscal year 2017 included net income from discontinued operations of $1,866 primarily resulting from the sale of the Performance Materials Division to Evonik Industries AG. Fiscal year 2016 included a net loss from discontinued operations of $465, which included an after-tax loss on the disposal of the Energy-from-Waste business of $847, partially offset by income from operations of the former Electronic Materials and Performance Materials divisions.
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(C)
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A reconciliation of adjusted diluted earnings per common share from continuing operations to diluted earnings per common share from continuing operations on a GAAP basis is presented on page 30. A reconciliation of adjusted EBITDA and adjusted EBITDA margin to net income and net income margin on a GAAP basis, respectively, is presented on page 31.
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(D)
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Total assets includes assets from continuing and discontinued operations.
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(E)
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Total debt includes long-term debt and current portion of long-term debt, including debt to related parties, and short-term borrowings as of the end of the year for continuing operations. Long-term obligations decreased in fiscal year 2017 primarily due to debt repayments subsequent to the spin-off of the former Electronic Materials division as Versum Materials, Inc.
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•
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Industrial Gases – Americas;
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•
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Industrial Gases – EMEA (Europe, Middle East, and Africa);
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•
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Industrial Gases – Asia;
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•
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Industrial Gases – Global; and
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•
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Corporate and other
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•
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Sales of $8,918.9 were flat as favorable pricing of 3% and higher volumes of 2% were offset by negative currency impacts of 3% and the negative impact of a contract modification to a tolling arrangement in India of 2%.
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•
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Operating income of $2,144.4 increased 9%, or $178.8, and operating margin of 24.0% increased 200 bp.
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•
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Net income of $1,809.4 increased 18%, or $276.5, and net income margin of 20.3% increased 310 bp.
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•
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Adjusted EBITDA of $3,468.0 increased 11%, or $352.5, and adjusted EBITDA margin of 38.9% increased 400 bp.
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•
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Diluted EPS of $7.94 increased 20%, or $1.35 per share. Adjusted diluted EPS of $8.21 increased 10%, or $.76 per share. A summary table of changes in diluted EPS is presented on the following page.
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•
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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.
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Increase
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||||||
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2019
|
2018
|
(Decrease)
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||||||
Diluted EPS
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$7.94
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|
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$6.59
|
|
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$1.35
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Operating Income Impact (after-tax)
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||||||
Underlying business
|
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||||||
Volume
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$.40
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||||
Price, net of variable costs
|
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.81
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|||||
Other costs
|
|
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(.17
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)
|
|||||
Currency
|
|
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(.20
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)
|
|||||
Facility closure
|
|
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(.10
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)
|
|||||
Change in inventory valuation method
|
|
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(.08
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)
|
|||||
Cost reduction actions
|
|
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(.08
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)
|
|||||
Gain on exchange of equity affiliate investments
|
|
|
.13
|
|
|||||
Total Operating Income Impact (after-tax)
|
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|
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$.71
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|
||||
Other Impact (after-tax)
|
|
|
|
||||||
Equity affiliates' income
|
|
|
.04
|
|
|||||
Interest expense
|
|
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(.02
|
)
|
|||||
Other non-operating income (expense), net
|
|
|
.21
|
|
|||||
Change in effective tax rate, excluding discrete items below
|
|
|
(.09
|
)
|
|||||
Tax reform repatriation
|
|
|
2.22
|
|
|||||
Tax reform adjustment related to deemed foreign dividends
|
|
|
(.51
|
)
|
|||||
Tax reform rate change and other
|
|
|
(.96
|
)
|
|||||
Tax restructuring
|
|
|
(.16
|
)
|
|||||
Noncontrolling interests
|
|
|
(.06
|
)
|
|||||
Weighted average diluted shares
|
|
|
(.03
|
)
|
|||||
Total Other Impact (after-tax)
|
|
|
|
$.64
|
|
||||
Total Change in Diluted EPS
|
|
|
|
$1.35
|
|
|
|
|
Increase
|
||||||
|
2019
|
2018
|
(Decrease)
|
||||||
Diluted EPS
|
|
$7.94
|
|
|
$6.59
|
|
|
$1.35
|
|
Facility closure
|
.10
|
|
—
|
|
.10
|
|
|||
Change in inventory valuation method
|
—
|
|
(.08
|
)
|
.08
|
|
|||
Cost reduction actions
|
.08
|
|
—
|
|
.08
|
|
|||
Gain on exchange of equity affiliate investments
|
(.13
|
)
|
—
|
|
(.13
|
)
|
|||
Pension settlement loss
|
.02
|
|
.15
|
|
(.13
|
)
|
|||
Tax reform repatriation
|
(.06
|
)
|
2.16
|
|
(2.22
|
)
|
|||
Tax reform adjustment related to deemed foreign dividends
|
.26
|
|
(.25
|
)
|
.51
|
|
|||
Tax reform rate change and other
|
—
|
|
(.96
|
)
|
.96
|
|
|||
Tax restructuring
|
—
|
|
(.16
|
)
|
.16
|
|
|||
Adjusted Diluted EPS
|
|
$8.21
|
|
|
$7.45
|
|
|
$.76
|
|
|
2019
|
2018
|
$ Change
|
|
Change
|
|
|||||
GAAP Measures
|
|
|
|
|
|||||||
Sales
|
|
$8,918.9
|
|
|
$8,930.2
|
|
|
($11.3
|
)
|
—
|
%
|
Operating income
|
2,144.4
|
|
1,965.6
|
|
178.8
|
|
9
|
%
|
|||
Operating margin
|
24.0
|
%
|
22.0
|
%
|
—
|
|
200 bp
|
|
|||
Equity affiliates’ income
|
|
$215.4
|
|
|
$174.8
|
|
|
$40.6
|
|
23
|
%
|
Net income
|
1,809.4
|
|
1,532.9
|
|
276.5
|
|
18
|
%
|
|||
Net income margin
|
20.3
|
%
|
17.2
|
%
|
—
|
|
310
|
bp
|
|||
Non-GAAP Measures
|
|
|
|
|
|||||||
Adjusted EBITDA
|
|
$3,468.0
|
|
|
$3,115.5
|
|
|
$352.5
|
|
11
|
%
|
Adjusted EBITDA margin
|
38.9
|
%
|
34.9
|
%
|
—
|
|
400 bp
|
|
Sales % Change from Prior Year
|
|
|
Volume
|
2
|
%
|
Price
|
3
|
%
|
Energy and raw material cost pass-through
|
—
|
%
|
Currency
|
(3
|
)%
|
Other(A)
|
(2
|
)%
|
Total Consolidated Sales Change
|
—
|
%
|
(A)
|
Includes the impact from the modification of a hydrogen supply contract to a tolling arrangement in India in December 2018 ("the India contract modification").
|
|
2019
|
|
2018
|
|
||
Interest incurred
|
|
$150.5
|
|
|
$150.0
|
|
Less: Capitalized interest
|
13.5
|
|
19.5
|
|
||
Interest Expense
|
|
$137.0
|
|
|
$130.5
|
|
|
2019
|
|
2018
|
|
$ Change
|
|
Change
|
|
|||
Sales
|
|
$3,873.5
|
|
|
$3,758.8
|
|
|
$114.7
|
|
3
|
%
|
Operating income
|
997.7
|
|
927.9
|
|
69.8
|
|
8
|
%
|
|||
Operating margin
|
25.8
|
%
|
24.7
|
%
|
—
|
|
110 bp
|
|
|||
Equity affiliates’ income
|
|
$84.8
|
|
|
$82.0
|
|
|
$2.8
|
|
3
|
%
|
Adjusted EBITDA
|
1,587.7
|
|
1,495.2
|
|
92.5
|
|
6
|
%
|
|||
Adjusted EBITDA margin
|
41.0
|
%
|
39.8
|
%
|
—
|
|
120 bp
|
|
Sales % Change from Prior Year
|
|
|
Volume
|
1
|
%
|
Price
|
3
|
%
|
Energy and natural gas cost pass-through
|
—
|
%
|
Currency
|
(1
|
)%
|
Total Industrial Gases – Americas Sales Change
|
3
|
%
|
|
2019
|
|
2018
|
|
$ Change
|
|
Change
|
|
|||
Sales
|
|
$2,002.5
|
|
|
$2,193.3
|
|
|
($190.8
|
)
|
(9
|
)%
|
Operating income
|
472.4
|
|
445.8
|
|
26.6
|
|
6
|
%
|
|||
Operating margin
|
23.6
|
%
|
20.3
|
%
|
—
|
|
330 bp
|
|
|||
Equity affiliates’ income
|
|
$69.0
|
|
|
$61.1
|
|
|
$7.9
|
|
13
|
%
|
Adjusted EBITDA
|
730.9
|
|
705.5
|
|
25.4
|
|
4
|
%
|
|||
Adjusted EBITDA margin
|
36.5
|
%
|
32.2
|
%
|
—
|
|
430 bp
|
|
Sales % Change from Prior Year
|
|
|
Volume
|
2
|
%
|
Price
|
3
|
%
|
Energy and natural gas cost pass-through
|
—
|
%
|
Currency
|
(5
|
)%
|
Other(A)
|
(9
|
)%
|
Total Industrial Gases – EMEA Sales Change
|
(9
|
)%
|
(A)
|
Includes the impact from the modification of a hydrogen supply contract to a tolling arrangement in India in December 2018 ("the India contract modification").
|
|
2019
|
|
2018
|
|
$ Change
|
|
Change
|
|
|||
Sales
|
|
$2,663.6
|
|
|
$2,458.0
|
|
|
$205.6
|
|
8
|
%
|
Operating income
|
864.2
|
|
689.9
|
|
174.3
|
|
25
|
%
|
|||
Operating margin
|
32.4
|
%
|
28.1
|
%
|
—
|
|
430 bp
|
|
|||
Equity affiliates’ income
|
|
$58.4
|
|
|
$58.3
|
|
|
$.1
|
|
—
|
%
|
Adjusted EBITDA
|
1,284.1
|
|
1,014.0
|
|
270.1
|
|
27
|
%
|
|||
Adjusted EBITDA margin
|
48.2
|
%
|
41.3
|
%
|
—
|
|
690 bp
|
|
Sales % Change from Prior Year
|
|
|
Volume
|
9
|
%
|
Price
|
3
|
%
|
Energy and natural gas cost pass-through
|
—
|
%
|
Currency
|
(4
|
)%
|
Total Industrial Gases – Asia Sales Change
|
8
|
%
|
|
2019
|
|
2018
|
|
$ Change
|
|
Change
|
|
|||
Sales
|
|
$261.0
|
|
|
$436.1
|
|
|
($175.1
|
)
|
(40
|
)%
|
Operating income (loss)
|
(11.7
|
)
|
53.9
|
|
(65.6
|
)
|
(122
|
)%
|
|||
Adjusted EBITDA
|
.1
|
|
63.9
|
|
(63.8
|
)
|
(100
|
)%
|
|
2019
|
|
2018
|
|
$ Change
|
|
Change
|
|
|||
Sales
|
|
$118.3
|
|
|
$84.0
|
|
|
$34.3
|
|
41
|
%
|
Operating loss
|
(152.8
|
)
|
(176.0
|
)
|
23.2
|
|
13
|
%
|
|||
Adjusted EBITDA
|
(134.8
|
)
|
(163.1
|
)
|
28.3
|
|
17
|
%
|
|
Operating
Income
|
Equity Affiliates' Income
|
Income Tax Provision
|
Net Income Attributable to Air Products
|
Diluted
EPS
|
||||||||||
2019 GAAP
|
|
$2,144.4
|
|
|
$215.4
|
|
|
$480.1
|
|
|
$1,760.0
|
|
|
$7.94
|
|
2018 GAAP
|
1,965.6
|
|
174.8
|
|
524.3
|
|
1,455.6
|
|
6.59
|
|
|||||
Change GAAP
|
|
|
|
|
$304.4
|
|
|
$1.35
|
|
||||||
% Change GAAP
|
|
|
|
21
|
%
|
20
|
%
|
||||||||
2019 GAAP
|
|
$2,144.4
|
|
|
$215.4
|
|
|
$480.1
|
|
|
$1,760.0
|
|
|
$7.94
|
|
Facility closure
|
29.0
|
|
—
|
|
6.9
|
|
22.1
|
|
.10
|
|
|||||
Cost reduction actions
|
25.5
|
|
—
|
|
6.7
|
|
18.8
|
|
.08
|
|
|||||
Gain on exchange of equity affiliate investments
|
(29.1
|
)
|
—
|
|
—
|
|
(29.1
|
)
|
(.13
|
)
|
|||||
Pension settlement loss(A)
|
—
|
|
—
|
|
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
|
|
.26
|
|
|||||
2019 Non-GAAP Measures ("Adjusted")
|
|
$2,169.8
|
|
|
$215.4
|
|
|
$451.1
|
|
|
$1,819.4
|
|
|
$8.21
|
|
2018 GAAP
|
|
$1,965.6
|
|
|
$174.8
|
|
|
$524.3
|
|
|
$1,455.6
|
|
|
$6.59
|
|
Change in inventory valuation method
|
(24.1
|
)
|
—
|
|
(6.6
|
)
|
(17.5
|
)
|
(.08
|
)
|
|||||
Pension settlement loss(A)
|
—
|
|
—
|
|
10.5
|
|
33.2
|
|
.15
|
|
|||||
Tax reform repatriation
|
—
|
|
28.5
|
|
(448.6
|
)
|
477.1
|
|
2.16
|
|
|||||
Tax reform adjustment related to deemed foreign dividends
|
—
|
|
—
|
|
56.2
|
|
(56.2
|
)
|
(.25
|
)
|
|||||
Tax reform rate change and other
|
—
|
|
—
|
|
211.8
|
|
(211.8
|
)
|
(.96
|
)
|
|||||
Tax restructuring
|
—
|
|
—
|
|
35.7
|
|
(35.7
|
)
|
(.16
|
)
|
|||||
2018 Non-GAAP Measures ("Adjusted")
|
|
$1,941.5
|
|
|
$203.3
|
|
|
$383.3
|
|
|
$1,644.7
|
|
|
$7.45
|
|
Change Non-GAAP Measures ("Adjusted")
|
|
|
|
|
$174.7
|
|
|
$.76
|
|
||||||
% Change Non-GAAP Measures ("Adjusted")
|
|
|
|
11
|
%
|
10
|
%
|
(A)
|
The before-tax impact of $5.0 and $43.7 for fiscal years 2019 and 2018, respectively, is reflected on the consolidated income statements within "Other non-operating income (expense), net."
