Air Products and Chemicals (APD) 11 Nov 202020 Q4 Earnings call transcript

Good morning and welcome to Air Products and Chemicals Fourth Quarter Earnings Release Conference Call. Today's call is being recorded at the request of Air Products. Please note that this presentation and the comments made on behalf of Air Products are subject to copyright by Air Products and all rights are reserved. Beginning today's call is Mr. Simon Moore, Vice President of Investor Relations.

Leanne. you, Thank everyone. Good morning, Air Products' earnings to quarter fourth teleconference. results Welcome XXXX of Moore, Simon is Investor Vice This President Relations. our and to Seifi Major, Secretary. President Crocco, Ghasemi, pleased our our Vice I'm be General Chairman, and joined Executive Vice CEO; Counsel and Financial Officer; Chief today President, by Executive Sean President and Scott comments, our pleased be your take After to will we questions.

refer statement This for on our Our that available discussion forward-looking found earnings earnings are contains release in forward-looking this release slide and call to statements. can be and Please the disclosure number at airproducts.com. the slides our website two. on

non-GAAP addition, on state EBITDA adjusted refer to earnings otherwise, a basis, on of we directly company-wide In margin adjusted to be measures share, margin per employed. release various adjusted specifically measures can refer we and comparable to we financial EBITDA EBITDA, we earnings Reconciliations earnings the relevant and capital most adjusted website in our to segment Unless today's financial throughout referring when these share, on are discussion, measures, section. both financial per our GAAP ROCE, our will return EBITDA, measures. found and

to to call the Now, over pleased I'm turn Seifi.

and Simon, to good you, day Thank everyone.

taking for schedule today. you thank from on we our always, your very busy time be As to call

quarter, be individuals crisis. of times world continues talk continue leadership the to I are the three. would challenged we the XXXX. results like character crisis. by COVID-XX to companies this and of about number slide Please unfortunately revealed I believe Before our to to turn And talk about and true during that

people. safety a always Our number priority has and well-being one of our been

to action. to protocols course safety I the protective and reduced remain equipment and nor to our hard to have for that procedures and serve significant continue the Throughout the we want provide employees people crisis, uphold challenging their We our committed these projects salaries reduced working right following to and health. and conditions. them thank under our of not COVID-XX staff, customers execute of we necessary

a plants world. job continue keeping and we had and the to our do volunteerism people and XXX business great increased in this around of of the to during smoothly run crisis, needs time our communities Recognizing all also Our productively. to local continue greater through Meanwhile, financial our our functions support. commitment corporate running our

its Our prove resilience onsite globally, we our remains mentioned robust stable, business business continues before. model as have as to

buses revolutionary project and stream demonstrate and of transportation it green a forward-looking a energy, the system future, focus of trucks is massive scale improved as commercial proud the to see, on In volumes. which NEOM Air our the despite hydrogen all And project, the supply comes truly can pricing on around XXXX. and the $X power addition, on We pricing to you on world, carbon-free in were regions. we source carbon-free hydrogen. hydrogen developed billion This that a Products will business enable possibility merchant totally have lower announce very in maintained of when the will discipline, carbon-free a based of our to

when We onsite X nearly significant will in tons world-scale for signed supports year also project million facility a per focus and produce energy a in contract of coal-to-methanol long-term independence a on Indonesia. Indonesia's methanol stream XXXX. This on

for excited opportunities are additional in We the Indonesia. potential about very

four. turn please Now, to slide number

electronics plants, five and our supply in in for agreement, Texas, our to win needs, and manufacturers PBF Gulf projects world growth we a pressing their that the mega projects help meet and This our acquisition year, for and the and environmental in around in drive the create hydrogen Delaware, customers to operating projects to expect China these decades cleaner Energy with solutions, California and energy investment for most Coast continue hydrogen ever for and largest project come. of United these Malaysia. long-term projects We States the multiple ammonia onsite included

and began supply a to Coast plants in construction reformer stream, also Louisiana box of We three nitrogen Gulf cold products and brought our in U.S. Netherlands to pipeline methane steam the system. on

to delighted deliver our are on be for these on We and projects, time selected our in new complete large confidence customers solution: demonstrating safely budget.

Now slide X. to please turn number

Qatar major industry-leading projects was LNG technology Algeria. Our selected and for in Mozambique,

year, successfully model Our ready our we are And position. about we opportunities. debt our earlier business and billion raised strong growth for financial exciting this supports of to $X enables ensure

growth sheet We in and balance significant build positions strong markets. have capacity remaining to are continuing

see for many energy, investments cash returning our dividend. focus to by will through creating With directly commitments for made we the hydrogen our come. to profitable With environment, we continue cleaner flow, growth Board's to which opportunities we years in And gasification, and capture the carbon Products, on cash Air our I about sustainability, shareholders to growth complement a speak moment. new strong

fiscal very throughout to focused I'm safely team that worked pleased accidents you goal to want stayed challenging pleased safety always Now obviously see and philosophy X-point turn management years. these please incidents. By to our see X following plan that and number can times I'm But six. before. We our performance. no slide or with X, improvement many have our see year versus you we slide XXXX and shared X,

I strategy. focus continuing the have details times unwavering them not of these since slides, implementation of Products' them well-defined our seen of included each on reminder you going cash generation to through I'm Air and as While have before, many go of a

Now, number please turn XX, is our which purpose. slide higher to

supporting do purpose also day. know, We are are work every superior financial to obviously delivering they our committed higher in the But performance. the people they

goals people of most all our at bring it focus Air at representation solutions XXXX, our to and face. least that population and XX% in representation innovative Products so environmental the In managerial and on can female us Products and sustainability is the collaborate the higher our challenges can our every is and that environment higher with develop from also. on team new By you consistent world, aims to least XX, United they and and XX% purpose purpose minority achieve day. population we That in purpose some together and inspires energy same all higher to of Our professional globally, Air drives States. slide our diversity over in the at significant support see

