How did COVID-19 impact Linde's Q3 2020 financial performance?

COVID-19 impacted Linde's Q3 2020 performance primarily through lower sales volumes across all geographic segments, contributing to a 3% decrease in reported sales volume. However, the company was able to partially offset this impact through higher pricing and effective cost reduction programs.

What is the significance of Linde's adjusted financial metrics?

Linde utilizes non-GAAP measures like adjusted operating profit and adjusted diluted EPS to provide investors with a clearer view of the company's ongoing business performance. These measures exclude items such as cost reduction programs, purchase accounting impacts, and net gains on business sales, which are not considered indicative of core operational trends.

What is the outlook for Linde's future sales growth?

Linde's project backlog of approximately $8.6 billion is a key indicator of future sales growth. This backlog, secured by long-term contracts, is primarily for sale of gas projects, with significant contributions from APAC and Americas, and is expected to supply customers in the electronics, chemicals, and energy sectors.

How has Linde managed its capital and liquidity during this period?

Linde demonstrated strong liquidity management, ending the nine months ended September 30, 2020, with $5.2 billion in cash and cash equivalents. The company also has a $5 billion undrawn revolving credit agreement. Cash flow from operations increased by 27% year-over-year to $4.995 billion, driven by higher net income and lower working capital requirements.

LIN 10-Q Quarterly Report Q3 FY2020 — Revenue, Net Income, EPS

Summary

Linde plc reported third-quarter 2020 results that showed resilience amidst a challenging global economic environment impacted by COVID-19. While reported sales saw a modest decrease of 2% year-over-year to $6.86 billion, adjusted operating profit increased by 9% to $1.52 billion, demonstrating effective cost management and pricing strategies. The company also reported a 2% increase in adjusted EBITDA from continuing operations to $2.23 billion, indicating strong operational performance. The report highlights the company's ability to navigate the macroeconomic slowdown through higher pricing and successful cost reduction programs, which offset volume declines. Management emphasized the company's strong project backlog of approximately $8.6 billion as a key indicator of future sales growth. Despite ongoing uncertainties related to the pandemic, Linde plc maintained a solid financial position with $5.2 billion in cash and an undrawn $5 billion credit facility, underscoring its liquidity and financial flexibility.

Financial Highlights

53 data points

Beta

Revenue

$6.86B

Net Income

$700.00M

0.1% Net Margin

EPS (Diluted)

$1.32

Total Assets

$87.21B

Cash & Equivalents

$5.20B

Free Cash Flow

$1.10B

Financial Statements

Beta

Revenue	$6.86B
R&D Expenses	$36.00M
SG&A Expenses	$770.00M
Operating Income	$969.00M
Net Income	$700.00M
EPS (Basic)	$1.33
EPS (Diluted)	$1.32
Shares Outstanding (Basic)	525.69M
Shares Outstanding (Diluted)	530.41M

Key Highlights

1Adjusted operating profit increased by 9% to $1.52 billion in Q3 2020 compared to Q3 2019, demonstrating strong operational execution.
2Adjusted diluted EPS from continuing operations grew 11% to $2.15 in Q3 2020, outpacing reported EPS.
3Total sales for Q3 2020 were $6.86 billion, a 2% decrease year-over-year, primarily attributed to lower volumes impacted by the COVID-19 pandemic.
4Cost of sales as a percentage of sales improved to 55.9% from 58.0% year-over-year, driven by cost reduction programs and productivity initiatives.
5The company maintained a strong project backlog of approximately $8.6 billion, signaling future revenue potential.
6The number of employees decreased by 7% to 74,648 as of September 30, 2020, reflecting cost reduction actions and divestitures.
7Linde plc ended the quarter with $5.2 billion in cash and cash equivalents, supported by a $5 billion undrawn revolving credit facility.

LINDE PLC Quarterly Report for Q3 Ended Sep 30, 2020

Summary

Financial Highlights

Key Highlights

Frequently Asked Questions