Core Insights - Linde plc reported first-quarter 2025 adjusted EPS of $3.95, exceeding the Zacks Consensus Estimate of $3.93 and improving from $3.75 in the previous year [1] - Total quarterly revenues were $8,112 million, slightly below the Zacks Consensus Estimate of $8,258 million, but up from $8,100 million year-over-year [1] - The strong earnings were driven by higher pricing and increased volumes in the Americas segment, though partially offset by lower contributions from the EMEA segment due to reduced volumes in certain end markets [1] Segmental Highlights - The Americas segment's operating profit rose 4.5% to $1,137 million, although it fell short of the Zacks Consensus Estimate of $1,160 million, supported by higher pricing and volume increases in electronics and chemicals & energy [2] - EMEA segment profit increased approximately 5.1% year-over-year to $722 million, surpassing the Zacks Consensus Estimate of $709 million, aided by higher pricing despite lower volumes in metals & mining and chemicals & energy [3] - The APAC segment's profit grew from $447 million to $451 million, meeting the Zacks Consensus Estimate, with stable pricing contributing to this growth [3] - Operating profit in the Engineering segment increased to $114 million from $100 million, exceeding the Zacks Consensus Estimate of $96 million [4] Backlogs - At the end of the first quarter, Linde's project backlog was $10.3 billion, including a sale-of-gas backlog of $7 billion [5] Capital Investment & Balance Sheet - Linde reported capital expenditures of $1.27 billion for the first quarter, with cash and cash equivalents of $5.29 billion and long-term debt of $17.6 billion [6] Guidance - For Q2 2025, Linde estimates adjusted EPS to be between $3.95 and $4.05, and for the full year 2025, adjusted EPS is expected to range from $16.20 to $16.50 [7] - The company reiterated its full-year capital expenditure guidance of $5 billion to $5.5 billion [7]

