Performance vs combined Linde + Praxair

% change YoY
  • Corporate Sales
  • Corporate Operating Income
  • Proforma Sales
  • Proforma Operating Income
,Corporate Sales,Corporate Operating Income,Proforma Sales,Proforma Operating Income 2014 Q1,5.2%,7.3%,null,null 2014 Q2,0.5%,0.9%,null,null 2014 Q3,3.5%,3.2%,null,null 2014 Q4,-1.7%,-10.3%,null,null 2015 Q1,-9.8%,-10.7%,null,null 2015 Q2,-9.3%,-19.2%,null,null 2015 Q3,-14.1%,-15.7%,null,null 2015 Q4,-13.2%,-11.5%,null,null 2016 Q1,-6.6%,-7.9%,null,null 2016 Q2,-5.8%,7.3%,null,null 2016 Q3,-0.6%,-9.7%,null,null 2016 Q4,2.1%,0.9%,null,null 2017 Q1,4.6%,1.9%,null,null 2017 Q2,1.9%,0.8%,null,null 2017 Q3,4.6%,20.7%,null,null 2017 Q4,5.1%,10.5%,null,null 2018 Q1,7.8%,23.0%,null,null 2018 Q2,8.9%,15.6%,null,null 2018 Q3,1.7%,2.8%,null,null 2018 Q4,0.0%,3.6%,null,null 2019 Q1,-15.0%,-13.9%,-0.4%,1.9% 2019 Q2,-14.0%,-10.9%,0.4%,5.9% 2019 Q3,-14.1%,1.5%,0.7%,16.5% 2019 Q4,-11.3%,-1.7%,0.8%,16.5% 2020 Q1,-2.5%,10.0%,null,null 2020 Q2,-11.5%,-0.2%,null,null
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Q2 group sales at $6.38Bn were down over -5% sequentially to be -11% lower YoY (on a reported basis)

Group Operating Income at $1.32Bn was again down sequentially to seasonality but was flat YoY

Solid operating leverage sequentially and YoY – broad based price improvement and continued progress on productivity

Operating Cash Flow again increased sequentially by over +30% and +75% YoY

Following the various divestitures, the new Linde plc business is split geographically with Americas Gases the largest followed by Europe/M.East/Africa and AsiaPacific. 11 countries account for nearly two-thirds of gas sales

Engineering accounts for 10% of global sales. ‘Other’ business includes small global gas related businesses in Global Helium and Electronic Materials as well as non-gas businesses such as Technologies and GIST Distribution



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Margin vs combined Linde + Praxair

% change YoY
  • Old Linde + Praxair margin
  • New Linde plc margin
,Old Linde + Praxair margin,New Linde plc margin 2014 Q1,16.2%,null 2014 Q2,16.6%,null 2014 Q3,16.1%,null 2014 Q4,15.6%,null 2015 Q1,16.0%,null 2015 Q2,14.8%,null 2015 Q3,15.8%,null 2015 Q4,15.9%,null 2016 Q1,15.8%,null 2016 Q2,16.8%,null 2016 Q3,14.4%,null 2016 Q4,15.8%,null 2017 Q1,15.4%,null 2017 Q2,16.7%,null 2017 Q3,16.6%,null 2017 Q4,16.6%,null 2018 Q1,17.5%,17.4% 2018 Q2,17.7%,17.4% 2018 Q3,16.8%,17.1% 2018 Q4,17.2%,17.2% 2019 Q1,17.8%,17.8% 2019 Q2,18.3%,18.3% 2019 Q3,19.8%,19.8% 2019 Q4,19.0%,19.0% 2020 Q1,20.1%,20.1% 2020 Q2,20.7%,20.7%
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Group Operating Margin at over 20½% in Q2 continues its upward trend to a new peak and compares with an average of around 16% for the combined Linde and Praxair over the pre-merger years 

Cost reduction and other charges increased to $249m in Q2, nearly half of which in EMEA – group SG&A costs down -14% YoY 

R&D costs reduced significantly to around 0.5% of sales

Reported After tax ROC up sequentially to over 12% up 170bp YoY



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Gases Revenue Growth Drivers

