LEHIGH VALLEY, Pa.,
Jan. 29, 2016 /PRNewswire/ --
- Quarterly EPS of $1.78 up 15
percent versus prior year despite currency headwinds
- Quarterly adjusted EBITDA margin of 33.4 percent up 520 basis
points, and ROCE of 11.7 percent up 160 basis points versus prior
year
- GAAP quarterly EPS of $1.67
versus prior year of $1.50
- Fiscal 2016 second quarter EPS guidance of $1.78 to $1.83, up 15 to 18 percent versus prior
year
- Maintaining fiscal full-year 2016 EPS guidance of $7.25 to $7.50, up 10 to 14 percent
- On track for the spin-off of Versum Materials prior to
September 2016
*The results and guidance in this release, including in the
highlights above, unless otherwise indicated, are based on non-GAAP
continuing operations. A reconciliation of GAAP to non-GAAP results
can be found at the end of this release.
Air Products (NYSE: APD) today reported net income of
$387 million and earnings per share
(EPS) of $1.78, both up 15 percent
versus prior year for its fiscal first quarter ended December 31, 2015.
On a GAAP basis, net income was $364
million and EPS was $1.67 for
the quarter.
First quarter sales of $2,356
million decreased eight percent from the prior year, as
unfavorable currency and lower energy pass-through of five percent
each more than offset volume and pricing increases of one percent
each.
Operating income of $519 million
increased 17 percent versus prior year, and record operating margin
of 22.0 percent improved 460 basis points. Adjusted EBITDA of
$786 million increased nine percent
over prior year, and record EBITDA margin of 33.4 percent improved
520 basis points. Profit improvement was driven by good cost
performance and higher pricing.
Commenting on the quarter, Seifi Ghasemi, chairman, president
and chief executive officer, said, "The Air Products teams around
the world continue to execute our five-point plan and control what
they can control, regardless of challenging economic conditions and
currency headwinds. You can see their focus and commitment
reflected in our very strong financial results, including EBITDA
margin of 33.4 percent, up over 500 basis points, and return on
capital employed of 11.7 percent, up 160 basis points."
First Quarter Results by Business Segment:
- Industrial Gases – Americas sales of $836 million decreased 17 percent versus prior
year, as lower energy pass-through reduced sales by 12 percent and
currency reduced sales by four percent. Volumes decreased three
percent on lower demand in Latin
America and weaker North American steel and oilfield
services markets. Pricing increased two percent. Operating income
of $212 million was flat to last
year, and adjusted EBITDA of $335
million increased one percent, as higher pricing,
restructuring benefits, and lower maintenance costs were offset by
headwinds from currency, lower energy pass-through, and lower
volumes. Operating margin of 25.3 percent improved 420 basis
points, and EBITDA margin of 40.1 percent improved 700 basis points
over prior year.
- Industrial Gases – Europe,
Middle East, and Africa (EMEA) sales of $438 million declined 12 percent versus last
year, primarily driven by 10 percent unfavorable currency.
Underlying sales were unchanged, as one percent higher pricing was
offset by one percent lower volumes. Operating income of
$92 million increased 13 percent from
the prior year. On a constant currency basis, operating income was
up 22 percent. Operating margin of 20.9 percent increased 470 basis
points, and EBITDA margin of 33.3 percent increased 480 basis
points over the prior year. Adjusted EBITDA of $146 million increased two percent versus prior
year. This profit improvement was driven primarily by the benefits
of restructuring actions, as well as higher pricing.
- Industrial Gases – Asia
sales of $413 million increased four
percent versus prior year, as volume growth of 11 percent, driven
by both strong underlying business and new plants, was partially
offset by six percent unfavorable currency. Operating income of
$117 million increased 29 percent,
and operating margin of 28.2 percent improved 550 basis points over
prior year. Adjusted EBITDA of $180
million increased 16 percent, and EBITDA margin of 43.6
percent increased 480 basis points. This profit improvement was due
to higher volumes and strong cost performance.
- Materials Technologies sales of $490 million decreased six percent versus the
prior year as positive pricing and mix of two percent was more than
offset by six percent lower volumes and two percent unfavorable
currency. Operating income of $127
million was up 22 percent from prior year, and operating
margin of 26 percent was up 600 basis points. Adjusted EBITDA was
$147 million, and EBITDA margin of
30.0 percent was up 530 basis points.
- Electronic Materials sales of $245
million declined four percent from the prior year, as higher
pricing and mix was more than offset by lower volumes and
unfavorable currency. Excluding delivery systems, volumes would
have been flat. Operating margin was up over 1,000 basis points,
driven by higher pricing and mix and the benefits of restructuring
actions.
- Performance Materials sales of $245
million decreased nine percent from the prior year on lower
volumes, unfavorable currency and lower pricing. Operating margin
was up slightly, driven by lower raw material costs and the
benefits of restructuring actions.
In the fiscal first quarter of 2016, non-GAAP results for the
Company exclude $14 million, or
$0.05 per share, for project
suspension costs and $12 million, or
$0.06 per share, in legal and
advisory fees related to the intended separation of the Company's
Materials Technologies business.
Outlook
The capital expenditure forecast for
fiscal year 2016 is approximately $1.3
billion.
Air Products expects fiscal 2016 second quarter EPS from
continuing operations to be between $1.78
and $1.83 per share, up 15 to 18 percent versus prior
year.
The Company is maintaining its full-year fiscal 2016 guidance of
$7.25 to $7.50 earnings per share,
which at midpoint, would be a 12 percent increase.
Access the Q1 earnings teleconference scheduled for
10:00 a.m. Eastern Time on
January 29 by calling
913-312-1411 and entering passcode
8688406, or access the Event Details
page on Air Products' Investor Relations web
site.
