LINDE PLC

Previous wording

The following table provides summary information for the three months ended March 31, 2024 and 2023. The reported amounts are GAAP amounts from the Consolidated Statements of Income. The adjusted amounts are intended to supplement investors' understanding of the company's financial information and are not a substitute for GAAP measures:

Current wording

The following table provides summary information for the quarters and six months ended June 30, 2024 and 2023. The reported amounts are GAAP amounts from the Consolidated Statements of Income. The adjusted amounts are intended to supplement investors' understanding of the company's financial information and are not a substitute for GAAP measures:

Previous wording

In the first quarter of 2024, Linde's sales were $8,100 million, $93 million below prior year. Cost pass-through, representing the contractual billing of energy cost variances primarily to onsite customers, decreased sales by 2% in the quarter, with minimal impact on operating profit. Volumes decreased sales by 1% in the quarter versus the 2023 respective period. The aforementioned drivers were partially offset by 2% higher price attainment.

Current wording

In the second quarter of 2024, Linde's sales were $8,267 million, $63 million above prior year. The increase in sales was driven by 3% higher price attainment. Engineering increased sales by 1% in the quarter. Volumes were flat in the quarter versus the 2023 respective period, as base volume declines were largely offset by new project start-ups. Currency translation decreased sales by 2% in the quarter driven primarily by the weakening of the Brazilian real, Chinese yuan and Euro against the U.S. Dollar. Cost pass-through, representing the contractual billing of energy cost variances primarily to onsite customers, decreased sales by 1% in the quarter, with minimal impact on operating profit.

Previous wording

Reported operating profit for the first quarter of 2024 of $2,095 million, or 25.9% of sales, was 8% above prior year. The reported year-over-year increase was primarily driven by higher pricing and productivity initiatives which more than offset adverse impacts from cost inflation and lower volumes. The reported effective tax rate ("ETR") was 22.3% in the first quarter 2024 versus 22.2% in the first quarter 2023. Diluted earnings per share ("EPS") was $3.35, or 9% above EPS of $3.06 in the first quarter of 2023, primarily due to higher net income - Linde plc and lower diluted shares outstanding.

Current wording

Reported operating profit for the second quarter of 2024 of $2,184 million, or 26.4% of sales, was 9% above prior year. The reported year-over-year increase was primarily driven by higher pricing and productivity initiatives which more than offset adverse impacts from cost inflation and currency translation. The reported effective tax rate ("ETR") was 23.5% in the second quarter 2024 versus 21.9% in the second quarter 2023. Diluted earnings per share ("EPS") was $3.44, or 8% above EPS of $3.19 in the second quarter of 2023, primarily due to higher net income - Linde plc and lower diluted shares outstanding.

Previous wording

In the first quarter of 2024, adjusted operating profit of $2,341, or 28.9% of sales, was 6% higher as compared to 2023, driven by higher pricing, and productivity initiatives, partially offset by cost inflation and lower volumes. The adjusted ETR was 22.7% in the first quarter 2024 versus 24.1% in the 2023 quarter, primarily due to higher tax benefits from share based compensation. On an adjusted basis, EPS was $3.75, 10% above the 2023 adjusted EPS of $3.42, driven by higher adjusted net income - Linde plc and lower diluted shares outstanding.

Current wording

In the second quarter of 2024, adjusted operating profit of $2,422 million, or 29.3% of sales, was 6% higher as compared to 2023, driven by higher pricing, and productivity initiatives, partially offset by cost inflation and currency translation. The adjusted ETR was 23.5% in the second quarter 2024 versus 23.7% in the 2023 quarter. On an adjusted basis, EPS was $3.85, 8% above the 2023 adjusted EPS of $3.57, driven by higher adjusted net income - Linde plc and lower diluted shares outstanding.

