Praxair Reports Record Full-Year 2012 Earnings and Cash Flow
Praxair Reports Record Full-Year 2012 Earnings and Cash Flow
* Full-year sales of $11.2 billion; adjusted diluted EPS of $5.57*
* Record full-year operating cash flow of $2.8 billion
* Fourth-quarter sales of $2.8 billion; diluted EPS of $1.38
* $2.6 billion project backlog at year-end; project development activity
remains solid
* 9% dividend increase; 20^th consecutive annual increase
* Full-year 2013 EPS guidance of $5.85 to $6.10; up 5% - 10%*;
First-quarter 2013 EPS guidance of $1.35 to $1.40
Business Wire
DANBURY, Conn. -- January 23, 2013
Praxair, Inc. (NYSE: PX) announced full-year 2012 reported net income of
$1,692 million and reported diluted earnings per share of $5.61. On an
adjusted basis, full-year net income was $1,681 million and diluted earnings
per share was $5.57, 3% above the prior year.*
Full-year sales were $11,224, 5% above 2011 excluding negative foreign
currency translation and cost pass-through effects.
Reported operating profit was $2,437 million. Adjusted operating profit was
$2,502 million, compared to $2,469 million in the prior year.* The increase
was driven by higher volumes, higher pricing and productivity, partially
offset by currency translation effects. Operating profit in North America grew
by 10%, but was largely offset by lower operating profit in Europe and South
America.
For the full year, cash flow from operations was a record $2,752 million, up
12% from 2011. Capital expenditures, primarily for new production plants under
long-term contracts with customers, were $2,180 million. The company invested
$280 million in acquisitions, for seventeen North American packaged gas
distributors and an industrial gas business in Russia. The company paid $655
million of dividends and repurchased $459 million of stock, net of issuances.
For the fourth quarter, net income and diluted earnings per share were $414
million and $1.38, as compared to adjusted amounts of $414 million and $1.36
in the prior-year quarter, respectively.*
Sales in the fourth quarter were $2,799 million, comparable to the prior-year,
as higher price and acquisitions were offset by negative currency effects.
Operating profit in the fourth quarter was $616 million versus $619 million in
the prior-year quarter.*
Commenting on the financial results and business outlook, chairman and chief
executive officer Steve Angel said, “In 2012, Praxair delivered record
operating cash flow of $2.8 billion, which represented 25% of sales. We also
achieved a record operating margin of 22.3%, which we achieved through global
productivity gains as well as price attainment in most operating segments. Our
industry-leading North American business achieved double-digit operating
profit growth with strength across most end markets. These strong results were
mitigated by recessions in Brazil and Europe, moderating growth in China, and
significant currency translation headwinds.
“As we enter 2013, Praxair remains committed to driving performance in an
uncertain economic environment. In addition, our backlog of large projects
remains strong at $2.6 billion and new proposal activity remains solid. This
backlog will contribute 4% to 6% growth in 2013, as the plants start up to
supply on-site customers under long-term contracts.”
For the full year of 2013, Praxair expects sales in the area of $12 billion.
The company expects diluted earnings per share to be in the range of $5.85 to
$6.10, up 5% to 10%.* Full-year capital expenditures are expected to be in the
range of $1.8 to $2.0 billion, and the effective tax rate is forecasted to
remain at about 28%.
For the first quarter of 2013, Praxair expects diluted earnings per share in
the range of $1.35 to $1.40.
Following is additional detail on fourth-quarter 2012 results by segment.
In North America, fourth-quarter sales were $1,416 million, up 2% from the
prior-year quarter. Sales grew to manufacturing, energy, and metals markets,
partially offset by declines in electronics. Operating profit of $367 million
grew 4% from the prior year due to price and productivity.
In Europe, fourth-quarter sales were $363 million, 5% below the prior-year
quarter primarily due to the negative impact of currency translation.
Operating profit was $60 million in the quarter, as compared to $64 million in
the prior-year quarter primarily due to negative currency effects.
In South America, fourth-quarter sales were $484 million, 9% below the
prior-year quarter. Operating profit was $92 million as compared to $118
million in the prior-year period. The lower sales and operating profit as
compared to the prior year were due primarily to negative currency effects.
Sales in Asia were $374 million in the quarter, up 12% from the prior year,
driven by strong volume growth in India, China, and Korea, including new plant
start-ups. Sales growth came primarily from metals and chemicals customers.
Operating profit was $69 million as compared to $60 million in the prior year,
due primarily to higher volumes.
Praxair Surface Technologies had fourth-quarter sales of $162 million,
compared to $160 million in the prior-year quarter. Sales grew 3%, excluding
negative currency effects, primarily from higher jet-engine and energy
coatings. Operating profit increased to $28 million from $24 million in the
quarter due primarily to price and productivity.
