Linde (LIN) 6 Feb 242023 Q4 Earnings call transcript

Ladies and gentlemen, good day, and thank you for standing by. Welcome to the Linde Full Year and Fourth Quarter 2023 Earnings Teleconference and Webcast. 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. sir. ahead, go Please

this Good presentation fourth the and forward-looking section. webcast. quarter of website White, in I'm Pelaez, Abby. Executive linde.com of all Lamba, will X appendix attending will and at are and performance Page Linde's and Officer; this note I'm you read available The then our Please to on statement Head Matt joined and which, disclosure presentation. Relations, after the provide outlook, the applies XXXX earnings Financial it Investor Investors slides remarks, by on and fourth morning, Q&A. you, the Sanjiv thank are Chief Matt statements Officer. Today's everyone, Chief for teleconference. quarter Juan Sanjiv morning materials up Thank the that opening call of our wrap we and on with this in during will financial made some update adjusted give reconciliations of numbers an

me call to now Sanjiv. the turn Let over

and again good to commitments morning, thanks XXXX challenges, industry-leading another And measures, was everyone. the from the all once its results. employees By year, world. despite economic and and Linde around hard successful Linde delivered work the on Juan, dedication geopolitical with Thanks,

gas maintain consistently doesn't As with important An results-driven provides rhythm. a daily to rhythm I critical we company. It where performance I've tenet view organization, accident. that a by a areas an industrial X people. a of this culture, said on those Slide starts operating leading to running metrics of shareholder disciplined drive grind is underpinned focus overview value. before, as It's happen across by the this entire

top-notch safe, efficient a who gas reliable have company. and a team We industrial run

I'd results. Supporting environment and we made results. than we reduced good absolute supported is active delivering purchases this maintaining these just communities lip long-term start world employees We've further it Linde. in, workforce highly see our a XXXX, diverse service the world-class all working to of to safety of emissions our around meaningful the like our thank progress for at while operate on During by engaged, our goal pleased towards been progress gas energy hour. external in greenhouse Last year, recognition. I'm X It's acknowledgment terawatt towards our while we and goals, increasing more for decades. renewable

Pacific, around updates have years. Recently, Europe, let key the indeed million confusion the $X the message. it. for some Middle on new backlog to OCI business regarding our next in backup questions We East hydrogen, of project $X future some COX both and been approximately blue day confident $XX industrial billion gas to per the the the sold included there me few help positioned I The happy respond but in to any contracts, standard regulations. IRA will with of which to also while XXX partnering And ExxonMobil with about under growth. U.S., cubic high-quality billion in views. supply will be reiterate I'm We've billion for winning Asia CapEx slide feet produce to be explain and a continue projects sequestration.

green green We to see leverage but we merchant to backlog expect identified to serve I on-site hydrogen these that definition. primarily type since have future criteria. primarily to not hydrogen clean our investment not large credits projects demand, projects our expect XXQ likely any U.S. yet meet will on-site small meet hydrogen midsized projects

have another the new well, position see energy we continue Aside business on-site you'll indeed, evidenced where our projects, base by as small on-site from traditional record. merchant, to clean investments, we

create financial X is After myriad by to through few steward the can for listed of metrics most key We've accomplishments, be I numbers. distracted easy primary a next on management's slide. It's all, management to to a the but a the purpose on metrics believe found value measured. capital. performance be of get be which shareholder important delivered we financial Finally, shareholder can

cannot trend shareholder which or represented chart way shareholder the cases growing them led be leading OCF industry. TSR. X and sustaining combination best sight value the the has members TSR have increase cash objective, my is is best X-year From theoretical the in against in results health capital. ROCE at while industry-leading both value, the X EPS the of deliver total best shows by Each EPS to have And levels ultimate operating Linde to compound some and for creation. the for global growth, wide all investment operating that. can events. We margins unprecedented Linde lose geopolitical margin by conditions despite of However, limits, in all maintained on think charts economic an perspective, including and margin. seasons, leadership operating return, I and these a of and business. superior is growth, them, demonstrate profit to flow volatile while return and demonstrate quality

about graph X-year and slide. you of the Linde So our the S&P XXX the the Index. metrics for about them This shows that next TSR what impacted Well, How on industry find TSR? shareholder? members can to