Our further growth projects for give bring company. to diverse a us our as the unique and continually measure into stretch we talent we opportunity will drive And improvement. progress,

for workplace. also the employees are program, discrimination such this and steps of a we subject identity specific culture few been program racial matters. -- belonging. discrimination building who Products are dependents to a to novel inclusion Through continue legal to support recently Air have taking We and this launched, advocacy These of outside our the their and

you XXXX. our can that Third turn to by one-third we which to our reduce by means please XX. goal slide 'XX Now, intensity When by carbon intend see number emissions

discussed emissions business' this aligned accountable on is near-term energy reducing focuses September, strategy. It are and the to we world. that I subject in measurable amount with It goal the As delivering. for relative and of us our is fully the delivering to hold

excellence, goal our key to consistent Third goal. all Third show very go growth point hydrogen, to One you opportunities. the 'XX business profitable achieve opportunities by low-carbon slide and our have renewable and that please support with we important is carbon-free number by goal. energy Carbon this when is the XX 'XX projects, we by operational capture, enabled Now,

materials natural our Countries which abundant to number The are raw largest I gasification it's projects. gasification on energy slide convert power At and specifically Arabia. gasification today. and chemicals on from gasifiers to project, into low-value the high-value very coal, sustainable manner to coke, you an to give refinery turn Aramco drivers fuels XX, still all and continue using the think please gasification large companies for acquisition our Now, in pet Saudi Jazan, highlights Saudi plants focus a resources these of and in around key bottoms valid fundamental relevant and this transportation gasification. update point, world like of appropriate

we it all work continue a not anticipated. to financing the this call to another than close terms. said as like the situation, hatched much open longer repeat this I in But until Therefore, on are they are to XXXX to We public I these my investors what do chickens relates that is of contractual acquisition. your June advice of it activities result is diligently please COVID-XX count to the as on taking would to and call complete strong

We will the and and only the terms if financial expected line on with this close in final the acquisition conditions contract are our expectations. returns of

my XXXX dividends our shows And on can reminder and that average XX points shows the XX% are basis see where number will our to Now, than customers. grown safely year. around share our EBITDA have opportunities, which dividend this per world consecutive number that last that people for we and finally challenges EBITDA shareholders XX% to we of then slide continuing XX% last is every is I on over our slide we more please world slide, continues the operating which up in these XXX average by years. you for number our X,XXX than again. where dedicated for favorite the the our is grown we about And to this over to around and by years. XX growth six margin despite margin, over would This earnings and our EPS turn the all six since obviously thank XX, it have the record a margin while the of you Thank facilities past hard-working on sixth COVID-XX the dividend over also focused billion year. XX the serving quarter like years staying $X.X raising is year more exciting provide develop slide

Vice like Financial President call Crocco, Now, to overview. to and Chief turn provide Officer Mr. a Scott the Executive over our I financial our would to -- Scott? Vice President Senior

Thank you, Seifi.

strengths presented the earlier challenges company our despite to As demonstrate Seifi the pandemic. stated our continues by

support announcing these We completing in committing hydrogen of debt and progress significant offering. projects made our and a gasification in capital, successful our Both mega growth. long-term mobility billion $X will highly for have

world-scale than years. next in Meanwhile, LNG onsite to half difficult add stable which profit heat is over projects, exchanger cash our several year. profit won also our deliver and will a continued growth more We which flow the business to few

for results. turn our to on please full details year XX more slide Now

Sales $X were and margins XXX were non-operational points. gain X% and increased of the by combined adverse in EBITDA factors. X% COVID-XX. price the roughly despite at profits volume was and basis billion flat Our almost margin effects offset as up EBITDA grew

primarily improved which together negative including Specifically, COVID-XX impacted overall our had Price of XXX by and more was to impact. year. pass-through activities all the equipment points for EBITDA modification three was margin. also $X.XX largest in and about and contract to the sales lower the in but $X.XX from X% point X%, energy about product by increase by profit the basis growth sales impact. major by most basis lower billion sale was We acquisitions, negatively XXX ROCE Price step-up regions driven the reduced our lines. debt. the by higher in LNG, estimate offset denominator the real India volume the The decreased plants of than new $X EPS no across the contributor COVID-XX additional and the

Now turn XX. slide please to

is positive or offset Our $X.XX driven volume increase sale price, up partially of about and our Korean full Against to business maintain price weaker third consecutive to year profits. growth unfavorable we to this and and negative why reduced impact Chinese adjusted South Chilean per in be share $X.XX continue to peso COVID-XX the the declined $X.XX. our equipment challenging caused $X.XX, reason negative was EPS to on of due we primarily Volume Currency by our other activities. the but year mix acquisitions, $X.XX the one full resources plants from backdrop, EPS RMB, improvement. support to sales, costs Different negative $X.XX This by were strong future higher as Again, add new facilities. continuing estimate year won. was $X.XX. on operations by COVID-XX X% was

new accounting income from expense also accounting $X.XX guidance million to expense together and underlying interest that by impact I $X.XX. affiliate issuance. reduction each the this results. this was offset lower in due to our partially the debt of balance interest mentioned debt reclass non-controlling year We Interest ventures about $X business expense underlying and adopted income. moves $X.XX a $X billion unfavorable interest non-operating favorable. interest Our and of lower quarter. added expense The cost was strong Non-operating change Equity just rates had joint were

Our roughly rate and of equaled year to last effective in XX.X% effective FY tax expect of we rate tax XXXX. XX% XX% an

commenting on our supported and of improve the project also and of slide equipment across equity EBITDA results. economies volume, I'll start continued brief grew discussion results versus higher as began Now sequentially, please Price sequentially increased rose affiliate turn to Volumes our activities to to for X% fourth a XX primarily by quarter improve. sale better X%. by currencies. volume to X% the regions gradually due merchant improved income favorable QX. up

offset were Americas. partially to additional growth and maintenance, these benefits particularly higher by increased mainly However, costs resource planned in investments due

As planned X% And FY from with interest 'XX. maintenance these tax we customer was mentioned earlier expense. quarter of were in up last some by the rate partially offset higher delayed EPS lower outages

