Air Products & Chemicals, Inc.

We believe we have sufficient cash, cash flows from operations, and access to funding sources to meet our liquidity needs. As further discussed in the "Cash Flows From Financing Activities" section on page 52, we are able to raise capital through a variety of financing activities, including accessing capital or commercial paper markets or drawing upon our credit facilities.

As of 30 September 2025, we had $1.4 billion of foreign cash and cash items, compared to total cash and cash items of $1.9 billion. We do not expect a significant portion of the earnings from our foreign subsidiaries and affiliates to be subject to U.S. income tax upon repatriation. Depending on the country in which these entities operate, repatriation of earnings may be subject to foreign withholding and other taxes. However, we intend to indefinitely reinvest the majority of our foreign cash and cash items that would be subject to additional taxes outside the U.S.

Cash Flows From Operations

In fiscal year 2025, cash provided by operating activities was $3.3 billion. Charges for business and asset actions totaled $3.7 billion, primarily driven by project exit costs as described in Note 5, Business and Asset Actions, to the consolidated financial statements. The adjustment for deferred income taxes of $554.8 was largely attributable to tax impacts associated with these costs.

Working capital accounts in fiscal year 2025 resulted in a net use of cash of $851.6, including $562.6 of other working capital driven by accrued income taxes. In fiscal year 2025, we made approximately $395 in tax payments related to the prior year sale of the LNG business. Payables and accrued liabilities were a use of cash of $224.0, primarily due to payments for contract terminations associated with our business and asset actions and previously accrued severance actions under our global cost reduction plan.

In fiscal year 2024, cash provided by operating activities totaled $3.6 billion. This included a $1.6 billion gain related to the sale of the LNG business as discussed in Note 4, Gain on Sale of Business, to the consolidated financial statements. Business and asset actions of $57.0 reflected expenses recognized for severance and other benefits associated with our global cost reduction plan. Refer to Note 5, Business and Asset Actions, to the consolidated financial statements for additional information. Other operating adjustments of $183.8 primarily included pension expense, net of contributions, totaling $89.1.

Working capital changes in fiscal year 2024 resulted in a net use of cash of $183.0. A use of cash of $338.7 within payables and accrued liabilities primarily resulted from a reduction in customer advances for sale of equipment projects as revenue was recognized, along with payments related to previously accrued severance actions and incentive compensation under the fiscal year 2023 plan. An inventory-related cash use of $137.8 was largely attributable to helium purchases. A use of cash of $111.0 from trade receivables was primarily due to the timing of collections. Offsetting these uses, other working capital provided a source of cash of $370.1, largely driven by the timing of income tax payments related to the LNG business sale. As noted above, tax payments associated with the LNG sale were remitted in fiscal year 2025.

Cash Flows From Investing Activities

In fiscal year 2025, cash used for investing activities was $7.2 billion. The primary use of cash was $7.0 billion for additions to plant and equipment, including long-term deposits, of which approximately $3 billion related to the NEOM Green Hydrogen Project. Additional uses included investments in and advances to unconsolidated affiliates of $390.4, investments in financing receivables of $61.9, and cash paid for acquisitions, net of cash acquired, of $59.9. These activities are further detailed in the "Capital Expenditures" section on page 51.

Cash proceeds of $245.8 from sales of assets and investments primarily included $104.3 from the sale of a subsidiary in Singapore and $37.7 for the sale of a regional office in Hersham, England, as further described in Note 6, Acquisitions and Divestitures, to the consolidated financial statements. Maturities of short-term investments provided cash of $122.5, which exceeded purchases of $117.6.

In fiscal year 2024, cash used for investing activities was $4.9 billion. The primary use of cash was $6.8 billion for additions to plant and equipment, including long-term deposits, and investments in financing receivables of $403.0. Additional information regarding the investments in financing receivables is provided in the "Capital Expenditures" section on page 51. Proceeds from the sale of assets and investments totaled $1.9 billion and primarily related to the sale of the LNG business in September 2024. Refer to Note 4, Gain on Sale of Business, to the consolidated financial statements for additional information. Maturities of short-term investments provided cash of $470.7, which exceeded purchases of $141.4.

Capital Expenditures (Non-GAAP Financial Measure)

The components of our capital expenditures are detailed in the table below. Refer to page 48 for a definition of this non-GAAP financial measure as well as a reconciliation to cash used for investing activities.