Linde deliver years, First X XX successive with S&P company for in companies entire observation only positive the our the far sector is do to and X alpha exceeded XXX X that equally has almost of so. double Linde shareholder involved, in to the is return. But all only

Because alpha, financial this, regardless call positive in we've and after our corresponding optimize value culture these During they compensation long-term to reward good organization. at turn value ability of to Linde remain outperformed all color. I'll proven gauge owners. The confident you metrics the our to shareholder over to designed are creation. to walk X of benchmark ways through now continue to how Matt and shareholder creating important correlate bad, our years the X the levels consistently I performance at results. of to and Year programs year, positively TSR the Linde the superior

a sequentially. no Versus sales X X% and and which the prior fourth year, cost Americas, pass-through on X% of X% contractual profit. lower energy effect from provides EMEA prices prior Slide to Sanjiv. Sales in has over summary billion declined results. year quarter due grew of Thanks, $X.X

translation U.S. currency packaged improved project from X% nexAir engineering purchase, gas was X% Foreign backlog a and dollar. execution. Acquisitions X% from from the increased weaker a tailwind

quarter, from were margin. primarily conditions weighted and sales production underlying from these profit higher fourth which stagnant, estimated to a continue contribution above year increased grew sales industrial last items, close as from engineering X% Versus base sequentially softer prices globally volumes, offset been in were project the Excluding the as X% timing. economic prices. flat backlog by X% volumes for track inflation. Year-over-year was the with project was EMEA. the and Operating Underlying third seasonally volumes. Overall, sales $X.X lower billion to weighted flat XX.X% for have our of quarter. as higher in operating countries offset XX% resulted growth was

pass-through, but begin engineering basis percent seasonality low last relates projects. to driven year, from XXX margins are and the EMEA XX sanctioned EMEA trend by cost margins lap impact expanded to normal points and mostly points basis Excluding mid-teens as we to declined run sequentially of but returning from to the operating engineering. The rate

impact also to However, We XX%. future, quarter's expect like devalued over unfavorable results embedded in XXXX. to expand a in margins I onetime Argentinian global the to this peso, related I'd the still point out operating which including

$X.XX allocation the to income country, As it recover recorded than another $XX provides on and million sequential on a the reflected total million was detail to the year primarily expect devaluation the of seasonal impacts finished and interest fully X We other as translation of base of profit Slide is $XX Americas further a pricing XX% The $X.XX a stewardship, capital operating inflation, over impact decline this interest. cash healthy Linde's line pricing driven was exception. only to backlog as and factors no was above capital net more management flow. charge Return backdrop of by hallmark peso. Disciplined XXXX of against operating Argentinian of of XX% the contribution and volumes. the low our lower the should of this sales last full to EBITDA a or ratio enable OCF projects. mid-XX% which year year X% with X% performance. Operating aligns EPS. significant and prior outflows inflation. EPS range. working flow is capital over grew operating of to billion engineering we despite count offset the the local in FX a as has This not hyperinflationary share passed, about in of net future time related lower Most cost summary subsequent down wind cash capital $X.X over to

our to $X.X criteria a On billion you can of share shareholders a a growing the investing all the returned into the sweep our that maintain of approach, much towards with business while just dollar which more we in opportunity billion long-standing in to priority form the and underlying capital to is invest is consistent dividends of repurchases. With investing mandate single while dividend, uses remaining number. capital But than meet policy share $X.X business. see in repurchases, allocation the the which to projects A rating an cash, and right, back

X% One XXXX $XX.XX assumes FX we have X% management is concept there Therefore, of for range. this the growth wrap We the Across ensure EPS XX% if understand or guidance to guidance owners grows, to initiating an most economy important economic can assumed headwind. be take this so well X. we'll responsibilities with at our on maintain capital recession, if of Consistent sleep with year integrated risk-weighted at night. I'll to is actions culture into upside. And and no We're Linde, the there this approach, an a Slide up it to return. at when improvement excluding the midpoint. appropriate prior $XX.XX is invested full would

of translates $X.XX excluding EPS a $X.XX this quarter, FX. X% to first X% the growth, to range or For to

the aren't seasonal in traditionally assumption to While due the full factors. February. first the to Heroes our quarter is economic similar lightest year, is made

early believe to remain appropriate it's the we cautious year. this in So

that Q&A. However, the we investors XXXX brings, what regardless will turn can assured to now I'll over to what create rest most matters value. call manage shareholder of

first from Goldman We take will Instructions] our [Operator Fisher with question Duffy Sachs.