|
|
2017
|
2016
|
2015
|
||||||
Diluted EPS
|
|
$5.16
|
|
|
$5.04
|
|
|
$4.29
|
|
Business separation costs
|
.12
|
|
.21
|
|
.03
|
|
|||
Tax (benefit) costs associated with business separation
|
(.02
|
)
|
.24
|
|
—
|
|
|||
Business restructuring, cost reduction, and asset actions
|
.49
|
|
.11
|
|
.61
|
|
|||
Goodwill and intangible asset impairment charge
|
.70
|
|
—
|
|
—
|
|
|||
Gain on previously held equity interest
|
—
|
|
—
|
|
(.05
|
)
|
|||
Gain on land sales
|
(.03
|
)
|
—
|
|
(.13
|
)
|
|||
Equity method investment impairment charge
|
.36
|
|
—
|
|
—
|
|
|||
Pension settlement loss
|
.03
|
|
.02
|
|
.06
|
|
|||
Loss on extinguishment of debt
|
—
|
|
.02
|
|
.07
|
|
|||
Tax election benefit
|
(.50
|
)
|
—
|
|
—
|
|
|||
Adjusted Diluted EPS
|
|
$6.31
|
|
|
$5.64
|
|
|
$4.88
|
|
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
Sales
|
|
$8,918.9
|
|
|
|
|
$8,930.2
|
|
|
|
|
$8,187.6
|
|
|
|
|
$7,503.7
|
|
|
|
|
$7,824.3
|
|
|
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||||||||||||
|
$
|
Margin
|
|
$
|
Margin
|
|
$
|
Margin
|
|
$
|
Margin
|
|
$
|
Margin
|
|||||||||||||||
Net income and net income margin
|
|
$1,809.4
|
|
20.3
|
%
|
|
|
$1,532.9
|
|
17.2
|
%
|
|
|
$3,021.2
|
|
36.9
|
%
|
|
|
$661.5
|
|
8.8
|
%
|
|
|
$1,317.6
|
|
16.8
|
%
|
Less: Income (Loss) from discontinued operations, net of tax
|
—
|
|
—
|
%
|
|
42.2
|
|
.5
|
%
|
|
1,866.0
|
|
22.8
|
%
|
|
(460.5
|
)
|
(6.1
|
)%
|
|
351.7
|
|
4.5
|
%
|
|||||
Add: Interest expense
|
137.0
|
|
1.5
|
%
|
|
130.5
|
|
1.5
|
%
|
|
120.6
|
|
1.5
|
%
|
|
115.2
|
|
1.5
|
%
|
|
102.8
|
|
1.3
|
%
|
|||||
Less: Other non-operating income (expense), net
|
66.7
|
|
.7
|
%
|
|
5.1
|
|
.1
|
%
|
|
16.6
|
|
.2
|
%
|
|
(5.4
|
)
|
(.1
|
)%
|
|
(42.3
|
)
|
(.5
|
)%
|
|||||
Add: Income tax provision
|
480.1
|
|
5.4
|
%
|
|
524.3
|
|
5.9
|
%
|
|
260.9
|
|
3.2
|
%
|
|
432.6
|
|
5.8
|
%
|
|
300.2
|
|
3.8
|
%
|
|||||
Add: Depreciation and amortization
|
1,082.8
|
|
12.1
|
%
|
|
970.7
|
|
10.9
|
%
|
|
865.8
|
|
10.6
|
%
|
|
854.6
|
|
11.4
|
%
|
|
858.5
|
|
11.0
|
%
|
|||||
Less: Change in inventory valuation method
|
—
|
|
—
|
%
|
|
24.1
|
|
.3
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|||||
Add: Facility closure
|
29.0
|
|
.3
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|||||
Add: Business separation costs
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
32.5
|
|
.4
|
%
|
|
50.6
|
|
.7
|
%
|
|
7.5
|
|
.1
|
%
|
|||||
Add: Business restructuring, cost reduction, and asset actions
|
25.5
|
|
.3
|
%
|
|
—
|
|
—
|
%
|
|
151.4
|
|
1.8
|
%
|
|
34.5
|
|
.4
|
%
|
|
180.1
|
|
2.4
|
%
|
|||||
Add: Goodwill and intangible asset impairment charge
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
162.1
|
|
2.0
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|||||
Less: Gain on previously held equity interest
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
17.9
|
|
.2
|
%
|
|||||
Less: Gain on exchange of equity affiliate investments
|
29.1
|
|
.3
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|||||
Less: Gain on land sales
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
12.2
|
|
.2
|
%
|
|
—
|
|
—
|
%
|
|
33.6
|
|
.4
|
%
|
|||||
Add: Equity method investment impairment charge
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
79.5
|
|
1.0
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|||||
Add: Loss on extinguishment of debt
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
6.9
|
|
.1
|
%
|
|
16.6
|
|
.2
|
%
|
|||||
Add: Tax reform repatriation - equity method investment
|
—
|
|
—
|
%
|
|
28.5
|
|
.3
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|||||
Adjusted EBITDA and adjusted EBITDA margin
|
|
$3,468.0
|
|
38.9
|
%
|
|
|
$3,115.5
|
|
34.9
|
%
|
|
|
$2,799.2
|
|
34.2
|
%
|
|
|
$2,621.8
|
|
34.9
|
%
|
|
|
$2,422.4
|
|
31.0
|
%
|
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
|
|
||||||||||||
Change GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income $ change
|
|
|
$276.5
|
|
|
|
|
($1,488.3
|
)
|
|
|
|
$2,359.7
|
|
|
|
|
($656.1
|
)
|
|
|
|
Net income % change
|
|
18
|
%
|
|
|
(49
|
)%
|
|
|
357
|
%
|
|
|
(50
|
)%
|
|
|
|
||||
Net income margin change
|
|
310
|
bp
|
|
|
(1,970
|
) bp
|
|
|
2,810
|
bp
|
|
|
(800
|
) bp
|
|
|
|
||||
Change Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBITDA $ change
|
|
|
$352.5
|
|
|
|
|
$316.3
|
|
|
|
|
$177.4
|
|
|
|
|
$199.4
|
|
|
|
|
Adjusted EBITDA % change
|
|
11
|
%
|
|
|
11
|
%
|
|
|
7
|
%
|
|
|
8
|
%
|
|
|
|
||||
Adjusted EBITDA margin change
|
|
400
|
bp
|
|
|
70
|
bp
|
|
|
(70
|
) bp
|
|
|
390
|
bp
|
|
|
|
|
Industrial
Gases–
Americas
|
Industrial
Gases–
EMEA
|
Industrial
Gases–
Asia
|
Industrial
Gases–
Global
|
Corporate
and other
|
Total
|
|
||||||||||||
GAAP Measure
|
|
|
|
|
|
|
|
||||||||||||
Twelve Months Ended 30 September 2019
|
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
|
$997.7
|
|
|
$472.4
|
|
|
$864.2
|
|
|
($11.7
|
)
|
|
($152.8
|
)
|
|
$2,169.8
|
|
(A)
|
Operating margin
|
25.8
|
%
|
23.6
|
%
|
32.4
|
%
|
|
|
|
|
|||||||||
Twelve Months Ended 30 September 2018
|
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
|
$927.9
|
|
|
$445.8
|
|
|
$689.9
|
|
|
$53.9
|
|
|
($176.0
|
)
|
|
$1,941.5
|
|
(A)
|
Operating margin
|
24.7
|
%
|
20.3
|
%
|
28.1
|
%
|
|
|
|
|
|||||||||
2019 vs. 2018
|
|
|
|
|
|
|
|
||||||||||||
Operating income (loss) change
|
|
$69.8
|
|
|
$26.6
|
|
|
$174.3
|
|
|
($65.6
|
)
|
|
$23.2
|
|
|
|
||
Operating income (loss) % change
|
8
|
%
|
6
|
%
|
25
|
%
|
(122
|
)%
|
13
|
%
|
|
|
|||||||
Operating margin change
|
110
|
bp
|
330
|
bp
|
430
|
bp
|
|
|
|
|
|
Industrial
Gases–
Americas
|
Industrial
Gases–
EMEA
|
Industrial
Gases–
Asia
|
Industrial
Gases–
Global
|
Corporate
and other
|
Total
|
|
||||||||||||
Non-GAAP Measure
|
|
|
|
|
|
|
|
||||||||||||
Twelve Months Ended 30 September 2019
|
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
|
$997.7
|
|
|
$472.4
|
|
|
$864.2
|
|
|
($11.7
|
)
|
|
($152.8
|
)
|
|
$2,169.8
|
|
(A)
|
Add: Depreciation and amortization
|
505.2
|
|
189.5
|
|
361.5
|
|
8.6
|
|
18.0
|
|
1,082.8
|
|
|
||||||
Add: Equity affiliates' income
|
84.8
|
|
69.0
|
|
58.4
|
|
3.2
|
|
—
|
|
215.4
|
|
(B)
|
||||||
Adjusted EBITDA
|
|
$1,587.7
|
|
|
$730.9
|
|
|
$1,284.1
|
|
|
$.1
|
|
|
($134.8
|
)
|
|
$3,468.0
|
|
|
Adjusted EBITDA margin
|
41.0
|
%
|
36.5
|
%
|
48.2
|
%
|
|
|
|
|
|||||||||
Twelve Months Ended 30 September 2018
|
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
|
$927.9
|
|
|
$445.8
|
|
|
$689.9
|
|
|
$53.9
|
|
|
($176.0
|
)
|
|
$1,941.5
|
|
(A)
|
Add: Depreciation and amortization
|
485.3
|
|
198.6
|
|
265.8
|
|
8.1
|
|
12.9
|
|
970.7
|
|
|
||||||
Add: Equity affiliates' income
|
82.0
|
|
61.1
|
|
58.3
|
|
1.9
|
|
—
|
|
203.3
|
|
(B)
|
||||||
Adjusted EBITDA
|
|
$1,495.2
|
|
|
$705.5
|
|
|
$1,014.0
|
|
|
$63.9
|
|
|
($163.1
|
)
|
|
$3,115.5
|
|
|
Adjusted EBITDA margin
|
39.8
|
%
|
32.2
|
%
|
41.3
|
%
|
|
|
|
|
|||||||||
2019 vs. 2018
|
|
|
|
|
|
|
|
||||||||||||
Adjusted EBITDA change
|
|
$92.5
|
|
|
$25.4
|
|
|
$270.1
|
|
|
($63.8
|
)
|
|
$28.3
|
|
|
|
||
Adjusted EBITDA % change
|
6
|
%
|
4
|
%
|
27
|
%
|
(100
|
)%
|
17
|
%
|
|
|
|||||||
Adjusted EBITDA margin change
|
120
|
bp
|
430
|
bp
|
690
|
bp
|
|
|
|
|
(A)
|
The table below reconciles operating income as reflected on our consolidated income statements to total operating income in the table above:
|
Operating Income
|
2019
|
|
2018
|
|
|
||
Consolidated operating income
|
|
$2,144.4
|
|
|
$1,965.6
|
|
|
Change in inventory valuation method
|
—
|
|
(24.1
|
)
|
|
||
Facility closure
|
29.0
|
|
—
|
|
|
||
Cost reduction and asset actions
|
25.5
|
|
—
|
|
|
||
Gain on exchange of equity affiliate investments
|
(29.1
|
)
|
—
|
|
|
||
Total
|
|
$2,169.8
|
|
|
$1,941.5
|
|
|
(B)
|
The table below reconciles equity affiliates' income as reflected on our consolidated income statements to total equity affiliates' income in the table above:
|
Equity Affiliates' Income
|
2019
|
2018
|
|
||||
Consolidated equity affiliates' income
|
|
$215.4
|
|
|
$174.8
|
|
|
Tax reform repatriation - equity method investment
|
—
|
|
28.5
|
|
|
||
Total
|
|
$215.4
|
|
|
$203.3
|
|
|
|
Effective Tax Rate
|
|||||
|
2019
|
2018
|
||||
Income Tax Provision
|
|
$480.1
|
|
|
$524.3
|
|
Income From Continuing Operations Before Taxes
|
|
$2,289.5
|
|
|
$2,015.0
|
|
Effective Tax Rate
|
21.0
|
%
|
26.0
|
%
|
||
Income Tax Provision
|
|
$480.1
|
|
|
$524.3
|
|
Change in inventory valuation method
|
—
|
|
(6.6
|
)
|
||
Facility closure
|
6.9
|
|
—
|
|
||
Cost reduction actions
|
6.7
|
|
—
|
|
||
Pension settlement loss
|
1.2
|
|
10.5
|
|
||
Tax reform repatriation
|
12.4
|
|
(448.6
|
)
|
||
Tax reform adjustment related to deemed foreign dividends
|
(56.2
|
)
|
56.2
|
|
||
Tax reform rate change and other
|
—
|
|
211.8
|
|
||
Tax restructuring
|
—
|
|
35.7
|
|
||
Adjusted Income Tax Provision
|
|
$451.1
|
|
|
$383.3
|
|
Income from Continuing Operations Before Taxes
|
|
$2,289.5
|
|
|
$2,015.0
|
|
Change in inventory valuation method
|
—
|
|
(24.1
|
)
|
||
Facility closure
|
29.0
|
|
—
|
|
||
Cost reduction actions
|
25.5
|
|
—
|
|
||
Gain on exchange of equity affiliate investments
|
(29.1
|
)
|
—
|
|
||
Pension settlement loss
|
5.0
|
|
43.7
|
|
||
Tax reform repatriation - equity method investment
|
—
|
|
28.5
|
|
||
Adjusted Income From Continuing Operations Before Taxes
|
|
$2,319.9
|
|
|
$2,063.1
|
|
Adjusted Effective Tax Rate
|
19.4
|
%
|
18.6
|
%
|
Cash Provided by (Used for)
|
2019
|
|
2018
|
|
||
Operating activities
|
|
$2,969.9
|
|
|
$2,547.2
|
|
Investing activities
|
(2,113.4
|
)
|
(1,641.6
|
)
|
||
Financing activities
|
(1,370.5
|
)
|
(1,359.8
|
)
|
|
2019
|
|
2018
|
|
||
Cash used for investing activities
|
|
$2,113.4
|
|
|
$1,641.6
|
|
Proceeds from sale of assets and investments
|
11.1
|
|
48.8
|
|
||
Purchases of investments
|
(172.1
|
)
|
(530.3
|
)
|
||
Proceeds from investments
|
190.5
|
|
748.2
|
|
||
Other investing activities
|
(14.3
|
)
|
5.5
|
|
||
Capital Expenditures
|
|
$2,128.6
|
|
|
$1,913.8
|
|
|
2019
|
|
2018
|
|
||
Additions to plant and equipment
|
|
$1,989.7
|
|
|
$1,568.4
|
|
Acquisitions, less cash acquired
|
123.2
|
|
345.4
|
|
||
Investments in and advances to unconsolidated affiliates
|
15.7
|
|
—
|
|
||
Capital Expenditures
|
|
$2,128.6
|
|
|
$1,913.8
|
|
|
Total
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
Thereafter
|
|
|||||||
Debt maturities
|
|
$3,275
|
|
|
$367
|
|
|
$440
|
|
|
$439
|
|
|
$454
|
|
|
$454
|
|
|
$1,121
|
|
Contractual interest on debt
|
466
|
|
78
|
|
69
|
|
55
|
|
44
|
|
35
|
|
185
|
|
|||||||
Capital leases
|
21
|
|
2
|
|
3
|
|
1
|
|
1
|
|
1
|
|
13
|
|
|||||||
Operating leases
|
418
|
|
75
|
|
63
|
|
44
|
|
36
|
|
29
|
|
171
|
|
|||||||
Pension obligations
|
641
|
|
35
|
|
51
|
|
52
|
|
52
|
|
52
|
|
399
|
|
|||||||
Unconditional purchase obligations
|
8,310
|
|
1,358
|
|
407
|
|
369
|
|
349
|
|
350
|
|
5,477
|
|
|||||||
Deemed repatriation tax related to the Tax Act
|
215
|
|
—
|
|
21
|
|
21
|
|
21
|
|
37
|
|
115
|
|
|||||||
Obligation for future contribution to an equity affiliate
|
100
|
|
100
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Total Contractual Obligations
|
|
$13,446
|
|
|
$2,015
|
|
|
$1,054
|
|
|
$981
|
|
|
$957
|
|
|
$958
|
|
|
$7,481
|
|
|
2019
|
|
2018
|
|
||
Pension expense, including special items noted below
|
|
$27.6
|
|
|
$91.8
|
|
Settlements, termination benefits, and curtailments ("special items")
|
7.2
|
|
48.9
|
|
||
Weighted average discount rate – Service cost
|
3.4
|
%
|
3.2
|
%
|
||
Weighted average discount rate – Interest cost
|
3.4
|
%
|
2.9
|
%
|
||
Weighted average expected rate of return on plan assets
|
6.4
|
%
|
6.9
|
%
|
||
Weighted average expected rate of compensation increase
|
3.5
|
%
|
3.5
|
%
|
(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
|
26 November 2019
|
|
|
|
26 November 2019
|
•
|
We tested the effectiveness of the Company’s controls related to the amount and timing of revenue recognition, including controls over identifying and assessing complex contract terms and provisions in certain on-site industrial gas customer contracts.
|
•
|
We evaluated the terms included within customer contracts to assess the accounting for provisions such as tolling arrangements, minimum payment requirements, pricing provisions, and variable components that require management to apply judgment in determining revenue recognition associated with the contract.
|
•
|
We tested the probability of collection of variable components, including penalties, which impacts the amount of revenue to which the Company is entitled.
|
•
|
We considered subsequent events, write-offs of customer receivables, collectability, and other factors that would impact the amount and timing of revenue recognition.