  • Natural Gas
  • Currency
  • Acquisition/Divest
  • Reported Growth
  • Underlying Growth
,Natural Gas,Currency,Acquisition/Divest,Reported Growth,Underlying Growth 2014 Q1,0.9%,-5.2%,0.8%,0.7%,4.1% 2014 Q2,0.0%,-4.0%,0.5%,-0.5%,2.9% 2014 Q3,-0.2%,-1.0%,0.0%,3.2%,4.4% 2014 Q4,-0.1%,-0.3%,0.0%,1.7%,2.1% 2015 Q1,-2.0%,2.1%,0.1%,1.2%,1.0% 2015 Q2,-1.8%,2.2%,0.4%,1.7%,0.9% 2015 Q3,-1.5%,-1.6%,0.4%,-2.2%,0.5% 2015 Q4,-1.5%,-2.0%,0.8%,-2.6%,0.1% 2016 Q1,-1.0%,-4.7%,0.7%,-4.4%,0.6% 2016 Q2,-0.9%,-4.6%,1.4%,-3.9%,0.2% 2016 Q3,0.0%,-1.8%,0.9%,-1.9%,-1.0% 2016 Q4,0.5%,-0.9%,0.8%,2.3%,2.0% 2017 Q1,1.5%,2.5%,-0.2%,6.5%,2.7% 2017 Q2,1.4%,0.8%,-0.5%,3.6%,2.0% 2017 Q3,0.7%,-1.5%,0.4%,2.7%,3.1% 2017 Q4,0.2%,-2.2%,0.0%,2.3%,4.2% 2018 Q1,0.2%,-3.5%,0.0%,0.6%,3.9% 2018 Q2,0.3%,-2.5%,0.0%,3.1%,5.4% 2018 Q3,0.6%,-2.8%,0.0%,3.6%,5.7% 2018 Q4,0.9%,-0.7%,-1.1%,3.2%,4.2% 2019 Q1,0.9%,-4.8%,-12.5%,-12.0%,4.5% 2019 Q2,0.0%,-4.1%,-12.3%,-13.1%,3.3% 2019 Q3,-1.2%,-2.6%,-13.5%,-14.4%,2.9% 2019 Q4,-1.6%,-1.5%,-15.2%,-16.6%,1.7% 2020 Q1,-1.0%,-2.4%,0.0%,-1.2%,2.1% 2020 Q2,-0.6%,-3.0%,-0.5%,-10.8%,-6.7%
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Reported gas sales were deteriorated again to be down nearly        -11% YoY in Q2

Negative impacts of -4% from currency were driven across all three regions. 

Energy cost pass-through impact was marginally negative, mainly driven again by Americas and Europe – this reflects both the scale of the energy price swings and also differences in the business profile by region

Also small negative impact YoY from net divestments



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Gases Underlying Growth Drivers

  • Underlying Growth
  • Volume
  • Price
,Underlying Growth,Volume,Price 2014 Q1,4.1%,2.8%,1.3% 2014 Q2,2.9%,2.2%,0.7% 2014 Q3,4.4%,2.9%,1.5% 2014 Q4,2.1%,1.3%,0.8% 2015 Q1,1.0%,0.8%,0.1% 2015 Q2,0.9%,0.4%,0.5% 2015 Q3,0.5%,0.0%,0.5% 2015 Q4,0.1%,-0.4%,0.5% 2016 Q1,0.6%,0.3%,0.3% 2016 Q2,0.2%,0.3%,-0.1% 2016 Q3,-1.0%,-1.1%,0.1% 2016 Q4,2.0%,1.9%,0.1% 2017 Q1,2.7%,3.3%,-0.6% 2017 Q2,2.0%,2.6%,-0.7% 2017 Q3,3.1%,3.6%,-0.5% 2017 Q4,4.2%,4.7%,-0.5% 2018 Q1,3.9%,3.2%,0.7% 2018 Q2,5.4%,4.0%,1.4% 2018 Q3,5.7%,4.1%,1.6% 2018 Q4,4.2%,2.9%,1.3% 2019 Q1,4.5%,2.8%,1.7% 2019 Q2,3.3%,1.0%,2.3% 2019 Q3,2.9%,0.7%,2.2% 2019 Q4,1.7%,-0.5%,2.2% 2020 Q1,2.1%,-0.4%,2.4% 2020 Q2,-6.7%,-8.5%,1.8%
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Underlying growth in gases sales slipped sharply in Q2 to nearly  –7% YoY –  reflecting global economic impacts of Covid and clearly substantially below the combined performance of old Linde plus old Praxair in the years up to 2018