and We China, and markets electronics? crosscurrents electronics. of us also around the from kind what there different Could getting you Question just you end for industrial of as production, the be companies as half outlook view both industrial what different to outlook kind report first seem both share they your on with is.

a a Why start possible course, by our market of various of across baseline. that about Sure, and total customers off profits, just X% And I Duffy. have. sales don't that China is quick spread every reminder is we in just that, as end

spoken about China recall, there. and would recovery and weakness you So over we've slow

months X this little a that as bit seeing being now. I as also, softer, year, surprise. result expect a at that, already, to. And China you least we've some X for think fact. to been of actions of really us should taken come of and country last in from tracked in all none of kind We've a as We've the would

already So in that's place. all of

Now about the XXXX. for let's outlook talk

industrials as seen momentum. to most for as about it we some We give part. through carry As of sense said, just walk through far see go, XXXX of what's a we've end the I'll a same you going markets on. talked last into year. We you lack

construction is the think a off market and Some I recovery don't a the pace shrinking reasonable QX. which broadly, pickup start maybe it in that towards second little towards a are weighed to. In would have other market a a slower. about of talking first chemicals -- little the at shape, at been that a been in, recovering has kind has see minor let maybe is, half for by while. of to bit a is It markets, of was down But we They the we year have stronger end fact bit course, me quite and China solid then a major just did expect than half. Steel, expected but which all the others, with. mention this we've in been we

steel crude QX about shrank In fact, in X%.

around and to hold you It foreseen Some the the anything will. Don't annual property not driven capacities, recovery is of market to because in control that happen if is expect administrative steel. market they on their wanted on to was property XXXX. really

lackluster, expect some large growth part but we Batteries So muddy up little to bit QX, instance, up that. most a well. year. spots EV, are have along about of Manufacturing that. Automobile, part generally some for this shown steel a bright of XX%. has in a bit good just there within for as been

as bit little been beyond say, a up I'd cells, manufacturing Solar this, Other has that. flattish than largely well. again,

is out As in kind the geopolitical as more happening a concerned, far comes about on saw watch risk about a is QX. of little escalation electronics that electronics recovery less electronics capacities bit what the to is view Again, China the thing probably in see of And in in of in watch and will remember, half the half, again, this is what we'll happens. time. second point the in just year to with have recovery our you particular first see at through mild continued electronics then and and

we take with And Leithead Barclays. question will Mike our from next

Sanjiv, quarter helium expect can how XXXX? in into your you to trend that performed market fourth business speak you'd how and the to

world. just So market look lot a broadly, excitement I'm Linde. When around at bit of that. Mike, of very been again in apparently you revenues less and a the But just more reminding or single-digit is start Helium, anyway, by balance see the little me there's surprised I off by let just the low I kind for across market

short there. We Middle East, out which imbalances that exacerbate might further. regional imbalances shipping, particular, them regional are impact logistical and slightly in see a there the Now do others challenges some regions There developing are long. some bit are little of some and in

QX as steady single-digit Again, mention. worthy and far concerned, stable. pricing of not we As while saw in was was volumes very declines low

will it the side us will more might do helium didn't My bit more on is of and be will markets remain it volumes terms largely mention electronics that are And balanced. There pressure. expectation of anywhere. which little what track on kind in You care long, really a mirror you see recovery. broadly, feel XXXX

Society our Peter take next Generale. from will Clark We question with

from volumes I want pricing jump really. to to

inflation fact, tracking obviously, pretty the You well. local you're the to alluded

EMEA costs sequential You've again. When your a went is I as the flattish. against price of X-year but Americas course, inflation know there, cost there's off. QX. coming actually in up stack, off. do was bucket coming QX But got are probably I local

into the say to I'm Just no like that assuming margins effectively, wondering you're are it very, reason feel 'XX. see any going secure how difference. But you trending here. does see very to

tell So Really, couple what a of you am to to point I yourself. just Peter, anything to going I reason I'll XXXX. think reiteration. question different maybe in saw you've answered see the of points no we a as make

to pricing The that early first, again, that seen this you best mentioned for well. proxy now. seems track globally inflation. many And over on. The is weighted I think reasonably our years We've

