Air Products And Chemicals, Inc. · NYSE:APD
Air Products And Chemicals — Q1 2021 Earnings Presentation
27 slides from Air Products And Chemicals's earnings presentation, Feb 4, 2021
Slide 1: Create Shareholder Value Q1 FY21 Earnings Conference Call
Moving forward Create Shareholder Value Q1 FY21 Earnings Conference Call February 4, 2021
Slide 2: Forward-looking statements and Non-GAAP Financial Measures
Moving forward Forward-looking statements This presentation contains “forward-looking statements” within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements about earnings guidance, business outlook and investment opportunities. These forward-look
Slide 3: Safety results
Moving forward Safety results Q1FY21 FY14 Q1FY21 vs FY14 Employee Lost Time Injury Rate 0.24 0.04 83% better Employee Recordable Injury Rate 0.58 0.30 48% better 3 FY14 includes MT
Slide 4: Our Goal
Moving forward Our Goal Air Products will be the safest, most diverse and most profitable industrial gas company in the world, providing excellent service to our customers 4
Slide 5: Creating shareholder value
Moving forward Creating shareholder value Management philosophy Shareholder Cash is king; cash flow drives long-term value. Value What counts in the long term is the increase in per share value of our stock, not size or growth. CEO Capital allocation is the most important job of Focus the CEO. Opera
Slide 6: Five Point Plan: Moving Forward
Moving forward Five Point Plan: Moving Forward Sustain Deploy Evolve Change Belong the lead capital portfolio culture and Matter Safest, most Strategically invest Grow onsite 4S Inclusion diverse, and most significant available portion profitable capacity Best-in-class Win profitable Energy, Committ
Slide 7: Dreams of the Future
Moving forward Dreams of the Future • To be the safest, most diverse, and most profitable industrial gas company in the world • To be the largest American chemical company as measured by market capitalization • To be the leader in providing solutions to the world’s energy and environmental challenge
Slide 8: Making Dreams a Reality
Moving forward Making Dreams a Reality • Improved safety record • Maintained highest margin in the industry • Announced new sustainability goals, including carbon intensity reduction and diversity goals • Double-digit average annual adjusted EPS* increase since 2014. Adjusted EPS* up in 2020 despite
Slide 9: Our Higher Purpose
Moving forward Our Higher Purpose Bringing people together to collaborate and innovate solutions to the world’s most significant energy and environmental sustainability challenges 9
Slide 10: Executing our gasification strategy
Moving forward Executing our gasification strategy Energy, environmental, emerging markets Indonesia 100% APD $2B Debang 2024 JV $0.25B Jiutai 2023 100% APD $0.65B Jazan IG/ 2022 Gasif/Power JV $11.5B Lu’An 2021 JV $1.5B Large ASUs 2018 for China coal gasification 10 Project capital represents 100%,
Slide 11: Dividend history
Dividend history Moving forward $6.00 $5.50 $5.00 Dividend/Share* $4.50 $4.00 $3.50 $3.00 $2.50 $2.00 2014 2015 2016 2017 2018 2019 2020 2021 • $1.50 per quarter or 12% dividend increase announced Jan 2021 • >$1.3B/year of dividends to shareholders expected in 2021 • 39 consecutive years of dividend
Slide 12: Adjusted EBITDA margin
Adjusted EBITDA margin* Moving forward Up over 1400 basis points 44% 42.7% 41.9% 42% 40.1% 40.3% 40.4% 40% 40.3% 37.7% 39.2% 38% 36.3% 35.9% 35.7% 36% 35.2% 34.8% 34.9% 34.1% 34.3% 35.8% 33.9% 34% 33.2% 34.8% 32.9% 33.2% 32% 31.1% 29.6% 30% 28.7% 28% 28.8% 26.5% 26% 25.1% 24% Q214 Q314 Q414 Q115 Q21
Slide 13: Q1 Results
Q1 Results Moving forward Fav/(Unfav) vs. ($ million) Q1FY21 Q1FY20 Q4FY20 Sales $2,375 5% 2% - Volume (1%) (3%) - Price 2% 1% - Energy cost pass-through 1% 2% - Currency 3% 2% Adjusted EBITDA* $932 3% (1%) - Adjusted EBITDA Margin* 39.2% (110bp) (120bp) Adjusted Operating Income* $539 (4%) (4%) - A
Slide 14: Q1 Adjusted EPS