Core Insights - Linde reported $8.11 billion in revenue for Q1 2025, a year-over-year increase of 0.2%, with an EPS of $3.95 compared to $3.75 a year ago [1] - The revenue fell short of the Zacks Consensus Estimate of $8.26 billion by 1.77%, while the EPS exceeded the consensus estimate of $3.93 by 0.51% [1] Financial Performance - Revenue by region: - Americas: $3.67 billion, a 3% increase year-over-year, below the average estimate of $3.73 billion [4] - EMEA: $2.03 billion, a 2.9% decrease year-over-year, below the average estimate of $2.14 billion [4] - Other: $311 million, a 2.5% decrease year-over-year, below the average estimate of $319.40 million [4] - Engineering: $565 million, a 4.8% increase year-over-year, slightly below the average estimate of $571.95 million [4] - APAC: $1.54 billion, a 3.3% decrease year-over-year, below the average estimate of $1.57 billion [4] Stock Performance - Linde's shares have returned -3.5% over the past month, compared to a -0.7% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Financial Performance - For Q1 2025, Linde's sales were $8,112 million, flat compared to Q1 2024, with a 2% increase from higher price attainment and a 1% increase from acquisitions [103]. - Adjusted operating profit for Q1 2025 was $2,438 million, a 4% increase from Q1 2024, driven by higher pricing and productivity initiatives [106]. - Reported net income for Linde plc increased by $46 million, or 3%, in Q1 2025 compared to Q1 2024, driven by higher operating profit [123]. - Diluted earnings per share rose to $3.51 in Q1 2025, a 5% increase from $3.35 in Q1 2024, attributed to higher net income and lower diluted shares outstanding [124]. - EBITDA for Q1 2025 was $3,132 million, up from $3,092 million in Q1 2024, reflecting higher operating profit [126]. - Reported operating profit for Q1 2025 was $2,184 million, a 4% increase from $2,095 million in Q1 2024 [163]. - Adjusted net income for Q1 2025 was $1,880 million, compared to $1,821 million in Q1 2024, reflecting a 3% increase [164]. - Adjusted diluted EPS for Q1 2025 was $3.95, up from $3.75 in Q1 2024, representing a 5% increase [165]. - EBITDA for Q1 2025 was $3,132 million, with an adjusted EBITDA of $3,213 million, reflecting 39.6% of sales [165]. Expenses and Cost Management - Selling, general and administrative expenses decreased by $74 million, or 9%, in Q1 2025, representing 9.7% of sales compared to 10.6% in Q1 2024 [111]. - Cost of sales, exclusive of depreciation and amortization, decreased by $59 million, or 1%, for Q1 2025, with costs representing 51.2% of sales [110]. - The number of employees decreased to 65,069 in Q1 2025, down by 1,126 from the previous year, primarily due to ongoing cost reduction programs [125]. Taxation - The effective tax rate for Q1 2025 was 23.4%, up from 22.3% in Q1 2024, primarily due to lower tax benefits from share-based compensation [105]. Cash Flow and Investments - Net cash provided by operating activities for the first quarter was $2,161 million, compared to $1,954 million in 2024 [152]. - Capital expenditures for the first quarter were $1,270 million, an increase from $1,048 million in 2024 [152]. - Cash provided by operations for Q1 2025 was $2,161 million, an increase of $207 million or 11% compared to Q1 2024 [153]. - Net cash used for investing activities was $1,369 million in Q1 2025, up $328 million from the previous year, primarily due to higher capital expenditures of $1,270 million [154]. - The company reported a net cash decrease from financing activities of $388 million, an improvement from a decrease of $668 million in 2024 [152]. - Cash used for financing activities decreased to $388 million in Q1 2025 from $668 million in Q1 2024, with cash provided by debt increasing to $1,493 million [157]. Segment Performance - The Americas segment reported sales of $3,666 million, up 3% from $3,560 million in 2024, with operating profit increasing by 5% to $1,137 million [131][132]. - EMEA segment sales decreased by 3% to $2,031 million, while operating profit increased by 5% to $722 million, driven by higher pricing [134][138]. - APAC segment sales fell by 3% to $1,539 million, with operating profit increasing by 1% to $451 million, primarily due to productivity initiatives [139][142]. - Engineering segment sales rose by 5% to $565 million, with operating profit increasing by 14% to $114 million, attributed to project timing [143][145]. - Other segment sales decreased by 3% to $311 million, with operating profit declining by 26% to $14 million, impacted by higher helium costs [146][149]. Comprehensive Income and Backlog - Other comprehensive income for Q1 2025 was $131 million, mainly from currency translation adjustments of $134 million [128]. - As of March 31, 2025, Linde's gas backlog for large projects under construction was approximately $7.0 billion [155]. - Acquisitions net of cash acquired totaled $112 million in Q1 2025, mainly in the Americas and APAC regions [156]. Balance Sheet Highlights - Current assets increased to $8,561 million at the end of March 2025, up from $7,827 million at the end of December 2024 [181]. - Long-term liabilities rose to $68,980 million at the end of March 2025, compared to $64,848 million at the end of December 2024 [181]. - The amount due from non-guarantor subsidiaries in current assets was $4,542 million as of March 31, 2025 [181]. - The amount due to non-guarantor subsidiaries in current liabilities was $1,888 million as of March 31, 2025 [181]. - Transactions with non-guarantor subsidiaries amounted to $833 million for the three months ended March 31, 2025, and $7,177 million for the twelve months ended December 31, 2024 [181]. Future Outlook - The company is expected to provide further discussions on market risk in its 2024 Annual Report on Form 10-K [182].