It's we'll is make, we've seen last we even I So pricing inflation talk my you should expect robust disinflation pricing us higher pricing so management and parts other to despite year, continue to see pricing discipline or actions is do probably levels in produce are that only that fact though as we about world, action. think, take, this seeing pricing is think, lower makes the I strong follows, expectation And mechanism every decade. The many what I'd that and that us. of they on the we something than for day. that that, being the point for a process

go should see as see XXXX. we into see to continue us improvement and expect in should you which margins, XXXX, to should through You that that some continue in reflected

from And JPMorgan. with we will Zekaukas take Jeff our next question

roughly terms case should industrial outlook you X% producing And Russia it coming up and before. if is comment your for volume your more new was than you then production flat X%? on stream, base helium is whether can of be projects on have In if global now XXXX, or

really, I'll therefore, that, Russia in a a just there. comment that know. we've probably in our on quickly production of on as point happens more is Russia what as that. healing at speculation concerned. There's a this I position were of And previously tell think reserve lot as come far on in Jeff, with we you around And time, to I'll out comment very contracts to that quickly you comment aren't

take just our outlook to to want as back you far I might guidance. is As concerned,

our said we the from kind X you we've know, of guidance we midpoint of As and economy, the that guidance, at see in help the that. maintain

top that backlog contribution. EPS on from contribution on I to we our range. a XXXX. X% point at Your growth backlog see see, for the reminder, that as ranges Again, of X% end that

all other EPS as the by as at a We I'll but obviously and points. And reiterate You then cost well, total level count XXXX. see EPS us us pricing, midpoint growth percent far brings the rest up take as them share what know productivity concerned, of the to a growth management X that's as action is about is just percentage the rest share as about and management quickly well help lever XX-plus buybacks for recap. to

And with we question next will Atlantic. take our Jones from Tony Redburn

you're Is it are that focus projects on likely long-term where be, and remarks, just sort your In large why? price, would highlighted tight. explain least the prepared to not quite at as is not your be price Could sort take-or-pay foreseeable of helpful. you contracts, for hydrogen future. of That the criteria you green really

point clearly see a happen what projects. get technology that green belief large is a the to will making green on-site hydrogen of green so to Tony, about very where projects, in electrolyzer on-site produced right? requires The for hydrogen talk midsize the I'm that said a is is ensures Sure. we've a bit couple that our is to here and it small I'll we hydrogen minute. distinction large things

So the reliability in large it needs XX/X to is large happen have of operate project if electrolyzer a X technology. demand pool to if to to you're need and improve the things serve needed. to a going green its One ability on-site terms on that

get to investments. electrolyzer isn't needs maybe point said And is in at Ultimately, so now is and where a piece a effective. electrolyzer happen of that technology particularly large-scale other on of there's efficiency becomes belaboring reliability of my inflection out cost-effective green work probably those make X- to drive from you'll on quite the times to dramatically technology, economics to a a The I've I've improve scale where favor point for basis cost view, the capital such at this PEM, at many view of and hydrogen. My point at up the X-year window both inflection we which the large-scale that said point moment, are to and sure a that point electrolyzers will to the again, economics happening. capital technology a point that the over, see view, needs we that

largely years small So it the why quite it that be X do grade. I complexes the doesn't expect, demand, where call to I flex reason built, and the of so you we bit of to referenced, is make merchant that's the they a in interim, product forth. reliability we however, how much have electrolyzer doesn't terms much make X quite think what kind and medium-sized and X available, type serve on product provided of and and so in will how is

We also are important this. And liquid about as an component. see hydrogen excited of development again, we

that liquid up we sure think medium happen support hydrogen green make are to small We technology scaling our that there around will this period. interim development in it's hydrogen to to the scale

from And our Begleiter will Deutsche question next take we with David Bank.