Praxair is the largest industrial gases company in North and South America,
and one of the largest worldwide. The company produces, sells and distributes
atmospheric and process gases, and high-performance surface coatings. Praxair
products, services and technologies are making the planet more productive by
bringing efficiency and environmental benefits to a wide variety of
industries, including aerospace, chemicals, food and beverage, electronics,
energy, healthcare, manufacturing, metals and others. More information on
Praxair is available on the Internet at www.praxair.com.
*See the attachments for calculations of non-GAAP measures. Full-year 2012
results are adjusted to exclude cost reduction charges, a pension settlement
charge and an income tax benefit. Fourth-quarter and full-year 2011 results
are adjusted to exclude the Yara acquisition net gain and restructuring
charges.
Attachments: Non-GAAP Reconciliations, Statements of Income, Balance Sheets,
Statements of Cash Flows, Segment Information, Quarterly Financial Summary,
and Appendix: Non-GAAP Measures.
A teleconference on Praxair’s fourth-quarter results is being held this
morning, January 23, at 11:00 am Eastern Time. The number is (617) 597-5346 --
Passcode: 52650064. The call also is available as a web cast at
www.praxair.com/investors. Materials to be used in the teleconference are also
available.
This document contains “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements are based
on management’s reasonable expectations and assumptions as of the date the
statements are made but involve risks and uncertainties. These risks and
uncertainties include, without limitation: the performance of stock markets
generally; developments in worldwide and national economies and other
international events and circumstances; changes in foreign currencies and in
interest rates; the cost and availability of electric power, natural gas and
other raw materials; the ability to achieve price increases to offset cost
increases; catastrophic events including natural disasters, epidemics and acts
of war and terrorism; the ability to attract, hire, and retain qualified
personnel; the impact of changes in financial accounting standards; the impact
of changes in pension plan liabilities; the impact of tax, environmental,
healthcare and other legislation and government regulation in jurisdictions in
which the company operates; the cost and outcomes of investigations,
litigation and regulatory proceedings; continued timely development and market
acceptance of new products and applications; the impact of competitive
products and pricing; future financial and operating performance of major
customers and industries served; the impact of information technology system
failures, network disruptions and breaches in data security; and the
effectiveness and speed of integrating new acquisitions into the business.
These risks and uncertainties may cause actual future results or circumstances
to differ materially from the projections or estimates contained in the
forward-looking statements. Additionally, financial projections or estimates
exclude the impact of special items which the company believes are not
indicative of ongoing business performance. The company assumes no obligation
to update or provide revisions to any forward-looking statement in response to
changing circumstances. The above listed risks and uncertainties are further
described in Item 1A (Risk Factors) in the company’s Form 10-K and 10-Q
reports filed with the SEC which should be reviewed carefully. Please consider
the company’s forward-looking statements in light of those risks.
PRAXAIR, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATIONS
(UNAUDITED)
The following Non-GAAP measures are intended to supplement an understanding of
the company's financial statements by providing measures which investors,
financial analysts and management use to help evaluate the company's operating
performance. Items which the company does not believe to be indicative of
on-going business trends are excluded from these calculations so that
investors can better evaluate and analyze historical and future business
trends on a consistent basis. Definitions of these non-GAAP measures may not
be comparable to similar definitions used by other companies and are not a
substitute for similar GAAP measures.
(Millions of dollars, except per share amounts)
Operating Profit Income Taxes Net Income - Praxair, Diluted EPS
Inc.
2012 2011 2012 2011 2012 2011 2012 2011
Quarter
Ended
December 31,
Reported $ 616 $ 618 $ 162 $ 156 $ 414 $ 420 $ 1.38 $ 1.38
GAAP amounts
Non-GAAP
adjustments:
Gain on
acquisition - (39 ) - (3 ) - (37 ) - (0.12 )
(a)
Cost
reduction - 40 - 9 - 31 - 0.10
program (b)
Total - 1 - 6 - (6 ) - (0.02 )
adjustments
Adjusted $ 616 $ 619 $ 162 $ 162 $ 414 $ 414 $ 1.38 $ 1.36
amounts
Year Ended
December 31,
Reported $ 2,437 $ 2,468 $ 586 $ 641 $ 1,692 $ 1,672 $ 5.61 $ 5.45
GAAP amounts
Non-GAAP
adjustments:
Gain on
acquisition - (39 ) - (3 ) - (37 ) - (0.12 )
(a)
Cost
reduction 56 40 16 9 38 31 0.12 0.10
programs (b)
Pension
settlement 9 - 3 - 6 - 0.02 -
charge (c)
Income tax - - 55 - (55 ) - (0.18 ) -
benefit (d)
Total 65 1 74 6 (11 ) (6 ) (0.04 ) (0.02 )
adjustments
Adjusted $ 2,502 $ 2,469 $ 660 $ 647 $ 1,681 $ 1,666 $ 5.57 $ 5.43
amounts
(a) Net gain on Praxair's acquisition of an additional 16% of Yara Praxair AS
and consolidation effective October 2011. Accounting rules require Praxair to
fair value its prior 50% ownership interest.