Financial Data and Key Metrics Changes - Earnings per share (EPS) increased by 5% year-over-year to $3.95, or 8% when excluding currency translation effects [17][22] - Operating profit rose by 4% to $2,400 million, resulting in an operating margin of 30.1%, which is 120 basis points higher than the previous year [17][22] - Sales remained flat at $8,100 million compared to the prior year, with a sequential decline of 2% [15][22] Business Line Data and Key Metrics Changes - In the Americas, packaged gases experienced weakness due to manufacturing uncertainty, while bulk volumes grew low to mid-single digits [12][22] - EMEA showed robust margin performance despite lower industrial activity, with margins improving due to management actions and pricing [34][62] - APAC saw stable trends in battery and electronics, but lower prices for rare gases and helium impacted overall performance [9][10] Market Data and Key Metrics Changes - The Americas segment had the highest price increase at 3%, reflecting inflationary pressures [12][22] - Industrial activity remains sluggish across most geographies, particularly in the U.S. and Western Europe, with expectations of continued softness in demand [71][72] - India is highlighted as a growth region, with ongoing investments and volume growth anticipated [73] Company Strategy and Development Direction - The company emphasizes a defensive operating model that has proven resilient during economic uncertainty, focusing on stable end markets such as healthcare and electronics [6][8] - Management is committed to maintaining a strong backlog of $10 billion, with over $7 billion in gas project sales under long-term contracts [13][22] - The company is actively pursuing clean energy projects, with expectations of $8 billion to $10 billion in opportunities over the next few years [39][40] Management's Comments on Operating Environment and Future Outlook - Management anticipates continued volatility in end market trends due to global trade policy changes, but expresses confidence in navigating uncertainty [14][24] - The outlook for 2025 includes cautious guidance, with EPS expected to grow by 3% to 5%, factoring in recessionary conditions [22][23] - Management remains optimistic about long-term growth driven by secular trends in electronics and emerging markets like India [111] Other Important Information - The company raised its annual dividend by 8%, marking 32 consecutive years of dividend growth [21] - Capital expenditures (CapEx) for the quarter were $1,300 million, with a significant portion allocated to project backlog [18][20] Q&A Session Summary Question: Impact of Dow's Alberta project delay on Linde - Management confirmed that contractual protections are in place for delays, and they will work with Dow to explore alternatives while safeguarding Linde's interests [29][30] Question: EMEA margin performance and future expectations - Management indicated that EMEA margins are a result of consistent management actions and expect margins to grow as volumes improve [34] Question: Clean energy market opportunities - Management remains confident in the $50 billion clean energy opportunity, with a focus on low carbon hydrogen projects and a projected $8 billion to $10 billion in the near term [39][40] Question: Guidance on FX impact and manufacturing demand - Management noted that the FX headwind was primarily felt in the Americas, with manufacturing demand showing weakness in sectors like automotive and agriculture [47][54] Question: SG&A expense reduction - Management attributed the 9% reduction in SG&A to restructuring efforts and lower incentive compensation due to performance [80][87] Question: Drivers of operating margin improvement - Management highlighted that productivity and pricing actions contributed to the 120 basis point margin improvement, with ongoing initiatives to enhance efficiency [92][96]

Financial Data and Key Metrics Changes - Earnings per share (EPS) increased by 8% excluding foreign exchange effects, with a reported EPS of $3.95, which is a 5% increase year-over-year [6][21] - Operating margins expanded by 120 basis points to 30.1%, driven by management actions and pricing strategies [6][21] - Return on Capital Employed (ROCE) remained strong at 25.7% [6] Business Line Data and Key Metrics Changes - Sales for the first quarter were $8.1 billion, flat compared to the prior year and down 2% sequentially [19] - Underlying sales increased by 1% year-over-year, with higher pricing offset by lower volumes [19][20] - The Americas segment saw a 3% price increase, reflecting inflationary pressures, while packaged gases experienced some weakness [15][19] Market Data and Key Metrics Changes - In the APAC region, China showed strength in battery and electronics, but rare gases and helium prices were lower than the previous year [12] - EMEA did not see meaningful improvement in industrial activity, despite government spending [13] - The Americas experienced mixed results, with Canada and U.S. packaged gases facing manufacturing uncertainty, while bulk volumes continued to grow [15] Company Strategy and Development Direction - The company maintains a defensive operating model, focusing on resilient end markets such as healthcare, electronics, and food and beverage [9][11] - Linde is positioned to capitalize on decarbonization discussions and potential infrastructure spending [14] - The company anticipates continued project wins and backlog growth, with a strong focus on capital allocation and management actions to drive EPS growth [16][27] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding the economic environment, expecting volatility in end market trends [17] - The company remains confident in navigating uncertainty and leveraging its operating model for high-quality growth [17][27] - Future guidance reflects a cautious outlook, with EPS expected to grow 3% to 5% in the second quarter, assuming recessionary conditions [25][26] Other Important Information - The company reported a strong backlog of $10 billion, with over $7 billion related to gas projects under long-term contracts [16][22] - Capital expenditures for the quarter were $1.3 billion, with a significant portion allocated to project backlog [22][24] - The company raised its annual dividend by 8%, marking 32 consecutive years of dividend growth [24] Q&A Session Summary Question: Impact of Dow's Alberta project delay on Linde - Management confirmed that contractual protections are in place for delays, and they will work with Dow to explore alternatives [31][32] Question: EMEA margin performance and future expectations - Management indicated that EMEA margins are a result of consistent management actions and expect margins to grow as volumes improve [35][37] Question: Clean energy market opportunities - Management remains confident in the $8 billion to $10 billion clean energy project pipeline over the next few years, focusing on low carbon hydrogen projects [40][43] Question: Guidance on FX impact and manufacturing demand - Management noted that the majority of FX impact was in the Americas, with manufacturing demand showing weakness in sectors like automotive and agriculture [51][57] Question: Electronics backlog and EMEA margins - Management stated that EMEA margins have improved due to effective execution of their business model, and they expect to start up $1 billion from the backlog this year [64][68] Question: Risks around backlog and project commitments - Management expressed confidence in the backlog and highlighted growth opportunities in resilient end markets, particularly in electronics and India [73][78]