Contribution from pricing was again over +2% YoY, close to its highest rate in recent years, while the volume impact deteriorated again to be negative overall at around –9% - this decline was indicated to be entirely attributable to Covid

Within Q2, April showed the steepest decline with May and June showing smaller falls

‘Other business’ -16% down in Q2 



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Americas Underlying Growth

  • New Linde plc Volume
  • New Linde plc Total
  • Praxair Volume
  • Praxair Total
  • Linde Total
,New Linde plc Volume,New Linde plc Total,Praxair Volume,Praxair Total,Linde Total 2014 Q1,null,null,3.6%,5.1%,4.2% 2014 Q2,null,null,3.0%,5.0%,3.4% 2014 Q3,null,null,1.4%,2.0%,5.3% 2014 Q4,null,null,1.6%,2.0%,5.5% 2015 Q1,null,null,-0.2%,1.0%,5.2% 2015 Q2,null,null,-2.4%,-1.0%,8.8% 2015 Q3,null,null,-4.0%,-3.0%,10.9% 2015 Q4,null,null,-4.4%,-3.0%,5.9% 2016 Q1,null,null,-4.4%,-4.0%,1.8% 2016 Q2,null,null,-1.4%,-1.0%,-0.2% 2016 Q3,null,null,-0.4%,0.0%,-6.9% 2016 Q4,null,null,-1.2%,-2.0%,2.3% 2017 Q1,null,null,2.4%,4.0%,-2.6% 2017 Q2,null,null,0.8%,4.0%,-9.8% 2017 Q3,null,null,2.8%,4.0%,-2.6% 2017 Q4,null,null,7.0%,9.0%,-6.6% 2018 Q1,null,null,3.4%,6.0%,1.0% 2018 Q2,null,null,4.0%,6.0%,5.2% 2018 Q3,null,null,3.8%,7.0%,7.0% 2018 Q4,null,null,1.8%,2.6%,null 2019 Q1,3.0%,5.0%,null,null,null 2019 Q2,1.0%,4.0%,null,null,null 2019 Q3,2.0%,5.0%,null,null,null 2019 Q4,1.0%,3.0%,null,null,null 2020 Q1,2.0%,4.0%,null,null,null 2020 Q2,-9.0%,-7.0%,null,null,null
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USA accounts for over 70% ($6.8Bn) of Americas sales with Brazil, Mexico and Canada each around 7-10% (over $700m)

Americas underlying growth in 2019 and into early 2020 for Linde plc on a pro forma basis remained similar to that of old Praxair through 2017/8 – however Q2 saw a sharp weakening to be down   -7% YoY driven by a volume fall of -9% only marginally offset by a positive price/mix impact again at +2%

Metals and manufacturing markets most impacted by Covid downturn. L.America medical O2 volumes higher with US homecare up. US chemicals & Refining volumes up. US metals volumes down



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EMEA Underlying Growth

  • New Linde plc Volume
  • New Linde plc Total
  • Praxair Volume
  • Praxair Total
  • Linde Total
,New Linde plc Volume,New Linde plc Total,Praxair Volume ,Praxair Total,Linde Total 2014 Q1,null,null,1.0%,2.0%,1.2% 2014 Q2,null,null,0.0%,1.0%,-0.2% 2014 Q3,null,null,1.0%,2.0%,1.4% 2014 Q4,null,null,-1.0%,-1.0%,-2.0% 2015 Q1,null,null,0.0%,1.0%,-1.6% 2015 Q2,null,null,-1.0%,-1.0%,-1.4% 2015 Q3,null,null,3.0%,3.0%,-1.8% 2015 Q4,null,null,3.0%,4.0%,0.0% 2016 Q1,null,null,2.0%,2.0%,-0.2% 2016 Q2,null,null,3.0%,4.0%,-0.2% 2016 Q3,null,null,0.0%,0.0%,-2.0% 2016 Q4,null,null,1.0%,1.0%,2.0% 2017 Q1,null,null,6.0%,6.0%,4.4% 2017 Q2,null,null,4.0%,5.0%,1.4% 2017 Q3,null,null,4.0%,5.0%,2.9% 2017 Q4,null,null,5.0%,5.0%,2.9% 2018 Q1,null,null,2.0%,3.0%,3.0% 2018 Q2,null,null,2.0%,5.0%,5.4% 2018 Q3,null,null,1.0%,4.0%,3.3% 2018 Q4,null,null,-1.0%,0.0%,null 2019 Q1,0.0%,1.0%,null,null,null 2019 Q2,-1.0%,1.0%,null,null,null 2019 Q3,0.0%,2.0%,null,null,null 2019 Q4,-2.0%,1.0%,null,null,null 2020 Q1,-1.0%,1.0%,null,null,null 2020 Q2,-7.0%,-6.0%,null,null,null
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Within Europe/M.East/Africa, Germany accounts for over 20% ($1.2Bn) of region sales with UK and Eastern Europe each around 12-16% (over $700m) with Rest of Europe sales of $2.4Bn and M.East/Africa nearly $500m 

