Air Products And Chemicals, Inc. · NYSE:APD
Air Products And Chemicals — Q2 2021 Earnings Presentation
27 slides from Air Products And Chemicals's earnings presentation, May 10, 2021
Slide 1: Create Shareholder Value: Q2 FY21 Earnings Conference Call
Moving forward Create Shareholder Value Q2 FY21 Earnings Conference Call May 10, 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 Q2FY21 vs FY14 Q2FY21 FY14 Employee Lost Time Injury Rate 0.24 0.05 79% better Employee Recordable Injury Rate 0.58 0.40 31% better 3 FY14 includes former Materials Technologies businesses that were divested in FY2017
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: 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 7
Slide 8: 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 • Lu'An: Customer has requested start-up of the
Slide 9: Air Products Adjusted EPS
Moving forward Air Products Adjusted EPS* $9.50 $9.00 $8.50 $8.00 $7.50 $7.00 +8% $6.50 +2% $6.00 +10% +18% $5.50 +12% $5.00 +16% $4.50 +10% $4.00 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 Guidance 9 * Non-GAAP financial measure. See website for reconciliation. CAGR is calculated using midpoint of FY2
Slide 10: Dividend/Share
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 • >$1.3B/year of dividends to shareholders expected in 2021 • 39 consecutive years of dividend
Slide 11: Adjusted EBITDA margin
Adjusted EBITDA margin* Moving forward Up over 1200 basis points 44% 42.7% 41.9% 42% 40.1% 40.3% 40.4% 40% 40.3% 37.7% 39.2% 38% 36.3% 37.3% 35.9% 35.7% 36% 35.2% 34.8% 34.9% 34.1% 34.3% 35.8% 33.9% 34% 33.2% 34.8% 32.9% 33.2% 32% 31.1% 29.6% 30% 28.7% 28% 28.8% 26.5% 26% 25.1% 24% Q214 Q314 Q414 Q1
Slide 12: Q2 Results
Q2 Results Moving forward Fav/(Unfav) vs. ($ million) Q2FY21 Q2FY20 Q1FY21 Sales $2,502 13% 5% - Volume -% (1%) - Price 2% 1% - Energy cost pass-through 7% 4% - Currency 4% 1% Adjusted EBITDA* $934 5% -% - Adjusted EBITDA Margin* 37.3% (300bp) (190bp) Adjusted Operating Income* $535 (2%) (1%) - Adju
Slide 13: Q2 Adjusted EPS
Q2 Adjusted EPS* Moving forward Q2FY20 Q2FY21 Change GAAP cont ops EPS $2.21 $2.13 Less: non-GAAP items 0.18 0.04 Adjusted EPS* $2.04 $2.08 $0.04 Volume (0.19) Price (net of variable costs) 0.09 Other Cost (0.03) ($0.13) Currency/FX $0.10 Equity Affiliate Income 0.05 Non-controlling Interest 0.04 In
Slide 14: Cash Flow Focus
Moving forward Cash Flow Focus ($ million) Q2FY21 LTM Adjusted EBITDA* $3,685 Interest, net* (94) Cash Tax (357) Maintenance Capex* (655) Distributable Cash Flow* $2,579 $11.59/Share* Dividends (1,185) Investable Cash Flow* $1,394 • $11.59/share of Distributable Cash Flow* • Paid over 45% of Distrib
Slide 15: Capital Deployment Scorecard
Capital Deployment Scorecard Moving forward Substantial investment capacity remaining Available Now (3/31/21) ($Billion) Total Debt Capacity $ 11.1 Assuming 3xLTM Adj EBITDA* Less: Net Debt* $ 1.8 Debt ($8.0B) minus cash# ($6.2B) Additional Available Now $ 9.2 Estimated Available In Future $ 2.1 LTM
Slide 16: Industrial Gases - Asia
Moving forward Industrial Gases - Asia Fav/(Unfav) vs. Q2FY21 Q2FY20 Q1FY21 Sales $698 6% (3%) - Volume (2%) (4%) - Price 1% -% - Energy cost pass-through -% -% - Currency 7% 1% Adjusted EBITDA* $324 (1%) (6%) - Adjusted EBITDA Margin* 46.4% (330bp) (130bp) Operating Income $199 (5%) (8%) - Operatin
Slide 17: Industrial Gases - Americas
Moving forward Industrial Gases - Americas Fav/(Unfav) vs. Q2FY21 Q2FY20 Q1FY21 Sales $1,056 13% 13% - Volume (6%) 2% - Price 3% 1% - Energy cost pass-through 15% 10% - Currency 1% -% Adjusted EBITDA* $449 6% 12% - Adjusted EBITDA Margin* 42.5% (310bp) (40bp) Operating Income $263 (2%) 17% - Operati
Slide 18: Industrial Gases - EMEA
Moving forward Industrial Gases - EMEA Fav/(Unfav) vs. Q2FY21 Q2FY20 Q1FY21 Sales $585 19% 4% - Volume 5% (1%) - Price 2% 1% - Energy cost pass-through 3% 2% - Currency 9% 2% Adjusted EBITDA* $218 17% (2%) - Adjusted EBITDA Margin* 37.2% (50bp) (220bp) Operating Income $140 12% (1%) - Operating Marg
Slide 19: Industrial Gases - Global
Moving forward Industrial Gases - Global Fav/(Unfav) vs. Q2FY21 Q2FY20 Sales $98 $19 Adjusted EBITDA* ($22) ($10) Operating Income ($26) ($6) • Sales up on SOE project activity • Profit down on business mix and higher product development spending 19 * Non-GAAP financial measure. See website for reco
Slide 20: Corporate and other
Moving forward Corporate and other Fav/(Unfav) vs. Q2FY21 Q2FY20 Sales $66 $12 Adjusted EBITDA* ($34) ($1) Operating Income ($41) ($2) • Sales higher on increased project activities • Profit lower on increased corporate costs 20 * Non-GAAP financial measure. See website for reconciliation.
Slide 21: Outlook
Moving forward Outlook* Q3 FY21 FY21 Adjusted EPS* vs PY Adjusted EPS* vs PY $2.30 to $2.40 +14% to +19% $8.95 to $9.10 +7% to +9% FY21 Capital Expenditures* = Approx. $2.5 billion EPS and Capex guidance do not include Jazan or Lu’An restart 21 * Non-GAAP financial measure. See website for reconcili
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 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 ASU/H2 Samsung Giheung, Ko
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 $2.08 Q3 $1.95 $2.17 $2.01 $2.30 - $2.40# Q4 $2.00 $2.27 $2.19 $4.42 $4.88 $5.64 $6.31 $7.45 $8.21 $8.38 $8.95 - $9.10# $9.50 $9.00 $8.50 $8.00 $7.50 $7.00 +8% $6.50 +2%
Slide 26: Capital Expenditures
Capital Expenditures* Moving forward FY $MM 2021 Approx. $2.5 billion# 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 Q4 * Non-GAAP financial measure. See website for reconciliation. Capital expenditure is calculated independently for each q
Slide 27: Thank you
Moving forward Thank you tell me more
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