About Air Products
Air Products (NYSE:APD) is a world-leading Industrial Gases company
celebrating 75 years of operation. The Company's core Industrial
Gases business provides atmospheric and process gases and related
equipment to manufacturing markets, including refining and
petrochemical, metals, electronics, and food and beverage. Air
Products is also the world's leading supplier of liquefied natural
gas process technology and equipment. The Company's Materials
Technologies business, which Air Products intends to spin-off by
September 2016, serves the
semiconductor, polyurethanes, cleaning and coatings, and adhesives
industries.
The Company had fiscal 2015 sales of $9.9
billion and was ranked number 284 on the Fortune 500 annual
list of public companies. Approximately 20,000 employees in 50
countries strive to make Air Products the world's safest and best
performing Industrial Gases company, providing sustainable
offerings and excellent service to all customers. For more
information, visit www.airproducts.com.
NOTE: This release contains "forward-looking statements"
within the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, including statements about earnings
guidance and business outlook. These forward-looking statements are
based on management's reasonable expectations and assumptions as of
the date of this release. Actual performance and financial results
may differ materially from projections and estimates expressed in
the forward-looking statements because of many factors not
anticipated by management, including, without limitation, global or
regional economic conditions and supply and demand dynamics in
market segments into which the Company sells; significant
fluctuations in interest rates and foreign currencies from that
currently anticipated; with regard to the intended
separation of Materials Technologies, general economic and business
conditions that may affect the proposed separation and the
execution thereof, changes in capital market conditions, and Air
Products' decision not to consummate the separation due to market,
economic or other events; future financial and operating
performance of major customers; unanticipated contract terminations
or customer cancellations or postponement of projects and sales;
asset impairments due to economic conditions or specific events;
the impact of competitive products and pricing; challenges of
implementing new technologies; ability to protect and enforce the
Company's intellectual property rights; unexpected changes in raw
material supply and markets; the impact of price fluctuations in
natural gas and disruptions in markets and the economy due to oil
price volatility; the ability to recover increased energy and raw
material costs from customers; costs and outcomes of litigation or
regulatory investigations; the success of productivity and cost
reduction programs; the timing, impact, and other uncertainties of
future acquisitions or divestitures; political risks, including the
risks of unanticipated government actions; acts of war or
terrorism; the impact of changes in environmental, tax or other
legislation and regulatory activities in jurisdictions in which the
Company and its affiliates operate; and other risk factors
described in the Company's Form 10-K for its fiscal year ended
September 30, 2015. The Company
disclaims any obligation or undertaking to disseminate any updates
or revisions to any forward-looking statements contained in this
release to reflect any change in the Company's assumptions, beliefs
or expectations or any change in events, conditions, or
circumstances upon which any such forward-looking statements are
based.
* Presented below are reconciliations of the reported GAAP
results to the non-GAAP measures.
RECONCILIATION OF NON-GAAP FINANCIAL
MEASURES
(Millions of dollars unless otherwise indicated,
except for share data)
The discussion of first quarter results includes comparisons to
non-GAAP financial measures, including Adjusted EBITDA and non‑GAAP
Capital Expenditures. The presentation of non-GAAP measures is
intended to enhance the usefulness of financial information by
providing measures which management uses internally to evaluate our
operating performance and manage our capital expenditures.
We use non-GAAP measures to assess our operating performance by
excluding certain disclosed items that we believe are not
representative of our underlying business. We believe non-GAAP
financial measures provide investors with meaningful information to
understand our underlying operating results and to analyze
financial and business trends. Non-GAAP financial measures,
including Adjusted EBITDA, should not be viewed in isolation, are
not a substitute for GAAP measures, and have limitations which
include but are not limited to:
- Our measure excludes certain disclosed items, which we do not
consider to be representative of underlying business operations.
However, these disclosed items represent costs (benefits) to the
Company.
- Though not business operating costs, interest expense and
income tax provision represent ongoing costs of the Company.
- Depreciation, amortization, and impairment charges represent
the wear and tear and/or reduction in value of the plant,
equipment, and intangible assets which permit us to manufacture
and/or market our products.
- Other companies may define non-GAAP measures differently than
we do, limiting their usefulness as comparative measures.
A reader may find any one or all of these items important in
evaluating our performance. Management compensates for the
limitations of using non-GAAP financial measures by using them only
to supplement our GAAP results to provide a more complete
understanding of the factors and trends affecting our business. In
evaluating these financial measures, the reader should be aware
that we may incur expenses similar to those eliminated in this
presentation in the future.
CONSOLIDATED
RESULTS
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|
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Operating
|
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Operating
|
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Net
|
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Diluted
|
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|
2016 Q1 vs. 2015
Q1
|
|
|
Income
|
|
Margin(A)
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|
Income
|
|
EPS
|
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|
2016 Q1
GAAP
|
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|
$
|
493.0
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20.9%
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$
|
363.6
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$
|
1.67
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|
2015 Q1
GAAP
|
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430.0
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16.8%
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|
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324.6
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|
1.50
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Change
GAAP
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$
|
63.0
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410bp
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$
|
39.0
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$
|
.17
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% Change
GAAP
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15%
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12%
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11%
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2016 Q1
GAAP
|
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$
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493.0
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20.9%
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|
$
|
363.6
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$
|
1.67
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Business separation
costs
|
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12.0
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|
.5%
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12.0
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|
.06
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Project suspension
costs (tax impact $2.9)
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14.3
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.6%
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11.4
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.05
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2016 Q1 Non-GAAP
Measure
|
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$
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519.3
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22.0%
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$
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387.0
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$
|
1.78
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|
|
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|
|
2015 Q1
GAAP
|
|
|
$
|
430.0
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|
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16.8%
|
|
|
$
|
324.6
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|
$
|
1.50
|
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|
|
Business
restructuring and cost reduction actions (tax impact
$10.7)
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32.4
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|
1.3%
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|
21.7
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|
.10
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Gain on previously
held equity interest (tax impact $6.7)
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(17.9)
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(.7)%
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(11.2)
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(.05)
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2015 Q1 Non-GAAP
Measure
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$
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444.5
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17.4%
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|
$
|
335.1
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$
|
1.55
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Change Non-GAAP
Measure
|
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|
$
|
74.8
|
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|
|
460bp
|
|
|
$
|
51.9
|
|
|
$
|
.23
|
|
|
|
% Change Non-GAAP
Measure
|
|
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|
17%
|
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|
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|
|
15%
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15%
|
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(A)Operating margin is calculated by
dividing operating income by sales.