$X.XX acquisitions $X.X is customer Volume for of XX%. our regions. versus Volume due EBITDA to of and improvement and the greater favorable contributed was the consecutive XXth prior above and of by level, equity X% was stable in affiliate EPS PBF equipment decline by billion Now to Operating results income. of to in and almost earlier we turning were driven million plants mix. overall up This EBITDA driven than X%, unfavorable due including income partially year. is EBITDA exceeded price activities, and price year-over-year higher down consecutive by to year. lower the margin as new was mix this in quarter plan in X% plants, COVID-XX, gain. plants, price $X.XX. sales, on $XXX short-term by with was EBITDA increased year. additions three sales last than a Sales product outages higher offset sales that XX%. Asia, but about new margin X% EBITDA, all contract to cost, reduced the which shortfalls the acquired sixth COVID-XX in end about attributable the flat business last by depreciation hydrogen quarter, currency the remained of year's compensated of This

turn to XX. slide Now please

tax and of associated points, was RMB exchange to euro, Our unfavorable down and share added we planned was impact. tax was by foreign contributed the driven tax due higher had price fourth due primarily $X.XX, to a per rate by XX.X% primarily $X.XX, was $X.XX The with X%, British $X.XX positive compensation effective basis the for a down rate. and unfavorable resources This offset pound. quarter unfavorable favorable PBF adjusted as and Currency increased growth $X.XX and and and new was partially EPS volume of or future cost benefit with Chinese Cost maintenance. COVID-XX. XXX benefits share-based Volume acquisition. $X.XX,

was affiliate to As stated previously, in the we unfavorable, was of with XXXX. expect associated also previously our effective tax strong rate to interest expense fiscal partially $X.XX be around billion Equity the Interest mentioned XX% as non-operating business results. offset accounting in additional $X.XX $X.XX This up together, XX% non-controlling underlying drove to re-class. primarily the the and cost debt, income unfavorable $X re-class by were year expense. due

Now turn slide please to XX.

our underscoring generate flow, of continue the business. to strong stability We cash

higher corporate supported CapEx driven by part headquarters. higher spending new in driven on cash EBITDA maintenance taxes and our Our higher by timing,

fiscal this provides or per through increasing comparable distributable prior dividends our capital $X.X shareholder $X.X share and continue flow, flow in dividends full the over gas times, investments. billion high-return year. nearly cash to to enables cash paid still capital shareholders details flow, XX to is about cash even deployment. uncertain distributable value XXXX, industrial to additional billion number have billion deployment. our or we our This available create Slide on for us XX% $XX $X.X strong From For as of year and

remaining. have We capacity investment substantial

cash FY generate of our we come spending more beyond projects stream. in capacity the on and borrowing Some as will And extends XXXX. backlog

you this in for potential reframe We XXXX. expect to

FY five-year over through As spent. of end and capacity can over flow $XX expect investable cash already the and we billion from FY over $X investment of $X billion includes almost capacity billion XXXX. billion the available see, period $XX you additional now XXXX FY cash today, and about available The debt of between of $X XXXX billion

AAX total on our coming $XX continue some with maintain to to a balance M&A our remaining new billion remain signed our on and around billion stream, them. on about will few focus commitments projects managing spend rating. current $XX.X We and debt project With to targeted

can already of the over capacity XX% you here. we we XX% see, So committed spent show already and have

segment call the of the turn begin to Now, back review our to I'll results, Seifi. business over

Thank you, Scott.

impact. will to our each confidence strategy talk COVID-XX I I'm Before make coming full responding a exceptionally teams in our well, months. like crisis. strong the comments full run teams about efficiently continue Asia, year to current have I very significant increased to margins the deliver our and our pricing say to would that segment performed about I that All performance. few in and business businesses three despite regions our proud very overall geographic EBITDA execute the our have

to please to results year, and adverse positive last a repeat short-term slide turn I'd a quarter fourth volumes our were outage was COVID-XX, to EBITDA the the impact continuing XX.X%. of in Now consecutive of like contributed XXth year. effect mainly the the due contract our and quarter XX, to margin for and that Pricing customer X% is quarter last down which was Asia. XXth, for Compared

impact Any Lu'An, and years, I major June in that the operating for successfully down scheduled and fiscal mentioned. our the outage also for speaking, restart to customer asked by maintenance customer impact for us COVID-XX plant delay a planned -- shutdown of that an and formally last on end our conditions. September, a this this stress facility the We to in information that and in planned earlier about mentioned. the just XXXX Now have to negative our of of completed so that the but China. are just to facility customer activity you has our expected basically like a I'm is in of not normal this maintenance I In to facility coal-to-liquid issue. add on with further XXXX. if the turnaround I'd maintenance, for the In was the actually year customer the obviously that due scheduled results give it's in I that over of largest as on appropriate After I more market would like this process the working Asia, customer think we two in is quarter, that today I successfully yet shutdown will restart customer sales plant XXXX,

status update will the announce situation in results we January you on We first of our this when XXXX. quarter

Now I about you would like to to to Scott? back over our Scott to the Americas turn talk results. call

Please you plants of also up and merchant improvement. merchant. for year, versus was Price the is ninth quarter. year-on-year maintenance across X% the of repairs COVID-XX, outages planned improvements X% down was outages and Seifi. with more was to impact the the recovery outages largely modest of product consecutive customers across price Thank increased year our positive product by of caused trend activities Price due or effect strong were lines. the as quarter earlier X% activities pricing major PBF increased acquisition. drove facilities by slide from price segment Sequentially, acquisition for results. X% hydrogen Americas our maintenance while of for turn planned XX full better to Laura continued PBF some all by year Maintenance our lines. volumes This the Hurricane a the planned our last up than damage primarily review X% Americas' quarter maintenance hydrogen were maintenance by postponed offset this Compared offset volume higher. key impact. and the to prior offset driven flat EBITDA volume and in the

last for two-thirds remained planned As versus up and million which sales PBF of volumes last as margin by activities. remained expected, unchanged the accounts the onsite points year from for was maintenance compensated EBITDA business, higher year price basis the XXX region's EBITDA price. lower and primarily stable. about acquisition merchant driven $XXX of better

XXX While margin on sequentially maintenance. points mainly was increased down basis

Simon? back call the turn discuss to over to like would Simon our I other to segments. Now