For Matt.

volumes on return, low X strong, option capital Your going to the in an flat last, contrast, still some are very, mid-XXs. been opportunities I forward? but have accept Is there growth your quarters. top to drive think, returns very line In value-creating

going this David, It's let favorite of to his is. I'm one topics. Matt answer

as that this. just cover up? very element. look a of the lot But I'll our discussion that on caught don't just don't we have get Matt, We up to kind we why a in sure headline, make briefly investments you basis at hey, ROC always IRR of an around mention

investment has operating And while think for combination end. And on believe metric been Thanks, Yes. where you the -- TSR basically you back incremental that as as off, while best healthy and in ROC the the IRR ROC accounting the outperformance. an start OCF creation when shareholder is Sanjiv maintaining prepared exactly our know, growing and margin primary to is value EPS, the for about and Sanjiv. ultimately, growing the ROC, decisions. mentioned and industry-leading we is and relative criteria remarks,

capital-intensive noncapital some and meets of theoretical is as are, a look of limits, are on has pricing healthy number. more course, we our embarking intensity It think, investment growth. helped, transformation, So we we a as the the growth has growth we helped while Obviously, there criteria. energy that on are out see good of the our

as it about. even make but yes, I therefore, see feel ROC declining IRR, very long view number, continue we would Maybe to on the which the as a we okay, that plateauing confident is. little as right bit, So we decisions

So about of levels more to leading levels but operating healthy not the for good They never will. or growth maintaining inhibit metrics ROC, us, margin maintaining while decisions we're it's organization. and for going growing those our projects. let either

from Andrews with we Morgan our Stanley. question take will And Vincent next

Vincent. This for is Steve on Haynes

XX% So of and the like over I sale that quarter up comparing versus just backlog a the the last deck highest some bit manufacturing think your it it's of versus is of was gas been time. kind share backlog little slide looks

So over out maybe little few quarters? you bit a how just talk see next end the will be over kind the trending your about of various you could backlog that how spread And markets?

will We expectation we kind which and of referencing, is as sale that factors, And couple is my backlog, what decarbonization grow from move on-site, metals, which chemicals, right? to that, an So cetera. you're our of continue is by today into our that traditional et energy, the portion example driven split growing then backlog is of of manufacturing, a forward. as gas

overlap Now some is what we that. in seeing are

are chemicals the metals that is more like companies, I'd say them with So you're a and decarbonization. moment at fair That's there actually up bit will you are share of growth more our countries at a chemical in manufacturing with play India who of alongside pick boost traditional see of more. seeing end side we're obviously, where course, kind growth of little refining We're the projects the than backlog. number and projects market. winning a the things. What And chemical we'll of into the of developing looking to that

in also around projects are the might decarbonization metals, well. seeing earlier, follow We [ but as obviously I some Cameco developments course which both referenced due ] as around

into expect momentum, up should of $X will about to signed see the currently are pipeline translate you backlog. $XX getting in and few of what mentioned, that projects then in that next billion that of as and terms in to into years, translating the the momentum kind I've that's So billion

will question Massimo from take We our Equita. Bonisoli next with

been has question my few if my a line Sorry asked already times. dropped

XXXX Just to billion. to this it award an question CapEx. the What and growth billion in wondering, acceleration $X.X XXXX X $X CapEx related Is you your driving does of this on indicate Or is to rate recent announced? XXXX?

you cover do Matt, to that? want

Sure.

earlier, So with lot transformation, of the intensity. a as capital I more energy mentioned we are seeing little a

project So largest that our OCI for is one, won. project we've our which

equipment for are the year That We case, stages projects, about what CapEx this CapEx. We're general our on a or the backlog. plus billion ordering into towards a about growth next we our will another driving on the in a half do it the meet the stream be lot be early backlog the have growth which roughly you CapEx, projects. that and little in we not for of EPC our And down, so higher call billion $X-plus definition. will break this base but final also when remainder, component. But is also on $X back into to of of that tend project that the be in year, of would coming drive will disciplined over projects that's end C electronic construction think our

we ensure So things fixed It fees. date or terms it committed. such contractually contract get is return returns like has our that certain defined as to and has

about. undertaking. higher We feel that feel good about good the therefore, quite we our we're CapEx, So execution

so function And just the wins increase. causing we've really a that of it's had

our And Josh next with from question we UBS. will take Spector

I had a question around EMEA.

