Q1 2024 Linde PLC Earnings Call Transcript
Key Points
- Linde PLC (LIN) reported a solid quarter with EPS growth of 10% to $3.75, and record levels of Return on Capital (ROC) at 25.6% and operating margins at 28.9%.
- Despite a decline in volumes, Linde PLC (LIN) has a healthy project backlog valued at approximately $5 billion, expected to contribute to earnings over the next few years.
- The company is actively managing its portfolio, focusing on growth opportunities in resilient markets like healthcare and food and beverage, which saw growth of 6%.
- Linde PLC (LIN) is making strategic investments in clean energy and decarbonization projects, including a new agreement to supply industrial gases for the world's first large-scale green steel production plant.
- The company continues to optimize capital expenditure, reducing the full-year estimate to $4 billion to $4.5 billion, reflecting disciplined financial management.
- Linde PLC (LIN) experienced a 1% decline in volumes, reflecting stagnant economic conditions and a challenging manufacturing environment, particularly in the EMEA region.
- The company noted several quarters of negative base volumes, tracking declining industrial production across key regions.
- Despite growth in certain sectors, the electronics segment only grew by 1%, with challenges in packaged and merchant volumes due to softer production levels.
- Linde PLC (LIN) faces ongoing geopolitical and energy challenges in the EMEA region, impacting industrial production and contributing to flat economic conditions.
- The company's operating cash flow in Q1 was 28% below the fourth quarter, influenced by timing issues related to Good Friday, although recovery is expected in Q2.
Ladies and gentlemen, good day, and thank you for standing by. Welcome to the Linde's First Quarter 2024 Earnings Call and Webcast. (Operator Instructions) And please be advised that today's conference is being recorded. (Operator Instructions)
And I would now like to hand the conference over to Mr. Juan Pelaez, Head of Investor Relations. Please go ahead, sir.
Abby, thank you, and good morning, everyone. Thanks for attending our 2024 first quarter earnings call and webcast. I am Juan Pelaez, Head of Investor Relations. And I'm joined this morning by Sanjiv Lamba, Chief Executive Officer; and Matt White, Chief Financial Officer. Today's presentation materials are available on our website at linde.com in the Investors section.
Please read the forward-looking statement disclosure on Page 2 of the slides and note that it applies to all statements made during this teleconference. The reconciliations of the adjusted numbers are in the appendix of the presentation. Sanjiv will provide some opening remarks, and then
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