|
Year Ended 30 September
|
2019
|
|
2018
|
|
2017
|
|
|||
Sales
|
|
$8,918.9
|
|
|
$8,930.2
|
|
|
$8,187.6
|
|
Cost of sales
|
5,975.5
|
|
6,189.5
|
|
5,751.5
|
|
|||
Facility closure
|
29.0
|
|
—
|
|
—
|
|
|||
Selling and administrative
|
750.0
|
|
760.8
|
|
713.5
|
|
|||
Research and development
|
72.9
|
|
64.5
|
|
57.6
|
|
|||
Business separation costs
|
—
|
|
—
|
|
32.5
|
|
|||
Cost reduction and asset actions
|
25.5
|
|
—
|
|
151.4
|
|
|||
Goodwill and intangible asset impairment charge
|
—
|
|
—
|
|
162.1
|
|
|||
Gain on exchange of equity affiliate investments
|
29.1
|
|
—
|
|
—
|
|
|||
Other income (expense), net
|
49.3
|
|
50.2
|
|
121.0
|
|
|||
Operating Income
|
2,144.4
|
|
1,965.6
|
|
1,440.0
|
|
|||
Equity affiliates' income
|
215.4
|
|
174.8
|
|
80.1
|
|
|||
Interest expense
|
137.0
|
|
130.5
|
|
120.6
|
|
|||
Other non-operating income (expense), net
|
66.7
|
|
5.1
|
|
16.6
|
|
|||
Income From Continuing Operations Before Taxes
|
2,289.5
|
|
2,015.0
|
|
1,416.1
|
|
|||
Income tax provision
|
480.1
|
|
524.3
|
|
260.9
|
|
|||
Income From Continuing Operations
|
1,809.4
|
|
1,490.7
|
|
1,155.2
|
|
|||
Income from discontinued operations, net of tax
|
—
|
|
42.2
|
|
1,866.0
|
|
|||
Net Income
|
1,809.4
|
|
1,532.9
|
|
3,021.2
|
|
|||
Net income attributable to noncontrolling interests of continuing operations
|
49.4
|
|
35.1
|
|
20.8
|
|
|||
Net Income Attributable to Air Products
|
|
$1,760.0
|
|
|
$1,497.8
|
|
|
$3,000.4
|
|
|
|
|
|
||||||
Net Income Attributable to Air Products
|
|
|
|
||||||
Net income from continuing operations
|
|
$1,760.0
|
|
|
$1,455.6
|
|
|
$1,134.4
|
|
Net income from discontinued operations
|
—
|
|
42.2
|
|
1,866.0
|
|
|||
Net Income Attributable to Air Products
|
|
$1,760.0
|
|
|
$1,497.8
|
|
|
$3,000.4
|
|
Basic Earnings Per Common Share Attributable to Air Products
|
|
|
|
||||||
Basic earnings per share from continuing operations
|
|
$7.99
|
|
|
$6.64
|
|
|
$5.20
|
|
Basic earnings per share from discontinued operations
|
—
|
|
.19
|
|
8.56
|
|
|||
Basic Earnings Per Common Share Attributable to Air Products
|
|
$7.99
|
|
|
$6.83
|
|
|
$13.76
|
|
Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
|
||||||
Diluted earnings per share from continuing operations
|
|
$7.94
|
|
|
$6.59
|
|
|
$5.16
|
|
Diluted earnings per share from discontinued operations
|
—
|
|
.19
|
|
8.49
|
|
|||
Diluted Earnings Per Common Share Attributable to Air Products
|
|
$7.94
|
|
|
$6.78
|
|
|
$13.65
|
|
Weighted Average Common Shares — Basic (in millions)
|
220.3
|
|
219.3
|
|
218.0
|
|
|||
Weighted Average Common Shares — Diluted (in millions)
|
221.6
|
|
220.8
|
|
219.8
|
|
Year ended 30 September
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|||
Net Income
|
|
|
$1,809.4
|
|
|
|
$1,532.9
|
|
|
|
$3,021.2
|
|
Other Comprehensive Income (Loss), net of tax:
|
|
|
|
|
|
|
||||||
Translation adjustments, net of tax of $25.1, $1.1, and ($19.3)
|
|
(356.2
|
)
|
|
(244.6
|
)
|
|
101.9
|
|
|||
Net gain (loss) on derivatives, net of tax of ($1.5), $9.7, and ($11.0)
|
|
(44.1
|
)
|
|
45.9
|
|
|
(12.6
|
)
|
|||
Pension and postretirement benefits, net of tax of ($97.9), $55.2, and $109.0
|
|
(326.2
|
)
|
|
179.4
|
|
|
251.6
|
|
|||
Reclassification adjustments:
|
|
|
|
|
|
|
||||||
Currency translation adjustment
|
|
(2.6
|
)
|
|
3.1
|
|
|
57.3
|
|
|||
Derivatives, net of tax of $4.5, ($9.2), and $11.7
|
|
12.3
|
|
|
(30.4
|
)
|
|
24.2
|
|
|||
Pension and postretirement benefits, net of tax of $20.5, $44.9, and $50.7
|
|
63.2
|
|
|
133.1
|
|
|
110.7
|
|
|||
Total Other Comprehensive Income (Loss)
|
|
(653.6
|
)
|
|
86.5
|
|
|
533.1
|
|
|||
Comprehensive Income
|
|
1,155.8
|
|
|
1,619.4
|
|
|
3,554.3
|
|
|||
Net Income Attributable to Noncontrolling Interests
|
|
49.4
|
|
|
35.1
|
|
|
20.8
|
|
|||
Other Comprehensive Income (Loss) Attributable to Noncontrolling Interests
|
|
(19.9
|
)
|
|
(19.0
|
)
|
|
3.7
|
|
|||
Comprehensive Income Attributable to Air Products
|
|
|
$1,126.3
|
|
|
|
$1,603.3
|
|
|
|
$3,529.8
|
|
30 September
|
2019
|
|
2018
|
|
||
Assets
|
|
|
||||
Current Assets
|
|
|
||||
Cash and cash items
|
|
$2,248.7
|
|
|
$2,791.3
|
|
Short-term investments
|
166.0
|
|
184.7
|
|
||
Trade receivables, net
|
1,260.2
|
|
1,207.2
|
|
||
Inventories
|
388.3
|
|
396.1
|
|
||
Prepaid expenses
|
77.4
|
|
129.6
|
|
||
Other receivables and current assets
|
477.7
|
|
373.3
|
|
||
Total Current Assets
|
4,618.3
|
|
5,082.2
|
|
||
Investment in net assets of and advances to equity affiliates
|
1,276.2
|
|
1,277.2
|
|
||
Plant and equipment, net
|
10,337.6
|
|
9,923.7
|
|
||
Goodwill, net
|
797.1
|
|
788.9
|
|
||
Intangible assets, net
|
419.5
|
|
438.5
|
|
||
Noncurrent capital lease receivables
|
890.0
|
|
1,013.3
|
|
||
Other noncurrent assets
|
604.1
|
|
654.5
|
|
||
Total Noncurrent Assets
|
14,324.5
|
|
14,096.1
|
|
||
Total Assets
|
|
$18,942.8
|
|
|
$19,178.3
|
|
Liabilities and Equity
|
|
|
||||
Current Liabilities
|
|
|
||||
Payables and accrued liabilities
|
|
$1,635.7
|
|
|
$1,817.8
|
|
Accrued income taxes
|
86.6
|
|
59.6
|
|
||
Short-term borrowings
|
58.2
|
|
54.3
|
|
||
Current portion of long-term debt
|
40.4
|
|
406.6
|
|
||
Total Current Liabilities
|
1,820.9
|
|
2,338.3
|
|
||
Long-term debt
|
2,907.3
|
|
2,967.4
|
|
||
Long-term debt – related party
|
320.1
|
|
384.3
|
|
||
Other noncurrent liabilities
|
1,712.4
|
|
1,536.9
|
|
||
Deferred income taxes
|
793.8
|
|
775.1
|
|
||
Total Noncurrent Liabilities
|
5,733.6
|
|
5,663.7
|
|
||
Total Liabilities
|
7,554.5
|
|
8,002.0
|
|
||
Commitments and Contingencies - See Note 18
|
|
|
||||
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
|
1,070.9
|
|
1,029.3
|
|
||
Retained earnings
|
14,138.4
|
|
13,409.9
|
|
||
Accumulated other comprehensive loss
|
(2,375.6
|
)
|
(1,741.9
|
)
|
||
Treasury stock, at cost (2019 - 29,040,322 shares; 2018 - 29,940,339 shares)
|
(2,029.5
|
)
|
(2,089.2
|
)
|
||
Total Air Products Shareholders' Equity
|
11,053.6
|
|
10,857.5
|
|
||
Noncontrolling Interests
|
334.7
|
|
318.8
|
|
||
Total Equity
|
11,388.3
|
|
11,176.3
|
|
||
Total Liabilities and Equity
|
|
$18,942.8
|
|
|
$19,178.3
|
|
Year ended 30 September
|
2019
|
|
2018
|
|
2017
|
|
|||
Operating Activities
|
|
|
|
||||||
Net income
|
|
$1,809.4
|
|
|
$1,532.9
|
|
|
$3,021.2
|
|
Less: Net income attributable to noncontrolling interests of continuing operations
|
49.4
|
|
35.1
|
|
20.8
|
|
|||
Net income attributable to Air Products
|
1,760.0
|
|
1,497.8
|
|
3,000.4
|
|
|||
Income from discontinued operations
|
—
|
|
(42.2
|
)
|
(1,866.0
|
)
|
|||
Income from continuing operations attributable to Air Products
|
1,760.0
|
|
1,455.6
|
|
1,134.4
|
|
|||
Adjustments to reconcile income to cash provided by operating activities:
|
|
|
|
||||||
Depreciation and amortization
|
1,082.8
|
|
970.7
|
|
865.8
|
|
|||
Deferred income taxes
|
57.6
|
|
(55.4
|
)
|
(38.0
|
)
|
|||
Tax reform repatriation
|
49.4
|
|
240.6
|
|
—
|
|
|||
Facility closure
|
29.0
|
|
—
|
|
—
|
|
|||
Undistributed earnings of unconsolidated affiliates
|
(75.8
|
)
|
(59.8
|
)
|
(65.8
|
)
|
|||
Gain on sale of assets and investments
|
(24.2
|
)
|
(6.9
|
)
|
(24.3
|
)
|
|||
Share-based compensation
|
41.2
|
|
38.8
|
|
39.9
|
|
|||
Noncurrent capital lease receivables
|
94.6
|
|
97.4
|
|
92.2
|
|
|||
Goodwill and intangible asset impairment charge
|
—
|
|
—
|
|
162.1
|
|
|||
Equity method investment impairment charge
|
—
|
|
—
|
|
79.5
|
|
|||
Write-down of long-lived assets associated with cost reduction actions
|
—
|
|
—
|
|
69.2
|
|
|||
Other adjustments
|
(19.4
|
)
|
131.6
|
|
165.4
|
|
|||
Working capital changes that provided (used) cash, excluding effects of acquisitions:
|
|
|
|
||||||
Trade receivables
|
(69.0
|
)
|
(42.8
|
)
|
(73.6
|
)
|
|||
Inventories
|
(3.0
|
)
|
(64.2
|
)
|
6.4
|
|
|||
Other receivables
|
79.8
|
|
128.3
|
|
105.4
|
|
|||
Payables and accrued liabilities
|
(41.8
|
)
|
(277.7
|
)
|
163.8
|
|
|||
Other working capital
|
8.7
|
|
(9.0
|
)
|
(154.0
|
)
|
|||
Cash Provided by Operating Activities
|
2,969.9
|
|
2,547.2
|
|
2,528.4
|
|
|||
Investing Activities
|
|
|
|
||||||
Additions to plant and equipment
|
(1,989.7
|
)
|
(1,568.4
|
)
|
(1,039.7
|
)
|
|||
Acquisitions, less cash acquired
|
(123.2
|
)
|
(345.4
|
)
|
(8.2
|
)
|
|||
Investment in and advances to unconsolidated affiliates
|
(15.7
|
)
|
—
|
|
(8.1
|
)
|
|||
Proceeds from sale of assets and investments
|
11.1
|
|
48.8
|
|
42.5
|
|
|||
Purchases of investments
|
(172.1
|
)
|
(530.3
|
)
|
(2,692.6
|
)
|
|||
Proceeds from investments
|
190.5
|
|
748.2
|
|
2,290.7
|
|
|||
Other investing activities
|
(14.3
|
)
|
5.5
|
|
3.4
|
|
|||
Cash Used for Investing Activities
|
(2,113.4
|
)
|
(1,641.6
|
)
|
(1,412.0
|
)
|
|||
Financing Activities
|
|
|
|
||||||
Long-term debt proceeds
|
—
|
|
.5
|
|
2.4
|
|
|||
Payments on long-term debt
|
(428.6
|
)
|
(418.7
|
)
|
(483.9
|
)
|
|||
Net increase (decrease) in commercial paper and short-term borrowings
|
3.9
|
|
(78.5
|
)
|
(798.6
|
)
|
|||
Dividends paid to shareholders
|
(994.0
|
)
|
(897.8
|
)
|
(787.9
|
)
|
|||
Proceeds from stock option exercises
|
68.1
|
|
76.2
|
|
68.4
|
|
|||
Other financing activities
|
(19.9
|
)
|
(41.5
|
)
|
(41.3
|
)
|
|||
Cash Used for Financing Activities
|
(1,370.5
|
)
|
(1,359.8
|
)
|
(2,040.9
|
)
|
|||
Discontinued Operations
|
|
|
|
||||||
Cash used for operating activities
|
—
|
|
(12.8
|
)
|
(966.2
|
)
|
|||
Cash provided by investing activities
|
—
|
|
18.6
|
|
3,750.6
|
|
|||
Cash provided by financing activities
|
—
|
|
—
|
|
69.5
|
|
|||
Cash Provided by Discontinued Operations
|
—
|
|
5.8
|
|
2,853.9
|
|
|||
Effect of Exchange Rate Changes on Cash
|
(28.6
|
)
|
(33.9
|
)
|
13.4
|
|
|||
Increase (Decrease) in cash and cash items
|
(542.6
|
)
|
(482.3
|
)
|
1,942.8
|
|
|||
Cash and Cash items – Beginning of Year
|
2,791.3
|
|
3,273.6
|
|
1,330.8
|
|
|||
Cash and Cash Items – End of Period
|
|
$2,248.7
|
|
|
$2,791.3
|
|
|
$3,273.6
|
|
Year ended 30 September
|
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 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 (loss)
|
—
|
|
—
|
|
—
|
|
529.4
|
|
—
|
|
529.4
|
|
3.7
|
|
533.1
|
|
||||||||
Dividends on common stock (per share $3.71)
|
—
|
|
—
|
|
(808.5
|
)
|
—
|
|
—
|
|
(808.5
|
)
|
—
|
|
(808.5
|
)
|
||||||||
Dividends to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(28.0
|
)
|
(28.0
|
)
|
||||||||
Share-based compensation
|
—
|
|
40.7
|
|
—
|
|
—
|
|
—
|
|
40.7
|
|
—
|
|
40.7
|
|
||||||||
Issuance of treasury shares for stock option and award plans
|
—
|
|
(9.6
|
)
|
—
|
|
—
|
|
63.5
|
|
53.9
|
|
—
|
|
53.9
|
|
||||||||
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 equity transactions
|
—
|
|
—
|
|
(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
|
|
Net income
|
—
|
|
—
|
|
1,497.8
|
|
—
|
|
—
|
|
1,497.8
|
|
35.1
|
|
1,532.9
|
|
||||||||
Other comprehensive income
|
—
|
|
—
|
|
—
|
|
105.5
|
|
—
|
|
105.5
|
|
(19.0
|
)
|
86.5
|
|
||||||||
Dividends on common stock (per share $4.25)
|
—
|
|
—
|
|
(931.8
|
)
|
—
|
|
—
|
|
(931.8
|
)
|
—
|
|
(931.8
|
)
|
||||||||
Dividends to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(29.9
|
)
|
(29.9
|
)
|
||||||||
Share-based compensation
|
—
|
|
38.1
|
|
—
|
|
—
|
|
—
|
|
38.1
|
|
—
|
|
38.1
|
|
||||||||
Issuance of treasury shares for stock option and award plans
|
—
|
|
(11.3
|
)
|
—
|
|
—
|
|
74.3
|
|
63.0
|
|
—
|
|
63.0
|
|
||||||||
Lu'An joint venture
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
227.4
|
|
227.4
|
|
||||||||
Other equity transactions
|
—
|
|
1.4
|
|
(2.7
|
)
|
—
|
|
—
|
|
(1.3
|
)
|
5.9
|
|
4.6
|
|
||||||||
Balance 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
|
—
|
|
—
|
|
1,760.0
|
|
—
|
|
—
|
|
1,760.0
|
|
49.4
|
|
1,809.4
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
—
|
|
—
|
|
(633.7
|
)
|
—
|
|
(633.7
|
)
|
(19.9
|
)
|
(653.6
|
)
|
||||||||
Dividends on common stock (per share $4.58)
|
—
|
|
—
|
|
(1,008.3
|
)
|
—
|
|
—
|
|
(1,008.3
|
)
|
—
|
|
(1,008.3
|
)
|
||||||||
Dividends to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
(12.2
|
)
|
(12.2
|
)
|
|||||||||
Share-based compensation
|
—
|
|
40.7
|
|
—
|
|
—
|
|
—
|
|
40.7
|
|
—
|
|
40.7
|
|
||||||||
Issuance of treasury shares for stock option and award plans
|
—
|
|
2.2
|
|
—
|
|
—
|
|
59.7
|
|
61.9
|
|
—
|
|
61.9
|
|
||||||||
Cumulative change in accounting principle
|
—
|
|
—
|
|
(17.1
|
)
|
|
—
|
|
(17.1
|
)
|
—
|
|
(17.1
|
)
|
|||||||||
Other equity transactions
|
—
|
|
(1.3
|
)
|
(6.1
|
)
|
—
|
|
—
|
|
(7.4
|
)
|
(1.4
|
)
|
(8.8
|
)
|
||||||||
Balance 30 September 2019
|
|
$249.4
|
|
|
$1,070.9
|
|
|
$14,138.4
|
|
|
($2,375.6
|
)
|
|
($2,029.5
|
)
|
|
$11,053.6
|
|
|
$334.7
|
|
|
$11,388.3
|
|
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
|
.