on-site variance about sales talk lower And sequentially, you So which flat. roughly and margins relative think down about I pricing mix were up. were margin to lower talked you the about when the but volumes, was

up could And you I'm margins of your curious in the there? just for margins driver quarter. also then So flat sequentially. the outlook expecting the are next just explain What if you year,

hasn't Josh, a as lot of you know, EMEA growth. seen

give years well, the for really credit negative done despite our of been things period. they've over team to I X tremendously same in of trends having the having one stories the profit So X volume that growth X last and

a done that. they've So actually tremendous just managing of job

that fourth over some go quarter, there to want the what for question the decline is So is alongside impact I that quarter. My make there which that basically, onetime I the is. fourth actually think costs volume point that And I outlook, momentum expectation let's the we've to is growth. terms think be seen the there team around is your volume with are handle as margin to -- we'll I that volume. improvement expectation the has my in the of expectation profit first in the well. built we in managing XXXX the quarter, my be And EMEA on that back X think would that My continue see over

question next We with our Stephen take will from ISI. Richardson Evercore

talked couple the about bit you dividend been you huge of for just TSR appreciate and stability clip drivers you shown year-over-year script. has Clearly, and business growing in of years. Can amount that Sanjiv is as Matt, a buyback, value has buyback little continued healthy about on healthy very I of that the a last to in was wondering the your getting if that at could amount? talk the talk there, -- a it to the agnostic Is the has at and dig you levers the what stock? is improve. your about -- dividend about ratio think terms it the I of do is X as is is think of coverage you guess the the -- I'm

higher the the the considering could where consider is of of place you there so stability dividend rebasing not kind business? And just a

I'll being be part as very the EPS we've our well, allocation capital the to to it XX-plus investors. And buyback as set an ourselves But an the Steve. EPS and important comprehensive deployed math in a see response important part back growth. just for last piece the which our think deploy more continues been capital therefore, capital intrinsic essentially, target it's part share that there, a we've the the buyback how is we in that of to philosophy and think address percent We and growth I piece allocation. and has business. kind of of return you give we of reflected

on talk feel all because I place EPS other levers growth TSR sure that that As confident you make drivers? people cetera, do forward about hit earlier, about I despite pretty we Matt, et said we the that have challenges percent in around, to that. we the cover pushing want to that XX-plus know

buybacks Sure. are obviously, Yes. important. and And the both look, dividends

have that both. We value shareholders

to That growing promise healthy our not. to thing dividend your will we capital continue On sense. well year. to I the dividend, a never to a makes Absolutely it yield. year, we stock. enable dividend Therefore, grow commit we one clip, is yield. no never healthy grow ratios also commit very grow will the that dividend we every point, us we the And a of do but have to with If the base we every that. But job

to buyback because it our $XXX, cash capital, to do excess owners. asked back. capital. It's at prospects, for understand find other any $XXX our look to On X exactly the the of organization, times have about $XXX, and think very it's the that side, of is not use use treat that's in many it. projects, and capital our been very same, homogeneous of on the we have for like such best this whether buybacks, we we We I've at important we just because you long-term pool and it's questions buying intrinsic opportunity continue that, we the see valuation attractive we a could stock tell like I how

X has the been the continued look we long-term when excess it of good discipline organization So capital. investment X thing invest problems if a use also we because it don't repurchases about of alternate have in meet can create for use you an the a of our is project, instills capital. And this projects, if on that we you poorly industry stock, at in that criteria decades. for

for are So buybacks for and an continue something overall us, capital this to continue capital of will to allocation intricate, and we're to do. element allocation growth both be. our dividend going But important is our it's process, important

from Cunningham with next we will our question take And Patrick Citi.

of we of face these term strong productivity forward? risk holding region follow-up I'm see your had just in face if the and on-site it's and longer Clearly, Do performer, price curious weaker volumes. the I a on weakness any potential a industrialization. levels the the on margin continued see EMEA. you the going thinking industrialization on in been to

as been growth other which on, growth where EMEA largely than Patrick, story is has of Americas countries. the the our mentioned maybe quite capital APAC, saw come most couple through. industrial and a Broadly, earlier of hasn't deployed in I we been growth

process right the mentioned EMEA said negative having that us. earlier story been very has, strong They Now volume profit I on, trend. whole through growth a that, as for manage

As look X see I trends. I ahead,

didn't there First, that that was resilient when a crisis. view ago the saw base we EMEA a very Look, crash happen. business. volumes energy would years X in

decline. seen a have steady We

We start a I'm And are -- we January as little seeing I'm to looking speak. that at flatten the out numbers bit.