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|
Operating
|
|
Operating
|
|
Net
|
|
Diluted
|
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|
|
2016 Q1 vs. 2015
Q4
|
|
Income
|
|
Margin(A)
|
|
Income
|
|
EPS
|
|
|
|
2016 Q1
GAAP
|
|
$
|
493.0
|
|
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|
20.9%
|
|
|
$
|
363.6
|
|
|
$
|
1.67
|
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|
|
2015 Q4
GAAP
|
|
|
472.2
|
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|
19.3%
|
|
|
|
344.5
|
|
|
|
1.58
|
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Change
GAAP
|
|
$
|
20.8
|
|
|
|
160bp
|
|
|
$
|
19.1
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|
|
$
|
.09
|
|
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|
% Change
GAAP
|
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|
4%
|
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|
6%
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6%
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|
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|
|
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|
2016 Q1
GAAP
|
|
$
|
493.0
|
|
|
|
20.9%
|
|
|
$
|
363.6
|
|
|
$
|
1.67
|
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|
|
Business separation
costs
|
|
12.0
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|
.5%
|
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|
|
12.0
|
|
|
|
.06
|
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|
|
Project suspension
costs (tax impact $2.9)
|
|
14.3
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|
.6%
|
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|
|
11.4
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|
.05
|
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|
2016 Q1 Non-GAAP
Measure
|
|
$
|
519.3
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|
22.0%
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|
$
|
387.0
|
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|
$
|
1.78
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|
2015 Q4
GAAP
|
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$
|
472.2
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19.3%
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$
|
344.5
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|
$
|
1.58
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Business
restructuring and cost reduction actions (tax impact
$7.2)
|
|
61.7
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|
2.5%
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|
54.5
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|
.25
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Pension settlement
loss (tax impact $2.2)
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|
7.0
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.3%
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|
4.8
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|
.02
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Business separation
costs
|
|
7.5
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|
.3%
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|
7.5
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|
.03
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|
Gain on land sales
(tax impact $5.3)
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|
(33.6)
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(1.4)%
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|
(28.3)
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(.13)
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Loss on early
retirement of debt (tax impact $2.4)(B)
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|
-
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-%
|
|
|
|
14.2
|
|
|
|
.07
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|
|
2015 Q4 Non-GAAP
Measure
|
|
$
|
514.8
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|
21.0%
|
|
|
$
|
397.2
|
|
|
$
|
1.82
|
|
|
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|
|
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|
|
|
|
|
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|
|
|
Change Non-GAAP
Measure
|
|
$
|
4.5
|
|
|
|
100bp
|
|
|
$
|
(10.2)
|
|
|
$
|
(.04)
|
|
|
|
% Change Non-GAAP
Measure
|
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|
1%
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|
(3)%
|
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|
(2)%
|
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|
(A)Operating margin is calculated by
dividing operating income by sales. Sales for the fourth quarter of
2015 were $2,449.4.
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(B)Income
before taxes impact of $16.6.
|
OPERATING INCOME – CONSTANT CURRENCY BASIS
Industrial Gases – EMEA
Operating income on a constant currency basis equals current
year GAAP operating income adjusted for prior period average
exchange rates to show the underlying growth rate versus the prior
year.
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
31
December
|
|
Percent
|
|
|
Industrial Gases –
EMEA
|
2015
|
|
2014
|
|
|
Change
|
|
|
GAAP Operating
Income
|
$
|
91.7
|
|
$
|
81.3
|
|
|
|
13%
|
|
|
Currency
Adjustment
|
|
7.7
|
|
|
-
|
|
|
|
|
|
|
Non-GAAP Constant
Currency Operating Income
|
$
|
99.4
|
|
$
|
81.3
|
|
|
|
22%
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
ADJUSTED EBITDA
We define Adjusted EBITDA as net income (including
noncontrolling interests) excluding certain disclosed items, which
the Company does not believe to be indicative of underlying
business trends, before interest expense, income tax provision, and
depreciation and amortization expense. Adjusted EBITDA provides a
useful metric for management to assess operating performance.
Below is a reconciliation of Net Income on a GAAP basis to
Adjusted EBITDA:
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|
2016
|
Q1
|
|
|
Q2
|
|
|
Q3
|
|
|
Q4
|
|
|
Total
|
|
|
Net
Income(A)
|
$
|
372.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
372.0
|
|
|
Add: Interest
expense
|
|
22.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22.2
|
|
|
Add: Income tax
provision
|
|
132.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
132.5
|
|
|
Add: Depreciation and
amortization
|
|
232.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
232.7
|
|
|
Add: Business
separation costs
|
|
12.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12.0
|
|
|
Add: Project
suspension costs
|
|
14.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14.3
|
|
|
Adjusted
EBITDA
|
$
|
785.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
785.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
2015
|
Q1
|
|
|
Q2
|
|
|
Q3
|
|
|
Q4
|
|
|
Total
|
|
|
Net
Income(A)
|
$
|
337.5
|
|
|
$
|
296.9
|
|
|
$
|
333.2
|
|
|
$
|
350.0
|
|
|
$
|
1,317.6
|
|
|
Add: Interest
expense
|
|
29.1
|
|
|
|
23.4
|
|
|
|
28.2
|
|
|
|
22.8
|
|
|
|
103.5
|
|
|
Add: Income tax
provision
|
|
106.5
|
|
|
|
87.1
|
|
|
|
103.5
|
|
|
|
118.8
|
|
|
|
415.9
|
|
|
Add: Depreciation and
amortization
|
|
235.5
|
|
|
|
233.3
|
|
|
|
233.0
|
|
|
|
234.6
|
|
|
|
936.4
|
|
|
Add: Business
restructuring and cost reduction actions
|
|
32.4
|
|
|
|
55.4
|
|
|
|
58.2
|
|
|
|
61.7
|
|
|
|
207.7
|
|
|
Add: Pension
settlement loss
|
|
-
|
|
|
|
12.6
|
|
|
|
1.6
|
|
|
|
7.0
|
|
|
|
21.2
|
|
|
Add: Business
separation costs
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
7.5
|
|
|
|
7.5
|
|
|
Less: Gain on
previously held equity interest
|
|
17.9
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
17.9
|
|
|
Less: Gain on land
sales
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
33.6
|
|
|
|
33.6
|
|
|
Add: Loss on early
retirement of debt
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
16.6
|
|
|
|
16.6
|
|
|
Adjusted
EBITDA
|
$
|
723.1
|
|
|
$
|
708.7
|
|
|
$
|
757.7
|
|
|
$
|
785.4
|
|
|
$
|
2,974.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A)Includes net income attributable to
noncontrolling interests.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016 vs.