EMEA underlying growth also weakened sharply to be down -6% YoY in Q2 – growth had been modest in previous quarters and below the performance of Linde and also the higher performing business of Praxair which has mostly had to be divested

Volume contribution was negative by -7% in Q2 driven by the Covid crisis - while positive pricing impact reduced to around +1%

Europe homecare higher. Metals volumes down in Germany and UK



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Asia Pacific Underlying Growth

  • New Linde plc Volume
  • New Linde plc Total
  • Praxair Volume
  • Praxair Total
  • Linde Total
,New Linde plc Volume,New Linde plc Total,Praxair Volume,Praxair Total,Linde Total 2014 Q1,null,null,9.0%,11.0%,4.6% 2014 Q2,null,null,5.0%,6.0%,6.2% 2014 Q3,null,null,10.0%,11.0%,5.4% 2014 Q4,null,null,5.0%,6.0%,2.6% 2015 Q1,null,null,1.0%,1.0%,0.0% 2015 Q2,null,null,1.0%,1.0%,-0.8% 2015 Q3,null,null,5.0%,6.0%,-2.5% 2015 Q4,null,null,4.0%,4.0%,-1.1% 2016 Q1,null,null,6.0%,5.0%,3.5% 2016 Q2,null,null,6.0%,5.0%,-0.5% 2016 Q3,null,null,2.0%,1.0%,0.3% 2016 Q4,null,null,6.0%,5.0%,3.9% 2017 Q1,null,null,9.0%,8.0%,4.9% 2017 Q2,null,null,10.0%,11.0%,5.7% 2017 Q3,null,null,13.0%,15.0%,8.3% 2017 Q4,null,null,11.0%,14.0%,7.9% 2018 Q1,null,null,11.0%,14.0%,4.6% 2018 Q2,null,null,11.0%,14.0%,4.0% 2018 Q3,null,null,7.0%,9.0%,6.7% 2018 Q4,null,null,7.0%,7.0%,null 2019 Q1,5.0%,7.0%,null,null,null 2019 Q2,3.0%,5.0%,null,null,null 2019 Q3,-1.0%,0.0%,null,null,null 2019 Q4,-2.0%,0.0%,null,null,null 2020 Q1,-5.0%,-3.0%,null,null,null 2020 Q2,-9.0%,-8.0%,null,null,null
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China & Taiwan sales (combined $1.9Bn) account for 40% of Asia Pacific sales followed by Australia (over $900m), S.Korea and India (each nearly $500m). Electronics market accounts for 25% of sales in this region – higher than other regions

Asia Pacific underlying growth of Linde plc weakened further after slowing significantly through 2019 and was down -8% YoY in Q2

The negative volume impact increased to -9% YoY including -3% impact due to high Equipment sales in the prior year. Pricing/mix impact eased to be +1% in Q2.

Electronics demand up in China and S.Korea. China chemicals & refining and metals up



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Total Sales by Business

% Change YoY
  • Total
  • Onsites
  • All Merchant
  • Liquid Bulk
  • Packaged
,Total,Onsites,All Merchant,Liquid Bulk,Packaged ,-11.5%,-16.3%,-12.1%,-15.3%,-9.9%
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Over 40% of Linde plc global gas sales are in packaged gases with nearly 30% in liquid bulk (giving total combined merchant sales of over 70%) and over a quarter in onsites 

Sharp fall in reported global onsite sales (-16% YoY) in Q2 – substantially driven by cost pass-through with volumes appearing to be relatively flat

Within merchant (Spiritus definition) saw significant turnround in liquid bulk sales to be down -15% YoY in Q2 combined with a further significant decline in packaged gases (around -10%) giving a net merchant sales decline of around -12% YoY. With pricing reported to be higher globally this indicates a volume decline of more than this rate 