Previous wording

Cost of sales, exclusive of depreciation and amortization decreased $215 million, or 5%, for the first quarter of 2024 primarily due to lower cost pass-through, lower volumes and productivity gains which more than offset cost inflation. Cost of sales, exclusive of depreciation and amortization was 52.0% of sales, respectively, for the first quarter versus 54.1% respective 2023 period. The decrease as a percentage of sales in the quarter was primarily due to higher pricing and lower cost pass-through.

Current wording

Cost of sales, exclusive of depreciation and amortization decreased $65 million, or 2%, for the second quarter of 2024 and decreased $280 million, or 3% for the six months ended June 30, 2024 primarily due to lower cost pass-through and productivity gains which more than offset cost inflation. Cost of sales, exclusive of depreciation and amortization was 51.4% and 51.7% of sales, respectively, for the second quarter and six months ended June 30, 2024 versus 52.6% and 53.3% for the respective 2023 periods. The decrease as a percentage of sales in the quarter was primarily due to higher pricing and lower cost pass-through.

Previous wording

Selling, general and administrative expense ("SG&A") increased $38 million, or 5%, for the first quarter of 2024 driven by higher costs. SG&A was 10.6% of first quarter sales versus 10.0% for the respective 2023 period.

Current wording

Selling, general and administrative expense ("SG&A") increased $7 million, or 1%, for the second quarter of 2024 and increased $45 million or 3% for the six months ended June 30, 2024 driven by higher costs. SG&A was 10.2% of second quarter sales for both 2023 and 2024. In the year-to-date period SG&A was 10.4% and 10.1% of sales versus the respective 2023 period.

Previous wording

Reported depreciation and amortization expense increased $1 million for the first quarter of 2024.

Current wording

Reported depreciation and amortization expense decreased $2 million for the second quarter of 2024 and decreased $1 million, for the six months ended June 30, 2024.

Previous wording

On an adjusted basis, depreciation and amortization increased $11 million, for the first quarter of 2024 driven by new project start ups.

Current wording

On an adjusted basis, depreciation and amortization increased $12 million, for the second quarter of 2024 and increased $23 million for the year-to-date period driven by new project start ups.

Previous wording

Reported other income (expense) - net was a benefit of $58 million for the first quarter of 2024 driven by $43 million in insurance recoveries primarily within the Other segment.

Current wording

Reported other income (expense) - net was a benefit of $2 million for the second quarter of 2024 and $60 million for the year-to-date period driven by $43 million in insurance recoveries primarily within the Other segment recognized during the first quarter.

Previous wording

On a reported basis, operating profit increased $162 million, or 8%, for the first quarter of 2024 . The increase in the quarter was primarily due to higher pricing, savings from productivity initiatives and lower other charges, which more than offset the adverse impacts of cost inflation and lower volumes in the first quarter of 2024.

Current wording

On a reported basis, operating profit increased $173 million, or 9%, for the second quarter of 2024 and increased $335 million, or 8%, for the six months ended June 30, 2024. The increase in the quarter and year-to-date periods of 2024 was primarily due to higher pricing, savings from productivity initiatives and lower other charges, which more than offset the adverse impacts of cost inflation and currency.

Previous wording

On an adjusted basis, which excludes the impacts of merger-related purchase accounting as well as other charges, operating profit increased $135 million, or 6% in the first quarter of 2024. Operating profit growth was driven by higher pricing and productivity initiatives, which more than offset the effects of cost inflation and lower volumes during the period. A discussion of operating profit by segment is included in the segment discussion that follows.

Current wording

On an adjusted basis, which excludes the impacts of merger-related purchase accounting as well as other charges, operating profit increased $136 million, or 6% in the second quarter of 2024 and increased $271 million, or 6% for the six months ended June 30, 2024. Operating profit growth was driven by higher pricing and productivity initiatives, which more than offset the effects of cost inflation and currency during the quarter and year-to-date periods of 2024. A discussion of operating profit by segment is included in the segment discussion that follows.