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
change
|
$
|
62.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA %
change
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016 Q1 vs. 2015
Q4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
change
|
$
|
.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA %
change
|
|
-
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Below is a reconciliation of segment Operating Income to
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Industrial
|
|
Industrial
|
|
Industrial
|
|
Industrial
|
|
|
|
|
Energy-
|
|
|
|
|
|
|
|
|
|
Gases–
|
|
Gases–
|
|
Gases–
|
|
Gases–
|
|
Materials
|
|
from-
|
|
Corporate
|
|
Segment
|
|
|
Americas
|
|
EMEA
|
|
Asia
|
|
Global
|
|
Technologies
|
|
Waste
|
|
and other
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
31 December 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
$
|
211.8
|
|
$
|
91.7
|
|
$
|
116.7
|
|
$
|
(19.3)
|
|
$
|
127.2
|
|
$
|
(3.6)
|
|
$
|
(5.2)
|
|
$
|
519.3
|
|
Add: Depreciation and
amortization
|
|
108.8
|
|
|
46.7
|
|
|
51.7
|
|
|
2.1
|
|
|
19.6
|
|
|
-
|
|
|
3.8
|
|
|
232.7
|
|
Add: Equity
affiliates' income (loss)
|
|
14.5
|
|
|
7.6
|
|
|
11.7
|
|
|
(.5)
|
|
|
.4
|
|
|
-
|
|
|
-
|
|
|
33.7
|
|
Adjusted
EBITDA
|
$
|
335.1
|
|
$
|
146.0
|
|
$
|
180.1
|
|
$
|
(17.7)
|
|
$
|
147.2
|
|
$
|
(3.6)
|
|
$
|
(1.4)
|
|
$
|
785.7
|
|
Adjusted EBITDA
margin
|
|
40.1%
|
|
|
33.3%
|
|
|
43.6%
|
|
|
|
|
|
30.0%
|
|
|
|
|
|
|
|
|
33.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
31 December 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
$
|
211.2
|
|
$
|
81.3
|
|
$
|
90.5
|
|
$
|
(17.9)
|
|
$
|
104.6
|
|
$
|
(2.5)
|
|
$
|
(22.7)
|
|
$
|
444.5
|
|
Add: Depreciation and
amortization
|
|
103.6
|
|
|
51.1
|
|
|
49.6
|
|
|
4.3
|
|
|
24.0
|
|
|
-
|
|
|
2.9
|
|
|
235.5
|
|
Add: Equity
affiliates' income
|
|
17.2
|
|
|
10.3
|
|
|
14.6
|
|
|
.4
|
|
|
.6
|
|
|
-
|
|
|
-
|
|
|
43.1
|
|
Adjusted
EBITDA
|
$
|
332.0
|
|
$
|
142.7
|
|
$
|
154.7
|
|
$
|
(13.2)
|
|
$
|
129.2
|
|
$
|
(2.5)
|
|
$
|
(19.8)
|
|
$
|
723.1
|
|
Adjusted EBITDA
margin
|
|
33.1%
|
|
|
28.5%
|
|
|
38.8%
|
|
|
|
|
|
24.7%
|
|
|
|
|
|
|
|
|
28.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
change
|
$
|
3.1
|
|
$
|
3.3
|
|
$
|
25.4
|
|
$
|
(4.5)
|
|
$
|
18.0
|
|
$
|
(1.1)
|
|
$
|
18.4
|
|
$
|
62.6
|
|
Adjusted EBITDA %
change
|
|
1%
|
|
|
2%
|
|
|
16%
|
|
|
(34)%
|
|
|
14%
|
|
|
(44)%
|
|
|
93%
|
|
|
9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
margin change
|
700bp
|
|
|
480bp
|
|
|
480bp
|
|
|
|
|
|
530bp
|
|
|
|
|
|
|
|
|
520bp
|
|
CAPITAL EXPENDITURES
We utilize a non-GAAP measure in the computation of capital
expenditures and include spending associated with facilities
accounted for as capital leases. Certain contracts associated with
facilities that are built to provide product to a specific customer
are required to be accounted for as leases, and such spending is
reflected as a use of cash within cash provided by operating
activities if the arrangement qualifies as a capital lease.
Below is a reconciliation of capital expenditures on a GAAP
basis to a non-GAAP measure:
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
|
31
December
|
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
|
Capital expenditures
– GAAP basis
|
|
|
|
|
|
|
$
|
350.6
|
|
$
|
469.1
|
|
|
Capital lease
expenditures
|
|
|
|
|
|
|
|
7.3
|
|
|
31.9
|
|
|
Capital expenditures
– Non-GAAP basis
|
|
|
|
|
|
|
$
|
357.9
|
|
$
|
501.0
|
|
We expect capital expenditures for fiscal year 2016 to be
approximately $1,300.