Scott. you Thank

and year the year-on-year costs, and improvement, hydrogen which were Now region of and by costs. volume remained future. price due sequentially, the the to and or compared price recovery up supported we improvement pound. region our the the driven unfavorable product X% currency. acquisitions XX% of Costs sub-regions. in for COVID-XX power offset consecutive Sales This other please better British maintenance higher increase review were volume the XX flat both all favorable Europe, outages. outages merchants in to and across uplift to euro was up, primarily turn Africa also to XXth offset increasing for equity but Compared favorable a currency together mix double-digit driven of Also EBITDA and XX% due East acquisitions planned to slide year, affiliate increased our impact by and Merchant while adverse X% X% and by expect currencies maintenance again and recover favorable facilities is the EBITDA increased XX% to favorable with improvement. as seasonally price last maintenance volume for growth of climbed currency results. results. sequentially, X% planned with by was in volumes Middle supported an and last quarter $XXX strong million the partially

and were includes Slide other turn which LNG profits the project corporate development includes and profit please sale equipment driven is but Gases Sales Mozambique and project quarter this turn equipment lower as business investments. mix Slide by costs. as project Golden of businesses, sale to to and our our well which to Sales activities Pass higher central due projects. to of LNG Global increased as well costs. LNG non-LNG Now higher Please activities, business due including as XX XX higher Corporate

the gas near awarded both were we Sonatrach the will which fourth the results in and project replacement During for the also future. project Qatar massive further our add quarter to

turn the to provide to Seifi. on Now I'll future over thoughts call back additional the some

Simon. you, Thank

for in forward, COVID-XX people worldwide deepening in cases XX,XXX of number economies U.S. continue around the And the reasonable and as Therefore, the around we a are we And guidance I not XXX,XXX unfortunately XXXX, of is CapEx guidance. outlook not world will course it's the for worse. is about we almost that situation daily the this the cases it cases world. XXXX. activity if and hope The less plain affecting a share the the of you in look we is Today of providing just to difficult, any When spoke earnings adversely crisis guidance about We very world of U.S. of of case, the per most day. COVID-XX impossible about late see to is make in XXX,XXX. we per April was is economic uncertain to day projection year Therefore if lot the cases move or and number provide fiscal XX,XXX. our As were January. the forward.

know with you don't shying very of open not being today will we guidance, we from of what terms we sit that but course just be. activity are are We as in the economic away here

However, to to XX% well that you is far our doing share I today want onsite and of continue. in business is this of the October so that what as seeing November. this A our expect are quarter we with sales we and of is month

where were they last the around is this merchant and merchant time in at area. are XX% other approximately where business our this is our each In we today are volumes The year. Asia, world

have in to seeing we impact unfortunately see there. volumes Europe. year of increase about are team, to X%. due as volumes number the do has recent commitment not in we please Air to certainly that merchant with competitive business we versus down and times Every merchant recovered And In significant our due the is COVID-XX would day, advantage And now cases good X% Americas, In the real gases I the great Europe, results of mainly these a North at packaged XX. but down like Asia the challenging Slide America. our last in motivation packaged to So to in today XX% gases surge we of you turn remind Products. are COVID-XX and business have

allow and strategy dividend. Our value including the shareholders position execute create us will to and financial strong our growth long-term continue business our model for to of our

most projects committed our world's forward create and year. continue to to growth our people's we dividend and some welfare will And we expected. continue as are we of families. do, protect of significant care The the of our take as projects. And in win are We and safety of every their the moving their backlog health to the welfare and

We are to committed that. you. I thank In say closing, want XXX% to

their around our First, employees of commitment. the and all to for world dedication

and support and our with communities to efficient in difficult confidence times. for you the to benefit alongside Our world, around employees are your continued higher the help critical Innovating to Thank my times. you And sustainable. world our more continue challenging products trust to the during will us. you our these you, express, to a during want and playing we a together know you and also local role making customers want and that we I environment difference these that customers. thanks finally to to especially, serve be you, our purpose, supplying stand I

Now we are have. pleased you questions might to answer that any

Instructions] [Operator take Zekauskas we you. Thank Jeff from And first will our with question JPMorgan.

Thanks the with the unclarities there financing sole Seifi, need have in financial very the about be much. I the are Is Jazan project. Or the that project? question Aramco to of settled? a issue terms

morning, Probably have…. Good Jeff.

Hi. morning. Yes. Good

still we $XX is you an every this excellent too that's that I'm have to X,XXX I with are single-term I. thing for project. exaggerating X,XXX is acquisition This billion. are and where agreed back T we Supporting question. very documentation That and this items every about big tell much always represent we -- investors forth that very you exactly crossed as going why be should every There not a pages. very strongly I on felt lawyers and is are. to or dotted that are Yes, our I to cannot upfront

still done Financing not thing. are this with going is on. We

the investors are But where our clear launched back how we are. know, wanted thing is where That's and at just you tell with to very be financing proceeding. calls exactly whole these the we XXX% in done to we the As exactly That things. is you see and I not July. job we

where Now announce weeks I we are. signed this have that of the this now situation we want change now right you as and just from two can But to is know thing. that can we

you that Okay. project as And a receiving conventional the the something a Lu'An a -- return contract if volatility does like between since that mean the that were project structured volatility? Air onsite there's standard the I in there wouldn't explain Can some a with don't and in that that fixed contract financial Products' contract? difference Lu'An you there's onsite know Lu'An be or fee isn't

-- a every years it again only The have shutdown is know the down than planned that's you very are exactly complete of is same. excellent world agreed around with question. we to three that With shut not do this a we that have I'm that an I differences Lu'An have the -- times of maintenance. facility, Jeff, the different and contracts And during the customer once better or the do complex two sure one you the

it our successfully gasification the charge We years. facility planned X.X wouldn't fee took to shut that. customer for us Therefore, agreement world. this months we time June shutdown. We largest We three running during the completed a XX% the at was around facility -- shut planned have been with it a in down. of maintenance the during them a shutdown was to maintenance it there do about that Yes. capacity But down which is very and

much. so you Thank right. All Okay.

Does that help?

you. Thank Yes.

Thank you.

And Fischer with Barclays. from we'll next question take our Duffy

Yes. Good morning.

are you? Duffy. Good How morning,

Good. Thanks.

that economic needs refurb with how put move you today the of a better Or part non-payment of on that economics it follow-up decide as Lu'An. is that money in the to to what kind would because If to guess to just to continue just economics out -- restart not Just take-or-pay kick start they if the on all And plant forward they a to happen of to situation? far corollary this? I are that capital would that of it for and in?

as to I said, we are feel where Duffy, now. you tell Again right we obligated exactly

any contract with they that significant as up. If We right start They up now they enforceable guys we any haven't will are the terms indicating shut go down shut us to and have they to contract an they asked and this facility. like to of conditions that and live you it down with never had issue facility. it is they there to other have not -- have and we

announced going refinery As in you are in the shut their day Convent that other know, Shell Louisiana. down to they

we'll we deal So supply over we that. contract have with a there them

this to the we to bring So is that this is that up felt of Because it you big the trying a the what situation customer. I attention obligated to look with are customer very tell is investors.