|
||
26
|
.
|
•
|
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.
|
•
|
The package of practical expedients, which allows us to carry forward the historical lease population and classification, among other things;
|
•
|
The land easements practical expedient, which allows us to carry forward our current accounting treatment for land easements on existing agreements;
|
•
|
The hindsight practical expedient, which is used to determine the reasonably certain lease term for existing leases as of the date of adoption;
|
•
|
The single component practical expedient, which allows us to account for lease and non-lease components associated with that lease as a single component, if certain criteria are met; and
|
•
|
The short-term leases practical expedient, which allows us to not record the related lease liabilities and right-of-use assets for operating leases in which we are the lessee with a term of 12 months or less.
|
|
Industrial
Gases– EMEA |
Industrial
Gases– Asia |
Industrial
Gases– Global |
Corporate
and other |
Total
|
%
|
||||||||||||||
2019
|
|
|
|
|
|
|
|
|||||||||||||
On-site
|
|
$2,230.6
|
|
|
$728.4
|
|
|
$1,622.6
|
|
|
$—
|
|
|
$—
|
|
|
$4,581.6
|
|
52
|
%
|
Merchant
|
1,642.9
|
|
1,274.1
|
|
1,041.0
|
|
—
|
|
—
|
|
3,958.0
|
|
44
|
%
|
||||||
Sale of Equipment
|
—
|
|
—
|
|
—
|
|
261.0
|
|
118.3
|
|
379.3
|
|
4
|
%
|
||||||
Total
|
|
$3,873.5
|
|
|
$2,002.5
|
|
|
$2,663.6
|
|
|
$261.0
|
|
|
$118.3
|
|
|
$8,918.9
|
|
100
|
%
|
|
30 September 2019
|
1 October 2018
|
||||
Assets
|
|
|
||||
Contract assets – current
|
|
$64.3
|
|
|
$53.0
|
|
Contract fulfillment costs – current
|
64.5
|
|
50.7
|
|
||
Liabilities
|
|
|
||||
Contract liabilities – current
|
247.4
|
|
174.5
|
|
||
Contract liabilities – noncurrent
|
49.2
|
|
53.5
|
|
|
|
|
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 of business, 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 related to costs incurred for ongoing project exit activities, administrative costs, and land lease obligations.
|
(B)
|
As a result of the expected gain on the 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 included expense for income tax reserves for uncertain tax positions of $28.0 gross ($21.0 net) in various jurisdictions.
|
|
|
||
2019 Charge
|
|
$25.5
|
|
Cash expenditures
|
(6.9
|
)
|
|
Amount reflected in pension liability
|
(.3
|
)
|
|
Currency translation adjustment
|
(.5
|
)
|
|
30 September 2019
|
|
$17.8
|
|
30 September
|
|
2019
|
|
|
2018
|
|
||
Payables and accrued liabilities
|
|
|
$8.9
|
|
|
|
$330.0
|
|
Current portion of long-term debt
|
|
37.8
|
|
|
—
|
|
||
Long-term debt – related party
|
|
320.1
|
|
|
384.3
|
|
30 September
|
|
2019
|
|
|
2018
|
|
||
Finished goods
|
|
|
$128.8
|
|
|
|
$125.4
|
|
Work in process
|
|
27.5
|
|
|
21.2
|
|
||
Raw materials, supplies and other
|
|
232.0
|
|
|
249.5
|
|
||
Inventories
|
|
|
$388.3
|
|
|
|
$396.1
|
|
Abdullah Hashim Industrial Gases & Equipment Co., Ltd. (25%);
|
|
INOX Air Products Private Limited (50%);
|
Air Products South Africa (Proprietary) Limited (50%);
|
|
Jazan Gas Projects Company (26%);
|
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%);
|
INFRA Group (40%);
|
|
and principally, other industrial gas producers.
|
30 September
|
|
|
|
2019
|
|
|
2018
|
|
||||
Current assets
|
|
|
|
|
$1,660.6
|
|
|
|
$1,556.9
|
|
||
Noncurrent assets
|
|
|
|
4,400.4
|
|
|
4,340.8
|
|
||||
Current liabilities
|
|
|
|
725.1
|
|
|
635.7
|
|
||||
Noncurrent liabilities
|
|
|
|
2,853.6
|
|
|
2,652.5
|
|
||||
|
|
|
|
|
|
|
||||||
Year Ended 30 September
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|||
Net sales
|
|
|
$2,885.6
|
|
|
|
$2,663.1
|
|
|
|
$2,343.3
|
|
Sales less cost of sales
|
|
1,193.4
|
|
|
1,050.6
|
|
|
878.6
|
|
|||
Operating income
|
|
763.4
|
|
|
635.3
|
|
|
509.5
|
|
|||
Net income
|
|
492.4
|
|
|
388.0
|
|
|
343.5
|
|
30 September
|
|
Useful Life
in years
|
|
2019
|
|
|
2018
|
|
||||
Land
|
|
|
|
|
|
|
$281.5
|
|
|
|
$269.4
|
|
Buildings
|
|
|
|
30
|
|
946.8
|
|
|
988.6
|
|
||
Production facilities(A)
|
|
10
|
to
|
20
|
|
15,602.1
|
|
|
15,082.8
|
|
||
Distribution and other machinery and equipment(B)
|
|
5
|
to
|
25
|
|
4,491.9
|
|
|
4,400.9
|
|
||
Construction in progress
|
|
|
|
|
|
1,011.4
|
|
|
748.5
|
|
||
Plant and equipment, at cost
|
|
|
|
|
|
22,333.7
|
|
|
21,490.2
|
|
||
Less: Accumulated depreciation
|
|
|
|
|
|
11,996.1
|
|
|
11,566.5
|
|
||
Plant and equipment, net
|
|
|
|
|
|
|
$10,337.6
|
|
|
|
$9,923.7
|
|
(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
|
Corporate and other
|
Total
|
||||||||||||
Goodwill, net at 30 September 2017
|
|
$163.7
|
|
|
$402.4
|
|
|
$135.2
|
|
|
$20.2
|
|
|
$—
|
|
|
$721.5
|
|
Acquisitions
|
—
|
|
29.5
|
|
38.1
|
|
—
|
|
10.4
|
|
78.0
|
|
||||||
Currency translation and other
|
(1.6
|
)
|
(7.5
|
)
|
(1.4
|
)
|
(.1
|
)
|
—
|
|
(10.6
|
)
|
||||||
Goodwill, net at 30 September 2018
|
|
$162.1
|
|
|
$424.4
|
|
|
$171.9
|
|
|
$20.1
|
|
|
$10.4
|
|
|
$788.9
|
|
Acquisitions
|
—
|
|
38.5
|
|
10.1
|
|
—
|
|
—
|
|
48.6
|
|
||||||
Currency translation and other
|
(5.8
|
)
|
(30.6
|
)
|
(3.5
|
)
|
(.5
|
)
|
—
|
|
(40.4
|
)
|
||||||
Goodwill, net at 30 September 2019
|
|
$156.3
|
|
|
$432.3
|
|
|
$178.5
|
|
|
$19.6
|
|
|
$10.4
|
|
|
$797.1
|
|
30 September
|
2019
|
|
2018
|
|
2017
|
|
|||
Goodwill, gross
|
|
$1,162.2
|
|
|
$1,194.7
|
|
|
$1,138.7
|
|
Accumulated impairment losses(A)
|
(365.1
|
)
|
(405.8
|
)
|
(417.2
|
)
|
|||
Goodwill, net
|
|
$797.1
|
|
|
$788.9
|
|
|
$721.5
|
|
(A)
|
Accumulated impairment losses include the impacts of currency translation. These losses are attributable to our Latin America reporting unit (LASA) within the Industrial Gases – Americas segment.
|
|
|
30 September 2019
|
|
30 September 2018
|
||||||||||||||||||||
|
|
Gross
|
|
|
Accumulated
Amortization/
Impairment
|
|
|
Net
|
|
|
Gross
|
|
|
Accumulated
Amortization/
Impairment
|
|
|
Net
|
|
||||||
Customer relationships
|
|
|
$487.9
|
|
|
|
($179.8
|
)
|
|
|
$308.1
|
|
|
|
$491.9
|
|
|
|
($165.5
|
)
|
|
|
$326.4
|
|
Patents and technology
|
|
39.0
|
|
|
(13.3
|
)
|
|
25.7
|
|
|
34.0
|
|
|
(11.9
|
)
|
|
22.1
|
|
||||||
Other
|
|
75.0
|
|
|
(33.4
|
)
|
|
41.6
|
|
|
72.6
|
|
|
(33.8
|
)
|
|
38.8
|
|
||||||
Total finite-lived intangibles
|
|
601.9
|
|
|
(226.5
|
)
|
|
375.4
|
|
|
598.5
|
|
|
(211.2
|
)
|
|
387.3
|
|
||||||
Trade names and trademarks, indefinite-lived
|
|
56.2
|
|
|
(12.1
|
)
|
|
44.1
|
|
|
64.8
|
|
|
(13.6
|
)
|
|
51.2
|
|
||||||
Total Intangible Assets
|
|
|
$658.1
|
|
|
|
($238.6
|
)
|
|
|
$419.5
|
|
|
|
$663.3
|
|
|
|
($224.8
|
)
|
|
|
$438.5
|
|
2020
|
|
$35.3
|
|
2021
|
33.5
|
|
|
2022
|
30.8
|
|
|
2023
|
29.6
|
|
|
2024
|
28.6
|
|
|
Thereafter
|
217.6
|
|
|
Total
|
|
$375.4
|
|
|
|
Capital
Leases
|
|
Operating
Leases
|
||||
2020
|
|
|
$1.7
|
|
|
|
$75.1
|
|
2021
|
|
2.5
|
|
|
62.6
|
|
||
2022
|
|
1.3
|
|
|
44.4
|
|
||
2023
|
|
1.1
|
|
|
35.9
|
|
||
2024
|
|
1.1
|
|
|
28.6
|
|
||
Thereafter
|
|
12.8
|
|
|
171.4
|
|
||
Total
|
|
|
$20.5
|
|
|
|
$418.0
|
|
2020
|
|
$321.7
|
|
2021
|
287.3
|
|
|
2022
|
283.1
|
|
|
2023
|
278.4
|
|
|
2024
|
275.5
|
|
|
Thereafter
|
3,042.5
|
|
|
Total
|
|
$4,488.5
|
|
30 September
|
|
2019
|
|
|
2018
|
|
||
Gross minimum lease payments receivable
|
|
|
$1,453.2
|
|
|
|
$1,673.7
|
|
Unearned interest income
|
|
(472.3
|
)
|
|
(568.3
|
)
|
||
Lease Receivables, net
|
|
|
$980.9
|
|
|
|
$1,105.4
|
|
2020
|
|
$162.5
|
|
2021
|
156.9
|
|
|
2022
|
145.7
|
|
|
2023
|
139.4
|
|
|
2024
|
133.2
|
|
|
Thereafter
|
715.5
|
|
|
Total
|
|
$1,453.2
|
|
|
|
30 September 2019
|
|
30 September 2018
|
||||||||
|
|
US$
Notional
|
|
|
Years
Average
Maturity
|
|
US$
Notional
|
|
|
Years
Average
Maturity
|
||
Forward Exchange Contracts
|
|
|
|
|
|
|
|
|
||||
Cash flow hedges
|
|
|
$2,418.2
|
|
|
0.5
|
|
|
$2,489.1
|
|
|
0.4
|
Net investment hedges
|
|
830.8
|
|
|
0.9
|
|
457.5
|
|
|
1.7
|
||
Not designated
|
|
1,053.5
|
|
|
0.6
|
|
1,736.1
|
|
|
0.8
|
||
Total Forward Exchange Contracts
|
|
|
$4,302.5
|
|
|
0.6
|
|
|
$4,682.7
|
|
|
0.7
|
|
|
30 September 2019
|
|
30 September 2018
|
||||||||||||||||||||
|
|
US$
Notional
|
|
|
Average Pay %
|
|
|
Average
Receive
%
|
|
|
Years
Average
Maturity
|
|
US$
Notional
|
|
|
Average Pay %
|
|
|
Average
Receive
%
|
|
|
Years
Average
Maturity
|
||
Interest rate swaps (fair value hedge)
|
|
|
$200.0
|
|
|
LIBOR
|
|
|
2.76
|
%
|
|
2.1
|
|
|
$600.0
|
|
|
LIBOR
|
|
|
2.60
|
%
|
|
1.6
|
Cross currency interest rate swaps (net investment hedge)
|
|
|
$216.8
|
|
|
4.80
|
%
|
|
3.31
|
%
|
|
3.5
|
|
|
$201.7
|
|
|
4.42
|
%
|
|
2.97
|
%
|
|
3.1
|
Cross currency interest rate swaps (cash flow hedge)
|
|
|
$1,129.3
|
|
|
4.92
|
%
|
|
3.04
|
%
|
|
2.3
|
|
|
$1,052.7
|
|
|
4.99
|
%
|
|
2.89
|
%
|
|
2.3
|
Cross currency interest rate swaps (not designated)
|
|
|
$6.1
|
|
|
2.55
|
%
|
|
3.72
|
%
|
|
4.5
|
|
|
$80.2
|
|
|
4.88
|
%
|
|
3.43
|
%
|
|
3.9
|
|
|
Balance Sheet
|
|
30 September
|
|
Balance Sheet
|
|
30 September
|
||||||||||||
|
|
Location
|
|
2019
|
|
|
2018
|
|
|
Location
|
|
2019
|
|
|
2018
|
|
||||
Derivatives Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
Other receivables
|
|
|
$79.0
|
|
|
|
$24.9
|
|
|
Accrued liabilities
|
|
|
$53.8
|
|
|
|
$37.0
|
|
Interest rate management contracts
|
|
Other receivables
|
|
24.8
|
|
|
24.3
|
|
|
Accrued liabilities
|
|
1.1
|
|
|
2.3
|
|
||||
Forward exchange contracts
|
|
Other noncurrent assets
|
|
11.9
|
|
|
19.8
|
|
|
Other noncurrent
liabilities
|
|
.7
|
|
|
4.6
|
|
||||
Interest rate management contracts
|
|
Other noncurrent assets
|
|
60.9
|
|
|
48.7
|
|
|
Other noncurrent
liabilities |
|
.7
|
|
|
11.6
|
|
||||
Total Derivatives Designated as Hedging Instruments
|
|
|
|
|
$176.6
|
|
|
|
$117.7
|
|
|
|
|
|
$56.3
|
|
|
|
$55.5
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
Other receivables
|
|
38.7
|
|
|
7.9
|
|
|
Accrued liabilities
|
|
|
$36.3
|
|
|
|
$14.9
|
|
||
Interest rate management contracts
|
|
Other receivables
|
|
—
|
|
|
4.0
|
|
|
Accrued liabilities
|
|
—
|
|
|
—
|
|
||||
Forward exchange contracts
|
|
Other noncurrent assets
|
|
8.4
|
|
|
16.2
|
|
|
Other noncurrent liabilities
|
|
19.8
|
|
|
23.7
|
|
||||
Interest rate management contracts
|
|
Other noncurrent assets
|
|
.5
|
|
|
.3
|
|
|
Other noncurrent
liabilities |
|
—
|
|
|
—
|
|
||||
Total Derivatives Not Designated as Hedging Instruments
|
|
|
|
|
$47.6
|
|
|
|
$28.4
|
|
|
|
|
|
$56.1
|
|
|
|
$38.6
|
|
Total Derivatives
|
|
|
|
|
$224.2
|
|
|
|
$146.1
|
|
|
|
|
|
$112.4
|
|
|
|
$94.1
|
|
|
|
Year Ended 30 September
|
||||||||||||||||||||||||||||||
|
|
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)
|
|
|
($35.7
|
)
|
|
|
$2.4
|
|
|
|
$—
|
|
|
|
$—
|
|
|
|
($8.4
|
)
|
|
|
$43.5
|
|
|
|
($44.1
|
)
|
|
|
$45.9
|
|
Net (gain) loss reclassified from OCI to sales/cost of sales (effective portion)
|
|
.6
|
|
|
7.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
.6
|
|
|
7.1
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (effective portion)
|
|
21.8
|
|
|
(7.8
|
)
|
|
—
|
|
|
—
|
|
|
(24.7
|
)
|
|
(33.8
|
)
|
|
(2.9
|
)
|
|
(41.6
|
)
|
||||||||
Net (gain) loss reclassified from OCI to interest expense (effective portion)
|
|
12.1
|
|
|
1.2
|
|
|
—
|
|
|
—
|
|
|
2.6
|
|
|
3.9
|
|
|
14.7
|
|
|
5.1
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (ineffective portion)
|
|
—
|
|
|
(.5
|
)
|
|
—
|
|
|
—
|
|
|
(.1
|
)
|
|
(.5
|
)
|
|
(.1
|
)
|
|
(1.0
|
)
|
||||||||
Fair Value Hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in interest expense(B)
|
|
|
$—
|
|
|
|
$—
|
|
|
|
$—
|
|
|
|
$—
|
|
|
|
$4.3
|
|
|
|
($10.1
|
)
|
|
|
$4.3
|
|
|
|
($10.1
|
)
|
Net Investment Hedges, net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI
|
|
|
$39.1
|
|
|
|
($.6
|
)
|
|
|
$49.6
|
|
|
|
$10.2
|
|
|
|
$9.8
|
|
|
|
$11.0
|
|
|
|
$98.5
|
|
|
|
$20.6
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in other income (expense), net(C)
|
|
|
($1.3
|
)
|
|
|
($4.0
|
)
|
|
|
$—
|
|
|
|
$—
|
|
|
|
$2.0
|
|
|
|
($.8
|
)
|
|
|
$.7
|
|
|
|
($4.8
|
)
|
(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 September 2019
|
|
30 September 2018
|
||||||||||||
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
|
$138.0
|
|
|
|
$138.0
|
|
|
|
$68.8
|
|
|
|
$68.8
|
|
Interest rate management contracts
|
|
86.2
|
|
|
86.2
|
|
|
77.3
|
|
|
77.3
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
|
$110.6
|
|
|
|
$110.6
|
|
|
|
$80.2
|
|
|
|
$80.2
|
|
Interest rate management contracts
|
|
1.8
|
|
|
1.8
|
|
|
13.9
|
|
|
13.9
|
|
||||
Long-term debt, including current portion and related party
|
|
3,267.8
|
|
|
3,350.9
|
|
|
3,758.3
|
|
|
3,788.2
|
|
|
|
30 September 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
|
|
|
$138.0
|
|
|
|
$—
|
|
|
|
$138.0
|
|
|
|
$—
|
|
|
|
$68.8
|
|
|
|
$—
|
|
|
|
$68.8
|
|
|
|
$—
|
|
Interest rate management contracts
|
|
86.2
|
|
|
—
|
|
|
86.2
|
|
|
—
|
|
|
77.3
|
|
|
—
|
|
|
77.3
|
|
|
—
|
|
||||||||
Total Assets at Fair Value
|
|
|
$224.2
|
|
|
|
$—
|
|
|
|
$224.2
|
|
|
|
$—
|
|
|
|
$146.1
|
|
|
|
$—
|
|
|
|
$146.1
|
|
|
|
$—
|
|
Liabilities at Fair Value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Forward exchange contracts
|
|
|
$110.6
|
|
|
|
$—
|
|
|
|
$110.6
|
|
|
|
$—
|
|
|
|
$80.2
|
|
|
|
$—
|
|
|
|
$80.2
|
|
|
|
$—
|
|
Interest rate management contracts
|
|
1.8
|
|
|
—
|
|
|
1.8
|
|
|
—
|
|
|
13.9
|
|
|
—
|
|
|
13.9
|
|
|
—
|
|
||||||||
Total Liabilities at Fair Value
|
|
|
$112.4
|
|
|
|
$—
|
|
|
|
$112.4
|
|
|
|
$—
|
|
|
|
$94.1
|
|
|
|
$—
|
|
|
|
$94.1
|
|
|
|
$—
|
|
|
30 June 2017
|
2017 Loss
|
||||||||||||||
|
Total
|
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||
Investment in Equity Affiliate(A)
|
|
$68.5
|
|
|
|
$—
|
|
|
$—
|
|
|
$68.5
|
|
|
$79.5
|
|
(A)
|
In fiscal year 2017, 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 events during fiscal years 2018 or 2019 requiring reassessment of our investment. For additional information, see Note 9, Summarized Financial Information of Equity Affiliates.