OUTLOOK
Guidance provided is on a non-GAAP basis, which excludes the
impact of certain items that we believe are not representative of
our underlying business.
|
|
Diluted
EPS
|
|
|
|
Q2
|
|
|
FY
|
|
|
2015
Non-GAAP
|
$
|
1.55
|
|
$
|
6.57
|
|
|
2016 Non-GAAP
Outlook
|
|
1.78–1.83
|
|
|
7.25–7.50
|
|
|
Change
Non-GAAP
|
$
|
.23–.28
|
|
$
|
.68–.93
|
|
|
% Change
Non-GAAP
|
|
15%–18%
|
|
|
10%–14%
|
|
RETURN ON CAPITAL EMPLOYED (ROCE)
Return on capital employed (ROCE) is calculated as earnings
after-tax divided by average total capital. Earnings after-tax is
defined as operating income and equity affiliate income, after tax,
at our effective tax rate. On a non-GAAP basis, operating income
and taxes have been adjusted for the impact of the disclosed items
detailed below. Total capital consists of total debt, total equity,
and redeemable noncontrolling interest.
|
2016
|
|
2015
|
|
|
2014
|
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
|
Q4
|
|
|
Q3
|
|
|
Q2
|
|
|
Q1
|
|
Operating
income
|
$
|
493.0
|
|
$
|
472.2
|
|
$
|
422.5
|
|
$
|
374.4
|
|
$
|
430.0
|
|
$
|
144.1
|
|
$
|
413.8
|
|
$
|
384.7
|
|
|
|
|
Equity affiliates'
income
|
|
33.7
|
|
|
36.0
|
|
|
42.4
|
|
|
33.0
|
|
|
43.1
|
|
|
39.7
|
|
|
43.1
|
|
|
30.4
|
|
|
|
|
Earnings Before
Tax—GAAP
|
$
|
526.7
|
|
$
|
508.2
|
|
$
|
464.9
|
|
$
|
407.4
|
|
$
|
473.1
|
|
$
|
183.8
|
|
$
|
456.9
|
|
$
|
415.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business separation
costs
|
|
12.0
|
|
|
7.5
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
Project suspension
costs
|
|
14.3
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
Business
restructuring and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
cost reduction
actions
|
|
-
|
|
|
61.7
|
|
|
58.2
|
|
|
55.4
|
|
|
32.4
|
|
|
12.7
|
|
|
-
|
|
|
-
|
|
|
|
|
Gain on previously
held
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(17.9)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
equity
interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension settlement
loss
|
|
-
|
|
|
7.0
|
|
|
1.6
|
|
|
12.6
|
|
|
-
|
|
|
5.5
|
|
|
-
|
|
|
-
|
|
|
|
|
Goodwill and
intangible asset
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
310.1
|
|
|
-
|
|
|
-
|
|
|
|
|
impairment
charge
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on land
sales
|
|
-
|
|
|
(33.6)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
Earnings Before
Tax—Non-GAAP
|
$
|
553.0
|
|
$
|
550.8
|
|
$
|
524.7
|
|
$
|
475.4
|
|
$
|
487.6
|
|
$
|
512.1
|
|
$
|
456.9
|
|
$
|
415.1
|
|
|
|
|
Taxes —
Non-GAAP
|
|
141.0
|
|
|
130.5
|
|
|
130.7
|
|
|
114.6
|
|
|
117.5
|
|
|
122.9
|
|
|
109.7
|
|
|
99.6
|
|
|
|
|
Earnings After
Tax—Non-GAAP
|
$
|
412.0
|
|
$
|
420.3
|
|
$
|
394.0
|
|
$
|
360.8
|
|
$
|
370.1
|
|
$
|
389.2
|
|
$
|
347.2
|
|
$
|
315.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term
borrowings
|
$
|
1,539.4
|
|
$
|
1,494.3
|
|
$
|
1,087.8
|
|
$
|
1,261.0
|
|
$
|
1,283.5
|
|
$
|
1,228.7
|
|
$
|
1,115.2
|
|
$
|
1,061.5
|
|
$
|
1,030.5
|
|
Current portion of
long-term debt
|
|
407.9
|
|
|
435.6
|
|
|
84.9
|
|
|
157.7
|
|
|
54.2
|
|
|
65.3
|
|
|
69.8
|
|
|
112.4
|
|
|
117.0
|
|
Long-term
debt
|
|
3,870.5
|
|
|
3,949.1
|
|
|
4,690.5
|
|
|
4,511.5
|
|
|
4,751.3
|
|
|
4,824.5
|
|
|
4,951.0
|
|
|
4,993.2
|
|
|
5,020.8
|
|
Total Debt
|
$
|
5,817.8
|
|
$
|
5,879.0
|
|
$
|
5,863.2
|
|
$
|
5,930.2
|
|
$
|
6,089.0
|
|
$
|
6,118.5
|
|
$
|
6,136.0
|
|
$
|
6,167.1
|
|
$
|
6,168.3
|
|
Total
Equity
|
$
|
7,499.0
|
|
$
|
7,381.1
|
|
$
|
7,731.3
|
|
$
|
7,476.3
|
|
$
|
7,503.3
|
|
$
|
7,521.4
|
|
$
|
7,856.2
|
|
$
|
7,527.8
|
|
$
|
7,422.7
|
|
Redeemable
Noncontrolling
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
|
|
-
|
|
|
-
|
|
|
277.9
|
|
|
280.0
|
|
|
288.7
|
|
|
287.2
|
|
|
341.4
|
|
|
343.6
|
|
|
358.7
|
|
Total
Capital
|
$
|
13,316.8
|
|
$
|
13,260.1
|
|
$
|
13,872.4
|
|
$
|
13,686.5
|
|
$
|
13,881.0
|
|
$
|
13,927.1
|
|
$
|
14,333.6
|
|
$
|
14,038.5
|
|
$
|
13,949.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings After
Tax—Non-GAAP
|
$
|
1,587.1
|
|
|
|
|
|
|
|
|
|
|
$
|
1,422.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Five-quarter average
total capital
|
|
13,603.4
|
|
|
|
|
|
|
|
|
|
|
|
14,026.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROCE—Non-GAAP
|
|
11.7%
|
|
|
|
|
|
|
|
|
|
|
|