And for the results fair. actual the just Very then quarter. on maybe

QX QX. step margin look was in down you in hit QX If even COVID from to though bigger was QX it the than

use? should of of So think forward about indicative? a and baseline we more margin is structure as modeling going XXXX, QX we indicative more Or was QX for the

that. depends obviously all COVID of It Well. on, and

I XXXX which QX. think is a fundamentally, we in that you Products I'm is indicative But more that, Air not other appreciate, going is that QX were on, is cost-cutting thing in Duffy is and mode than XXXX. we sure one are-- there

Therefore we are are our once in to growth. big margins on people our That mode. order be and of so to in the come the going costs short-term and relative then stream, down. a that growth will come higher. in then, to means hiring cost are all plants We of these And all on support the that,

not So of cutting costs that. we of we and are -- in where all the mode company are a we are

felt but people it under also about of people, all then which of that, lot the different made COVID is feel a I conditions, strongly conscious We are on down. for our lot is long-term. the very a a from made have conscious like people do other decision, of to better lot stress, of of have margins could cut That their worrying about But of we was our them the didn't I could and part. that did. their them to safety we We want to cut off. or on salaries margins, lot our families that. decision the lay under a to a our people, go are but health that a not We demonstrate we off. same that time that Obviously decided with salaries, is consequence the a their our But take at that of people it hit

on We based announce quarter. a this result company and trying operating the heroes are be not to

We are building the company for the next XX years.

people as go absolutely as our sacrificed. that middle that I them. justified. be, our of well supportive -- hit, is That what I And a take to have And think But And we to They Our running wanted seen. have have we COVID, facilities. of got do, you will means morning, we up is every just forward. the in is that policy. that going

Terrific. guys. Thank you

much, Thank you very Duffy.

from question with Bank of next America. our Steve take we'll And Byrne

you Yes. Good back… Seifi, when morning. look

Steve. morning, Good

when back Seifi, than been were relative you contributed at …Good fiscal year expectations I'm obviously to you curious, different, for year? year, COVID this therefore meaningfully delayed what to fiscal what your and would being you Jazan impacts were the fiscal not highlight you of ago, expecting $X.XX year. has last morning, $X.XX. the had to look the else as a what

an asking had about $X.XX question. you're guidance given a the Steve, We of year. excellent for

about If you was $X.XX, that the out, know you COVID contribution is about Jazan $X.XX. contribution take which if we out and you take delivered $X.XX,

committed So we delivered had basically we kind of what to.

than want There those nothing surprises. no highlight. two that, other to I unusual So was was no -- we -- there

Obviously That running. giving But got We plants shutdown kept lockdown We not or we of got be didn't great. is don't think have will form interpreted Steve, performance Air impact. another into facility. that, Products I pricing. concerned in unusual. wasn't Air day all to doing fundamentally about go guidance. But there might of that. and Products. we We have shape why, -- COVID-XX that I'm anything our And is any are the I to the want any the its

kept the of our operating even a the today crisis, height great people. at have demonstrated. the remember, during of Please customers. have are motivated. even of bunch XXX COVID, plants, all They we They We our and served

very confident company. feel, feel, the I So about And about very the good future. I

different your any that. Australia or Thank quite have they're Industries. bit you flow the out CF certainly green for up any NEOM, you than customers, to hydrogen following has I targeting be you particular, was for announcement And either on, for on with of end-markets contracts of would your the I when curious, might term, some a just of say might that green coming have whether But highlighted in potential on line recently on in ammonia green respect able and your out with longer And NEOM. part of surged. news that ammonia, led expectations to kind dialogue NEOM any change And of to project?

question. the for you Thank Well.

But We green are whole and project. in getting the and blue more more hydrogen optimistic excited green emphasis hydrogen. the lot is general, and a same there time, about, and on and ammonia green more hydrogen hydrogen more at of

largest hydrogen, the from are gray We of hydrogen. hydrocarbons. which I producer ordinary that call comes

where can COX COX you mean about world. and ammonia We ammonia we you are blue go COX the But want. not doesn't ammonia as for is if I I people then in in hydrogen has me countries There largest capture They right. credit can that transporting and make hydrogen producer. and only the for so-called have around will I'm But using or it hydrogen popular very because of And get blue you coal, the significant and interest blue – I certify in – look the ammonia is that way whatever they ammonia care putting can are which do together, the air, COX that becoming ammonia a the the they places is that. use say burn collected the been Indonesia, need emission. is blue provide that

is mean ultimate one And ammonia And in one. produce we is middle the then that green that the ammonia. blue – to are going called the obviously then what So plant. is is I that

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that a things. think what of are we But that. But excited projects So I is the I the is those hydrogen have these or thing we happy mentioned. the – one have main form the because or is we energy very important lead very you now actual world been about four we encouraging that is talking thing be years, that the another all about it. I'm future. that have to Everybody beginning going five to about significantly for – in we see is think opportunities doing play saying is of real

Thank you.

sir. you, Thank

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

taking just Vincent. for you deliver have [ph] This to I our thank for on Hi, is but question. Andrew Casio Jazan. ask the Seifi wanted on to point

from October. hoping an went to close everything to you So uncertain in – finish time line or

today, a kind it of bit little more of to As uncertainty. looks we're you look back like

you when of you risk Or kind So ongoing the change makes project curious, last did about as and just about now between of more uncertain profile COVID? risk did it think conditions, the going something about the just change? beyond terms that the profile talked you talked and this forward,

in that. we you is That's prices chickens – single markets in changing wait is oil and before world use companies words, look mean every have I'm I'm Okay. to have done The up go about something is All I'm change on I Jazan all changes for this just change, or exact I my model share All like count announce your at day. please XXXX don't want investors all in to before that the we it day. mean I financing that a have because that the model. that, not whatever of people mean saying do down. different and their and put is the your is until absolute that that. every that. they count saying that saying everything I $X

There We I of is obligation have you tell what a is you you we wanted right that. possibility is My a just possibility There a know of quarter we have new is on when we front to know. now have this acquisition sure what in exactly haven't of is know every we closed things. I'm presidential a make new election. policy. And to that a and president. a is There a foreign different Nothing XXX%. lot possibility, we that