|
30 September
|
|
2019
|
|
|
2018
|
|
||
Short-term borrowings
|
|
|
$58.2
|
|
|
|
$54.3
|
|
Current portion of long-term debt(A)(B)
|
|
40.4
|
|
|
406.6
|
|
||
Long-term debt
|
|
2,907.3
|
|
|
2,967.4
|
|
||
Long-term debt – related party(B)
|
|
320.1
|
|
|
384.3
|
|
||
Total Debt
|
|
|
$3,326.0
|
|
|
|
$3,812.6
|
|
(A)
|
Fiscal year 2019 includes the current portion of long-term debt owed to a related party of $37.8.
|
(B)
|
Refer to Note 7, Acquisitions, for additional information regarding related party debt.
|
30 September
|
|
Fiscal Year
Maturities
|
|
2019
|
|
|
2018
|
|
||
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 4.375%
|
|
2019
|
|
—
|
|
|
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 1.44%
|
|
2035 to 2050
|
|
631.9
|
|
|
631.9
|
|
||
Other .25%(A)
|
|
|
|
—
|
|
|
.9
|
|
||
Payable in Other Currencies
|
|
|
|
|
|
|
||||
Eurobonds 2.0%
|
|
2020
|
|
327.0
|
|
|
348.1
|
|
||
Eurobonds .375%
|
|
2021
|
|
381.5
|
|
|
406.2
|
|
||
Eurobonds 1.0%
|
|
2025
|
|
327.0
|
|
|
348.1
|
|
||
Other 2.9%
|
|
2020 to 2023
|
|
3.8
|
|
|
8.0
|
|
||
Related Party(B)
|
|
|
|
|
|
|
||||
Chinese Renminbi 5.5%
|
|
2020 to 2026
|
|
357.9
|
|
|
384.3
|
|
||
Capital Lease Obligations
|
|
|
|
|
|
|
||||
Foreign 10.3%
|
|
2020 to 2036
|
|
10.1
|
|
|
10.5
|
|
||
Total Principal Amount
|
|
|
|
3,274.8
|
|
|
3,773.6
|
|
||
Less: Unamortized discount and debt issuance costs
|
|
|
|
(12.2
|
)
|
|
(15.3
|
)
|
||
Less: Fair value hedge accounting adjustments(A)
|
|
|
|
5.2
|
|
|
—
|
|
||
Total Long-term Debt
|
|
|
|
3,267.8
|
|
|
3,758.3
|
|
||
Less: Current portion of long-term debt
|
|
|
|
(40.4
|
)
|
|
(406.6
|
)
|
||
Less: Long-term debt – related party
|
|
|
|
(320.1
|
)
|
|
(384.3
|
)
|
||
Long-term Debt
|
|
|
|
|
$2,907.3
|
|
|
|
$2,967.4
|
|
(A)
|
The Company has entered into LIBOR-based interest rate swap arrangements with various counterparty financial institutions on certain of our outstanding fixed-rate senior notes, which have maturity dates between 2019 and 2022. These interest rate swaps have been designated as fair value hedges of the notes. Refer to Note 14, Financial Instruments, for additional information. The fiscal year 2018 fair value hedge accounting adjustment is reflected as "Other" senior notes in the table above.
|
(B)
|
Refer to Note 7, Acquisitions, for additional information regarding related party debt.
|
2020
|
|
$367.4
|
|
2021
|
440.2
|
|
|
2022
|
439.3
|
|
|
2023
|
453.7
|
|
|
2024
|
453.4
|
|
|
Thereafter
|
1,120.8
|
|
|
Total
|
|
$3,274.8
|
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
||||||
Service cost
|
|
$21.4
|
|
|
$19.3
|
|
|
|
$25.5
|
|
|
$25.5
|
|
|
|
$29.0
|
|
|
$25.9
|
|
Interest cost
|
113.4
|
|
35.8
|
|
|
107.2
|
|
37.3
|
|
|
107.5
|
|
32.2
|
|
||||||
Expected return on plan assets
|
(172.5
|
)
|
(75.1
|
)
|
|
(201.6
|
)
|
(81.7
|
)
|
|
(207.7
|
)
|
(75.2
|
)
|
||||||
Amortization
|
|
|
|
|
|
|
|
|
||||||||||||
Net actuarial loss
|
65.3
|
|
10.9
|
|
|
87.4
|
|
40.2
|
|
|
88.7
|
|
54.7
|
|
||||||
Prior service cost (credit)
|
1.1
|
|
—
|
|
|
1.6
|
|
—
|
|
|
2.3
|
|
(.1
|
)
|
||||||
Settlements
|
6.2
|
|
.2
|
|
|
45.0
|
|
3.5
|
|
|
10.5
|
|
1.7
|
|
||||||
Curtailments
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
4.3
|
|
(1.3
|
)
|
||||||
Special termination benefits
|
.7
|
|
.1
|
|
|
.4
|
|
—
|
|
|
2.8
|
|
.4
|
|
||||||
Other
|
—
|
|
.8
|
|
|
—
|
|
1.5
|
|
|
—
|
|
1.1
|
|
||||||
Net Periodic Benefit Cost/(Benefit) – Total
|
|
$35.6
|
|
|
($8.0
|
)
|
|
|
$65.5
|
|
|
$26.3
|
|
|
|
$37.4
|
|
|
$39.4
|
|
Less: Discontinued Operations
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
(.7
|
)
|
(4.1
|
)
|
||||||
Net Periodic Benefit Cost/(Benefit) – Continuing Operations
|
|
$35.6
|
|
|
($8.0
|
)
|
|
|
$65.5
|
|
|
$26.3
|
|
|
|
$36.7
|
|
|
$35.3
|
|
|
2019
|
|
2018
|
|
2017
|
|||||||||
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
Discount rate – Service cost
|
4.3
|
%
|
2.5
|
%
|
|
3.9
|
%
|
2.6
|
%
|
|
3.6
|
%
|
2.1
|
%
|
Discount rate – Interest cost
|
4.0
|
%
|
2.2
|
%
|
|
3.3
|
%
|
2.2
|
%
|
|
3.0
|
%
|
1.8
|
%
|
Expected return on plan assets
|
7.0
|
%
|
5.3
|
%
|
|
7.5
|
%
|
5.8
|
%
|
|
8.0
|
%
|
6.1
|
%
|
Rate of compensation increase
|
3.5
|
%
|
3.5
|
%
|
|
3.5
|
%
|
3.6
|
%
|
|
3.5
|
%
|
3.5
|
%
|
|
|
2019
|
|
2018
|
||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
Discount rate
|
|
3.2
|
%
|
|
1.5
|
%
|
|
4.3
|
%
|
|
2.5
|
%
|
Rate of compensation increase
|
|
3.5
|
%
|
|
3.3
|
%
|
|
3.5
|
%
|
|
3.5
|
%
|
|
|
2019
|
|
2018
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Change in Projected Benefit Obligation
|
|
|
|
|
|
|
|
|
||||||||
Obligation at beginning of year
|
|
|
$2,922.8
|
|
|
|
$1,660.5
|
|
|
|
$3,357.7
|
|
|
|
$1,749.5
|
|
Service cost
|
|
21.4
|
|
|
19.3
|
|
|
25.5
|
|
|
25.5
|
|
||||
Interest cost
|
|
113.4
|
|
|
35.8
|
|
|
107.2
|
|
|
37.3
|
|
||||
Amendments
|
|
1.1
|
|
|
4.7
|
|
|
.1
|
|
|
.7
|
|
||||
Actuarial loss (gain)
|
|
380.3
|
|
|
300.2
|
|
|
(217.8
|
)
|
|
(33.9
|
)
|
||||
Settlements
|
|
(12.2
|
)
|
|
(1.6
|
)
|
|
(193.0
|
)
|
|
(24.6
|
)
|
||||
Special termination benefits
|
|
.7
|
|
|
.1
|
|
|
.4
|
|
|
—
|
|
||||
Participant contributions
|
|
—
|
|
|
1.3
|
|
|
—
|
|
|
1.4
|
|
||||
Benefits paid
|
|
(146.2
|
)
|
|
(47.7
|
)
|
|
(157.3
|
)
|
|
(51.3
|
)
|
||||
Currency translation and other
|
|
.3
|
|
|
(108.6
|
)
|
|
—
|
|
|
(44.1
|
)
|
||||
Obligation at End of Year
|
|
|
$3,281.6
|
|
|
|
$1,864.0
|
|
|
|
$2,922.8
|
|
|
|
$1,660.5
|
|
|
|
2019
|
|
2018
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Change in Plan Assets
|
|
|
|
|
|
|
|
|
||||||||
Fair value at beginning of year
|
|
|
$2,684.9
|
|
|
|
$1,588.2
|
|
|
|
$2,869.2
|
|
|
|
$1,540.0
|
|
Actual return on plan assets
|
|
289.9
|
|
|
208.0
|
|
|
150.2
|
|
|
115.5
|
|
||||
Company contributions
|
|
16.0
|
|
|
24.2
|
|
|
14.6
|
|
|
53.7
|
|
||||
Participant contributions
|
|
—
|
|
|
1.3
|
|
|
—
|
|
|
1.4
|
|
||||
Benefits paid
|
|
(146.2
|
)
|
|
(47.7
|
)
|
|
(157.3
|
)
|
|
(51.3
|
)
|
||||
Settlements
|
|
(12.2
|
)
|
|
(1.6
|
)
|
|
(191.8
|
)
|
|
(24.6
|
)
|
||||
Currency translation and other
|
|
—
|
|
|
(100.0
|
)
|
|
—
|
|
|
(46.5
|
)
|
||||
Fair Value at End of Year
|
|
|
$2,832.4
|
|
|
|
$1,672.4
|
|
|
|
$2,684.9
|
|
|
|
$1,588.2
|
|
Funded Status at End of Year
|
|
|
($449.2
|
)
|
|
|
($191.6
|
)
|
|
|
($237.9
|
)
|
|
|
($72.3
|
)
|
|
|
2019
|
|
2018
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Amounts Recognized
|
|
|
|
|
|
|
|
|
||||||||
Noncurrent assets
|
|
|
$17.3
|
|
|
|
$11.4
|
|
|
|
$28.2
|
|
|
|
$103.5
|
|
Accrued liabilities
|
|
18.3
|
|
|
—
|
|
|
23.5
|
|
|
1.2
|
|
||||
Noncurrent liabilities
|
|
448.2
|
|
|
203.0
|
|
|
242.6
|
|
|
174.6
|
|
||||
Net Liability Recognized
|
|
|
$449.2
|
|
|
|
$191.6
|
|
|
|
$237.9
|
|
|
|
$72.3
|
|
|
|
2019
|
|
2018
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Net actuarial loss (gain) arising during the period
|
|
|
$262.9
|
|
|
|
$161.5
|
|
|
|
($167.7
|
)
|
|
|
($64.6
|
)
|
Amortization of net actuarial loss
|
|
(71.5
|
)
|
|
(11.1
|
)
|
|
(132.4
|
)
|
|
(43.7
|
)
|
||||
Prior service cost arising during the period
|
|
1.1
|
|
|
4.7
|
|
|
.1
|
|
|
.7
|
|
||||
Amortization of prior service cost
|
|
(1.1
|
)
|
|
—
|
|
|
(1.6
|
)
|
|
—
|
|
||||
Total
|
|
|
$191.4
|
|
|
|
$155.1
|
|
|
|
($301.6
|
)
|
|
|
($107.6
|
)
|
|
|
2019
|
|
2018
|
||||||||||||
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Net actuarial loss
|
|
|
$871.8
|
|
|
|
$594.0
|
|
|
|
$680.4
|
|
|
|
$443.6
|
|
Prior service cost (credit)
|
|
6.6
|
|
|
3.6
|
|
|
6.6
|
|
|
(1.1
|
)
|
||||
Net transition liability
|
|
—
|
|
|
.4
|
|
|
—
|
|
|
.4
|
|
||||
Total
|
|
|
$878.4
|
|
|
|
$598.0
|
|
|
|
$687.0
|
|
|
|
$442.9
|
|
|
|
U.S.
|
|
|
International
|
|
||
Net actuarial loss
|
|
|
$84.2
|
|
|
|
$19.2
|
|
Prior service cost (credit)
|
|
1.4
|
|
|
—
|
|
|
30 September 2019
|
|
30 September 2018
|
||||||||||
|
U.S.
|
|
International
|
|
|
U.S.