(b) Charges in the third quarter 2012 and fourth quarter 2011 related to
severance and business restructuring actions primarily in Europe within the
industrial gases and surface technologies businesses.
(c) A pension settlement charge was recorded in the 2012 third quarter related
to lump sum benefit payments made from the U.S. supplemental pension plan to a
number of recently retired senior managers.
(d) Income tax benefit related to a loss on a liquidated subsidiary as a
result of the divestiture of the U.S. Homecare business.
PRAXAIR, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Millions of dollars, except per share data)
(UNAUDITED)
Quarter Ended Year to Date
December 31, December 31,
2012 2011 2012 2011
SALES $ 2,799 $ 2,796 $ 11,224 $ 11,252
Cost of sales 1,583 1,598 6,396 6,458
Selling,
general and 319 315 1,270 1,239
administrative
Depreciation
and 254 249 1,001 1,003
amortization
Research and 25 23 98 90
development
Cost reduction
programs and - 1 65 1
other charges
Other income
(expense) - (2 ) 8 43 7
net
OPERATING 616 618 2,437 2,468
PROFIT
Interest 35 38 141 145
expense - net
INCOME BEFORE
INCOME TAXES 581 580 2,296 2,323
AND EQUITY
INVESTMENTS
Income taxes 162 156 586 641
INCOME BEFORE
EQUITY 419 424 1,710 1,682
INVESTMENTS
Income from
equity 9 7 34 40
investments
NET INCOME
(INCLUDING 428 431 1,744 1,722
NONCONTROLLING
INTERESTS)
Less:
noncontrolling (14 ) (11 ) (52 ) (50 )
interests
NET INCOME - $ 414 $ 420 $ 1,692 $ 1,672
PRAXAIR, INC.
PER SHARE DATA
- PRAXAIR,
INC.
SHAREHOLDERS
Basic earnings $ 1.40 $ 1.40 $ 5.67 $ 5.53
per share
Diluted
earnings per $ 1.38 $ 1.38 $ 5.61 $ 5.45
share
Cash dividends $ 0.55 $ 0.50 $ 2.20 $ 2.00
WEIGHTED
AVERAGE SHARES
OUTSTANDING
Basic shares
outstanding 296,887 299,575 298,316 302,237
(000's)
Diluted shares
outstanding 300,224 303,700 301,845 306,722
(000's)
PRAXAIR, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Millions of dollars)
(UNAUDITED)
December 31, December 31,
2012 2011
ASSETS
Cash and cash equivalents $ 157 $ 90
Accounts receivable - net 1,834 1,795
Inventories 476 456
Prepaid and other current 325 266
assets
TOTAL CURRENT ASSETS 2,792 2,607
Property, plant and equipment 11,453 10,131
- net
Goodwill 2,507 2,372
Other intangibles - net 173 167
Other long-term assets 1,165 1,079
TOTAL ASSETS $ 18,090 $ 16,356
LIABILITIES AND EQUITY
Accounts payable $ 928 $ 896
Short-term debt 638 337
Current portion of long-term 39 387
debt
Other current liabilities 874 915
TOTAL CURRENT LIABILITIES 2,479 2,535
Long-term debt 6,685 5,838
Other long-term liabilities 2,253 1,966
TOTAL LIABILITIES 11,417 10,339
REDEEMABLE NONCONTROLLING 252 220
INTERESTS
EQUITY
Praxair, Inc. shareholders' 6,064 5,488
equity
Noncontrolling interests 357 309
TOTAL EQUITY 6,421 5,797
TOTAL LIABILITIES AND EQUITY $ 18,090 $ 16,356
PRAXAIR, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Millions of dollars)
(UNAUDITED)
Quarter Ended Year to Date
December 31, December 31,
2012 2011 2012 2011
OPERATIONS
Net income - $ 414 $ 420 $ 1,692 $ 1,672
Praxair, Inc.