Understood. the the then And quarter maybe back business. just to and

sense end highlighted thus you us business think at the were talk in far could that XQ, we what different kind merchant for and could well you're markets volumes there? of a broader your you what the trends we just seeing versus you as look as about XQ, give about mentioned And As region? and by

that volumes XXth you, of today, we way one something, mentioned are our for is as November, the in business my repeat where on I of they see our that back the prepared that that Asia remarks, in Well I'll to were XXXX.

has especially and issue. our there. doing Asia, business is no recovered It is China, COVID there fine

restrictions. there So situation Europe, unfortunately well we surge, that's said. a That are as very you a when is in what know creating In is putting significant governments COVID-XX.

down because volumes, susceptible States, in very our economic is most is the a In to volumes X%. actually not as activity. packaged that XX% which and that. the in are lockdowns as mainly States. packaged because lower business, gone gas People the doing lower gases have business to have our we year, is in logical COVID and United all And bit today up. are again are them activity. of significantly the Some X% you down especially there of know, little getting last of like cases Therefore, Europe XX% than more a merchant conservative are about don't United business They our expandable

where we that's So are.

you. Thank

Thank you.

with And question next Partners. we'll Vertical Kevin McCarthy take from Research our

like in Yes, on good LNG going lot a seems morning. arena. Seifi, have you it the

could word sense XXXX? in what describe the capital You a Mozambique, to and fiscal us required for them project give the then two tailwinds And be things; U.S. Can Qatar massive used I and for think you projects? from referenced, Algeria the the these earnings the you

very thank Well, Thanks lot Kevin, have for up very and that quarters the Good very a the is Kevin. our we think are this business you Obviously we about of question. positive. much. morning, picked optimistic business. we outlook LNG for

now were cyclical. is the the obviously do four Obviously that cycle. this up for are better years we You on down know business than cycle. on last Right we the three, I think we

paid capital, In get about the return great sale is are what we put don't we doing. of It's on terms the is we infinite. Because thing for capital that projects capital these of the our equipment. of any

that that So plant sell on return is facilities of the new the that have order. don't money make whatever new we the plant we we capital we the a employed and then get

high. these on on the very, very projects capital return So very, are

the And down margin third then that. the as ask for you that second Thank a I pattern XXX margin Americas in the basis EBITDA pattern, was points. sequential in question, about fourth wanted to the quarter versus

I affected if think explain margin. all change the wondering in I'm was that factors? the prepared particular, of hydrogen In maintenance remarks increased indicated percentage there Were activity. other you Did the business there? there

maintenance that is mean, very are over main of being the you during about cost I for the have -- of when cost. refineries. considering going the of we don't the was The Because situation that happen can decided of control -- the maintenance cost they we you with the have time lot to marketplace the down the lot of happens. control there But I their the maintenance. the mean, driven was we to what decides don't a Kevin, only their refineries summer that. on Obviously shut the in effect control when market, a have that customer refineries. take shutdown not during know, the right

we is South doing America, we grow got the hits? America report well. hit. not obviously, South is did very that when But So that we Americas, Please forget are don't other what there

was but factors it cost you the combination maintenance of the as a factor mentioned. other So main was

so Thank much. Okay. you

Thank you.

take And question we'll from Bob Goldman Sachs. our Koort next with

you Thank Seifi.

that? to was opportunities. give sign Asam a deal into I Bukit, you plugging Indonesian month. you're Can at with highlighted it were think still a this away you that you Pertamina some I guess going and maybe insight us blip news

good Bob morning.

say contract to latest the thing than You Jazan then something out that about the delayed. lesson are part the it explain But that to is final better one is learned anything announce have any very the it world, obviously not comes is Bob. rather why of have you from up-to-date from that we until and have

As going that that to Once on. Indonesia. learning that. a out we result announce of comment have will or I what another we of want deal is one on But don't we of have let you to have is rumors if coming anything lot have announce. announce we until day about will to And a actually comment There anything I from a that, we know. no

think Fair with green or wondering formally able announce enough. agreements when on bus depot for you do be the you offtake truck I'm some hydrogen to customers? might NEOM,

any announcement. don't We Never. to intend make

the point, contract market Sorry to just so categorical, a for making want don't where the do to not But just we announcing we obviously and start is. on, to Bob. be whom because tell I'm we people sign intend

Bob. We are you, very going to be that. confidential Thank about

Thanks.

Okay.

our P.J. we'll from And take Juvekar next question with Citi.

Good morning, Seifi.

my He good P.J. friend? morning, How are you

the a Good, little [ph] low good. the customers light in. the volumes refining? bit two-one-one refinery that Can heavy you Coast margins on outlook hydrogen of Gulf the into for come about What's the spreads health talk given have

a people and people a your of know So more and other than P.J. about lot me. lot that you

barrels at is know comment million able X%. U.S. to about a when don't an capacity day, announcements you expert of only be barrels, look I had I already the to million, about between, is on XX somewhere I'm have XXX,XXX of So about that. thing refining The not know which XX that shutdown you that

Now Or that shortages? I material hasn't to has And is don't that go on today. based know on up don't we main that. our to come we the effect now, know. forward, not any enough what and expect really material to going justify is comment I demand create do we seen any as business, we effect business. thing know have on that? our is what had on a more been destruction to back there of Or how needed? But

these do And projects carbon coming that to say, there? see into can capture And more And on stone capture experience expertise of then projects, you about CCS-type really Fair green your on? hydrogen? should what's just stepping I Okay. talk get is there? And a there, enough. the we expect your carbon projects, you like position before

We think move parallel. that things in will

how gray lot continue which will will green hydrogen drive will hydrogen, people blue is which carbon the think and the hydrogen need of to means ammonia, a and matter up produced. to will clean in I the hydrogen. capture Then they no obviously system just that drive opportunities, hydrogen, blue transportation it cities, need a blue

will all think them I three go So, in of parallel.