10.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change
|
|
160bp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AIR PRODUCTS AND
CHEMICALS, INC. and Subsidiaries
|
CONSOLIDATED
INCOME STATEMENTS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
31
December
|
|
|
(Millions of dollars,
except for share data)
|
|
2015
|
|
|
2014
|
|
|
Sales
|
|
$
|
2,355.8
|
|
|
$
|
2,560.8
|
|
|
Cost of
sales
|
|
|
1,598.0
|
|
|
|
1,831.0
|
|
|
Selling and
administrative
|
|
|
212.0
|
|
|
|
258.2
|
|
|
Research and
development
|
|
|
32.4
|
|
|
|
35.4
|
|
|
Business separation
costs
|
|
|
12.0
|
|
|
|
-
|
|
|
Project suspension
costs
|
|
|
14.3
|
|
|
|
-
|
|
|
Business
restructuring and cost reduction actions
|
|
|
-
|
|
|
|
32.4
|
|
|
Gain on previously
held equity interest
|
|
|
-
|
|
|
|
17.9
|
|
|
Other income
(expense), net
|
|
|
5.9
|
|
|
|
8.3
|
|
|
Operating
Income
|
|
|
493.0
|
|
|
|
430.0
|
|
|
Equity affiliates'
income
|
|
|
33.7
|
|
|
|
43.1
|
|
|
Interest
expense
|
|
|
22.2
|
|
|
|
29.1
|
|
|
Income Before
Taxes
|
|
|
504.5
|
|
|
|
444.0
|
|
|
Income tax
provision
|
|
|
132.5
|
|
|
|
106.5
|
|
|
Net
Income
|
|
|
372.0
|
|
|
|
337.5
|
|
|
Less: Net Income
Attributable to Noncontrolling Interests
|
|
|
8.4
|
|
|
|
12.9
|
|
|
Net Income
Attributable to Air Products
|
|
$
|
363.6
|
|
|
$
|
324.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per
Common Share Attributable to Air Products
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Air Products — Basic
|
|
$
|
1.68
|
|
|
$
|
1.52
|
|
|
Net income
attributable to Air Products — Diluted
|
|
|
1.67
|
|
|
|
1.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Common Shares — Basic (in millions)
|
|
|
215.8
|
|
|
|
214.2
|
|
|
Weighted Average
Common Shares — Diluted (in millions)
|
|
|
217.6
|
|
|
|
216.6
|
|
|
Dividends Declared
Per Common Share — Cash
|
|
$
|
.81
|
|
|
$
|
.77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Data
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
$
|
232.7
|
|
|
$
|
235.5
|
|
|
|
Capital expenditures
on a Non-GAAP basis
|
|
|
357.9
|
|
|
|
501.0
|
|
|
|
|
(see page 9 for
reconciliation)
|
|
|
|
|
|
|
|
|
|
|
|
|
AIR PRODUCTS AND
CHEMICALS, INC. and Subsidiaries
|
CONSOLIDATED
BALANCE SHEETS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
31
December
|
30
September
|
|
(Millions of
dollars)
|
|
2015
|
|
|
2015
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
|
|
|
Cash and cash
items
|
|
$
|
279.1
|
|
|
$
|
206.4
|
|
|
Trade receivables,
net
|
|
|
1,288.5
|
|
|
|
1,406.2
|
|
|
Inventories
|
|
|
665.6
|
|
|
|
657.8
|
|
|
Contracts in
progress, less progress billings
|
|
|
129.1
|
|
|
|
110.8
|
|
|
Prepaid
expenses
|
|
|
59.2
|
|
|
|
67.3
|
|
|
Other receivables and
current assets
|
|
|
357.5
|
|
|
|
345.0
|
|
|
Total Current
Assets
|
|
|
2,779.0
|
|
|
|
2,793.5
|
|
|
Investment in net
assets of and advances to equity affiliates
|
|
|
1,262.4
|
|
|
|
1,265.7
|
|
|
Plant and equipment,
at cost
|
|
|
20,443.2
|
|
|
|
20,354.6
|
|
|
Less: accumulated
depreciation
|
|
|
10,824.2
|
|
|
|
10,717.7
|
|
|
Plant and equipment,
net
|
|
|
9,619.0
|
|
|
|
9,636.9
|
|
|
Goodwill,
net
|
|
|
1,115.4
|
|
|
|
1,131.3
|
|
|
Intangible assets,
net
|
|
|
491.0
|
|
|
|
508.3
|
|
|
Noncurrent capital
lease receivables
|
|
|
1,319.4
|
|
|
|
1,350.2
|
|
|
Other noncurrent
assets
|
|
|
674.1
|
|
|
|
648.6
|
|
|
Total Noncurrent
Assets
|
|
|
14,481.3
|
|
|
|
14,541.0
|
|
|
Total
Assets
|
|
$
|
17,260.3
|
|
|
$
|
17,334.5
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
|
|
Payables and accrued
liabilities
|
|
$
|
1,533.5
|
|
|
$
|
1,658.7
|
|
|
Accrued income
taxes
|
|
|
91.6
|
|
|
|
55.8
|
|
|
Short-term
borrowings
|
|
|
1,539.4
|
|
|
|
1,494.3
|
|
|
Current portion of
long-term debt
|
|
|
407.9
|
|
|
|
435.6
|
|
|
Total Current
Liabilities
|
|
|
3,572.4
|
|
|
|
3,644.4
|
|
|
Long-term
debt
|
|
|
3,870.5
|
|
|
|
3,949.1
|
|
|
Other noncurrent
liabilities
|
|
|
1,487.2
|
|
|
|
1,556.5
|
|
|
Deferred income
taxes
|
|
|
831.2
|
|
|
|
803.4
|
|
|
Total Noncurrent
Liabilities
|
|
|
6,188.9
|
|
|
|
6,309.0
|
|
|
Total
Liabilities
|
|
|
9,761.3
|
|
|
|
9,953.4
|
|
|
Air Products
Shareholders' Equity
|
|
|
7,367.1
|
|
|
|
7,249.0
|
|
|
Noncontrolling
Interests
|
|
|
131.9
|
|
|
|
132.1
|
|
|
Total
Equity
|
|
|
7,499.0
|
|
|
|
7,381.1
|
|
|
Total Liabilities
and Equity
|
|
$
|
17,260.3
|
|
|
$
|