a remains that is forth, so contract So resilience portfolio. base business, the have we of rentals actually by on with so fees and is that my expectation driven important the that structures and of very and fixed which part also

will stable and just very will will the from will off of The encouraging seeing even the X, of direction. We to other intent, steady in develop forward that we and project as an expect should kind will think decarbonization. X, around see that view underpin has largely long-term X make rules, announced well, be has growing an a strong large you projects point again, trends will and over EMEA gas Linde in we piece, decarbonization for and have the to a is The led And contribution there. I industries the a by growth we complex I opportunities with think saying that very change. urban to I know I unit industrial by ever market momentum move projects, expect you next continue that look end but to that that is important it which EPS see don't push they market be spurring us. And that years. to intent there that at. that are

take will next Markets. our with Capital We McNulty BMO from John question

and green of views also seeing hydrogen liquid Can the help that on premiums hydrogen pay? on customers about to the for they're kind types types to the on of you're IRA of the you green and Sanjiv, the -- think bill spoke that the opportunity. willing us your you

Sure.

question, good to and carbon that's is distinction a to I just blue because want about begin green. hydrogen and then transition So intensity talk John, I -- want the to with to make and

And it. come customers start natural capturing OCI is a to So benefits doing do as existing will given to hydrogen, be an large And using into of low-carbon all project hydrogen that developed. we of sequestering where COX the the are gas years. references in the and and we recognize on-site already we my Celanese, couple view risk, established is at from facility. enable in it a existing that with low up technical about development. Blue we've blue that around converting project, example hydrogen hydrogen that intensity

they going lower which sustain so customer an in terms of there's large XX-, baseline now green example a We're I'm risk for So hydrogen. of -- period. something reference can technology -- the of -- a with with to kind looking on-site then over option that XX-, what's against happening XX-year reliable that's

a built concerned, As broad-scale you to hydrogen and these those larger agreements expect offtake that effectiveness. deterring to starting level far increasingly small electrolyzer around as of green that got it transitions kind cost I to are hasn't longer that are crude want hydrogen and feed green and hydrogen term. There where have you're be of mobility the are to technology same that's And factors is into more largely an the the recognizing hydrogen infrastructure of agreement long-term build volumes infrastructure. you think effective green fairly will that small green will as offtake technology people customers, infrastructure monetization enable is small -- volumes -- enable reliability,

green where far fertilizers, want of I hydrogen. point think scale. And hydrogen these really some about see in gigawatts I cetera. talk small last the in green utilized have So et that's countries I as just the are of most terms the chemicals being of again, think you'll There small processes, are But people mandates that some imposed to is set facility Phillips gigawatt both blue they is hydrogen gigawatt carbon hasn't for we of are as hydrogen happened with are up electrolyzers that a capture facility up in yet. we facility is hydrogen, the OCI Sweeny building an traditional as those concerned. just XX, for plus. Whereas a that sequestration setting and are The reality producing for both example the make

miniscule You're is of building XX, that a have. which megawatts, requirements volume XX in typically large on-site XX, typical customer would terms the

allows of that of XX, what mobility developments megawatts and scale development some that the is the users. large on-site around scale only XX moment, the end at So for deters smaller

We of from will take Stephen America. our question next Bank Byrne with

Yes.

associated even to a you gas from how in an expand that energy sale have presumably roughly the facilities, the in your be generate X X both the business highlighted that of could that just years, sale IRR? the in with you preference customers as would you backlog increased latter, much the expect that in clean So could clean opportunities of be from $XX retrofit sale which your higher last energy, clip maybe to $X or your benefits of or gas XX%. would pipeline either by and billion have plant existing gas. And sale then more more, Do for billion you increase for either of where existing of that your rest your faster do of

let headlines deeper. then provide Steve, and first so kind me I'll dive the bit of a little

to right into gas should earlier we years, concerned. that on are that I our the billion And will probably $X is backlog grow. the sale go So billion expect the as $X you next continue that over few $XX billion to that $XX referenced of is, see far translate to we into weighted you're backlog. That headline projects the absolutely billion to as

some XXX-plus billion will which the understand that's referenced talked a And move number the billion, past, I've not. is projects the feeder a good that that we clearly, So $XX that times about. where $X rich that with few into is projects pipeline, may I've opportunity forward, many of those in to

see from then into an we opportunity those gas the of pipeline backlog into really contracts So being reflect reflected that and number. backlog should sale moving projects

mix by say you default. Your question little to bit new and is I'd around opportunistic. incumbency projects that a that,