We gray I the obviously, are playing we’re them. of largest in all three hydrogen producer We -- as said, in the of world.

carbon capture of on ammonia much when it obviously, announce of will hydrogen. blue working whether of the in is green them. is And projects of of time lot we, are production and hydrogen a whether all have or we comes involved very production that. for We production it And

I a need make fact. we play joke. is projects all the everybody want is fundamentally, by projects different and there would massive So, public And fundamental Because is and world announcements, that would science-based, the It will people these. is a Japan, in do fundamental about there that. warmer. Korea, think the not warming quite of the and even a opinion, because think that of Global these in U.S., will It forward, all of I I it future. activities. think and is go everybody move all And even three is for in in of a as something these opportunities frankly, is Europe, you a see China, result, change announced us everywhere to for in especially getting

Thank Okay. you.

Thank you, P.J.

comes next question from our with And John UBS. Roberts

any and in not Seifi. in that a dioxide. to dry you are This like helium? but going we for with company had Europe you, ice spikes facing may be shortages called there Do we you ACP, vaccine think some business big, Thank acquired in carbon the be Are distribution?

a comment with very and all on. to don't asking of involvement you're want And our with the agreement the people question. confidentiality good I I on working because are me we don't much vaccine, depends too because the about to that, really on we make that that. have market want really John, opine it development Well,

right. All

closing? coming renewal of assume years Secondly, sites. going announced, refineries with might couple close Shell And be other refinery next to you eight for its recently any closures. have up of contracts the see it's refinery Do hydrogen in some we'll that I

is that know only is know mean, know Those contract Convent are closing that closing. we -- the that Well, had is we Shell We one closing. because ones that come And know. Martinez Shell a up quite the in not Anything money -- we might going that I up. there. make material much we might that to we Products, to else to that be don't these are Shell But, things come frankly selling anyway. Air hydrogen is

So, even to out close, rob profit. going if lot they a it's not us of

you. Thank

you, Thank John.

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

some Hey, in cost the talk drivers other the You in you for of should have good about I hopper. XXXX? think can morning. Seifi, have other you projects earnings Potentially savings. growth some should pricing,

even Jazan keep positive EPS things So that trend? and other help are if Lu'An there the delayed, on are

for done. on and statements what to of very XXXX But record pricing. an don't because forward-looking That's trends absolutely excellent We have have in I want seen Mike. we really see about question, you're LNG. you morning, in pricing, make right. don't we Air comment Good track positive Products our

merchant even that. all even of in quarter, was of Our past X%, about COVID pricing the and all up in the in regions

projects, that some that said, results we our at of do that have time, do us. come able we because you able hope do for to to It's projects the January about not positive good this kind as going I'm have that, So, year. by LNG give But new stream. I that. a a lot I we of other other pricing. next are this then, we will going of be on things of But Therefore, very to uncertainty a guidance. as result for are And unfortunate

a that going region quick -- area growth or attractive follow-up us for growth Got then, forward? you remind Indonesia. is it. Can maybe why on capital And just for

if they we to Indonesia foreign President reduce things, imported at dependence oil at to have highest level, the their natural commitments has produce to currency. DME, such made their to a or going their and level buy reduce the that Because order on methanol chemicals in of resource, that decision play technology to all are lot leading that, coal, fundamental they are going internally, I these their use result as hope that as in They to them make have would see And that, think, coal exchange. to a -- we of use they be of have and they gasification a that. foreign projects our role with decision. you don't made Indonesia. Therefore, a in of

Thank you.

Thank you, sir.

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

Thank portion you. negotiations refinery the Aramco and just time what's in that Good your here the Jazan, with Seifi, terms from of Aramco product on of starting from their morning. needs Jazan? the line up

from from put It from months don't can is I you it But, with four and I David. be all really line morning, now. on family. David, I this I a know. well I time It thing, months hope month to your six don't don't can Good be want because now. mean, now. know. be can a

it will what line we thing. doing. appropriate and -- I are we are us to put think time be exactly everybody But would for knows this where not on a we

I wanted to just very open be that. about So

did get demand market we the paid just as customer when speak? And to operating fairly last the you given on when customer? -- doing in China not first, by well, Lu'An, And is end will why yet, appears be

is took the the -- shutdown, shut plant Well, the we cost down.

to plant and of or so the maybe now freeze different But with all don't to to the another, the on. the that these need We customer that that of them to calls. and we feel have of things our we The decided to you not their problem tell the they those that -- the to kind generate plant sure just restarted. parts keep the responsible what feel keep like I'm a things mean, -- up situation some customer they that that on anything the right are right It's product plant starting make of I don't of the be and all -- I right now. under -- decision. stays that obligated it that want need you have can they they mean want supply/demand it now of steam -- it's I'm We know price that. I major that time minds represent and a to the either of and we don't -- structural don't into to force you speaking oil as

situation they of from from the three decided But start now now, the formally to up change So can right as weeks two now. plant. or weeks haven't

you. Thank

Thank you, David.

with Bernstein. take question And we'll next Jonas our from Oxgaard

But really which mind. who the Hey. sticking at if Good you. take point is was one Like, stab morning. between Jazan, held by? or to JV Thank banks? and don't You is parties partners, hoping more the the negotiation Aramco, you the up I here?

way, in venture Saudi a Aramco I Well, taking in want partner to obviously, the to held the put end is But have a the day, say is sure, are parties. because for time. It interesting, we together three up. the also us joint Aramco is we a long with at But because wouldn't funny of different the they Saudi acquisition. it have do customer. It's

joint Aramco do is acquisition venture majority Saudi the themselves. Power you with Products ACWA is know, going to and the that shareholder, structure the Air as the So, of

with the dividend have what paid. is included, gets all billion. what them? they be committing is when they to video takes comes banks That have of on? situation the I is paid Those more What the with So finalized. get really the what all How related can time. things said, the they the time is LIBOR? and sheets, as Saudi the paid? interest things you conditions are, and rate taking included, that about they of what it to bit acquisition returns so All joint do physically and Aramco conference these hours not to doing that is, dividend time. first? the complicated venture? At conditions, their $X in of little and joint becomes of have that And unfortunately Who challenge. of term nobody that of their the to is to acquisition. what that the did negotiating are billion of they get are charge? a the is much the get Exactly And do much together the people term how The terms are final a venture what goes that $XX is two Considering then, want supply need issues to is financing who How

So at everything not even it which banks Aramco, in to parties deal have their the Saudi if all we then, we the their requirement do with but the have on yet, terms changes. end requirement. of is and to everything finalize everything you agree. the everything day, with done with and mean, finalize if even the of And obviously and and so banks I

major Now, they on the the are based It's like all the this. of the acquisition. These in of in view recent the complications What banks any see? a How U.S.? what just do they is see election other the future? did deal like

mind. And big interesting. Very you are hydrogen. your green talking don't you. question Both Thank a competitors biogas different into if about

