Item 6. SELECTED FINANCIAL DATA

8K characters. Original on sec.gov · Markdown

Item 6. SELECTED FINANCIAL DATA

Unless otherwise indicated, information presented is on a continuing operations basis.



(Millions of dollars, except for share and per share data)	2017(A)			2016(A)			2015(A)			2014(A)			2013(A)
Operating Results
Sales	$	8,188		$	7,504		$	7,824		$	8,384		$	8,313
Cost of sales	5,753			5,177			5,598			6,208			6,138
Selling and administrative	716			685			773			892			896
Research and development	58			72			76			79			74
Business restructuring and cost reduction actions	151			35			180			11			98
Operating income	1,428			1,530			1,233			924			1,149
Equity affiliates’ income(B)	80			147			152			149			165
Income from continuing operations attributable to Air Products	1,134			1,100			933			697			869
Net income attributable to Air Products(C)	3,000			631			1,278			992			994
Basic earnings per common share attributable to Air Products:
Income from continuing operations	5.20			5.08			4.34			3.28			4.14
Net income(C)	13.76			2.92			5.95			4.66			4.74
Diluted earnings per common share attributable to Air Products:
Income from continuing operations	5.16			5.04			4.29			3.24			4.09
Net income(C)	13.65			2.89			5.88			4.61			4.68
Year-End Financial Position
Plant and equipment, at cost	$	19,548		$	18,660		$	17,999		$	18,180		$	17,676
Total assets(C)(D)(E)	18,467			18,029			17,317			17,648			17,740
Working capital(C)	3,388			1,034			(851		)	199			100
Total debt(E)(F)	3,963			5,211			5,856			6,081			6,231
Redeemable noncontrolling interest	—			—			—			287			376
Air Products shareholders’ equity(C)	10,086			7,080			7,249			7,366			7,042
Total equity(C)	10,186			7,213			7,381			7,521			7,199
Financial Ratios
Return on average Air Products shareholders’ equity(G)	13.2		%	15.4		%	12.7		%	9.5		%	13.3		%
Operating margin	17.4		%	20.4		%	15.8		%	11.0		%	13.8		%
Selling and administrative as a percentage of sales	8.7		%	9.1		%	9.9		%	10.6		%	10.8		%
Total debt to total capitalization(E)(F)(H)	28.0		%	41.9		%	44.2		%	43.8		%	45.1		%
Other Data
Income from continuing operations including noncontrolling interests	$	1,155		$	1,122		$	966		$	691		$	900
Adjusted EBITDA(I)	2,795			2,622			2,399			2,275			2,247
Depreciation and amortization	866			855			859			876			825
Capital expenditures on a GAAP basis(J)	1,056			908			1,201			1,297			1,400
Capital expenditures on a non-GAAP basis(J)	1,066			935			1,575			1,498			1,642
Cash provided by operating activities	2,534			2,259			2,047			1,862			1,313
Cash used for investing activities	(1,418		)	(865		)	(1,147		)	(1,257		)	(1,354		)
Cash (used for) provided by financing activities	(2,041		)	(860		)	(960		)	(524		)	112
Dividends declared per common share	3.71			3.39			3.20			3.02			2.77
Weighted Average Common Shares – Basic (in millions)	218			216			215			213			210
Weighted Average Common Shares – Diluted (in millions)	220			218			217			215			212
Book value per common share at year-end	$	46.19		$	32.57		$	33.66		$	34.49		$	33.35
Shareholders at year-end	5,700			6,000			6,400			6,600			7,000
Employees at year-end(K)	15,300			18,600			19,700			21,200			21,600


(A)	Unless otherwise stated, selected financial data is presented on a GAAP basis. Our operating results were impacted by certain items which management does not believe to be indicative of ongoing business trends and are excluded from the non-GAAP measure. Refer to pages 31-37 for reconciliations of the GAAP to non-GAAP measures for fiscal year 2017, 2016, and 2015. Descriptions of the excluded items appear on pages 24-26. For 2014, these items include: (i) a charge to operating income of $11 ($7 after-tax, or $.03 per share) related to business restructuring and cost reduction actions, (ii) pension settlement losses of $5 ($3 after-tax, or $.02 per share), and (iii) a goodwill and intangible asset impairment charge of $310 ($275 attributable to Air Products, after-tax, or $1.27 per share). For 2013, these items include: (i) a charge to operating income of $98 ($71 after-tax, or $.33 per share) related to business restructuring and cost reduction actions, and (ii) expenses of $10 ($6 after-tax, or $.03 per share) related to advisory costs.