Previous wording

Reported interest expense - net increased $28 million for the first quarter of 2024. On an adjusted basis, interest expense increased $21 million for the first quarter of 2024 versus the respective 2023 period. The increase in both periods was driven primarily by higher interest rates on debt.

Current wording

Reported interest expense - net increased $18 million for the second quarter of 2024 and increased $46 million for the six months ended June 30, 2024. On an adjusted basis, interest expense increased $15 million for the second quarter of 2024 and increased $36 million for the six months ended June 30, 2024 versus the respective 2023 period. The increase in both periods was driven primarily by higher interest rates on debt.

Previous wording

Reported net pension and OPEB cost (benefit), excluding service cost were benefits of $50 million versus $45 million for the respective 2023 period. The increase in the benefit primarily relates to higher expected return on assets and lower amortization of deferred losses year-over-year.

Current wording

Reported net pension and OPEB cost (benefit), excluding service cost were benefits of $49 million and $99 million for the quarter and six months ended June 30, 2024, respectively, versus $45 million and $90 million for the respective 2023 periods. The increase in the benefit primarily relates to higher expected return on assets and lower amortization of deferred losses year-over-year.

Previous wording

The reported effective tax rate ("ETR") for the quarter was 22.3% versus 22.2% for the respective 2023 period. While the rate is relatively flat year over year, 2024 included higher tax benefits from share based compensation and 2023 included a net decrease in uncertain tax positions. Effective January 1, 2024, Linde is subject to the 15% global minimum tax rate provisions of the OECD’s framework for Pillar Two, the implementation of which did not have a significant impact on the effective tax rate for the quarter.

Current wording

The reported effective tax rate ("ETR") for the quarter and six months ended June 30, 2024 was 23.5% and 22.9% versus 21.9% and 22.0% for the respective 2023 periods. The increase in the quarter rate is primarily related a 2023 tax refund that did not repeat in 2024, partially offset by tax benefits from a repatriation in the current year. The increase in the year to date rate is primarily related to a prior year benefit from a net decrease in the company’s uncertain tax positions and a tax refund. Effective January 1, 2024, Linde is subject to the 15% global minimum tax rate provisions of the OECD’s framework for Pillar Two, the implementation of which did not have a significant impact on the effective tax rate for the quarter or year-to-date periods.

Previous wording

On an adjusted basis, the ETR for the quarter was 22.7% versus 24.1% for the respective 2023 period. The decrease in the adjusted ETR is primarily due to higher tax benefits from share based compensation in 2024.

Current wording

On an adjusted basis, the ETR for the quarter and six months ended June 30, 2024 was 23.5% and 23.1% versus 23.7% and 23.9% for the respective 2023 periods. The decrease in the year-to-date rate is primarily due to tax benefits from a repatriation and higher tax benefits from share based compensation.

Previous wording

Reported income from equity investments for the first quarter of 2024 was $48 million versus $41 million for the respective 2023 period.

Current wording

Reported income from equity investments for the second quarter and six months ended June 30, 2024 was $45 million and $93 million versus $46 million and $87 million for the respective 2023 periods.

Previous wording

On an adjusted basis, income from equity investments for the first quarter was $66 million versus $59 million in the respective 2023 period.

Current wording

On an adjusted basis, income from equity investments for the second quarter and six months ended June 30, 2024 was $63 million and $129 million versus $64 million and $123 million for the respective 2023 periods.

Previous wording

At March 31, 2024, noncontrolling interests consisted primarily of non-controlling shareholders' investments in APAC (primarily China). Reported noncontrolling interests income increased $2 million for the first quarter of 2024 from the respective 2023 period.

Current wording

At June 30, 2024, noncontrolling interests consisted primarily of non-controlling shareholders' investments in APAC (primarily China). Reported noncontrolling interests income was $37 million for the second quarter of 2024 and the respective 2023 period. For the six months ended June 30, 2024 noncontrolling interests income was $75 million versus $73 million in the respective 2023 period.