Noncontrolling 14 11 52 50
interests
Net income
(including 428 431 1,744 1,722
noncontrolling
interests)
Adjustments to
reconcile net
income to net cash
provided by
operating
activities:
Cost reduction
programs and other (9 ) (5 ) 43 (5 )
charges, net of
payments
Deferred income 56 (36 ) 258 (3 )
taxes
Depreciation and 254 249 1,001 1,003
amortization
Accounts receivable 71 94 (36 ) (108 )
Inventory 12 12 (18 ) (31 )
Payables and 41 92 (34 ) 44
accruals
Pension (72 ) (7 ) (184 ) (94 )
contributions
Other 98 (39 ) (22 ) (73 )
Net cash provided
by operating 879 791 2,752 2,455
activities
INVESTING
Capital (586 ) (572 ) (2,180 ) (1,797 )
expenditures
Acquisitions, net (171 ) (195 ) (280 ) (294 )
of cash acquired
Divestitures and 5 46 82 86
asset sales
Net cash used for
investing (752 ) (721 ) (2,378 ) (2,005 )
activities
FINANCING
Debt increase 224 189 807 914
(decrease) - net
Issuances of common 38 31 164 195
stock
Purchases of common (185 ) (179 ) (623 ) (937 )
stock
Cash dividends -
Praxair, Inc. (163 ) (149 ) (655 ) (602 )
shareholders
Excess tax benefit
on stock option 10 6 60 53
exercises
Noncontrolling
interest (1 ) 1 (56 ) (3 )
transactions and
other
Net cash provided
by (used for) (77 ) (101 ) (303 ) (380 )
financing
activities
Effect of exchange
rate changes on (1 ) (4 ) (4 ) (19 )
cash and cash
equivalents
Change in cash and 49 (35 ) 67 51
cash equivalents
Cash and cash
equivalents, 108 125 90 39
beginning-of-period
Cash and cash
equivalents, $ 157 $ 90 $ 157 $ 90
end-of-period
PRAXAIR, INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(Millions of dollars)
(UNAUDITED)
Quarter Ended Year to Date
December 31, December 31,
2012 2011 (a) 2012 2011 (a)
SALES
North $ 1,416 $ 1,388 $ 5,598 $ 5,490
America
Europe 363 382 1,474 1,458
South 484 532 2,082 2,308
America
Asia 374 334 1,414 1,348
Surface 162 160 656 648
Technologies
Total sales $ 2,799 $ 2,796 $ 11,224 $ 11,252
OPERATING
PROFIT
North $ 367 $ 353 $ 1,465 $ 1,331
America
Europe 60 64 256 272
South 92 118 429 530
America
Asia 69 60 246 234
Surface 28 24 106 102
Technologies
Segment
operating 616 619 2,502 2,469
profit
Cost
reduction
programs and - (1 ) (65 ) (1 )
other
charges
Total
operating $ 616 $ 618 $ 2,437 $ 2,468
profit
Effective with the 2012 first quarter, Praxair changed the measurement
of its segment sales and operating profit. These changes primarily
relate to helium and specialty gas sales and result in slightly higher
(a) sales and operating profit in the Europe and Asia segments with
offsetting declines in the North America segment. Prior-period amounts
have been reclassified to conform to the current presentation. See the
Investors section of Praxair's website for a summary of the
remeasurement adjustments for 2011 and 2010.
PRAXAIR, INC. AND SUBSIDIARIES
QUARTERLY FINANCIAL SUMMARY
(Millions of dollars, except per share data)
(UNAUDITED)
2012 2011
Q4 Q3 (b) Q2 Q1 Q4 (b) Q3 Q2 Q1
FROM THE INCOME
STATEMENT
Sales $ 2,799 $ 2,774 $ 2,811 $ 2,840 $ 2,796 $ 2,896 $ 2,858 $ 2,702
Cost of sales 1,583 1,595 1,602 1,616 1,598 1,684 1,640 1,536
Selling, general
and 319 306 310 335 315 307 309 308
administrative
Depreciation and 254 248 247 252 249 256 254 244
amortization
Research and 25 24 25 24 23 22 23 22
development
Cost reduction
programs and - 65 - - 1 - - -
other charges -
net
Other income (2 ) 22 9 14 8 5 (5 ) (1 )
(expenses) - net
Operating profit 616 558 636 627 618 632 627 591
Interest expense 35 36 33 37 38 36 36 35
- net
Income taxes 162 90 169 165 156 166 163 156
Income from
equity 9 8 10 7 7 13 11 9
investments
Net income
(including 428 440 444 432 431 443 439 409
noncontrolling
interests)
Less:
noncontrolling (14 ) (10 ) (15 ) (13 ) (11 ) (14 ) (14 ) (11 )
interests
Net income - $ 414 $ 430 $ 429 $ 419 $ 420 $ 429 $ 425 $ 398
Praxair, Inc.
PER SHARE DATA -
PRAXAIR, INC.