|
|
International
|
|
||||
Pension Plans with PBO in Excess of Plan Assets:
|
|
|
|
|
|
||||||||
PBO
|
|
$3,069.2
|
|
|
$521.1
|
|
|
|
$2,733.6
|
|
|
$452.6
|
|
Fair value of plan assets
|
2,602.8
|
|
318.0
|
|
|
2,467.5
|
|
276.8
|
|
||||
Pension Plans with ABO in Excess of Plan Assets:
|
|
|
|
|
|
||||||||
ABO
|
|
$2,941.2
|
|
|
$413.3
|
|
|
|
$2,608.6
|
|
|
$357.9
|
|
Fair value of plan assets
|
2,602.8
|
|
266.5
|
|
|
2,467.5
|
|
228.2
|
|
|
|
2019 Target Allocation
|
|
2019 Actual Allocation
|
|
2018 Actual Allocation
|
||||||||||||||
|
|
U.S.
|
|
International
|
|
U.S.
|
|
|
International
|
|
|
U.S.
|
|
|
International
|
|
||||
Asset Category
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity securities
|
|
43
|
-
|
58%
|
|
39
|
-
|
49%
|
|
38
|
%
|
|
42
|
%
|
|
41
|
%
|
|
46
|
%
|
Debt securities
|
|
34
|
-
|
49%
|
|
51
|
-
|
61%
|
|
56
|
%
|
|
57
|
%
|
|
50
|
%
|
|
53
|
%
|
Real estate and other
|
|
—
|
-
|
10%
|
|
|
|
—%
|
|
6
|
%
|
|
—
|
%
|
|
8
|
%
|
|
—
|
%
|
Cash
|
|
|
|
—%
|
|
|
|
—%
|
|
—
|
%
|
|
1
|
%
|
|
1
|
%
|
|
1
|
%
|
Total
|
|
|
|
|
|
|
|
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
30 September 2019
|
|
30 September 2018
|
||||||||||||||||||||||
|
Total
|
Level 1
|
Level 2
|
Level 3
|
|
Total
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||||||
U.S. Qualified Pension Plans
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Cash and cash equivalents
|
|
$13.7
|
|
|
$13.7
|
|
|
$—
|
|
|
$—
|
|
|
|
$13.8
|
|
|
$13.8
|
|
|
$—
|
|
|
$—
|
|
Equity securities
|
401.1
|
|
401.1
|
|
—
|
|
—
|
|
|
397.9
|
|
397.9
|
|
—
|
|
—
|
|
||||||||
Equity mutual funds
|
152.9
|
|
152.9
|
|
—
|
|
—
|
|
|
173.8
|
|
173.8
|
|
—
|
|
—
|
|
||||||||
Equity pooled funds
|
524.8
|
|
—
|
|
524.8
|
|
—
|
|
|
545.2
|
|
—
|
|
545.2
|
|
—
|
|
||||||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Bonds (government
and corporate)
|
1,572.1
|
|
—
|
|
1,572.1
|
|
—
|
|
|
1,344.6
|
|
—
|
|
1,344.6
|
|
—
|
|
||||||||
Total U.S. Qualified Pension Plans at Fair Value
|
|
$2,664.6
|
|
|
$567.7
|
|
|
$2,096.9
|
|
|
$—
|
|
|
|
$2,475.3
|
|
|
$585.5
|
|
|
$1,889.8
|
|
|
$—
|
|
Real estate pooled funds(A)
|
|
$167.8
|
|
|
|
|
|
|
$209.6
|
|
|
|
|
||||||||||||
Total U.S. Qualified Pension Plans
|
|
$2,832.4
|
|
|
|
|
|
|
|
|
$2,684.9
|
|
|
|
|
|
|
||||||||
International Pension Plans
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Cash and cash equivalents
|
|
$13.4
|
|
|
$13.4
|
|
|
$—
|
|
|
$—
|
|
|
|
$15.8
|
|
|
$15.8
|
|
|
$—
|
|
|
$—
|
|
Equity pooled funds
|
711.3
|
|
—
|
|
711.3
|
|
—
|
|
|
727.9
|
|
—
|
|
727.9
|
|
—
|
|
||||||||
Fixed income pooled funds
|
679.9
|
|
—
|
|
679.9
|
|
—
|
|
|
615.2
|
|
—
|
|
615.2
|
|
—
|
|
||||||||
Other pooled funds
|
13.7
|
|
—
|
|
13.7
|
|
—
|
|
|
11.6
|
|
—
|
|
11.6
|
|
—
|
|
||||||||
Insurance contracts
|
254.1
|
|
—
|
|
—
|
|
254.1
|
|
|
217.7
|
|
—
|
|
—
|
|
217.7
|
|
||||||||
Total International Pension Plans
|
|
$1,672.4
|
|
|
$13.4
|
|
|
$1,404.9
|
|
|
$254.1
|
|
|
|
$1,588.2
|
|
|
$15.8
|
|
|
$1,354.7
|
|
|
$217.7
|
|
(A)
|
Real estate pooled funds consist of funds that invest in properties. These funds generally allow for quarterly redemption with 30 days' notice. Timing for redemption could be delayed based on the priority of our request and the availability of funds. Interests in these funds are valued using the net asset value (NAV) per share practical expedient and are not classified in the fair value hierarchy.
|
|
|
Other
Pooled Funds
|
|
|
Insurance
Contracts
|
|
|
Total
|
|
|||
30 September 2017
|
|
|
$7.8
|
|
|
|
$41.4
|
|
|
|
$49.2
|
|
Actual return on plan assets:
|
|
|
|
|
|
|
||||||
Assets held at end of year
|
|
—
|
|
|
.9
|
|
|
.9
|
|
|||
Assets sold during the period
|
|
.5
|
|
|
—
|
|
|
.5
|
|
|||
Purchases, sales, and settlements, net
|
|
(8.3
|
)
|
|
175.4
|
|
|
167.1
|
|
|||
30 September 2018
|
|
|
$—
|
|
|
|
$217.7
|
|
|
|
$217.7
|
|
Actual return on plan assets:
|
|
|
|
|
|
|
||||||
Assets held at end of year
|
|
—
|
|
|
38.1
|
|
|
38.1
|
|
|||
Purchases, sales, and settlements, net
|
|
—
|
|
|
(1.7
|
)
|
|
(1.7
|
)
|
|||
30 September 2019
|
|
|
$—
|
|
|
|
$254.1
|
|
|
|
$254.1
|
|
|
|
U.S.
|
|
|
International
|
|
||
2020
|
|
|
$166.8
|
|
|
|
$47.9
|
|
2021
|
|
160.0
|
|
|
49.1
|
|
||
2022
|
|
166.0
|
|
|
50.1
|
|
||
2023
|
|
170.1
|
|
|
54.3
|
|
||
2024
|
|
174.1
|
|
|
58.0
|
|
||
2025-2029
|
|
919.9
|
|
|
308.3
|
|
Balance at 30 September 2017
|
|
$144.7
|
|
Additional accruals
|
43.8
|
|
|
Liabilities settled
|
(2.6
|
)
|
|
Accretion expense
|
7.2
|
|
|
Currency translation adjustment
|
(2.7
|
)
|
|
Balance at 30 September 2018
|
|
$190.4
|
|
Additional accruals
|
14.7
|
|
|
Liabilities settled
|
(2.1
|
)
|
|
Accretion expense
|
8.7
|
|
|
Currency translation adjustment
|
(3.5
|
)
|
|
Balance at 30 September 2019
|
|
$208.2
|
|
2020
|
|
$1,358
|
|
2021
|
407
|
|
|
2022
|
369
|
|
|
2023
|
349
|
|
|
2024
|
350
|
|
|
Thereafter
|
5,477
|
|
|
Total
|
|
$8,310
|
|
Year ended 30 September
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
Number of Common Shares Outstanding
|
|
|
|
|
|
|
|||
Balance, beginning of year
|
|
219,515,245
|
|
|
218,346,074
|
|
|
217,350,825
|
|
Issuance of treasury shares for stock option and award plans
|
|
900,017
|
|
|
1,169,171
|
|
|
995,249
|
|
Balance, end of year
|
|
220,415,262
|
|
|
219,515,245
|
|
|
218,346,074
|
|
|
2019
|
|
2018
|
|
2017
|
|
|||
Before-Tax Share-Based Compensation Cost – Total
|
|
$41.2
|
|
|
$38.8
|
|
|
$40.7
|
|
Before-Tax Share-Based Compensation Cost – Discontinued Operations
|
—
|
|
—
|
|
.8
|
|
|||
Before-Tax Share-Based Compensation Cost – Continuing Operations
|
|
$41.2
|
|
|
$38.8
|
|
|
$39.9
|
|
Income tax benefit – Continuing Operations
|
(9.7
|
)
|
(9.1
|
)
|
(14.0
|
)
|
|||
After-Tax Share-Based Compensation Cost – Continuing Operations
|
|
$31.5
|
|
|
$29.7
|
|
|
$25.9
|
|
|
2019
|
|
2018
|
|
2017
|
|
|||
Deferred stock units
|
|
$41.1
|
|
|
$38.3
|
|
|
$34.5
|
|
Stock options
|
—
|
|
.2
|
|
1.4
|
|
|||
Restricted stock
|
.1
|
|
.3
|
|
4.8
|
|
|||
Before-Tax Share-Based Compensation Cost – Total
|
|
$41.2
|
|
|
$38.8
|
|
|
$40.7
|
|
|
|
2019
|
2018
|
2017
|
|||
Expected volatility
|
|
17.5
|
%
|
18.7
|
%
|
20.6
|
%
|
Risk-free interest rate
|
|
2.8
|
%
|
1.9
|
%
|
1.4
|
%
|
Expected dividend yield
|
|
2.6
|
%
|
2.6
|
%
|
2.5
|
%
|
Deferred Stock Units
|
|
Shares (000)
|
|
|
Weighted Average
Grant-Date Fair Value
|
|
|
Outstanding at 30 September 2018
|
|
940
|
|
|
|
$137.78
|
|
Granted
|
|
285
|
|
|
193.29
|
|
|
Paid out
|
|
(113
|
)
|
|
119.59
|
|
|
Forfeited/adjustments
|
|
(136
|
)
|
|
136.11
|
|
|
Outstanding at 30 September 2019
|
|
976
|
|
|
|
$156.31
|
|
Stock Options
|
|
Shares (000)
|
|
|
Weighted Average
Exercise Price
|
|
|
Outstanding at 30 September 2018
|
|
2,186
|
|
|
|
$89.33
|
|
Exercised
|
|
(842
|
)
|
|
82.27
|
|
|
Forfeited
|
|
—
|
|
|
—
|
|
|
Outstanding and Exercisable at 30 September 2019
|
|
1,344
|
|
|
|
$93.75
|
|
Stock Options
|
|
Weighted Average Remaining Contractual Term (in years)
|
|
Aggregate Intrinsic Value
|
|
|
Outstanding and Exercisable at 30 September 2019
|
|
3.4
|
|
|
$172
|
|
Restricted Stock
|
|
Shares (000)
|
|
|
Weighted Average
Grant-Date Fair Value
|
|
|
Outstanding at 30 September 2018
|
|
42
|
|
|
|
$140.28
|
|
Vested
|
|
(16
|
)
|
|
144.09
|
|
|
Outstanding at 30 September 2019
|
|
26
|
|
|
|
$138.00
|
|
|
|
Derivatives
qualifying
as hedges
|
|
Foreign
currency
translation
adjustments
|
|
Pension and
postretirement
benefits
|
|
Total
|
||||||||
Balance at 30 September 2016
|
|
|
($65.0
|
)
|
|
|
($949.3
|
)
|
|
|
($1,374.0
|
)
|
|
|
($2,388.3
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
(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
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
45.9
|
|
|
(244.6
|
)
|
|
179.4
|
|
|
(19.3
|
)
|
||||
Amounts reclassified from AOCL
|
|
(30.4
|
)
|
|
3.1
|
|
|
133.1
|
|
|
105.8
|
|
||||
Net current period other comprehensive income (loss)
|
|
|
$15.5
|
|
|
|
($241.5
|
)
|
|
|
$312.5
|
|
|
|
$86.5
|
|
Amount attributable to noncontrolling interest
|
|
—
|
|
|
(18.8
|
)
|
|
(.2
|
)
|
|
(19.0
|
)
|
||||
Balance at 30 September 2018
|
|
|
($37.6
|
)
|
|
|
($1,009.8
|
)
|
|
|
($694.5
|
)
|
|
|
($1,741.9
|
)
|
Other comprehensive loss before reclassifications
|
|
(44.1
|
)
|
|
(356.2
|
)
|
|
(326.2
|
)
|
|
(726.5
|
)
|
||||
Amounts reclassified from AOCL
|
|
12.3
|
|
|
(2.6
|
)
|
|
63.2
|
|
|
72.9
|
|
||||
Net current period other comprehensive loss
|
|
|
($31.8
|
)
|
|
|
($358.8
|
)
|
|
|
($263.0
|
)
|
|
|
($653.6
|
)
|
Amount attributable to noncontrolling interest
|
|
(8.0
|
)
|
|
(11.7
|
)
|
|
(.2
|
)
|
|
(19.9
|
)
|
||||
Balance at 30 September 2019
|
|
|
($61.4
|
)
|
|
|
($1,356.9
|
)
|
|
|
($957.3
|
)
|
|
|
($2,375.6
|
)
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
(Gain) Loss on Cash Flow Hedges, net of tax
|
|
|
|
|
|
|
||||||
Sales/Cost of sales
|
|
|
$.6
|
|
|
|
$7.1
|
|
|
|
$18.3
|
|
Other income (expense), net
|
|
(3.0
|
)
|
|
(42.6
|
)
|
|
5.1
|
|
|||
Interest expense
|
|
14.7
|
|
|
5.1
|
|
|
.8
|
|
|||
Total (Gain) Loss on Cash Flow Hedges, net of tax
|
|
|
$12.3
|
|
|
|
($30.4
|
)
|
|
|
$24.2
|
|
|
|
|
|
|
|
|
||||||
Currency Translation Adjustment
|
|
|
|
|
|
|
||||||
Cost of sales(A)
|
|
|
$—
|
|
|
|
$3.1
|
|
|
|
$—
|
|
Cost reduction and asset actions(B)
|
|
—
|
|
|
—
|
|
|
8.2
|
|
|||
Gain on exchange of equity affiliate investments(C)
|
|
(2.6
|
)
|
|
—
|
|
|
—
|
|
|||
Loss from discontinued operations, net of tax(D)
|
|
—
|
|
|
—
|
|
|
49.1
|
|
|||
Total Currency Translation Adjustment
|
|
|
($2.6
|
)
|
|
|
$3.1
|
|
|
|
$57.3
|
|
|
|
|
|
|
|
|
||||||
Pension and Postretirement Benefits, net of tax(E)
|
|
|
$63.2
|
|
|
|
$133.1
|
|
|
|
$110.7
|
|
(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 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.
|
(C)
|
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 7, Acquisitions, for additional information.
|
(D)
|
The fiscal year 2017 impact relates to the sale of PMD during the second quarter.
|
(E)
|
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 17, Retirement Benefits, for additional information.