Q1 Adjusted EPS* Moving forward Q1FY20 Q1FY21 Change GAAP cont ops EPS $2.14 $2.12 non-GAAP items 0.00 0.00 Adjusted EPS* $2.14 $2.12 ($0.02) Volume (0.25) Price (net of variable costs) 0.17 Other Cost (0.06) ($0.14) Currency/FX $0.06 Equity Affiliate Income 0.04 Non-controlling Interest 0.04 Intere
Slide 15: Cash Flow Focus
Moving forward Cash Flow Focus ($ million) Q1FY21 LTM Adjusted EBITDA* $3,644 Interest, net* (87) Cash Tax (387) Maintenance Capex* (616) Distributable Cash Flow* $2,554 $11.48/Share* Dividends (1,144) Investable Cash Flow* $1,410 • ~$11.50/share of Distributable Cash Flow* • Paid over 40% of Distri
Slide 16: Capital Deployment Scorecard
Capital Deployment Scorecard Moving forward Substantial investment capacity remaining Available Now (12/31/20) ($Billion) Total Debt Capacity $ 10.9 Assuming 3xLTM Adj EBITDA* Less: Net Debt* $ 1.8 Debt ($8.0B) minus cash# ($6.2B) Additional Available Now $ 9.1 Estimated Available In Future $ 2.5 LT
Slide 17: Industrial Gases - Asia
Moving forward Industrial Gases - Asia Fav/(Unfav) vs. Q1FY21 Q1FY20 Q4FY20 Sales $718 4% 1% - Volume (4%) (3%) - Price 1% -% - Energy cost pass-through 1% -% - Currency 6% 4% Adjusted EBITDA* $343 (1%) 4% - Adjusted EBITDA Margin* 47.7% (240bp) 140bp Operating Income $215 (6%) 2% - Operating Margin
Slide 18: Industrial Gases - Americas
Moving forward Industrial Gases - Americas Fav/(Unfav) vs. Q1FY21 Q1FY20 Q4FY20 Sales $933 -% 2% - Volume (5%) (4%) - Price 3% 1% - Energy cost pass-through 2% 5% - Currency -% -% Adjusted EBITDA* $400 (2%) (3%) - Adjusted EBITDA Margin* 42.9% (90bp) (210bp) Operating Income $226 (12%) (5%) - Operat
Slide 19: Industrial Gases - EMEA
Moving forward Industrial Gases - EMEA Fav/(Unfav) vs. Q1FY21 Q1FY20 Q4FY20 Sales $563 13% 11% - Volume 5% 6% - Price 3% 1% - Energy cost pass-through (1%) 2% - Currency 6% 2% Adjusted EBITDA* $222 18% 11% - Adjusted EBITDA Margin* 39.4% 170bp (20bp) Operating Income $142 17% 15% - Operating Margin
Slide 20: Industrial Gases - Global
Moving forward Industrial Gases - Global Fav/(Unfav) vs. Q1FY21 Q1FY20 Sales $105 $12 Adjusted EBITDA* $0 ($7) Operating Income ($5) ($8) • Sales up on SOE project activity • Profit down on business mix and higher product development spending • Favorable contract settlement this year offset other pr
Slide 21: Corporate
Moving forward Corporate Fav/(Unfav) vs. Q1FY21 Q1FY20 Sales $57 $23 Adjusted EBITDA* ($32) $11 Operating Income ($38) $10 • LNG project activity drives business improvement • Golden Pass and Mozambique on-going and Qatargas contributed 21 * Non-GAAP financial measure. See website for reconciliation
Slide 22: Our competitive advantage
Moving forward Our competitive advantage The only sustainable element of long-term competitive advantage is the degree of commitment and motivation of the people in the enterprise 22
Slide 23: Appendix slides
Appendix slides
Slide 24: Major projects
Major projects * Multiple Phases Plant Customer/Location Capacity Timing Market ONSTREAM (last five quarters) H2/CO Geismar, Louisiana 50MMH2+6.5MMCO Q2 FY20 Chem/Pipeline Hydrogen PBF - California & Delaware 300MMSCFD Q3 FY20 Refinery Syngas BPCL Ph 2, India Not disclosed Q1 FY21 Chemicals PROJECT
Slide 25: Air Products Adjusted EPS
Air Products Adjusted EPS* Moving forward FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 Q1 $1.79 $1.86 $2.14 $2.12 Q2 $1.71 $1.92 $2.04 Q3 $1.95 $2.17 $2.01 Q4 $2.00 $2.27 $2.19 $4.42 $4.88 $5.64 $6.31 $7.45 $8.21 $8.38 $9.00 $8.00 $7.00 +2% $6.00 +10% $5.00 +18% $4.00 +12% $3.00 +16% +10% $2.00 $1.00 $-
Slide 26: Capital Expenditure
Capital Expenditure* Moving forward FY $MM 2020 $2,717 2019 $2,129 2018 $1,914 2017 $1,056 2016 $908 2015 $1,201 FY21 Quarter $MM Q1 $684 Q2 Q3 Q4 * Non-GAAP financial measure. See website for reconciliation. 26 Capital expenditure is calculated independently for each quarter and may not sum to full
Slide 27: Thank you
Moving forward Thank you tell me more
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