In all three regions, these negative growth rates have been compounded by negative currency impacts



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Americas Sales by Business

  • Total
  • Onsites
  • All Merchant
  • Liquid Bulk
  • Packaged
,Total,Onsites,All Merchant,Liquid Bulk,Packaged ,-13.0%,-20.0%,-10.0%,-13.7%,-8.0%
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Nearly half of Linde plc Americas gas sales are in packaged gases with nearly 30% in liquid bulk (giving total combined merchant sales of nearly 75%) and a quarter in onsites 

Sharp fall in reported onsite sales (-20% YoY) in Q2 – although partly driven by negative impact of cost pass-through this also implies a significant volume decline

Within merchant (Spiritus definition) sharp weakening in liquid bulk sales in Q2 (to nearly -14% YoY) combined with a further decline in packaged gases (to around -8%) giving a net merchant growth of around -10% YoY. The slight decline in volumes in Q1 when adjusted for increased pricing appears to have deteriorated into a double digit volume decline in Q2



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Europe Sales by Business

% Change YoY
  • Total
  • Onsites
  • All Merchant
  • Liquid Bulk
  • Packaged
,Total,Onsites,All Merchant,Liquid Bulk,Packaged ,-13.4%,-14.4%,-14.0%,-12.8%,-14.6%
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Around half of Linde plc European gas sales are in packaged gases with nearly 30% in liquid bulk (giving total combined merchant sales of nearly 80%) compared with only marginally over 20% in onsites 

Sharp fall in reported onsite sales  to be nearly -15% YoY) in Q2 – apparently due to a combination of negative cost pass-through and significantly lower volumes

Within merchant (Spiritus definition) significant turnround in liquid bulk sales to be down to be down nearly -13% in Q2 combined with continued major weakness in reported packaged gases sales (-14%) giving a net merchant sales decline of  -14% YoY with a significantly sharper fall in volumes partly offset by improved pricing



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Asia Pacific Sales by Business

  • Total
  • Onsites
  • All Merchant
  • Liquid Bulk
  • Packaged
,Total,Onsites,All Merchant,Liquid Bulk,Packaged ,-14.4%,-12.7%,-12.4%,-16.7%,-6.2%
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Around 35% of Linde plc Asia Pacific gas sales are in onsites with a similar proportion in liquid bulk and close to a quarter in packaged gases (giving total combined merchant sales of slightly over 60%)

Significant decline seen in Q1 in reported sales in all major businesses 

Fall in reported onsite sales (-3½% YoY) in Q1 with negative impact of energy cost pass-through more than offsetting indications of higher volumes

Within merchant (Spiritus definition) significant declines in range of -7 to -7½% in both liquid bulk and packaged gases with sharp falls in volumes only partly offset by increased pricing

Healthcare largest market for Linde gases (21% of sales) followed by Manufacturing and Chemicals & Refining (both nearly 20%) and Metals (13%) with Electronics and Food & Beverages each around 10%

Electronics and Healthcare showed highest YoY growth in Q2 at 5% and 4% respectively while other sectors sharply down YoY with Manufacturing down -15%, Metals -13%, Food & Beverages -9% and Chemicals & Refining -6% 

Higher volumes for food and dry ice but lower CO2 volumes for bottlers and restaurants



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Profit profile

$M
  • Americas gases
  • EMEA gases
  • APAC gases
  • Engineering
  • Other
,Americas gases,EMEA gases,APAC gases,Engineering,Other ,622,294,303,138,-40
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Americas gases is the major source of profits for Linde plc accounting for nearly half of group operating income with APAC and EMEA each around a quarter

Gases operating income at $1.2Bn in Q2 was down by -5% YoY. Operating Income in the Americas was down -4% while APAC and Europe were down -3% and -8% respectively.  Engineering showed an improvement of nearly +40% driven by project and productivity performance

Group operating margin in Q1 rose to over 20½% with regional Gases businesses reporting a combined margin approaching 23½% – both of these are up by at least 200bp YoY. Engineering margin improved sequentially and YoY to 17% in Q2 