(A)

Unless otherwise stated, selected financial data is presented on a GAAP basis. Our operating results were impacted by certain items which management does not believe to be indicative of ongoing business trends and are excluded from the non-GAAP measure. Refer to pages 31-37 for reconciliations of the GAAP to non-GAAP measures for fiscal year 2017, 2016, and 2015. Descriptions of the excluded items appear on pages 24-26. For 2014, these items include: (i) a charge to operating income of $11 ($7 after-tax, or $.03 per share) related to business restructuring and cost reduction actions, (ii) pension settlement losses of $5 ($3 after-tax, or $.02 per share), and (iii) a goodwill and intangible asset impairment charge of $310 ($275 attributable to Air Products, after-tax, or $1.27 per share). For 2013, these items include: (i) a charge to operating income of $98 ($71 after-tax, or $.33 per share) related to business restructuring and cost reduction actions, and (ii) expenses of $10 ($6 after-tax, or $.03 per share) related to advisory costs.


(B)	For 2017, includes the impact of a noncash impairment charge of $79.5 ($.36 per share) on our investment in Abdullah Hashim Industrial Gases & Equipment Co., Ltd. (AHG), a 25%‑owned equity affiliate in our Industrial Gases – EMEA segment.


(C)	Information presented on a total company basis, which includes both continuing and discontinued operations.


(D)	Reflects adoption of guidance on the presentation of deferred income taxes on a retrospective basis. Refer to Note 2, New Accounting Guidance, for additional information.


(E)	Reflects adoption of guidance on the presentation of deferred financing costs on a retrospective basis. Refer to Note 2, New Accounting Guidance, for additional information.


(F)	Total debt includes long-term debt, current portion of long-term debt, and short-term borrowings as of the end of the year for continuing operations.


(G)	Calculated using income from continuing operations attributable to Air Products and five-quarter average Air Products shareholders’ equity.


(H)	Total capitalization includes total debt for continuing operations plus total equity plus redeemable noncontrolling interest as of the end of the year.


(I)	A reconciliation of Income from Continuing Operations on a GAAP basis to Adjusted EBITDA is presented on pages 34-36.


(J)	Capital expenditures presented on a GAAP basis include additions to plant and equipment, investment in and advances to unconsolidated affiliates, and acquisitions. The Company utilizes a non-GAAP measure in the computation of capital expenditures and includes spending associated with facilities accounted for as capital leases and purchases of noncontrolling interests. Refer to page 39 for a reconciliation of the GAAP to non-GAAP measures for 2017, 2016, and 2015. For 2014, the GAAP measure was adjusted by $200 for spending associated with facilities accounted for as capital leases. For 2013, the GAAP measure was adjusted by $228 and $14 for spending associated with facilities accounted for as capital leases and purchases of noncontrolling interests, respectively.

(J)

Capital expenditures presented on a GAAP basis include additions to plant and equipment, investment in and advances to unconsolidated affiliates, and acquisitions. The Company utilizes a non-GAAP measure in the computation of capital expenditures and includes spending associated with facilities accounted for as capital leases and purchases of noncontrolling interests. Refer to page 39 for a reconciliation of the GAAP to non-GAAP measures for 2017, 2016, and 2015. For 2014, the GAAP measure was adjusted by $200 for spending associated with facilities accounted for as capital leases. For 2013, the GAAP measure was adjusted by $228 and $14 for spending associated with facilities accounted for as capital leases and purchases of noncontrolling interests, respectively.


(K)	Includes full- and part-time employees from continuing and discontinued operations.

Previous: Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, · Next: Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS