Air Products And Chemicals, Inc. · NYSE:APD
Air Products And Chemicals — Q4 2021 Earnings Presentation
32 slides from Air Products And Chemicals's earnings presentation, Nov 4, 2021
Slide 1: Create Shareholder Value: Q4 FY21 Earnings Conference Call
Moving forward Create Shareholder Value Q4 FY21 Earnings Conference Call November 4, 2021
Slide 2: Forward-looking statements; 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: FY21 highlights
FY21 highlights Moving forward Delivering growth while driving the energy transition • Delivered strong EPS in FY21 • 39th consecutive year of dividend increase • Recognized for outstanding Sustainability performance Gov. Edwards, LA Jazan • Completed ~$12B Jazan JV • Alberta net-zero hydrogen energ
Slide 4: Safety results
Moving forward Safety results FY21 vs FY14 FY21 FY14 Employee Lost Time Injury Rate 0.24 0.06 75% better Employee Recordable Injury Rate 0.58 0.39 33% better FY14 includes former Materials Technologies businesses divested in FY2017 4
Slide 5: 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 5
Slide 6: 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 7: 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 8: 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 8
Slide 9: Air Products' Position in the Energy Transformation to Hydrogen
Air Products’ Position in the Moving forward Energy Transformation to Hydrogen Gray Hydrogen Blue Hydrogen Green Hydrogen from Hydrocarbons from Hydrocarbons with CCS from Wind and Solar Air Products is the Air Products will be the Air Products will be the Global Leader in Global Leader in Global Le
Slide 10: Executing our growth strategy
Moving forward Executing our growth strategy Gasification, Carbon Capture and Hydrogen Jazan Jiutai Debang GCA Indonesia Gasif/Power JV 100% APD JV 100% APD 100% APD $12B $0.65B $0.25B $0.5B $2B 2021/2023 2023 2023 2023 2025 Blue, but better. NEOM Alberta, Canada Louisiana JV 100% APD 100% APD $5B $
Slide 11: Jazan - Air Products financials
Jazan - Air Products financials Moving forward • Air Products will not consolidate JV results (i.e., Equity Affiliate Income) • Accounted for as a financing transaction • Full ~$12 billion financial commitments completed • Phase I Assets closed October 2021 - Phase I Assets = ASU, utilities and port
Slide 12: Air Products adjusted EPS
Moving forward Air Products adjusted EPS* $11.00 +13% to+15% $10.50 $10.00 $9.50 $9.00 $8.50 $8.00 $7.50 +8% $7.00 +2% $6.50 $6.00 +10% +18% $5.50 +12% $5.00 +16% $4.50 +10% $4.00 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Guidance 12 * Non-GAAP financial measure. See website for reconciliation. C
Slide 13: 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 • ~$1.3B of dividends to shareholders in 2021 • 39 consecutive years of dividend increases 13
Slide 14: Adjusted EBITDA margin
Adjusted EBITDA margin* Moving forward Up over 1,100 basis points 44% 42.7% 41.9% 42% 40.1% 40.3% 40.4% 40% 40.3% 39.2% 37.7% 38% 37.5% 36.3% 35.9% 35.7% 37.3% 36% 35.2% 34.8% 34.9% 36.6% 34.1% 34.3%35.8% 33.9% 34% 33.2% 34.8% 32.9%33.2% 32% 31.1% 29.6% 30% 28.7% 28% 28.8% 26.5% 26% 25.1% 24% • 2/3
Slide 15: Fiscal Year Results
Moving forward Fiscal Year Results ($ million) FY20 FY21 Change Sales $8,856 $10,323 17% - Volume 5% - Price 2% - Energy cost pass-through 6% - Currency 4% Adjusted EBITDA* $3,620 $3,883 7% - Adjusted EBITDA Margin* 40.9% 37.6% (330bp) Adjusted Operating Income* $2,204 $2,268 3% - Adjusted Operating
Slide 16: Full Year Adjusted EPS
Full Year Adjusted EPS* Moving forward Adjusted EPS* Up 8% vs. PY FY20 FY21 Change GAAP cont ops EPS $8.55 $9.12 Less: non-GAAP items (0.18) (0.09) Adjusted EPS* $8.38 $9.02 $0.64 Volume 0.00 Price (net of variable costs) 0.34 Other Cost (0.46) ($0.12) Currency/FX $0.35 Equity Affiliate Income 0.23
Slide 17: Q4 Results
Q4 Results Moving forward Fav/(Unfav) vs. ($ million) Q4FY21 Q4FY20 Q3FY21 Sales $2,841 22% 9% - Volume 9% 5% - Price 3% 1% - Energy cost pass-through 8% 4% - Currency 2% (1%) Adjusted EBITDA* $1,041 11% 7% - Adjusted EBITDA Margin* 36.6% (380bp) (90bp) Adjusted Operating Income* $617 10% 7% - Adjus
Slide 18: Q4 Adjusted EPS
Q4 Adjusted EPS* Moving forward Adjusted EPS* Up 15% vs. PY Q4FY20 Q4FY21 Change GAAP cont ops EPS $2.19 $2.51 Less: non-GAAP items 0.00 0.00 Adjusted EPS* $2.19 $2.51 $0.32 Volume 0.19 Price (net of variable costs) 0.04 Other Cost (0.08) $0.15 Currency/FX $0.06 Equity Affiliate Income 0.09 Interest
Slide 19: Cash Flow Focus
Moving forward Cash Flow Focus ($ million) FY20 FY21 Change Adjusted EBITDA* $3,620 $3,883 $263 Interest, net* (79) (68) 11 Cash Tax (380) (391) (11) Maintenance CapEx* (563) (774) (211) Distributable Cash Flow* $2,598 $2,650 $52 $11.69/Share* $11.91/Share* Dividends (1,104) (1,257) (153) Investable
Slide 20: FY18-27 Capital Deployment Scorecard
FY18-27 Capital Deployment Scorecard Moving forward Significant progress made, substantial investment capacity remaining Available Now (9/30/21) ($Billion) Total Debt Capacity $ 11.6 Assuming 3xLTM Adj EBITDA* Less: Net Debt* $ 1.8 Debt ($7.6B) minus cash1 ($5.8B) Additional Available Now $ 9.8 Esti
Slide 21: Industrial Gases - Asia
Moving forward Industrial Gases - Asia Fav/(Unfav) vs. Q4FY21 Q4FY20 Q3FY21 Sales $754 6% -% - Volume -% 1% - Price 1% -% - Energy cost pass-through -% -% - Currency 5% (1%) Adjusted EBITDA* $341 3% (4%) - Adjusted EBITDA Margin* 45.3% (100bp) (210bp) Operating Income $206 (2%) (6%) - Operating Marg
Slide 22: Industrial Gases - Americas
Moving forward Industrial Gases - Americas Fav/(Unfav) vs. Q4FY21 Q4FY20 Q3FY21 Sales $1,115 22% 5% - Volume 3% (2%) - Price 4% 2% - Energy cost pass-through 15% 6% - Currency -% (1%) Adjusted EBITDA* $476 16% 2% - Adjusted EBITDA Margin* 42.7% (230bp) (100bp) Operating Income $290 22% 2% - Operatin
Slide 23: Industrial Gases - EMEA
Moving forward Industrial Gases - EMEA Fav/(Unfav) vs. Q4FY21 Q4FY20 Q3FY21 Sales $674 33% 8% - Volume 14% 1% - Price 4% 1% - Energy cost pass-through 12% 8% - Currency 3% (2%) Adjusted EBITDA* $229 14% 8% - Adjusted EBITDA Margin* 34.0% (560bp) (10bp) Operating Income $136 11% (3%) - Operating Marg
Slide 24: Industrial Gases - Global
Moving forward Industrial Gases - Global Fav/(Unfav) vs. Q4FY21 Q4FY20 Sales $210 $94 Adjusted EBITDA* $8 $14 Operating Income $4 $14 • Sales and profit up on SOE project activity • Continue to add resources for future project growth 24 * Non-GAAP financial measure. See website for reconciliation.
Slide 25: Corporate and other
Moving forward Corporate and other Fav/(Unfav) vs. Q4FY21 Q4FY20 Sales $88 $15 Adjusted EBITDA* ($13) ($16) Operating Income ($19) ($17) • Sales higher on increased project activities • Profit lower on increased costs 25 * Non-GAAP financial measure. See website for reconciliation.
Slide 26: Outlook
Moving forward Outlook* Q1 FY22 FY22 Adjusted EPS* vs PY Adjusted EPS* vs PY $2.45 to $2.55 +16% to +20% $10.20 to $10.40 +13% to +15% FY22 Capital Expenditures* = $4.5 to $5.0 billion 26 * Non-GAAP financial measure. See website for reconciliation.
Slide 27: 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 27
Slide 28: Appendix slides
Appendix slides 28
Slide 29: Major projects
Major projects Plant Customer/Location Capacity Timing Market ONSTREAM (last five quarters) Syngas BPCL Ph 2, India Not disclosed Q1 FY21 Chemicals ASU/H2 Samsung Giheung, Korea World Scale Q2 FY21 Electronics ASU/Liquid Big River Steel, Arkansas >250 TPD + liquid Q3 FY21 Steel/Merchant PROJECT COMM
Slide 30: Air Products Adjusted EPS
Air Products Adjusted EPS* Moving forward FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Q1 $1.79 $1.86 $2.14 $2.12 $2.45 - $2.55# Q2 $1.71 $1.92 $2.04 $2.08 Q3 $1.95 $2.17 $2.01 $2.31 Q4 $2.00 $2.27 $2.19 $2.51 $4.42 $4.88 $5.64 $6.31 $7.45 $8.21 $8.38 $9.02 $10.20 - $10.40# $11.00 $10.00 $9.00 +13%
Slide 31: Capital Expenditures
Capital Expenditures* Moving forward FY $MM 2022 $4.5 - $5.0 billion# 2021 $2,551 2020 $2,717 2019 $2,129 2018 $1,914 2017 $1,056 2016 $908 2015 $1,201 FY21 Quarter $MM Q1 $684 Q2 $613 Q3 $636 Q4 $617 * Non-GAAP financial measure. See website for reconciliation. Capital expenditures are calculated i
Slide 32: Thank you
Moving forward Thank you tell me more
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