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Americas Operating Margin

  • New Linde plc pro forms
  • Old Praxair
  • Old Linde
,New Linde plc pro forms,Old Praxair,Old Linde 2014 Q1,null,23.7%,12.5% 2014 Q2,null,23.9%,11.0% 2014 Q3,null,24.7%,11.6% 2014 Q4,null,23.9%,12.9% 2015 Q1,null,24.4%,13.9% 2015 Q2,null,25.1%,13.5% 2015 Q3,null,25.2%,14.3% 2015 Q4,null,26.8%,12.9% 2016 Q1,null,24.3%,13.4% 2016 Q2,null,24.3%,13.8% 2016 Q3,null,23.8%,11.1% 2016 Q4,null,24.2%,15.9% 2017 Q1,null,22.2%,12.4% 2017 Q2,null,23.5%,11.8% 2017 Q3,null,23.7%,11.6% 2017 Q4,null,23.9%,11.8% 2018 Q1,22.3%,23.9%,12.8% 2018 Q2,23.7%,25.1%,16.9% 2018 Q3,23.7%,24.6%,14.4% 2018 Q4,22.7%,24.0%,null 2019 Q1,21.6%,null,null 2019 Q2,23.2%,null,null 2019 Q3,24.2%,null,null 2019 Q4,24.7%,null,null 2020 Q1,24.7%,null,null 2020 Q2,25.7%,null,null
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Operating Margin in the Americas rose again to over 25½% in Q2, approaching the historic peak performance of Praxair in this region in 2015 – an increase of 250bp YoY

L.America margins stated to be around 20% - indicates N.America significantly higher than region average of 25%

Margin expansion led by pricing and productivity initiatives

Much of the former Linde business in the region has been divested, dampening its adverse impact on the combined region’s performance



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EMEA Operating Margin

  • New Linde plc pro forma
  • Old Praxair
  • Old Linde
,New Linde plc pro forma,Old Praxair,Old Linde 2014 Q1,null,19.9%,18.3% 2014 Q2,null,19.1%,19.5% 2014 Q3,null,18.4%,18.9% 2014 Q4,null,17.7%,17.2% 2015 Q1,null,19.0%,18.5% 2015 Q2,null,19.0%,19.6% 2015 Q3,null,18.6%,17.5% 2015 Q4,null,19.1%,17.7% 2016 Q1,null,19.4%,18.6% 2016 Q2,null,19.2%,19.8% 2016 Q3,null,19.7%,18.2% 2016 Q4,null,20.2%,17.3% 2017 Q1,null,18.8%,19.1% 2017 Q2,null,19.3%,19.3% 2017 Q3,null,19.4%,20.1% 2017 Q4,null,19.7%,20.5% 2018 Q1,21.3%,18.7%,23.1% 2018 Q2,19.9%,19.6%,18.3% 2018 Q3,18.2%,19.1%,16.8% 2018 Q4,17.4%,23.1%,null 2019 Q1,20.6%,null,null 2019 Q2,19.8%,null,null 2019 Q3,20.5%,null,null 2019 Q4,21.3%,null,null 2020 Q1,21.7%,null,null 2020 Q2,20.9%,null,null
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Operating Margin in the EMEA region slipped back from its recent peak to below 21% in Q2

Margin trending flat sequentially and is below that of the two other major regions

Much of the former Praxair business in the region had to be divested although there had been little difference in the overall profit performance between the two businesses historically until late-2018



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Asia Pacific Operating Margin

  • New Linde plc pro forma
  • Old Praxair
  • Old Linde
,New Linde plc pro forma,Old Praxair,Old Linde 2014 Q1,null,19.1%,12.0% 2014 Q2,null,19.3%,13.4% 2014 Q3,null,17.6%,12.1% 2014 Q4,null,18.9%,13.1% 2015 Q1,null,18.6%,10.4% 2015 Q2,null,17.8%,12.8% 2015 Q3,null,19.5%,11.7% 2015 Q4,null,18.6%,11.0% 2016 Q1,null,16.8%,12.2% 2016 Q2,null,17.0%,12.2% 2016 Q3,null,17.4%,13.3% 2016 Q4,null,19.7%,13.1% 2017 Q1,null,19.0%,11.5% 2017 Q2,null,19.0%,12.8% 2017 Q3,null,19.5%,14.4% 2017 Q4,null,19.1%,11.9% 2018 Q1,17.7%,21.8%,15.0% 2018 Q2,17.9%,21.3%,16.7% 2018 Q3,16.6%,22.6%,17.3% 2018 Q4,17.0%,23.2%,null 2019 Q1,19.1%,null,null 2019 Q2,20.4%,null,null 2019 Q3,21.1%,null,null 2019 Q4,21.3%,null,null 2020 Q1,21.0%,null,null 2020 Q2,22.7%,null,null
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Operating Margin in Asia Pacific resumed its upward trend sequentially at over 22½% in Q2 and was up over 200bp YoY