(A)Reflects the portion of "Additions to plant and equipment, including long-term deposits" that is associated with NGHC, less our approximate cash investment in the joint venture.

Capital expenditures totaled $5.1 billion in fiscal year 2025, a 2% decrease from capital expenditures of $5.2 billion in fiscal year 2024. Spending in fiscal year 2025 was driven by $7.0 billion in additions to plant and equipment, primarily supporting our clean energy initiatives, including the NEOM Green Hydrogen Project in NEOM City, Saudi Arabia, and clean energy complexes in Louisiana, United States, and Alberta, Canada. We also continued to invest in our core industrial gases business, funding the development of new plants and the maintenance and replacement of existing facilities.

The $390.4 investment in and advances to unconsolidated affiliates in fiscal year 2025 included approximately $238 related to BHIG and approximately $115 for our final investment in the JIGPC joint venture. Additional information regarding these affiliates is provided in Note 6, Acquisitions and Divestitures, and Note 10, Equity Affiliates, to the consolidated financial statements. The $61.9 investment in financing receivables related to the financing arrangement for the natural gas-to-syngas processing facility in Uzbekistan. Additional details regarding this arrangement are provided in Note 6, Acquisitions and Divestitures, to the consolidated financial statements. In the prior year, the $403.0 investment in financing receivables included approximately $120 associated with the Uzbekistan arrangement, with the remaining amount related to the purchase of renewable fuel assets from World Energy. As discussed in Note 3, Variable Interest Entities, to the consolidated financial statements, we exited the World Energy sustainable aviation fuel project in fiscal year 2025. Cash paid for acquisitions, net of cash acquired, totaled $59.9 in fiscal year 2025 and was paid at the closing of our acquisition of an independent industrial gases company in Belgium.

Outlook for Investing Activities

It is not possible, without unreasonable efforts, to reconcile our forecasted capital expenditures to future cash used for investing activities because management is unable to identify the timing or occurrence of our future investment activity, which is driven by our assessment of competing opportunities at the time we enter into transactions. These decisions, either individually or in the aggregate, could have a significant effect on our cash used for investing activities. Accordingly, management is unable to fully reconcile, without unreasonable efforts, our forecasted capital expenditures to future cash used for investing activities.

We expect capital expenditures for fiscal year 2026 to be approximately $4 billion, reflecting continued investment in our energy transition projects, traditional industrial gas projects, and maintenance within our core business. Approximately $1 billion is expected to be dedicated to traditional industrial gas projects. We anticipate funding these expenditures through our existing cash balance and cash generated from continuing operations. We also have access to capital and money market financing as well as other sources of funding as discussed in the "Financing and Capital Structure" section on page 52.

Cash Flows From Financing Activities

In fiscal year 2025, cash provided by financing activities was $2.8 billion. The primary source of cash was long-term debt proceeds of$4.4 billion, which included $2.7 billion from Euro- and U.S. Dollar-denominated senior fixed-rate notes issued in February and June 2025. Net proceeds from the notes were used to repay commercial paper obligations, including those incurred prior to the closing of the February 2025 Offering that were used to repay €300 million (approximately $311) aggregate principal amount outstanding of our 1.000% Euro-denominated senior fixed-rate notes at maturity, plus accrued interest, and for general corporate purposes. An additional$1.6 billion in long-term debt proceeds was provided through project financing available to the NGHC joint venture, as further discussed onpage 53. Separately, we received$594.6 in contributions from noncontrolling interests, primarily related to NGHC. These sources of cash were partially offset by dividend payments to shareholders of$1.6 billion.

In fiscal year 2024, cash provided by financing activities was $2.6 billion. The primary source of cash was long-term debt proceeds of $4.7 billion, which included $2.5 billion from green senior notes issued during the second quarter of fiscal year 2024 through U.S. Dollar-denominated fixed-rate offerings. In line with our Green Finance Framework, we allocated the net proceeds to finance or refinance, in whole or in part, projects expected to deliver environmental benefits, such as pollution prevention and control, renewable energy generation and procurement, and sustainable aviation fuel. Additionally, the NGHC joint venture borrowed approximately $2.0 billion from project financing in fiscal year 2024. These proceeds were partially offset by financing fees of approximately $112.0, which were reflected within "Other financing activities." We also received $428.5 in contributions from noncontrolling interests.

