10-QPeriod: Q1 FY2022

LINDE PLC Quarterly Report for Q1 Ended Mar 31, 2022

Filed May 2, 2022For Securities:LIN

Summary

Linde plc reported strong first-quarter 2022 results, demonstrating robust growth driven by increased pricing and volume across its key segments. Sales surged by 13% year-over-year, reaching $8.21 billion, with adjusted diluted earnings per share (EPS) also showing a healthy 18% increase to $2.93. The company benefited from effective price attainment, which contributed significantly to sales growth, and solid volume increases in most end markets, particularly in the Americas and APAC regions. Despite inflationary pressures, Linde's operational efficiencies and cost reduction programs helped maintain strong operating margins, with adjusted operating profit growing 13% to $1.91 billion. Financially, Linde exhibited strong cash flow generation from operations, amounting to $2.00 billion, although this was a slight decrease from the prior year due to working capital needs. The company actively managed its capital structure, with significant debt issuances and a substantial increase in share repurchases, underscoring its commitment to returning capital to shareholders and enhancing shareholder value. Management expressed confidence in the company's financial position and liquidity, with ample cash reserves and an undrawn revolving credit facility.

Financial Highlights

52 data points
Beta

Revenue

$8.21B

Net Income

$1.17B

14.3% Net Margin

EPS (Diluted)

$2.30

Total Assets

$82.77B

Cash & Equivalents

$4.46B

Free Cash Flow

$1.35B

Financial Statements
Beta
Revenue$8.21B
R&D Expenses$35.00M
SG&A Expenses$802.00M
Operating Income$1.48B
Net Income$1.17B
EPS (Basic)$2.31
EPS (Diluted)$2.30
Shares Outstanding (Basic)507.15M
Shares Outstanding (Diluted)511.41M

Key Highlights

  • 1Total sales increased by 13% to $8.21 billion in Q1 2022 compared to Q1 2021.
  • 2Adjusted diluted EPS from continuing operations grew by 18% to $2.93.
  • 3Strong pricing power contributed 6% to sales growth, with an additional 3% from higher volumes.
  • 4Adjusted operating profit increased by 13% to $1.91 billion, driven by pricing and productivity initiatives.
  • 5Cash provided by operating activities was $2.00 billion, reflecting solid operational cash generation.
  • 6The company significantly increased share repurchases, spending $1.709 billion in Q1 2022 under its authorized programs.
  • 7Americas and APAC segments showed robust sales growth of 14% and 12% respectively, driven by volume and pricing.

Frequently Asked Questions

Linde plc reported a 13% increase in sales for the first quarter of 2022, reaching $8.21 billion, up from $7.24 billion in the same period of 2021. This growth was primarily driven by a combination of higher pricing (6%) and increased volumes (3%), along with a 6% contribution from cost pass-through mechanisms.

Currency translation had a negative impact on sales, decreasing them by 3% in the first quarter of 2022 compared to 2021. This was largely due to the weakening of currencies such as the Euro, Australian dollar, and British pound against the U.S. dollar, particularly affecting sales in EMEA and APAC regions.

In the first quarter of 2022, Linde generated $2.00 billion in cash from operating activities. The company actively engaged in financing activities, including $2.55 billion in net debt increases and $1.71 billion in share repurchases. Linde maintains significant financial flexibility with $4.5 billion in cash and an undrawn $5 billion revolving credit facility, indicating ample resources to meet its business needs and commitment to shareholder returns.

Linde uses non-GAAP measures, such as adjusted operating profit and adjusted diluted EPS, to provide investors with a clearer view of the company's underlying operational performance by excluding items like purchase accounting impacts from the Linde AG merger, cost reduction programs, and other charges. This allows for a better assessment of ongoing business trends and performance on a more comparable basis year-over-year.