Did built like Now, in five there biogas reason is talking ago. that guys ago, project? And if learn facility you're that about remember years three biogas Japan a you something years today? from hydrogen not I correctly, you a

will My we -- friend, talking problem. are about we no have

XXX,XXX are We day is it some hydrogen We for will two are power tons is are that world. in location Europe the That it. biogas those actually at a ridiculous for on have a related mean, projects there around biogas. assume against But -- I making quite hydrogen. of but there don't involved biogas trucks projects, specific those -- we to enough be doing anybody involving bio to anything honestly to

plants. those have We

joke. I have We biogas that is to the they that. be hydrogen a produce continue to have a claim, But plant tons of that on based would XXX day that. issue build no -- can that anybody with for

you. Thank

in much. this scale. do a to bigger be you, I'll very And Thank

Chris next Credit with take we'll question And from Parkinson our Suisse.

you. Thank Great.

despite world So Thank on seems we've kind Seifi, whether you COVID just forward. India opportunity that of are seen. in upfront Indonesia as are a opportunities in like likely would few hone moving you there you. which in still not be mentioned or these also opportunities being Can well? in the some It also

Thank we much you. participating India. India. the in the a Hope a in you Prime right giant very we is coal And about quotation India Chris, coal And well been on all opportunities project much have obviously, now, that. does record gasification. very talking for Minister request with with are very Chris. definitely gasification see actually, on India has for

billion or at seeing coal significant in expect gasification see is think opportunities Their we we'll are like India a will as as do converting bid gasification, that given that. significant China And is in very live dependence the now, and India about we same of leaders we tons future. reduce massively becoming Whether not, think very will that. their the on do are are result yes, and a process. of to a just We win Indonesia big chemicals. see, are but do they And And But right like participate countries a we probably coal because, it coal the year India it things amount India. project, participating gasification where on China publicly to definitely said, It's to systems. that. They project million through definitely And bidding has investment opportunity them is I in being $X see XXX of reality their a much place into that committed I Indonesia. these of that coal oil. matter we

a just Great. And quick as follow-up.

just trying ammonia why? markets a the obviously obviously also Europe. Do potential for identify and Just about opportunities are key quick But believe a talking in in lot question ammonia/blue have if Northeast just Asia? you. some you mobility investors And under-appreciating to been of us so

I will don't smart think catch they Well, up investors everything. that I very -- are with and

free a companies talking on. -- their that. for the people of I trading been go haven't Japan paying has to of they specifically Japan their and many some source a hydrogen is lot very to for Accord specifically think the are details is had is attention They about authorized reason as They focused is been much because because ammonia hydrogen years. that, look going ammonia COX of the ammonia meeting But making ammonia about concerned requirement hydrocarbons. produced want to -- have want of reduction. they they focused where their for in much COX the -- so they captured being blue are on -- or not getting use which by for Paris

the big focused focused So, is reason they're called that it intention what put which It in burn And ammonia I'm the think for intention -- then they which to result is right power on cars as be the the electricity That electricity And blue to ammonia and I is because on. ammonia. ammonia. are any didn't COX their is now right And the I use inject be therefore plus drive the I'm plants. I my a least into on Therefore so ammonia that and and now. doesn't my plan buy but change blue -- power their COX will going producing at ammonia. now was then take the is to it is produced is produced captured. was carbon-free. their in air which plants its ammonia It will going And would COX captured.

on about is do and electricity. because trucks to conclusion not to your are enough they cannot you because come will what they run that the think that I going buses

then heat I for why claim That's is focus. it. are aware and my with of very of electricity well focused they ammonia will free. and much is it So, of are blue all then all I so hydrogen I much COX okay very the ammonia And discussion that at But that But And And anyway. is the that right think And some take in thing can point their the are that electricity. electricity. on time, up they is is need that they clean we Japan. there focused now that that I what on. buildings other obviously will about generate burn

working and that. been looking projects aware have We of four it are -- on to supply five years or for we

much. very you Thank Great.

sir. you, Thank

hour -- gone left have there an We passed questions half operator? how XX many -- are more

have still two questions. currently we And

fine. We'll okay. ahead. take Go that's Okay, that. That's

next will question our And Mike Securities. Harrison come Global with Seaport from

there, strip that had Can if pipeline Hi, you good Charles that other Coast impact morning. A on your you what impact outages? from from out network? quick in you wondering hurricane. maybe Lake you saw outages separate Gulf power area. one the an impacts impact the And Just from saw any maintenance on

Good million in it's not mean or $XX it an million order impact, impact, million. not I but morning $X there Mike. of or Mike is million was the of $X material. $XX

talk same an impact. the But area. which have three didn't we Unfortunately, of that's been why them So, there was about. hit has there

a Our West Lake plant impact for while, is was the significant. line on out but our not bottom that

that in then and you supply or has seeing those Argon. and you're you're when produce merchant to costs of All past move the talk right. some it And low times mill around? been during rates downtime impacted steel have elevated when mills of some to in are what whether seeing utilization your taking about Can Argon demand ability bar

material Mike on that. Nothing

right. All very Thanks much.

okay, Mike. so this you, the ahead. question go last Yeah, then. be Thank will

last question from Alexander our And Laurence Jefferies. with comes

morning. Hi, good

any activity onsite have is any very the core where regions one end a or markets quick just In do improving? then. business, you Sorry bidding

sure I bidding Let say improving that? that of and for means all you people are When more bids me asking understand. there just make that

the gas people Exactly. In traditional the core industrial what businesses? as think of like

two Yes, obviously like point in the areas. out to electronics. would I is One

in the two world. new and parts the a of a second We people seeing both all obviously green are activity talking U.S. of blue about in inquiries areas. of and building about of that. ammonia, And lot fabs are of China one lot significant is There's in a and lot then blue the the hydrogen, Those hydrogen, there. other

you. Thank

thank Stay quarter. Well, our forward the very for you And safe. time. would appreciate healthy. I like And stay you thank the being your with -- for our to on for taking much. that, everybody results We next to All best. look we call much today. Please to talking very next interest. Thank you

conclude does you Thank conference. participation. for that today's And your

now may disconnect. You