SHAREHOLDERS
Diluted earnings $ 1.38 $ 1.43 $ 1.42 $ 1.38 $ 1.38 $ 1.40 $ 1.38 $ 1.29
per share
Cash dividends $ 0.55 $ 0.55 $ 0.55 $ 0.55 $ 0.50 $ 0.50 $ 0.50 $ 0.50
per share
Diluted weighted
average shares 300,224 301,731 302,492 302,876 303,700 305,623 308,253 308,595
outstanding
(000's)
FROM THE BALANCE
SHEET
Net debt (a) $ 7,205 $ 7,028 $ 6,891 $ 6,749 $ 6,472 $ 6,185 $ 6,039 $ 5,752
Capital (a) $ 13,878 $ 13,617 $ 13,017 $ 13,248 $ 12,489 $ 12,306 $ 12,809 $ 12,289
Debt-to-capital 51.9 % 51.6 % 52.9 % 50.9 % 51.8 % 50.3 % 47.1 % 46.8 %
ratio (a)
FROM THE
STATEMENT OF
CASH FLOWS
Cash flow from $ 879 $ 746 $ 725 $ 402 $ 791 $ 732 $ 573 $ 359
operations
Capital 586 547 564 483 572 458 433 334
expenditures
Acquisitions 171 58 39 12 195 19 80 -
Cash dividends 163 164 164 164 149 150 151 152
OTHER
INFORMATION
After-tax return
on capital (ROC) 13.9 % 14.2 % 14.5 % 14.6 % 14.8 % 14.8 % 14.7 % 14.6 %
(a)
Return on
Praxair, Inc. 28.9 % 29.2 % 29.0 % 28.4 % 28.1 % 27.2 % 26.6 % 26.6 %
shareholders'
equity (ROE) (a)
Adjusted
earnings before
interest, taxes,
depreciation and $ 879 $ 879 $ 893 $ 886 $ 875 $ 901 $ 892 $ 844
amortization
(adjusted
EBITDA) (a)
Debt-to-adjusted 1.9 1.9 1.8 1.8 1.7 1.7 1.6 1.6
EBITDA ratio (a)
Number of 26,539 26,215 26,353 26,259 26,184 25,793 25,678 25,482
employees
SEGMENT DATA (c)
SALES
North America $ 1,416 $ 1,391 $ 1,393 $ 1,398 $ 1,388 $ 1,416 $ 1,361 $ 1,325
Europe 363 352 382 377 382 361 370 345
South America 484 516 520 562 532 607 611 558
Asia 374 358 348 334 334 349 348 317
Surface 162 157 168 169 160 163 168 157
Technologies
Total sales $ 2,799 $ 2,774 $ 2,811 $ 2,840 $ 2,796 $ 2,896 $ 2,858 $ 2,702
OPERATING PROFIT
North America $ 367 $ 374 $ 363 $ 361 $ 353 $ 340 $ 326 $ 312
Europe 60 60 68 68 64 68 72 68
South America 92 112 110 115 118 140 139 133
Asia 69 52 68 57 60 58 63 53
Surface 28 25 27 26 24 26 27 25
Technologies
Segment 616 623 636 627 619 632 627 591
operating profit
Cost reduction
programs and - (65 ) - - (1 ) - - -
other charges -
net
Total operating $ 616 $ 558 $ 636 $ 627 $ 618 $ 632 $ 627 $ 591
profit
(a) Non-GAAP measure, see Appendix.
The third quarter 2012 includes: (i)a pre-tax charge of $56 million ($38
million after-tax and non-controlling interests, or $0.12 per diluted
share) related to the 2012 cost reduction program; (ii) a pre-tax charge
of $9 million ($6 million after-tax, or $0.02 per diluted share) related
to pension settlement; and (iii) an income tax benefit of $55 million,
or $0.18 per diluted share, related to a loss on a liquidated subsidiary
(b) as a result of the divestiture of the U.S. Homecare business. The fourth
quarter 2011 includes: (i) a pre-tax gain of $39 million ($37 million
after-tax and noncontrolling interests, or $0.12 per diluted share)
related to a gain on acquisition; and (ii) a pre-tax charge of $40
million ($31 million after-tax, or $0.10 per diluted share) related to
the 2011 cost reduction program. Also, see the Appendix - Non-GAAP
Measures which provides Non-GAAP amounts that exclude the impact of
these items.
Effective with the 2012 first quarter, Praxair changed the measurement
(c) of its segment sales and operating profit. Prior period amounts have
been reclassified to conform to the current presentation. See segment
information.