Core Viewpoint - Linde reported quarterly earnings of $3.95 per share, exceeding the Zacks Consensus Estimate of $3.93 per share, and showing an increase from $3.75 per share a year ago, indicating a positive earnings surprise of 0.51% [1] Group 1: Earnings Performance - The company has surpassed consensus EPS estimates for the last four quarters [2] - Linde's revenues for the quarter ended March 2025 were $8.11 billion, which missed the Zacks Consensus Estimate by 1.77%, and remained relatively flat compared to year-ago revenues of $8.1 billion [2] - The company has not beaten consensus revenue estimates over the last four quarters [2] Group 2: Stock Performance and Outlook - Linde shares have increased approximately 8.3% since the beginning of the year, contrasting with the S&P 500's decline of -5.3% [3] - The future performance of Linde's stock will depend on management's commentary during the earnings call and the company's earnings outlook [3][4] - The current consensus EPS estimate for the upcoming quarter is $4.14 on revenues of $8.39 billion, and for the current fiscal year, it is $16.43 on revenues of $33.91 billion [7] Group 3: Industry Context - The Chemical - Specialty industry, to which Linde belongs, is currently ranked in the bottom 41% of over 250 Zacks industries, which may impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that investors should monitor these revisions closely [5][6]

EX-99.1 2 lin_ex991.htm PRESS RELEASE Linde Reports First-Quarter 2025 Results First-Quarter Highlights Woking, UK, May 1, 2025 – Linde plc (Nasdaq: LIN) today reported first-quarter 2025 net income of $1,673 million and diluted earnings per share of $3.51, up 3% and 5% respectively. Excluding Linde AG purchase accounting impacts and other charges, adjusted net income was $1,880 million, up 3% versus prior year. Adjusted earnings per share was $3.95, 5% above prior year. Linde's sales for the first quarter ...

May 1, 2025 Forward-Looking Statement Linde plc Investor Teleconference Presentation First Quarter 2025 This document contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. They are based on management's reasonable expecta ...

Core Viewpoint - Linde plc is expected to report its first-quarter 2025 results on May 1, with positive indicators from previous quarters suggesting a potential earnings beat due to strong performance in the Americas segment and favorable pricing dynamics [1][7]. Group 1: Previous Quarter Performance - In the last reported quarter, Linde's earnings were $3.97 per share, surpassing the Zacks Consensus Estimate of $3.93, driven by higher pricing and increased volumes from the Americas segment [2]. - Linde has consistently beaten the Zacks Consensus Estimate in the last four quarters, with an average surprise of 1.45% [2]. Group 2: Earnings Estimates - The Zacks Consensus Estimate for first-quarter earnings per share is $3.93, reflecting a 4.8% improvement from the prior-year quarter [3]. - The revenue estimate for the first quarter is $8.26 billion, indicating a year-over-year increase of 1.96% [3]. Group 3: Contributing Factors - Linde's position as a global leader in industrial gases, including oxygen, hydrogen, and nitrogen, supports its performance across various end markets such as healthcare and manufacturing [4]. - The Americas segment is expected to contribute significantly to profits, with operating profit estimated at $1.16 billion, up from $1.12 billion in the first quarter of 2024 [6]. - The Engineering business unit's operating profit is estimated at $96 million, an increase from $93 million a year ago, indicating overall positive demand and pricing dynamics [6]. Group 4: Earnings Prediction - The company's Earnings ESP is +0.30%, suggesting a strong likelihood of an earnings beat, supported by a Zacks Rank of 3 [7].

Wall Street analysts forecast that Linde (LIN) will report quarterly earnings of $3.93 per share in its upcoming release, pointing to a year-over-year increase of 4.8%. It is anticipated that revenues will amount to $8.26 billion, exhibiting an increase of 2% compared to the year-ago quarter. The consensus EPS estimate for the quarter has been revised 0.1% higher over the last 30 days to the current level. This reflects how the analysts covering the stock have collectively reevaluated their initial estimate ...