17,334.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AIR PRODUCTS AND
CHEMICALS, INC. and Subsidiaries
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
31
December
|
|
|
(Millions of
dollars)
|
2015
|
|
|
2014
|
|
|
Operating
Activities
|
|
|
|
|
|
|
|
|
Net Income
|
$
|
372.0
|
|
|
$
|
337.5
|
|
|
Less: Net income
attributable to noncontrolling interests
|
|
8.4
|
|
|
|
12.9
|
|
|
Net income
attributable to Air Products
|
|
363.6
|
|
|
|
324.6
|
|
|
Adjustments to
reconcile income to cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
232.7
|
|
|
|
235.5
|
|
|
|
Deferred income
taxes
|
|
42.9
|
|
|
|
26.2
|
|
|
|
Gain on previously
held equity interest
|
|
-
|
|
|
|
(17.9)
|
|
|
|
Undistributed
earnings of unconsolidated affiliates
|
|
7.0
|
|
|
|
(31.3)
|
|
|
|
Share-based
compensation
|
|
10.2
|
|
|
|
11.9
|
|
|
|
Noncurrent capital
lease receivables
|
|
12.5
|
|
|
|
(8.1)
|
|
|
|
Other
adjustments
|
|
(42.0)
|
|
|
|
(60.5)
|
|
|
Working capital
changes that provided (used) cash, excluding effects of
acquisitions and divestitures:
|
|
|
|
|
|
|
|
|
|
Trade
receivables
|
|
97.1
|
|
|
|
22.3
|
|
|
|
Inventories
|
|
(14.0)
|
|
|
|
(16.0)
|
|
|
|
Contracts in
progress, less progress billings
|
|
(20.0)
|
|
|
|
6.8
|
|
|
|
Other
receivables
|
|
(23.7)
|
|
|
|
(27.3)
|
|
|
|
Payables and accrued
liabilities
|
|
(113.4)
|
|
|
|
5.0
|
|
|
|
Other working
capital
|
|
20.6
|
|
|
|
15.4
|
|
|
Cash Provided by
Operating Activities
|
|
573.5
|
|
|
|
486.6
|
|
|
Investing
Activities
|
|
|
|
|
|
|
|
|
Additions to plant
and equipment
|
|
(350.6)
|
|
|
|
(446.5)
|
|
|
Acquisitions, less
cash acquired
|
|
-
|
|
|
|
(22.6)
|
|
|
Proceeds from sale of
assets and investments
|
|
47.2
|
|
|
|
3.7
|
|
|
Other investing
activities
|
|
2.0
|
|
|
|
2.2
|
|
|
Cash Used for
Investing Activities
|
|
(301.4)
|
|
|
|
(463.2)
|
|
|
Financing
Activities
|
|
|
|
|
|
|
|
|
Long-term debt
proceeds
|
|
-
|
|
|
|
.9
|
|
|
Payments on long-term
debt
|
|
(65.5)
|
|
|
|
(38.5)
|
|
|
Net increase in
commercial paper and short-term borrowings
|
|
45.5
|
|
|
|
54.0
|
|
|
Dividends paid to
shareholders
|
|
(174.4)
|
|
|
|
(164.4)
|
|
|
Proceeds from stock
option exercises
|
|
10.3
|
|
|
|
42.1
|
|
|
Excess tax benefit
from share-based compensation
|
|
4.9
|
|
|
|
13.4
|
|
|
Other financing
activities
|
|
(18.8)
|
|
|
|
(19.4)
|
|
|
Cash Used for
Financing Activities
|
|
(198.0)
|
|
|
|
(111.9)
|
|
|
Effect of Exchange
Rate Changes on Cash
|
|
(1.4)
|
|
|
|
(9.3)
|
|
|
Increase (Decrease)
in Cash and Cash Items
|
|
72.7
|
|
|
|
(97.8)
|
|
|
Cash and Cash Items –
Beginning of Year
|
|
206.4
|
|
|
|
336.6
|
|
|
Cash and Cash
Items – End of Period
|
$
|
279.1
|
|
|
$
|
238.8
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Cash
Flow Information
|
|
|
|
|
|
|
|
|
Cash paid for taxes
(net of cash refunds)
|
$
|
66.9
|
|
|
$
|
62.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AIR PRODUCTS AND
CHEMICALS, INC. and Subsidiaries
|
|
SUMMARY BY
BUSINESS SEGMENTS
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Industrial
|
|
Industrial
|
|
Industrial
|
|
Industrial
|
|
|
|
|
Energy-
|
|
|
|
|
|
|
|
|
Gases–
|
|
Gases–
|
|
Gases–
|
|
Gases–
|
|
Materials
|
|
from-
|
|
Corporate
|
|
Segment
|
|
(Millions of
dollars)
|
Americas
|
|
EMEA
|
|
Asia
|
|
Global
|
|
Technologies
|
|
Waste
|
|
and other
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
31 December 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
|
836.1
|
|
$
|
438.3
|
|
$
|
413.2
|
|
$
|
104.3
|
|
$
|
490.0
|
|
$
|
-
|
|
$
|
73.9
|
|
$
|
2,355.8
|
|
Operating income
(loss)
|
|
211.8
|
|
|
91.7
|
|
|
116.7
|
|
|
(19.3)
|
|
|
127.2
|
|
|
(3.6)
|
|
|
(5.2)
|
|
|
519.3
|
|
Depreciation and
amortization
|
|
108.8
|
|
|
46.7
|
|
|
51.7
|
|
|
2.1
|
|
|
19.6
|
|
|
-
|
|
|
3.8
|
|
|
232.7
|
|
Equity affiliates'
income (loss)
|
|
14.5
|
|
|
7.6
|
|
|
11.7
|
|
|
(.5)
|
|
|
.4
|
|
|
-
|
|
|
-
|
|
|
33.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
31 December 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
|
1,003.0
|
|
$
|
500.8
|
|
$
|
398.7
|
|
$
|
59.0
|
|
$
|
524.0
|
|
$
|
-
|
|
$
|
75.3
|
|
$
|
2,560.8
|
|
Operating income
(loss)
|
|
211.2
|
|
|
81.3
|
|
|
90.5
|
|
|
(17.9)
|
|
|
104.6
|
|
|
(2.5)
|
|
|
(22.7)
|
|
|
444.5
|
|
Depreciation and
amortization
|
|
103.6
|
|
|
51.1
|
|
|
49.6
|
|
|
4.3
|
|
|
24.0