PRAXAIR, INC. AND SUBSIDIARIES
APPENDIX
NON-GAAP MEASURES
(Millions of dollars, except per share data)
The following non-GAAP measures are intended to supplement an understanding of
the company’s financial information by providing measures which investors,
financial analysts and management use to help evaluate the company’s financing
leverage, return on net assets employed and operating performance. Items which
the company does not believe to be indicative of on-going business trends are
excluded from these calculations so that investors can better evaluate and
analyze historical and future business trends on a consistent basis.
Definitions of these non-GAAP measures may not be comparable to similar
definitions used by other companies and are not a substitute for similar GAAP
measures. Adjusted amounts exclude the impact of the 2012 third-quarter cost
reduction program, pension settlement charge, and an income tax benefit; the
2011 fourth-quarter gain on acquisition and cost reduction program; and the
2010 first-quarter loss on Venezuela currency devaluation and the 2010
fourth-quarter loss on the U.S. Homecare divestiture, Spanish income tax
settlement and repatriation tax benefit.
To be more consistent with the methodology used for annual reporting and to
improve comparability, effective in the third quarter 2012 the company changed
the methodology that it uses for calculating the following non-GAAP measures:
Debt to capital, After-tax ROC, ROE, Debt-to-Adjusted EBITDA. These
calculations are now based on a rolling four quarters approach for the
earnings component of the calculations (NOPAT, Net income- Praxair, Inc.,
Adjusted EBITDA) and a five quarter average for the balance sheet component of
the calculation (capital, equity, debt). In addition, the company decided to
use net debt instead of debt in the new calculations. Net debt is defined as
debt less cash and cash equivalents. Prior-period amounts have been adjusted
to conform to the current methodology.
2012 2011 2010
Year Q4 Q3 Q2 Q1 Year Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1
Debt to Capital Ratio - The debt-to-capital ratio is a measure used by investors, financial analysts and management to provide a measure of financial leverage and insights into how the company is
financing its operations.
Debt $ 7,362 $ 7,136 $ 6,995 $ 6,856 $ 6,562 $ 6,310 $ 6,119 $ 5,838 $ 5,557 $ 5,077 $ 5,026 $ 5,404
Less: cash and (157 ) (108 ) (104 ) (107 ) (90 ) (125 ) (80 ) (86 ) (39 ) (71 ) (48 ) (376 )
cash equivalents
Net debt 7,205 7,028 6,891 6,749 6,472 6,185 6,039 5,752 5,518 5,006 4,978 5,028
Equity and
redeemable
noncontrolling
interests:
Redeemable
noncontrolling 252 243 232 232 220 - - - - - - -
interests
Praxair, Inc.
shareholders' 6,064 6,015 5,615 5,940 5,488 5,753 6,400 6,165 5,792 5,991 5,452 5,398
equity
Noncontrolling 357 331 279 327 309 368 370 372 353 339 315 332
interests
Total equity and
redeemable 6,673 6,589 6,126 6,499 6,017 6,121 6,770 6,537 6,145 6,330 5,767 5,730
noncontrolling
interests
Capital $ 13,878 $ 13,617 $ 13,017 $ 13,248 $ 12,489 $ 12,306 $ 12,809 $ 12,289 $ 11,663 $ 11,336 $ 10,745 $ 10,758
Debt-to-capital 51.9 % 51.6 % 52.9 % 50.9 % 51.8 % 50.3 % 47.1 % 46.8 % 47.3 % 44.2 % 46.3 % 46.7 %
After -tax return on Capital (ROC) - After-tax return on capital is a measure used by investors, financial analysts and management to evaluate the return on net assets employed in the business. ROC
measures the after-tax operating profit that the company was able to generate with the investments made by all parties in the business (debt, noncontrolling interests and Praxair, Inc. shareholders’
equity).
Adjusted
operating profit $ 2,502 $ 616 $ 623 $ 636 $ 627 $ 2,469 $ 619 $ 632 $ 627 $ 591 $ 563 $ 551 $ 547 $ 506
(a)
Less: adjusted (660 ) (162 ) (164 ) (169 ) (165 ) (647 ) (162 ) (166 ) (163 ) (156 ) (149 ) (146 ) (145 ) (132 )
income taxes (a)
Less: tax
benefit on (39 ) (10 ) (10 ) (9 ) (10 ) (41 ) (11 ) (10 ) (10 ) (10 ) (8 ) (8 ) (8 ) (9 )
interest expense
Add: income from
equity 34 9 8 10 7 40 7 13 11 9 11 12 8 7
investments
Adjusted net
operating profit $ 1,837 $ 453 $ 457 $ 468 $ 459 $ 1,821 $ 453 $ 469 $ 465 $ 434 $ 417 $ 409 $ 402 $ 372
after-tax
(NOPAT)
4-quarter
trailing $ 1,837 $ 1,837 $ 1,849 $ 1,846 $ 1,821 $ 1,785 $ 1,725 $ 1,662
adjusted NOPAT
Ending capital $ 13,878 $ 13,878 $ 13,617 $ 13,017 $ 13,248 $ 12,489 $ 12,489 $ 12,306 $ 12,809 $ 12,289 $ 11,663 $ 11,336 $ 10,745 $ 10,758
(see above)
5-quarter
average ending $ 13,250 $ 13,250 $ 12,935 $ 12,774 $ 12,628 $ 12,311 $ 12,311 $ 12,081 $ 11,768 $ 11,358
capital
After-tax ROC
(4-quarter
trailing NOPAT / 13.9 % 13.9 % 14.2 % 14.5 % 14.6 % 14.8 % 14.8 % 14.8 % 14.7 % 14.6 %
5-quarter
average capital)
Return on Praxair, Inc. Shareholder's equity (ROE) - Return on Praxair, Inc. shareholders' equity is a measure used by investors, financial analysts and management to evaluate operating performance from a
Praxair shareholder perspective. ROE measures the net income attributable to Praxair, Inc. that the company was able to generate with the money shareholders have invested.