This performance is similar to that of Praxair historically in this region and above that of Linde 

Region performance includes the impact of required divestments of several businesses, particularly significant parts of Linde S.Korea and Praxair in India



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Capital Expenditure

$M
  • Old Praxair
  • Old Linde
,Old Praxair,Old Linde 2013 Q1,447.4,639.7 2013 Q2,501.1,687.2 2013 Q3,495.4,798.7 2013 Q4,495.4,907.5 2014 Q1,377.3,542.5 2014 Q2,368.6,564.4 2014 Q3,412.8,563.8 2014 Q4,462.7,821.5 2015 Q1,381.1,319.8 2015 Q2,337.9,493.8 2015 Q3,388.8,526.1 2015 Q4,371.5,758.0 2016 Q1,310.1,330.0 2016 Q2,342.7,443.8 2016 Q3,361.0,456.9 2016 Q4,392.6,606.9 2017 Q1,313.9,385.5 2017 Q2,312.0,399.3 2017 Q3,307.2,470.2 2017 Q4,325.4,736.2 2018 Q1,312.0,425.1 2018 Q2,337.0,535.2 2018 Q3,364.8,469.8 2018 Q4,436.8,696.1 2019 Q1,null,843.0 2019 Q2,null,865.0 2019 Q3,null,959.0 2019 Q4,null,1015.0 2020 Q1,null,803.0 2020 Q2,null,783.0
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Linde capital expenditure remains at around $800m, its lowest level since the merger – however this broadly reflects project timing profiles

Project capex slipped further sequentially to $334m in Q2 and was down -16% YoY – base capex (mainly support equipment and smaller projects) was down -4% YoY at $449m

Sale of gas backlog fell again to $3.6Bn – nearly 70% in APAC and under 25% in Americas while nearly 60% is for refining, 18% for electronics and 12% for chemicals. Sale of Equipment backlog also fell again marginally to $5Bn giving a total backlog of $9.5Bn. SOE order intake also slipped back sharply to under $300m

Capex forecast for CY2020 unchanged at $3.0-3.4Bn

Started up 4 new plants in Q2 and also signed 2 new projects 

Announced divestment of LNG and biogas business in Scandinavia to Gasum of Norway - generates annual revenues of €100m



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Linde plc Capex/Sales ratio

  • Praxair
  • Linde
,Praxair,Linde 2013 Q1,16.4%,12.9% 2013 Q2,17.6%,13.6% 2013 Q3,17.4%,17.3% 2013 Q4,17.4%,19.3% 2014 Q1,13.2%,11.8% 2014 Q2,12.5%,11.9% 2014 Q3,13.9%,11.9% 2014 Q4,16.4%,18.4% 2015 Q1,14.7%,7.7% 2015 Q2,13.1%,11.2% 2015 Q3,15.3%,12.4% 2015 Q4,15.2%,18.2% 2016 Q1,13.1%,8.3% 2016 Q2,13.6%,10.6% 2016 Q3,14.1%,11.1% 2016 Q4,15.7%,14.5% 2017 Q1,12.2%,9.5% 2017 Q2,11.6%,9.6% 2017 Q3,11.1%,10.9% 2017 Q4,11.6%,16.7% 2018 Q1,11.0%,9.9% 2018 Q2,11.7%,12.2% 2018 Q3,12.8%,10.9% 2018 Q4,15.8%,15.4% 2019 Q1,null,14.5% 2019 Q2,null,14.6% 2019 Q3,null,16.3% 2019 Q4,null,17.5% 2020 Q1,null,14.2% 2020 Q2,null,15.2%
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Capex to sales ratio moved back over 15% - above the trend for the combined businesses over the previous five years

This ratio appears close to the underlying average of Tier 1 companies  

Healthy pipeline of potential opportunities for decaps (acquisition of customer owned tonnage plants) as competitors also indicate. Continuing to look at further packaged gases and healthcare acquisitions – larger acquisitions delayed by Covid

Continues to look at JVs and divesting some smaller country positions as part of portfolio management

Significant interest in long term H2/energy opportunities but indicates economics need to change significantly before opportunity fully impacts – H2 for mobility most realistic near term opportunity. Agreements signed with major Chinese companies for developments in China



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