Cash proceeds from financing activities in fiscal year 2024 were partially offset by dividend payments to shareholders of $1.6 billion, payments on long-term debt of $486.2, and net decreases in commercial paper and short-term borrowings of $289.9.

Financing and Capital Structure

Debt

Total debt increased to $17.7 billion as of 30 September 2025 from $14.2 billion as of 30 September 2024. We issued Euro- and U.S. Dollar-denominated senior fixed-rate notes in February and June 2025, which together had a combined carrying value of $2.9 billion as of 30 September 2025. Total debt also increased due to approximately $1.6 billion in incremental borrowings under the project financing arrangement related to the NEOM Green Hydrogen Project, which is nonrecourse to Air Products, as further discussed on page 53. Total debt included related party debt of $236.5 and $304.4 as of 30 September 2025 and 2024, respectively.

Subsequent to the balance sheet date, we repaid at maturity $550.0 aggregate principal amount of our 1.50% senior notes due October 2025, plus accumulated and unpaid interest through the maturity date.

Various debt agreements to which we are a party include financial covenants and other restrictions, including restrictions pertaining to the ability to create property liens and enter into certain sale and leaseback transactions. As of 30 September 2025, we were in compliance with all the financial and other covenants under our debt agreements.

Committed Credit Facilities

During the second quarter of fiscal year 2025, we refinanced our existing 364-day $500 revolving credit agreement to extend its maturity date from 27 March 2025 to 26 March 2026 (the “364-Day Credit Agreement”). All other terms remain consistent with the original 364-Day Credit Agreement, including our ability to convert the facility into a term loan maturing 26 March 2027. Fees incurred in connection with the refinancing were not material.

We also maintain a five-year $3.0 billion revolving credit agreement that matures on 31 March 2029 (the “Five-Year Credit Agreement”). Both the 364-Day Credit Agreement and the Five-Year Credit Agreement are syndicated committed facilities that provide a source of liquidity and support our commercial paper program through the availability of senior unsecured debt to us and certain of our subsidiaries. No borrowings were outstanding under either of the 364-Day Credit Agreement or the Five-Year Credit Agreement as of 30 September 2025 or 30 September 2024.

Separately, certain of our foreign subsidiaries maintain access to committed credit facilities with a combined maximum borrowing capacity of $394.0, all of which was borrowed and outstanding as of 30 September 2025. The amount borrowed from available facilities as of 30 September 2024 was $1.1 billion, which included long-term borrowings of approximately $675 that were derecognized upon deconsolidation of BHIG during the second quarter of fiscal year 2025. Refer to Note 6, Acquisitions and Divestitures, to the consolidated financial statements for additional information.

NEOM Green Hydrogen Project Financing

To support the NEOM Green Hydrogen Project, NGHC has access to project financing of approximately $6.1 billion, which is expected to fund about 73% of the project and is being drawn over the construction period, as well as additional credit facilities totaling approximately $500 primarily for NGHC's working capital needs. Creditors of NGHC do not have recourse to the general credit of Air Products. As of 30 September 2025, the joint venture had borrowed short- and long-term principal amounts totaling $4.9 billion compared to $3.3 billion as of 30 September 2024. Refer to Note 3, Variable Interest Entities, to the consolidated financial statements for additional information.

Dividends

We believe that providing a consistent dividend plays a critical role in creating shareholder value. The Board of Directors determines whether to declare cash dividends on our common stock, as well as the timing and amount, based on our financial condition and other factors it deems relevant. We returned approximately $1.6 billion to shareholders in fiscal year 2025, an increase of 1% compared to the prior year, and we remain committed to continuing our history of dividend growth as part of our long-term capital allocation strategy.

Dividends are paid quarterly, usually during the sixth week after the close of the fiscal quarter. On 18 July 2025, the Board of Directors declared a quarterly dividend of $1.79 per share that was payable on 10 November 2025 to shareholders of record at the close of business on 1 October 2025. Additionally, on 19 November 2025, the Board of Directors declared a quarterly dividend of $1.79 per share that is payable on 9 February 2026 to shareholders of record at the close of business on 2 January 2026.