Adjusted net
income - $ 1,681 $ 414 $ 419 $ 429 $ 419 $ 1,666 $ 414 $ 429 $ 425 $ 398 $ 388 $ 377 $ 371 $ 340
Praxair, Inc.
(a)
4-quarter
trailing
adjusted net $ 1,681 $ 1,681 $ 1,691 $ 1,687 $ 1,666 $ 1,640 $ 1,588 $ 1,534
income -
Praxair, Inc.
(a)
Ending Praxair,
Inc. $ 6,064 $ 6,064 $ 6,015 $ 5,615 $ 5,940 $ 5,488 $ 5,488 $ 5,753 $ 6,400 $ 6,165 $ 5,792 $ 5,991 $ 5,452 $ 5,398
shareholders'
equity
5-quarter
average Praxair $ 5,824 $ 5,824 $ 5,762 $ 5,839 $ 5,949 $ 5,920 $ 5,920 $ 6,020 $ 5,960 $ 5,760
shareholders'
equity
ROE (4-quarter
trailing
adjusted net
income -
Praxair, Inc. / 28.9 % 28.9 % 29.2 % 29.0 % 28.4 % 28.1 % 28.1 % 27.2 % 26.6 % 26.6 %
5-quarter
average Praxair
shareholders'
equity)
Adjusted EBITDA and Debt-to-Adjusted EBITDA Ratio - These measures are used by investors, financial analysts and management to assess a company's ability to meet it's financial obligations.
Adjusted net
income - $ 1,681 $ 414 $ 419 $ 429 $ 419 $ 1,666 $ 414 $ 429 $ 425 $ 398 $ 388 $ 377 $ 371 $ 340
Praxair, Inc.
(a)
Add: adjusted
noncontrolling 54 14 12 15 13 51 12 14 14 11 9 11 10 9
interests (a)
Add: interest 141 35 36 33 37 145 38 36 36 35 28 29 29 32
expense - net
Add: adjusted 660 162 164 169 165 647 162 166 163 156 149 146 145 132
income taxes (a)
Add:
depreciation and 1,001 254 248 247 252 1,003 249 256 254 244 240 227 230 228
amortization
Adjusted EBITDA $ 3,537 $ 879 $ 879 $ 893 $ 886 $ 3,512 $ 875 $ 901 $ 892 $ 844 $ 814 $ 790 $ 785 $ 741
4-quarter
trailing $ 3,537 $ 3,533 $ 3,555 $ 3,554 $ 3,512 $ 3,451 $ 3,340 $ 3,233
adjusted EBITDA
Ending net debt $ 7,205 $ 7,205 $ 7,028 $ 6,891 $ 6,749 $ 6,472 $ 6,472 $ 6,185 $ 6,039 $ 5,752 $ 5,518 $ 5,006 $ 4,978 $ 5,028
(see above)
5-quarter $ 6,869 $ 6,869 $ 6,665 $ 6,467 $ 6,239 $ 5,993 $ 5,993 $ 5,700 $ 5,459 $ 5,256
average net debt
Debt-to-adjusted
EBITDA ratio
(5-quarter
average net debt 1.9 1.9 1.9 1.8 1.8 1.7 1.7 1.7 1.6 1.6
/ 4-quarter
trailing
adjusted EBITDA)
APPENDIX - Cont'd
The following table presents adjusted amounts for Operating Profit and
Operating Profit Margin, Income Taxes, Effective Tax Rate,
Noncontrolling Interests, Net income - Praxair, Inc., and Diluted EPS
(a) for the Third Quarter and full year 2012, the Fourth Quarter and full
year 2011 and the First Quarter, Fourth Quarter and full year 2010.