Previous wording

Reported net income - Linde plc increased $111 million, or 7%, for the first quarter of 2024 versus the respective 2023 period.

Current wording

Reported net income - Linde plc increased $88 million, or 6%, for the second quarter of 2024 and increased $199 million, or 6%, for the six months ended June 30, 2024 versus the respective 2023 periods.

Previous wording

On an adjusted basis, which excludes the impacts of purchase accounting and other charges, net income - Linde plc increased $128 million, or 8%, for the first quarter of 2024 versus the respective 2023 period.

Current wording

On an adjusted basis, which excludes the impacts of purchase accounting and other charges, net income - Linde plc increased $99 million, or 6%, for the second quarter of 2024 and increased $227 million, or 7%, for the six months ended June 30, 2024 versus the respective 2023 periods.

Previous wording

Reported diluted earnings per share increased $0.29, or 9%, for the first quarter of 2024 versus the comparable 2023 period.

Current wording

Reported diluted earnings per share increased $0.25, or 8%, for the second quarter of 2024 and increased $0.54, or 9%, for the six months ended June 30, 2024 versus the respective 2023 periods.

Previous wording

On an adjusted basis, diluted EPS increased $0.33, or 10%, for the first quarter of 2024 versus the respective 2023 period.

Current wording

On an adjusted basis, diluted EPS increased $0.28, or 8%, for the second quarter of 2024 and increased $0.62, or 9% for the six months ended June 30, 2024 versus the respective 2023 periods.

Previous wording

The number of employees at March 31, 2024 was 66,195, an increase of 814 employees from March 31, 2023 due primarily to acquisitions.

Current wording

The number of employees at June 30, 2024 was 65,987, a decrease of 283 employees from June 30, 2023.

Previous wording

EBITDA was $3,092 million for the first quarter of 2024 as compared to $2,922 million in the respective 2023 period. The increase was driven by higher net income - Linde plc versus prior year.

Current wording

EBITDA was $3,187 million for the second quarter of 2024 as compared to $3,017 million in the respective 2023 period. EBITDA was $6,279 million for the six months ended June 30, 2024 as compared to $5,939 million in the respective 2023 period. The increase was driven by higher net income - Linde plc versus prior year.

Previous wording

Adjusted EBITDA increased to $3,116 million for the first quarter 2024 from $2,963 million in the respective 2023 period. The higher EBITDA was primarily due to higher net income - Linde plc versus the respective prior period.

Current wording

Adjusted EBITDA increased to $3,206 million for the second quarter 2024 from $3,059 million in the respective 2023 period. Adjusted EBITDA was $6,322 million for the six months ended June 30, 2024 as compared to $6,022 million in the respective 2023 period. The higher EBITDA was primarily due to higher net income - Linde plc versus the respective prior periods.

Previous wording

Other comprehensive losses for the first quarter were $738 million. The loss in the quarter resulted primarily from currency translation adjustments of $744 million. The translation adjustments reflect the impact of translating local currency foreign subsidiary financial statements to U.S. dollars, and are largely driven by the movement of the U.S. dollar against major currencies including the Euro, British pound and the Chinese yuan. See the "Currency" section of the MD&A for exchange rates used for translation purposes and Note 10 to the condensed consolidated financial statements for a summary of the currency translation adjustment component of accumulated other comprehensive income (loss) by segment.

Current wording

Other comprehensive losses for the second quarter and six months ended June 30, 2024 were $276 million and $1,014 million, respectively. The loss in the quarter and year-to-date period resulted primarily from currency translation adjustments of $274 million and $1,018 million, respectively. The translation adjustments reflect the impact of translating local currency foreign subsidiary financial statements to U.S. dollars, and are largely driven by the movement of the U.S. dollar against major currencies including the Euro, British pound and the Chinese yuan. See the "Currency" section of the MD&A for exchange rates used for translation purposes and Note 10 to the condensed consolidated financial statements for a summary of the currency translation adjustment component of accumulated other comprehensive income (loss) by segment.