We commitment. have made a

said invest about a that existing in our we side, from capture of the we to retrofit U.S. those hydrogen. That's likely a will we've about blue assets Steve, capture able recall, we said it to when $X billion to that in context pipeline, its sequester and expect expected where with the convert be billion of decade investments recall, $XX might sustainability repurposing COX condition might ensure our we facilities and that number, happen. to to was in billion You facilities most $X over retrofitting And carbon you of the

So that's a good ratio.

customers we for -- in the I the retrofits to looking think a but likely I'd come such will alongside ratio of are conversions opening happen. ammonia, obviously markets helping the where you the new happening we you as think if the were that's to will where that's direction et new just blue kind give of also as pointing carbonization our ratio, saying, to projects be. where cetera. That's And decarbonize, up are boutique that

Mike next Fargo. from Wells will take we question Sison with our And

quarter Nice and outlook.

economic sort global at a XXXX. the in looking market you're look you midpoint have when here, X of yellows. that not end growth and took I trends, greens X curious, you mentioned your Just much for at

terms you sort you more now I So midpoint. rating are that mean, above economic are of maybe And growth growth? than the of in run seeing midpoint

this Matt. Mike, is

of couple a So things.

referencing think, base end markets, I your you first, includes backlog that the and point, as to price know, volume.

those of X all So growth. the influence will

on mentioned weighted we'd contractual separately, Pricing, off expect the hold I'll that conditions. feel that terms we inflation. globally Sanjiv X% and we based is cadence, our earlier, on very X% As right, the confident backlog, say on and based to given

Very we in the X we've deliver way guidance, volume really, there, is are similar X assumptions how that base be last, to it. type basically your where to whatever on. And no-growth so this to volumes. And able assumption we're approaching structuring should being years. been remaining base a the we're And the taking

plays what we'll to see volumes But growth it's sort of X the out. really type underpinnings around this industrial is of it now, base how as the that assumption they right correlate an production metric. means, and So

next Alexander Laurence Jefferies. from take will with question our We

I is what than to more relatively want start just obviously, wondering was at your of I Laurence. at, of usually mentioned people part for look you on that as did opportunities you should in small Rizzo but looking mention check, is growth Dan India It's we business, if opportunity China. a a India. China which

in for an years. for Well, We've about been market market us. the India is important XX

well with So network of We density. positioned. strong lead kind

important which fair that the of to All be for see. India that provides continue well. have share Linde of been there, deployed our us an for many up able ways of our kind of position be unique built than a and the of opportunity be to opportunities will more is as will China win in that assets terms in particular. But we on market to a obviously it's that again, ground, capacities the important the the in scale industry

in to looking So which share we been of kind forward. be But are and fair winning 'XX than India, that we've in as will track fair more our make as well, going well. what share and doing to we continue happens there that to we our also we look sure in getting doing forward China

Roberts from now final Mizuho. John We question take our with will

are X% all impact you food food companies down up and in volume market? And Almost volume. Could the processed year-over-year. and XXQ? parse any is price showing seeing from shows food XX COX beverage Slide and the beverage, price

is for we there you more comes that really benefit beverage line than market that a that market, and in again, broken food up around you helping on can been think that. There in there. the leads to and what beverage that sales carbonation. supporting food and into of sale I COX Linde beverage. that in line the freezing. has share. in see innovation the over win see And end growth some of pricing fair particular, We freezing food done food our through beverage, market and the into imagine, and the So drives The food lot has obviously as

well. I'd My that, growth for to expectation secular say reason. of use that development food gases innovation think, growth we'll I combination thesis you for space, no a We beverage term, there My a obviously the be have small application strong that helping part of a that to could pricing, resilient you again, Longer continuing continued is strong pricing. is soda performance growth COX around across I'd XXQ moment see in any linkage it story, remains is a So market a around very freezing, say are trend. now, particular, But between food. see expectation and call at and to and that as linkage. don't in that. we important apparent you for but

Pelaez like would Mr. for the now call or to Juan turn any back I And to closing additional remarks.

today's Thanks, great guys, of rest your everyone, questions. Have all for your in participating for a call. Thank day. you, Stay safe.

you will And today's disconnect. for call. participation, now gentlemen, thank that We ladies you conference and conclude your may and