Additionally, this table presents the percentage change in Diluted EPS
Guidance for the full year 2012.
Third Fourth Fourth First
Year Year Year
Quarter Quarter Quarter Quarter
2012 2012 2011 2011 2010 2010 2010
Adjusted
Operating
Profit and
Operating
Profit Margin
Reported
operating $ 2,437 $ 558 $ 2,468 $ 618 $ 2,082 $ 505 $ 479
profit
Add: Pension
settlement 9 9 - - - - -
charge
Add: Cost
reduction 56 56 40 40 - - -
programs
Less: Gain on - - (39 ) (39 ) - - -
acquisition
Add: U.S.
Homecare - - - - 58 58 -
divestiture
Add: Venezuela
currency - - - - 27 - 27
devaluation
Total 65 65 1 1 85 58 27
adjustments
Adjusted
operating $ 2,502 $ 623 $ 2,469 $ 619 $ 2,167 $ 563 $ 506
profit
Reported sales $ 11,224 $ 2,774 $ 11,252 $ 2,796 $ 10,116 $ 2,623 $ 2,428
Adjusted
operating 22.3 % 22.5 % 21.9 % 22.1 % 21.4 % 21.5 % 20.8 %
profit margin
Adjusted
Income Taxes
Reported $ 586 $ 90 $ 641 $ 156 $ 768 $ 346 $ 131
income taxes
Add: Pension
settlement 3 3 - - - - -
charge
Add: Income 55 55 - - - - -
tax benefit
Add: Cost
reduction 16 16 9 9 - - -
programs
Less: Gain on - - (3 ) (3 ) - - -
acquisition
Less: Spanish
income tax - - - - (250 ) (250 ) -
settlement
Add: U.S.
Homecare - - - - 18 18 -
divestiture
Add:
Repatriation - - - - 35 35 -
tax benefit
Add: Venezuela
currency - - - - 1 - 1
devaluation
Total 74 74 6 6 (196 ) (197 ) 1
adjustments
Adjusted $ 660 $ 164 $ 647 $ 162 $ 572 $ 149 $ 132
income taxes
Adjusted
Effective Tax
Rate
Reported
income before
income taxes $ 2,296 $ 522 $ 2,323 $ 580 $ 1,964 $ 477 $ 447
and equity
investments
Add: Pension
settlement 9 9 - - - - -
charge
Add: Cost
reduction 56 56 40 40 - - -
programs
Less: Gain on - - (39 ) (39 ) - - -
acquisition
Add: U.S.
Homecare - - - - 58 58 -
divestiture
Add: Venezuela
currency - - - - 27 - 27
devaluation
Total 65 65 1 1 85 58 27
adjustments
Adjusted
income before
income taxes $ 2,361 $ 587 $ 2,324 $ 581 $ 2,049 $ 535 $ 474
and equity
investments
Adjusted
income taxes $ 660 $ 164 $ 647 $ 162 $ 572 $ 149 $ 132
(above)
Adjusted
effective tax 28 % 28 % 28 % 28 % 28 % 28 % 28 %
rate
Adjusted
Noncontrolling
interest
Reported
noncontrolling $ 52 $ 10 $ 50 $ 11
interest
Add: Cost
reduction 2 2 - -
programs
Add: Gain on - - 1 1
acquisition
Total 2 2 51 12
adjustments
Adjusted
noncontrolling $ 54 $ 12 $ 51 $ 12
interest
Adjusted Net
Income -
Praxair, Inc.
Reported net
income - $ 1,692 $ 430 $ 1,672 $ 42 $ 1,195 $ 133 $ 314
Praxair, Inc.
Add: Pension
settlement 6 6 - - - - -
charge
Less: Income (55 ) (55 ) - - - - -
tax benefit
Add: Cost
reduction 38 38 31 31 - - -
programs
Less: Gain on - - (37 ) (37 ) - - -
acquisition
Add: Spanish
income tax - - - - 250 250 -
settlement
Add: U.S.
Homecare - - - - 40 40 -
divestiture
Less:
Repatriation - - - - (35 ) (35 ) -
tax benefit
Add: Venezuela
currency - - - - 26 - 26
devaluation
Total (11 ) (11 ) (6 ) (6 ) 281 255 26
adjustments
Adjusted net
income - $ 1,681 $ 419 $ 1,666 $ 414 $ 1,476 $ 388 $ 340
Praxair, Inc.
Adjusted
Diluted EPS
Reported *Story
diluted EPS $ 5.61 $ 1.43 too
large*
[TRUNCATED]
Sponsored Links
Advertisement
Advertisements
Sponsored Links
Advertisement
Rate this Page