Previous wording

Operating profit in the Americas segment increased $63 million, or 6%, in the first quarter versus the respective 2023 period, driven primarily by higher pricing and continued productivity initiatives which more than offset cost inflation and lower volumes during the quarter.

Current wording

Operating profit in the Americas segment increased $89 million, or 8%, in the second quarter and increased $152 million, or 7%, for the six months ended June 30, 2024 versus the respective 2023 periods, driven primarily by higher pricing and continued productivity initiatives which more than offset cost inflation.

Previous wording

EMEA segment sales decreased by $86 million, or 4%, in the first quarter compared to the respective 2023 period. Higher price attainment increased sales by 3% in the quarter . Volumes decreased sales by 2% in the quarter led by the manufacturing end market. Cost pass-through decreased sales by 5% in the quarter with minimal impact on operating profit. Currency translation was flat in the quarter.

Current wording

EMEA segment sales decreased by $69 million, or 3%, in the second quarter and decreased $155 million or 4% for the six months ended June 30, 2024 compared to the respective 2023 periods. Higher price attainment increased sales by 3% in the quarter and year-to-date periods. Volumes decreased sales by 1% in the quarter and 2% in the year-to-date period driven by the metals and mining end market. Cost pass-through decreased sales by 4% in the quarter and 5% in the year-to-date period with minimal impact on operating profit. Currency translation decreased sales by 1% in the quarter driven primarily by the weakening of the Euro against the U.S. Dollar and was flat in the year-to-date period.

Previous wording

Operating profit for the EMEA segment increased by $80 million, or 13%, in the first quarter compared to the respective 2023 periods. The increase in operating profit in the first quarter was driven primarily by higher pricing and continued productivity initiatives, partially offset by cost inflation and lower volumes.

Current wording

Operating profit for the EMEA segment increased by $74 million, or 12%, in the second quarter and increased by $154 million, or 12% for the six months ended June 30, 2024 compared to the respective 2023 periods. The increase in operating profit in the second quarter and year-to-date period was driven primarily by higher pricing and continued productivity initiatives, partially offset by cost inflation and lower volumes.

Previous wording

Sales for the APAC segment decreased $7 million in the first quarter versus the respective 2023 period. Higher pricing contributed 1% to sales in the quarter. Volumes increased 3% in the quarter including project start-ups in the electronics and chemicals and energy end markets. Currency translation decreased sales by 4%, driven primarily by the weakening of the Australian dollar, Korean won and Chinese yuan against the U.S. dollar.

Current wording

Sales for the APAC segment decreased $26 million, or 2% in the second quarter and decreased $33 million, or 1%, for the six months ended June 30, 2024 versus the respective 2023 periods. Pricing was flat in the quarter and year-to-date periods. Volumes were flat in the quarterand increased 2% for year-to-date period including project start-ups in the electronics and chemicals and energy end markets. Currency translation decreased sales by 3%, in the quarterand 2% for the year-to-date period driven primarily by the weakening of the Australian dollar, Korean won and Chinese yuan against the U.S. dollar.

Previous wording

Operating profit in the APAC segment increased $24 million, or 6%, in the first quarter versus the respective 2023 period, driven by continued productivity initiatives which more than offset the impact of currency and cost inflation during the first quarter.

Current wording

Operating profit in the APAC segment increased $2 million in the second quarter and increased $26 million, or 3% in the six months ended June 30, 2024 versus the respective 2023 periods, driven by continued productivity initiatives which more than offset the impact of currency and cost inflation.

Previous wording

Engineering segment operating profit decreased $49 million, or 33%, in the first quarter compared to the respective 2023 period due to prior year's benefit from higher margin on lawful wind down of projects subject to sanctions in Russia.

Current wording

Engineering segment operating profit decreased $11 million, or 10%, in the second quarter and decreased $60 million or 23% in the six months ended June 30, 2024 compared to the respective 2023 period due to prior year's benefit from higher margin on lawful wind down of projects subject to sanctions in Russia.

Previous wording

Operating profit in Other increased $17 million in the first quarter versus the respective 2023 period. The increase in the quarter was driven primarily by an insurance recovery in the period for the coatings business partially offset by higher costs due to helium and corporate.

Current wording

Operating profit in Other decreased $18 million in the second quarter anddecreased $1 million, or 11% in thesix months ended June 30, 2024 versus the respective 2023 periods. The decrease in the quarter was driven by higher costs due to helium, which was partially offset by an insurance recovery for the coatings business in the year-to-date period.

Previous wording

The results of Linde's non-U.S. operations are translated to the company’s reporting currency, the U.S. dollar, from the functional currencies. For most operations, Linde uses the local currency as its functional currency. There is inherent variability and unpredictability in the relationship of these functional currencies to the U.S. dollar and such currency movements may materially impact Linde's results of operations in any given period.

Current wording

The results of Linde's non-U.S. operations are translated to the company’s reporting currency, the U.S. dollar, from the functional currencies. For most operations, Linde uses the local currency as its functional currency. There is inherent variability and unpredictability in the relationship of these functional currencies to the U.S. dollar and such currency movements may materially impact Linde's results of operations in any given periods.

Previous wording

Cash provided by operations of $1,954 million for the three months ended March 31, 2024 increased $46 million, or 2%, versus 2023. The increase was driven primarily by higher net income adjusted for non-cash charges, partially offset by higher net working capital and other cash requirements.

Current wording

Cash provided by operations of $3,883 million for the six months ended June 30, 2024 decreased $175 million, or 4%, versus 2023. The decrease was driven primarily by higher net working capital requirements including lower inflows from contract liabilities from engineering customer advanced payments and higher cash taxes and interest, partially offset by higher net income adjusted for non-cash charges.

Previous wording

Linde estimates that total 2024 required contributions to its pension plans will be in the range of approximately $30 million to $40 million, of which $11 million has been made through March 31, 2024.

Current wording

Linde estimates that total 2024 required contributions to its pension plans will be in the range of approximately $30 million to $40 million, of which $24 million has been made through June 30, 2024.

Previous wording

Net cash used for investing of $1,041 million for the three months ended March 31, 2024 decreased $593 million versus 2023, due to lower acquisitions, net of cash acquired partially offset by higher capital expenditures.

Current wording

Net cash used for investing activities of $2,311 million for the six months ended June 30, 2024 decreased $187 million versus 2023, due to lower acquisitions, net of cash acquired, partially offset by higher capital expenditures.

Previous wording

Capital expenditures for the three months ended March 31, 2024 were $1,048 million, $219 million higher than the prior year due primarily to investments in new plant and production equipment for backlog growth requirements.

Current wording

Capital expenditures for the six months ended June 30, 2024 were $2,181 million, $493 million higher than the prior year due primarily to investments in new plant and production equipment for backlog growth requirements.

Previous wording

At March 31, 2024, Linde's sale of gas backlog of large projects under construction was approximately $4.9 billion. This represents the total estimated capital cost of large plants under construction.

Current wording

At June 30, 2024, Linde's sale of gas backlog of large projects under construction was approximately $4.7 billion. This represents the total estimated capital cost of large plants under construction.

Previous wording

There were no acquisitions for the three months ended March 31, 2024. Acquisitions, net of cash acquired were $808 million, for the three months ended March 31, 2023 and related primarily to the acquisition of nexAir in the Americas.

Current wording

Acquisitions, net of cash acquired were $152 million for the six months ended June 30, 2024 and relate primarily to packaged gas businesses in the Americas. Acquisitions, net of cash acquired were $834 million, for the six months ended June 30, 2023 and related primarily to the acquisition of nexAir in the Americas.