|
|
|
-
|
|
|
2.9
|
|
|
235.5
|
|
Equity affiliates'
income
|
|
17.2
|
|
|
10.3
|
|
|
14.6
|
|
|
.4
|
|
|
.6
|
|
|
-
|
|
|
-
|
|
|
43.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31 December
2015
|
$
|
5,674.3
|
|
$
|
3,224.5
|
|
$
|
4,155.4
|
|
$
|
383.3
|
|
$
|
1,705.8
|
|
$
|
938.9
|
|
$
|
1,178.1
|
|
$
|
17,260.3
|
|
30 September
2015
|
|
5,774.9
|
|
|
3,323.9
|
|
|
4,154.0
|
|
|
370.5
|
|
|
1,741.9
|
|
|
894.4
|
|
|
1,074.9
|
|
|
17,334.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Below is a
reconciliation of segment total operating income to consolidated
operating income:
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
31
December
|
|
Operating
Income
|
|
|
2015
|
|
|
2014
|
|
Segment
total
|
|
$
|
519.3
|
|
$
|
444.5
|
|
Business separation
costs
|
|
|
(12.0)
|
|
|
-
|
|
Project suspension
costs
|
|
|
(14.3)
|
|
|
-
|
|
Business
restructuring and cost reduction actions
|
|
|
-
|
|
|
(32.4)
|
|
Gain on previously
held equity interest
|
|
|
-
|
|
|
17.9
|
|
Consolidated
Total
|
|
$
|
493.0
|
|
$
|
430.0
|
|
|
|
|
AIR PRODUCTS AND CHEMICALS, INC. and
Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS
(Unaudited)
(Millions of dollars, unless otherwise indicated)
1. MATERIALS TECHNOLOGIES SEPARATION
On 16 September 2015, the Company
announced its intention to separate its Materials Technologies
business into an independent publicly traded company. Subsequent to
the satisfaction of specific conditions, the separation will be
accomplished by distribution to Air Products shareholders of all of
the shares of common stock of Versum Materials, LLC, or Versum, a
newly formed company which will hold the Materials Technologies
business. Versum is currently a wholly owned subsidiary of the
Company and will be converted from a limited liability company to a
Delaware corporation (Versum
Materials, Inc.) prior to the distribution.
During the first quarter of 2016, we incurred legal and other
advisory fees of $12.0 ($.06 per share) related to the intended
separation. Since the announcement, we have incurred $19.5 in separation fees. These fees are
reflected on the consolidated income statements as "Business
separation costs." The results of operations, financial condition,
and cash flows of the Materials Technologies business will continue
to be presented within our consolidated financial statements as
continuing operations until the Board of Directors approves the
final separation and the separation occurs, at which time we expect
the financial presentation of the historical results of this
business will be reflected as a discontinued operation.
2. PROJECT SUSPENSION COSTS
Our Energy-from-Waste segment consists of two projects under
construction in Tees Valley, United
Kingdom, designed to process municipal solid waste to
generate renewable power. In November
2015, the Company suspended construction of the second
project until certain design issues of the first project are
understood, remediated, and can be efficiently integrated into the
design of the second project. During the three months ended
31 December 2015, we incurred
incremental costs of $14.3
($11.4 after-tax, or $.05 per share) to safely suspend construction
activities of the second project. These costs are reflected on the
consolidated income statements as "Project suspension costs." We
expect additional costs to be incurred in the second quarter.
3. BALANCE SHEET CLASSIFICATION OF DEFERRED TAXES
In November 2015, the Financial
Accounting Standards Board (FASB) issued guidance to simplify the
presentation of deferred income taxes by requiring that all
deferred tax liabilities and assets be classified as noncurrent on
the balance sheet. As of the first quarter of fiscal year 2016, we
adopted this guidance on a retrospective basis. Accordingly, prior
year amounts have been reclassified to conform to the current year
presentation. The guidance, which did not change the existing
requirement to net deferred tax assets and liabilities within a
jurisdiction, resulted in a reclassification adjustment that
increased noncurrent deferred tax assets by $13.7 and decreased noncurrent deferred tax
liabilities by $99.9 as of
30 September 2015.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/air-products-reports-fiscal-2016-first-quarter-eps-up-15-percent-300212063.html
SOURCE Air Products