|
30 September
|
2019
|
|
|
2018
|
|
|
2017
|
|
|||
Numerator
|
|
|
|
|
|
||||||
Net income from continuing operations
|
|
$1,760.0
|
|
|
|
$1,455.6
|
|
|
|
$1,134.4
|
|
Net income from discontinued operations
|
—
|
|
|
42.2
|
|
|
1,866.0
|
|
|||
Net Income Attributable to Air Products
|
|
$1,760.0
|
|
|
|
$1,497.8
|
|
|
|
$3,000.4
|
|
Denominator (in millions)
|
|
|
|
|
|
||||||
Weighted average common shares — Basic
|
220.3
|
|
|
219.3
|
|
|
218.0
|
|
|||
Effect of dilutive securities
|
|
|
|
|
|
||||||
Employee stock option and other award plans
|
1.3
|
|
|
1.5
|
|
|
1.8
|
|
|||
Weighted average common shares — Diluted
|
221.6
|
|
|
220.8
|
|
|
219.8
|
|
|||
Basic EPS Attributable to Air Products
|
|
|
|
|
|
||||||
Basic earnings per share from continuing operations
|
|
$7.99
|
|
|
|
$6.64
|
|
|
|
$5.20
|
|
Basic earnings per share from discontinued operations
|
—
|
|
|
.19
|
|
|
8.56
|
|
|||
Basic Earnings Per Common Share Attributable to Air Products
|
|
$7.99
|
|
|
|
$6.83
|
|
|
|
$13.76
|
|
Diluted EPS Attributable to Air Products
|
|
|
|
|
|
||||||
Diluted earnings per share from continuing operations
|
|
$7.94
|
|
|
|
$6.59
|
|
|
|
$5.16
|
|
Diluted earnings per share from discontinued operations
|
—
|
|
|
.19
|
|
|
8.49
|
|
|||
Diluted Earnings Per Common Share Attributable to Air Products
|
|
$7.94
|
|
|
|
$6.78
|
|
|
|
$13.65
|
|
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|||
Income from Continuing Operations Before Taxes
|
|
|
|
|
|
|
||||||
United States
|
|
|
$723.3
|
|
|
|
$688.5
|
|
|
|
$669.8
|
|
Foreign
|
|
1,350.8
|
|
|
1,151.7
|
|
|
666.2
|
|
|||
Income from equity affiliates
|
|
215.4
|
|
|
174.8
|
|
|
80.1
|
|
|||
Total
|
|
|
$2,289.5
|
|
|
|
$2,015.0
|
|
|
|
$1,416.1
|
|
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|||
Current Tax Provision
|
|
|
|
|
|
|
||||||
Federal
|
|
|
$163.7
|
|
|
|
$305.1
|
|
|
|
$62.8
|
|
State
|
|
23.3
|
|
|
17.7
|
|
|
7.0
|
|
|||
Foreign
|
|
235.5
|
|
|
256.9
|
|
|
229.1
|
|
|||
Total Current Tax Provision
|
|
422.5
|
|
|
579.7
|
|
|
298.9
|
|
|||
Deferred Tax Provision
|
|
|
|
|
|
|
||||||
Federal
|
|
9.7
|
|
|
(121.7
|
)
|
|
1.4
|
|
|||
State
|
|
2.4
|
|
|
12.5
|
|
|
6.0
|
|
|||
Foreign
|
|
45.5
|
|
|
53.8
|
|
|
(45.4
|
)
|
|||
Total Deferred Tax Provision
|
|
57.6
|
|
|
(55.4
|
)
|
|
(38.0
|
)
|
|||
Total Income Tax Provision
|
|
|
$480.1
|
|
|
|
$524.3
|
|
|
|
$260.9
|
|
(Percent of income before taxes)
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
U.S. federal statutory tax rate
|
|
21.0
|
%
|
|
24.5
|
%
|
|
35.0
|
%
|
State taxes, net of federal benefit
|
|
1.0
|
|
|
1.0
|
|
|
1.0
|
|
Income from equity affiliates
|
|
(2.0
|
)
|
|
(2.1
|
)
|
|
(2.0
|
)
|
Foreign tax differentials
|
|
1.0
|
|
|
(1.0
|
)
|
|
(7.9
|
)
|
Tax on foreign repatriated earnings
|
|
.1
|
|
|
(.4
|
)
|
|
(2.2
|
)
|
Domestic production activities
|
|
—
|
|
|
(.4
|
)
|
|
(.8
|
)
|
Share-based compensation
|
|
(.6
|
)
|
|
(1.0
|
)
|
|
(1.2
|
)
|
Tax reform repatriation
|
|
1.9
|
|
|
19.5
|
|
|
—
|
|
Tax reform rate change and other
|
|
—
|
|
|
(11.1
|
)
|
|
—
|
|
Tax restructuring benefit
|
|
—
|
|
|
(1.8
|
)
|
|
—
|
|
Non-deductible goodwill impairment charge
|
|
—
|
|
|
—
|
|
|
3.6
|
|
Non-U.S. subsidiary tax election
|
|
—
|
|
|
—
|
|
|
(7.7
|
)
|
Business separation costs
|
|
—
|
|
|
—
|
|
|
.2
|
|
Other
|
|
(1.4
|
)
|
|
(1.2
|
)
|
|
.4
|
|
Effective Tax Rate
|
|
21.0
|
%
|
|
26.0
|
%
|
|
18.4
|
%
|
30 September
|
|
2019
|
|
|
2018
|
|
||
Gross Deferred Tax Assets
|
|
|
|
|
||||
Retirement benefits and compensation accruals
|
|
|
$227.1
|
|
|
|
$153.1
|
|
Tax loss carryforwards
|
|
140.6
|
|
|
143.5
|
|
||
Tax credits and other tax carryforwards
|
|
31.1
|
|
|
17.1
|
|
||
Reserves and accruals
|
|
69.6
|
|
|
42.5
|
|
||
Currency losses
|
|
—
|
|
|
3.8
|
|
||
Other
|
|
57.7
|
|
|
45.4
|
|
||
Valuation allowance
|
|
(92.1
|
)
|
|
(105.0
|
)
|
||
Deferred Tax Assets
|
|
434.0
|
|
|
300.4
|
|
||
Gross Deferred Tax Liabilities
|
|
|
|
|
||||
Plant and equipment
|
|
954.6
|
|
|
811.8
|
|
||
Currency gains
|
|
23.9
|
|
|
—
|
|
||
Unremitted earnings of foreign entities
|
|
31.0
|
|
|
36.1
|
|
||
Partnership and other investments
|
|
14.8
|
|
|
16.3
|
|
||
Intangible assets
|
|
80.0
|
|
|
84.3
|
|
||
Other
|
|
8.3
|
|
|
5.6
|
|
||
Deferred Tax Liabilities
|
|
1,112.6
|
|
|
954.1
|
|
||
Net Deferred Income Tax Liability
|
|
|
$678.6
|
|
|
|
$653.7
|
|
|
|
2019
|
|
|
2018
|
|
||
Deferred Tax Assets
|
|
|
|
|
||||
Other noncurrent assets
|
|
|
$115.2
|
|
|
|
$121.4
|
|
Deferred Tax Liabilities
|
|
|
|
|
||||
Deferred income taxes
|
|
793.8
|
|
|
775.1
|
|
||
Net Deferred Income Tax Liability
|
|
|
$678.6
|
|
|
|
$653.7
|
|
Jurisdiction
|
|
Gross Tax Asset
|
|
|
Expiration Period
|
|
U.S. State
|
|
|
$1.7
|
|
|
2020 - 2034
|
U.S. Federal
|
|
13.3
|
|
|
2024 - 2029
|
|
Foreign
|
|
20.8
|
|
|
2020 - 2025; Indefinite
|
Jurisdiction
|
|
Gross Loss Carryforward
|
|
|
Expiration Period
|
|
U.S. State Net Operating Loss
|
|
|
$296.3
|
|
|
2020 - 2034
|
U.S. Federal Capital Loss
|
|
1.8
|
|
|
2023
|
|
Foreign Net Operating Loss
|
|
352.6
|
|
|
2020 - 2029; Indefinite
|
|
Foreign Capital Loss
|
|
262.5
|
|
|
Indefinite
|
Unrecognized Tax Benefits
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|||
Balance at beginning of year
|
|
|
$233.6
|
|
|
|
$146.4
|
|
|
|
$90.2
|
|
Additions for tax positions of the current year
|
|
7.8
|
|
|
26.4
|
|
|
47.5
|
|
|||
Additions for tax positions of prior years
|
|
14.2
|
|
|
119.2
|
|
|
16.1
|
|
|||
Reductions for tax positions of prior years
|
|
(14.7
|
)
|
|
(41.3
|
)
|
|
(4.0
|
)
|
|||
Settlements
|
|
(1.5
|
)
|
|
(14.2
|
)
|
|
(2.0
|
)
|
|||
Statute of limitations expiration
|
|
(3.9
|
)
|
|
(2.6
|
)
|
|
(3.2
|
)
|
|||
Foreign currency translation
|
|
(3.8
|
)
|
|
(.3
|
)
|
|
1.8
|
|
|||
Balance at End of Year
|
|
|
$231.7
|
|
|
|
$233.6
|
|
|
|
$146.4
|
|
Major Tax Jurisdiction
|
Open Tax Years
|
||
North America
|
|
|
|
United States – Federal
|
2016
|
-
|
2019
|
United States – State
|
2010
|
-
|
2019
|
Canada
|
2015
|
-
|
2019
|
Europe
|
|
|
|
France
|
2016
|
-
|
2019
|
Germany
|
2013
|
-
|
2019
|
Netherlands
|
2018
|
-
|
2019
|
Spain
|
2015
|
-
|
2019
|
United Kingdom
|
2015
|
-
|
2019
|
Asia
|
|
|
|
China
|
2014
|
-
|
2019
|
South Korea
|
2010
|
-
|
2019
|
Taiwan
|
2014
|
-
|
2019
|
Latin America
|
|
|
|
Chile
|
2016
|
-
|
2019
|
Other Receivables and Current Assets
30 September
|
2019
|
|
2018
|
|
||
Contract assets
|
|
$64.3
|
|
|
$—
|
|
Contract fulfillment costs
|
64.5
|
|
—
|
|
||
Derivative instruments
|
142.5
|
|
61.1
|
|
||
Current capital lease receivables
|
90.9
|
|
92.1
|
|
||
Contracts in progress, less progress billings
|
—
|
|
77.5
|
|
||
Other
|
115.5
|
|
142.6
|
|
||
Other receivables and current assets
|
|
$477.7
|
|
|
$373.3
|
|
Other Noncurrent Assets
30 September
|
2019
|
|
2018
|
|
||
Derivative instruments
|
|
$81.7
|
|
|
$85.0
|
|
Noncurrent customer receivable
|
118.0
|
|
92.4
|
|
||
Prepaid tax
|
17.0
|
|
13.2
|
|
||
Deferred tax assets
|
115.2
|
|
121.4
|
|
||
Pension benefits
|
28.7
|
|
131.7
|
|
||
Other
|
243.5
|
|
210.8
|
|
||
Other noncurrent assets
|
|
$604.1
|
|
|
$654.5
|
|
Payables and Accrued Liabilities
30 September
|
2019
|
|
2018
|
|
||
Trade creditors
|
|
$519.3
|
|
|
$594.6
|
|
Payables associated with Lu'An
|
8.9
|
|
330.0
|
|
||
Contract liabilities
|
247.4
|
|
156.6
|
|
||
Accrued payroll and employee benefits
|
186.1
|
|
201.4
|
|
||
Pension and postretirement benefits
|
26.0
|
|
34.1
|
|
||
Dividends payable
|
255.7
|
|
241.5
|
|
||
Derivative instruments
|
91.2
|
|
54.2
|
|
||
Obligation for future contribution to an equity affiliate
|
94.4
|
|
—
|
|
||
Other
|
206.7
|
|
205.4
|
|
||
Payables and accrued liabilities
|
|
$1,635.7
|
|
|
$1,817.8
|
|
Other Noncurrent Liabilities
30 September
|
2019
|
|
2018
|
|
||
Pension benefits
|
|
$651.2
|
|
|
$417.2
|
|
Postretirement benefits
|
36.0
|
|
47.0
|
|
||
Noncurrent customer liability
|
118.0
|
|
92.4
|
|
||
Long-term accrued income taxes related to U.S. tax reform
|
215.4
|
|
184.4
|
|
||
Contingencies related to uncertain tax positions
|
123.3
|
|
113.2
|
|
||
Contract liabilities
|
49.2
|
|
58.2
|
|
||
Environmental liabilities
|
59.1
|
|
64.6
|
|
||
Derivative instruments
|
21.2
|
|
39.9
|
|
||
Asset retirement obligations
|
201.9
|
|
189.5
|
|
||
Obligation for future contribution to an equity affiliate
|
—
|
|
94.4
|
|
||
Obligations associated with EfW
|
57.8
|
|
63.3
|
|
||
Other
|
179.3
|
|
172.8
|
|
||
Other noncurrent liabilities
|
|
$1,712.4
|
|
|
$1,536.9
|
|
2019
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Total
|
|
||||||||||
Sales
|
|
$2,224.0
|
|
|
|
$2,187.7
|
|
|
|
$2,224.0
|
|
|
|
$2,283.2
|
|
|
|
$8,918.9
|
|
|
Gross profit
|
651.0
|
|
(A)
|
713.0
|
|
|
758.0
|
|
|
792.4
|
|
|
2,914.4
|
|
(A)
|
|||||
Cost reduction actions (See Note 6)
|
—
|
|
|
—
|
|
|
25.5
|
|
|
—
|
|
|
25.5
|
|
|
|||||
Gain on exchange of equity affiliate investments (See Note 7)
|
—
|
|
|
—
|
|
|
29.1
|
|
|
—
|
|
|
29.1
|
|
|
|||||
Operating income
|
455.0
|
|
|
516.5
|
|
|
569.7
|
|
|
603.2
|
|
|
2,144.4
|
|
|
|||||
Equity affiliates' income
|
52.9
|
|
|
46.2
|
|
|
56.4
|
|
|
59.9
|
|
|
215.4
|
|
|
|||||
Pension settlement loss (See Note 17)
|
—
|
|
|
5.0
|
|
|
—
|
|
|
—
|
|
|
5.0
|
|
|
|||||
Income tax provision
|
132.1
|
|
(B)
|
107.5
|
|
|
109.3
|
|
(B)
|
131.2
|
|
|
480.1
|
|
(B)
|
|||||
Income from continuing operations
|
357.0
|
|
|
433.5
|
|
|
500.2
|
|
|
518.7
|
|
|
1,809.4
|
|
|
|||||
Income from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||
Net income
|
357.0
|
|
|
433.5
|
|
|
500.2
|
|
|
518.7
|
|
|
1,809.4
|
|
|
|||||
Net Income Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income from continuing operations
|
|
$347.5
|
|
|
|
$421.3
|
|
|
|
$488.0
|
|
|
|
$503.2
|
|
|
|
$1,760.0
|
|
|
Net income from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||
Net Income Attributable to Air Products
|
|
$347.5
|
|
|
|
$421.3
|
|
|
|
$488.0
|
|
|
|
$503.2
|
|
|
|
$1,760.0
|
|
|
Basic Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic earnings per share from continuing operations
|
|
$1.58
|
|
|
|
$1.91
|
|
|
|
$2.21
|
|
|
|
$2.28
|
|
|
|
$7.99
|
|
|
Basic earnings per share from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||
Basic Earnings Per Common Share Attributable to Air Products
|
|
$1.58
|
|
|
|
$1.91
|
|
|
|
$2.21
|
|
|
|
$2.28
|
|
|
|
$7.99
|
|
|
Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted earnings per share from continuing operations
|
|
$1.57
|
|
|
|
$1.90
|
|
|
|
$2.20
|
|
|
|
$2.27
|
|
|
|
$7.94
|
|
|
Diluted earnings per share from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||
Diluted Earnings Per Common Share Attributable to Air Products
|
|
$1.57
|
|
|
|
$1.90
|
|
|
|
$2.20
|
|
|
|
$2.27
|
|
|
|
$7.94
|
|
|
Weighted Average Common Shares (in millions)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
219.9
|
|
|
220.2
|
|
|
220.6
|
|
|
220.7
|
|
|
220.3
|
|
|
|||||
Diluted
|
221.0
|
|
|
221.4
|
|
|
221.9
|
|
|
222.1
|
|
|
221.6
|
|
|
|||||
Dividend Information
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends declared per common share
|
|
$1.10
|
|
|
|
$1.16
|
|
|
|
$1.16
|
|
|
|
$1.16
|
|
|
|
$4.58
|
|
|
2018
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Total
|
|
||||||||||
Sales
|
|
$2,216.6
|
|
|
|
$2,155.7
|
|
|
|
$2,259.0
|
|
|
|
$2,298.9
|
|
|
|
$8,930.2
|
|
|
Gross profit
|
644.8
|
|
|
649.2
|
|
|
713.6
|
|
|
733.1
|
|
(C)
|
2,740.7
|
|
(C)
|
|||||
Operating income
|
460.7
|
|
|
455.4
|
|
|
515.8
|
|
|
533.7
|
|
|
1,965.6
|
|
|
|||||
Equity affiliates' income
|
13.8
|
|
|
43.7
|
|
|
58.1
|
|
|
59.2
|
|
|
174.8
|
|
|
|||||
Pension settlement loss (See Note 17)
|
—
|
|
|
—
|
|
|
—
|
|
|
43.7
|
|
|
43.7
|
|
|
|||||
Income tax provision
|
291.8
|
|
(B)
|
56.2
|
|
(D)
|
107.1
|
|
|
69.2
|
|
(B)(D)
|
524.3
|
|
(B)(D)
|
|||||
Income from continuing operations
|
162.7
|
|
|
423.6
|
|
|
444.7
|
|
|
459.7
|
|
|
1,490.7
|
|
|
|||||
Income from discontinued operations, net of tax (See Note 4)
|
(1.0
|
)
|
|
—
|
|
|
43.2
|
|
|
—
|
|
|
42.2
|
|
|
|||||
Net income
|
161.7
|
|
|
423.6
|
|
|
487.9
|
|
|
459.7
|
|
|
1,532.9
|
|
|
|||||
Net Income Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income from continuing operations
|
|
$155.6
|
|
|
|
$416.4
|
|
|
|
$430.7
|
|
|
|
$452.9
|
|
|
|
$1,455.6
|
|
|
Net income from discontinued operations
|
(1.0
|
)
|
|
—
|
|
|
43.2
|
|
|
—
|
|
|
42.2
|
|
|
|||||
Net Income Attributable to Air Products
|
|
$154.6
|
|
|
|
$416.4
|
|
|
|
$473.9
|
|
|
|
$452.9
|
|
|
|
$1,497.8
|
|
|
Basic Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic earnings per share from continuing operations
|
|
$.71
|
|
|
|
$1.90
|
|
|
|
$1.96
|
|
|
|
$2.06
|
|
|
|
$6.64
|
|
|
Basic earnings per share from discontinued operations
|
—
|
|
|
—
|
|
|
.20
|
|
|
—
|
|
|
.19
|
|
|
|||||
Basic Earnings Per Common Share Attributable to Air Products
|
|
$.71
|
|
|
|
$1.90
|
|
|
|
$2.16
|
|
|
|
$2.06
|
|
|
|
$6.83
|
|
|
Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted earnings per share from continuing operations
|
|
$.70
|
|
|
|
$1.89
|
|
|
|
$1.95
|
|
|
|
$2.05
|
|
|
|
$6.59
|
|
|
Diluted earnings per share from discontinued operations
|
—
|
|
|
—
|
|
|
.20
|
|
|
—
|
|
|
.19
|
|
|
|||||
Diluted Earnings Per Common Share Attributable to Air Products
|
|
$.70
|
|
|
|
$1.89
|
|
|
|
$2.15
|
|
|
|
$2.05
|
|
|
|
$6.78
|
|
|
Weighted Average Common Shares (in millions)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
218.9
|
|
|
219.4
|
|
|
219.5
|
|
|
219.6
|
|
|
219.3
|
|
|
|||||
Diluted
|
220.4
|
|
|
220.8
|
|
|
220.9
|
|
|
220.9
|
|
|
220.8
|
|
|
|||||
Dividend Information
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends declared per common share
|
|
$.95
|
|
|
|
$1.10
|
|
|
|
$1.10
|
|
|
|
$1.10
|
|
|
|
$4.25
|
|
|
(A)
|
Includes the impact of a facility closure charge of $29.0 resulting from the government enforced shutdown of a customer. Refer to Note 24, Supplemental Information, for additional information.
|
(B)
|
Our income tax provision for fiscal years 2019 and 2018 reflects impacts from the U.S. Tax Cuts and Jobs Act (the "Tax Act"). Refer to Note 23, Income Taxes, for additional information. Fiscal year 2019 includes a discrete net income tax expense of $43.8, primarily recorded in the first quarter to finalize our estimates of the impacts of the Tax Act. Fiscal year 2018 includes a discrete net income tax expense of $180.6, primarily recorded in the first quarter for our initial estimates of the impacts of the Tax Act.
|
(C)
|
Includes the impact of a benefit of $24.1 for the change in inventory valuation method for our United States industrial gas inventories. Refer to Note 1, Major Accounting Policies, for additional information.
|
(D)
|
Includes an income tax benefit of $35.7, net of reserves for uncertain tax positions, resulting from the restructuring of several foreign subsidiaries, primarily during the second quarter.
|
•
|
Industrial Gases – Americas;
|
•
|
Industrial Gases – EMEA (Europe, Middle East, and Africa);
|
•
|
Industrial Gases – Asia;
|
•
|
Industrial Gases – Global; and
|
•
|
Corporate and other
|
|
Industrial
Gases–
Americas
|
Industrial
Gases–
EMEA
|
Industrial
Gases–
Asia
|
Industrial
Gases–
Global
|
Corporate
and other
|
Total
|
|
||||||||||||
2019
|
|
|
|
|
|
|
|
||||||||||||
Sales
|
|
$3,873.5
|
|
|
$2,002.5
|
|
|
$2,663.6
|
|
|
$261.0
|
|
|
$118.3
|
|
|
$8,918.9
|
|
(A)
|
Operating income (loss)
|
997.7
|
|
472.4
|
|
864.2
|
|
(11.7
|
)
|
(152.8
|
)
|
2,169.8
|
|
(B)
|
||||||
Depreciation and amortization
|
505.2
|
|
189.5
|
|
361.5
|
|
8.6
|
|
18.0
|
|
1,082.8
|
|
|
||||||
Equity affiliates' income
|
84.8
|
|
69.0
|
|
58.4
|
|
3.2
|
|
—
|
|
215.4
|
|
(B)
|
||||||
Expenditures for long-lived assets
|
545.8
|
|
216.3
|
|
1,105.5
|
|
33.8
|
|
88.3
|
|
1,989.7
|
|
|
||||||
Investments in net assets of and advances to equity affiliates
|
301.6
|
|
493.4
|
|
445.5
|
|
35.7
|
|
—
|
|
1,276.2
|
|
|
||||||
Total assets
|
5,832.2
|
|
3,250.8
|
|
6,240.6
|
|
325.7
|
|
3,293.5
|
|
18,942.8
|
|
|
||||||
2018
|
|
|
|
|
|
|
|
||||||||||||
Sales
|
|
$3,758.8
|
|
|
$2,193.3
|
|
|
$2,458.0
|
|
|
$436.1
|
|
|
$84.0
|
|
|
$8,930.2
|
|
(A)
|
Operating income (loss)
|
927.9
|
|
445.8
|
|
689.9
|
|
53.9
|
|
(176.0
|
)
|
1,941.5
|
|
(B)
|
||||||
Depreciation and amortization
|
485.3
|
|
198.6
|
|
265.8
|
|
8.1
|
|
12.9
|
|
970.7
|
|
|
||||||
Equity affiliates' income
|
82.0
|
|
61.1
|
|
58.3
|
|
1.9
|
|
—
|
|
203.3
|
|
(B)
|
||||||
Expenditures for long-lived assets
|
546.5
|
|
163.1
|
|
791.9
|
|
17.3
|
|
49.6
|
|
1,568.4
|
|
|
||||||
Investments in net assets of and advances to equity affiliates
|
312.1
|
|
503.3
|
|
445.6
|
|
16.2
|
|
—
|
|
1,277.2
|
|
|
||||||
Total assets
|
5,904.0
|
|
3,280.4
|
|
5,899.5
|
|
240.1
|
|
3,854.3
|
|
19,178.3
|
|
|
||||||
2017
|
|
|
|
|
|
|
|
||||||||||||
Sales
|
|
$3,637.0
|
|
|
$1,780.4
|
|
|
$1,964.7
|
|
|
$722.9
|
|
|
$82.6
|
|
|
$8,187.6
|
|
(A)
|
Operating income (loss)
|
946.1
|
|
395.5
|
|
532.6
|
|
71.1
|
|
(171.5
|
)
|
1,773.8
|
|
(B)
|
||||||
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
|
|
(B)
|
||||||
Expenditures for long-lived assets
|
427.2
|
|
143.2
|
|
337.8
|
|
25.6
|
|
105.9
|
|
1,039.7
|
|
|
(A)
|
The sales information noted above relates to external customers only. All intersegment sales are eliminated in consolidation. Intersegment sales are generally transacted at market pricing. We generally do not have intersegment sales from our regional industrial gases businesses. Equipment manufactured for our regional industrial gases segments are generally transferred at cost and are not reflected as an intersegment sale.
|
(B)
|
Refer to the Reconciliations to Consolidated Results section below.
|
Operating Income
|
2019
|
|
2018
|
|
2017
|
|
|||
Total
|
|
$2,169.8
|
|
|
$1,941.5
|
|
|
$1,773.8
|
|
Change in inventory valuation method
|
—
|
|
24.1
|
|
—
|
|
|||
Facility closure
|
(29.0
|
)
|
—
|
|
—
|
|
|||
Business separation costs
|
—
|
|
—
|
|
(32.5
|
)
|
|||
Cost reduction and asset actions
|
(25.5
|
)
|
—
|
|
(151.4
|
)
|
|||
Goodwill and intangible asset impairment charge
|
—
|
|
—
|
|
(162.1
|
)
|
|||
Gain on exchange of equity affiliate investments
|
29.1
|
|
—
|
|
—
|
|
|||
Gain on land sale
|
—
|
|
—
|
|
12.2
|
|
|||
Consolidated Operating Income
|
|
$2,144.4
|
|
|
$1,965.6
|
|
|
$1,440.0
|
|
Equity Affiliates' Income
|
2019
|
2018
|
2017
|
||||||
Total
|
|
$215.4
|
|
|
$203.3
|
|
|
$159.6
|
|
Equity method investment impairment charge
|
—
|
|
—
|
|
(79.5
|
)
|
|||
Tax reform repatriation - equity method investment
|
—
|
|
(28.5
|
)
|
—
|
|
|||
Consolidated Equity Affiliates' Income
|
|
$215.4
|
|
|
$174.8
|
|
|
$80.1
|
|
Sales to External Customers
|
2019
|
|
2018
|
|
2017
|
|
|||
United States
|
|
$3,351.8
|
|
|
$3,149.6
|
|
|
$2,886.8
|
|
Europe, including Middle East
|
2,090.3
|
|
2,292.5
|
|
2,478.5
|
|
|||
Asia, excluding China and India
|
953.1
|
|
904.0
|
|
849.6
|
|
|||
China
|
1,730.2
|
|
1,585.7
|
|
1,143.4
|
|
|||
Other(A)
|
793.5
|
|
998.4
|
|
829.3
|
|
|||
Total
|
|
$8,918.9
|
|
|
$8,930.2
|
|
|
$8,187.6
|
|
Long-Lived Assets(B)
|
2019
|
|
2018
|
|
2017
|
|
|||
United States
|
|
$3,721.3
|
|
|
$3,512.7
|
|
|
$3,407.4
|
|
Europe, including Middle East
|
1,278.9
|
|
1,283.3
|
|
1,279.0
|
|
|||
Asia, excluding China and India
|
933.8
|
|
899.8
|
|
778.5
|
|
|||
China
|
3,302.6
|
|
3,066.6
|
|
1,737.9
|
|
|||
Other(A)
|
1,101.0
|
|
1,161.3
|
|
1,237.4
|
|
|||
Total
|
|
$10,337.6
|
|
|
$9,923.7
|
|
|
$8,440.2
|
|
(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
|
2,567,962
|
|
(1)
|
|
$93.75
|
|
4,581,960
|
|
(2)
|
Equity compensation plans not approved by security holders
|
54,304
|
|
(3)
|
—
|
|
—
|
|
|
|
Total
|
2,622,266
|
|
|
|
$93.75
|
|
4,581,960
|
|
|
(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. The amount presented assumes the maximum potential payout.
|
(2)
|
Represents authorized shares that were available for future grants as of 30 September 2019. 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 value of the underlying shares of stock with eligible deferred compensation.
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
(a) The documents below are filed as a part of this report:
|
||
|
|
|
(1)
|
Financial Statements. The following is a list of the Consolidated Financial Statements of Air Products and Chemicals, Inc. and its subsidiaries included in Item 8 of Part II of this report:
|
|
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
(2)
|
Financial Statement Schedules. The financial statement schedule below is filed as a part of this report as required by Form 10-K. 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 report as required by Item 601 of Regulation S-K are listed in the Index to Exhibits located on page 122 of this report.
|
|
Exhibit No.
|
Description
|
|
|
(2)
|
Plan of acquisition, reorganization, arrangement, liquidation or succession.
|
|
|
(3)
|
Articles of Incorporation and By-Laws.
|
|
|
3.1
|
Restated Certificate of Incorporation of the Company. (Filed as Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the fiscal year ended 30 September 1987.)*
|
|
|
3.2
|
|
|
|
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 File No. 33-36974.)*
|
|
|
4.2
|
|
|
|
4.3
|
|
|
|
4.4
|
|
|
|
4.5
|
|
|
|
(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 Annual Report on Form 10-K for the fiscal year ended 30 September 1989.)*†
|
|
|
Exhibit No.
|
Description
|
10.2
|
|
|
|
10.3
|
|
|
|
10.4
|
|
|
|
10.5
|
|
|
|
10.5(a)
|
|
|
|
10.5(b)
|
|
|
|
10.5(c)
|
|
|
|
10.6
|
|
|
|
10.6(a)
|
|
|
|
10.6(b)
|
|
|
|
10.6(c)
|
|
|
|
10.6(d)
|
|
|
|
10.6(e)
|
|
|
|
10.7
|
|
|
|
10.7(a)
|
Exhibit No.
|
Description
|
|
|
10.7(b)
|
|
|
|
10.7(c)
|
|
|
|
10.8
|
|
|
|
10.9
|
|
|
|
10.9(a)
|
|
|
|
10.10
|
|
|
|
10.11
|
|
|
|
10.12
|
|
|
|
10.13
|
|
|
|
10.14
|
|
|
|
10.16
|
|
|
|
16
|
Letter re change in certifying accountant
|
|
|
16.1
|
|
|
|
21
|
|
|
|
(23)
|
Consents of Experts and Counsel.
|
|
|
23.1
|
|
|
|
23.2
|
|
|
|
24
|
|
|
|
Exhibit No.
|
Description
|
(31)
|
Rule 13a-14(a)/15d-14(a) Certifications.
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
(32)
|
Section 1350 Certifications.
|
|
|
32.1
|
|
|
|
(99)
|
Additional Financial Exhibits
|
|
|
99.1
|
|
|
|
(101)
|
Interactive Data Files
|
|
|
101.INS
|
Inline 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
|
Inline XBRL Taxonomy Extension Schema Document.
|
|
|
101.CAL
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
101.LAB
|
Inline XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
101.PRE
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
104
|
Cover Page Interactive Data File, formatted in Inline XBRL (included in Exhibit 101).
|
*
|
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:
|
26 November 2019
|
Signature and Title
|
|
Date
|
|
|
|
/s/ Seifi Ghasemi
|
|
26 November 2019
|
(Seifi Ghasemi)
Director, Chairman, President, and
Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
/s/ Russell A. Flugel
|
|
26 November 2019
|
(Russell A. Flugel)
Senior Vice President, Corporate Controller, and Principal Accounting Officer
|
|
|
|
|
|
*
|
|
26 November 2019
|
(Susan K. Carter)
Director
|
|
|
|
|
|
*
|
|
26 November 2019
|
(Charles I. Cogut)
Director
|
|
|
|
|
|
*
|
|
26 November 2019
|
(Chad C. Deaton)
Director
|
|
|
|
|
|
*
|
|
26 November 2019
|
(David H. Y. Ho)
Director
|
|
|
|
|
|
*
|
|
26 November 2019
|
(Margaret G. McGlynn)
Director
|
|
|
|
|
|
Signature and Title
|
|
Date
|
*
|
|
26 November 2019
|
(Edward L. Monser)
Director
|
|
|
|
|
|
*
|
|
26 November 2019
|
(Matthew H. Paull)
Director
|
|
|
*
|
Sean D. Major, Executive Vice President, General Counsel and Secretary, by signing his 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/ Sean D. Major
|
|
Sean D. Major
|
|
Executive Vice President, General Counsel and Secretary
|
|
|
Date:
|
26 November 2019
|
|
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 2019
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$91
|
|
|
$12
|
|
|
$37
|
|
|
($52
|
)
|
|
$88
|
|
Allowance for deferred tax assets
|
105
|
|
5
|
|
2
|
|
(20
|
)
|
92
|
|
|||||
|
|
|
|
|
|
||||||||||
Year Ended 30 September 2018
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$94
|
|
|
$17
|
|
|
$7
|
|
|
($27
|
)
|
|
$91
|
|
Allowance for deferred tax assets
|
108
|
|
3
|
|
4
|
|
(10
|
)
|
105
|
|
|||||
|
|
|
|
|
|
||||||||||
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
|
|
(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 4, Discontinued Operations, for additional information.
|
1.
|
Section 2.67 shall be amended to include a new section (f) to read as follows:
|
2.
|
In all other respects the Plan shall remain in full force and effect.
|
1.
|
Section 2.67 shall be amended to read as follows:
|
2.
|
In all other respects the Plan shall remain in full force and effect.
|
Signature
|
Title
|
Date
|
|
|
|
/s/ Susan K. Carter
|
Director
|
25 November 2019
|
Susan K. Carter
|
|
|
|
|
|
/s/ Charles I. Cogut
|
Director
|
25 November 2019
|
Charles I. Cogut
|
|
|
|
|
|
/s/ Chad C. Deaton
|
Director
|
25 November 2019
|
Chad C. Deaton
|
|
|
|
|
|
/s/ Seifi Ghasemi
|
Director and Chairman of the Board,
President and Chief Executive Officer
(Principal Executive Officer)
|
25 November 2019
|
Seifi Ghasemi
|
|
|
|
|
|
/s/ David H. Y. Ho
|
Director
|
25 November 2019
|
David H. Y. Ho
|
|
|
|
|
|
/s/ Margaret G. McGlynn
|
Director
|
25 November 2019
|
Margaret G. McGlynn
|
|
|
|
|
|
/s/ Edward L. Monser
|
Director
|
25 November 2019
|
Edward l. Monser
|
|
|
|
|
|
/s/ Matthew H. Paull
|
Director
|
25 November 2019
|
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: 26 November 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
|