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1、Table of Contents UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON,D.C.20549FORM 10-QQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended March 31,2023orTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANG

2、E ACT OF 1934For the transition period from toCommission file number001-38730LINDE PLC(Exact name of registrant as specified in its charter)Ireland98-1448883(State or other jurisdiction of incorporation)(I.R.S.Employer Identification No.)10 Riverview Drive,ForgeDanbury,Connecticut43 Church Street We

3、stUnited States 06810Woking,Surrey GU21 6HTUnited Kingdom(Address of principal executive offices)(Zip Code)(203)837-2000+44 14 83 242200(Registrants telephone number,including area code)N/A(Former name,former address and former fiscal year,if changed since last reportSecurities registered pursuant t

4、o Section 12(b)of the Act:Title of each classTrading symbol(s)Name of each exchange on which registeredOrdinary shares(0.001 nominal value per share)LIN New York Stock ExchangeIndicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Secu

5、rities Exchange Act of 1934 during the preceding 12 months(or for suchshorter period that the registrant was required to file such reports),and(2)has been subject to such filing requirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every

6、Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(or for such shorter period that the registrant was required to submit and post such files).Yes No Indicate by check mark whether the registrant is a large acce

7、lerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,or an emerging growth company.See the definitionsof“large accelerated filer,”“accelerated filer,”“smaller reporting company,”and emerging growth company in Rule 12b-2 of the Exchange Act.Large accelerated filer Ac

8、celerated filer Non-accelerated filer Smaller reporting company Emerging growth companyIf an emerging growth company,indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accountingstandards provided pursuant to

9、 Section 13(a)of the Exchange Act.Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No At March 31,2023,490,251,988 ordinary shares(0.001 par value)of the Registrant were outstanding.1 Table of Contents INDEXPART I-FINANCIAL INFORMATIO

10、N Item 1.Financial Statements(unaudited)Consolidated Statements of Income-Quarters Ended March 31,2023 and 20224Consolidated Statements of Comprehensive Income-Quarters Ended March 31,2023 and 20225Condensed Consolidated Balance Sheets-March 31,2023 and December 31,20226Condensed Consolidated Statem

11、ents of Cash Flows-Three Months Ended March 31,2023 and 20227Notes to Condensed Consolidated Financial Statements8Item 2.Managements Discussion and Analysis of Financial Condition and Results of Operations23Item 3.Quantitative and Qualitative Disclosures about Market Risk41Item 4.Controls and Proced

12、ures41PART II-OTHER INFORMATIONItem 1.Legal Proceedings42Item 1A.Risk Factors42Item 2.Unregistered Sales of Equity Securities and Use of Proceeds42Item 3.Defaults Upon Senior Securities42Item 4.Mine Safety Disclosures42Item 5.Other Information42Item 6.Exhibits43Signature442 Table of Contents Forward

13、-looking StatementsThis document contains“forward-looking statements”within the meaning of the Private Securities Litigation Reform Act of 1995.These forward-lookingstatements are identified by terms and phrases such as:anticipate,believe,intend,estimate,expect,continue,should,could,may,plan,project

14、,predict,will,potential,forecast,and similar expressions.They are based on managements reasonable expectations and assumptions as of the date the statements are madebut involve risks and uncertainties.These risks and uncertainties include,without limitation:the performance of stock markets generally

15、;developments inworldwide and national economies and other international events and circumstances,including trade conflicts and tariffs;changes in foreign currencies and ininterest rates;the cost and availability of electric power,natural gas and other raw materials;the ability to achieve price incr

16、eases to offset cost increases;catastrophic events including natural disasters,epidemics,pandemics such as COVID-19,and acts of war and terrorism;the ability to attract,hire,and retainqualified personnel;the impact of changes in financial accounting standards;the impact of changes in pension plan li

17、abilities;the impact of tax,environmental,healthcare and other legislation and government regulation in jurisdictions in which the company operates;the cost and outcomes of investigations,litigationand regulatory proceedings;the impact of potential unusual or non-recurring items;continued timely dev

18、elopment and market acceptance of new products andapplications;the impact of competitive products and pricing;future financial and operating performance of major customers and industries served;the impactof information technology system failures,network disruptions and breaches in data security;and

19、the effectiveness and speed of integrating new acquisitionsinto the business.These risks and uncertainties may cause future results or circumstances to differ materially from adjusted projections,estimates or otherforward-looking statements.Linde plc assumes no obligation to update or provide revisi

20、ons to any forward-looking statement in response to changing circumstances.The above listed risksand uncertainties are further described in Item 1A.Risk Factors in Linde plcs Form 10-K for the fiscal year ended December 31,2022 filed with the SEC onFebruary 28,2023,which should be reviewed carefully

21、.Please consider Linde plcs forward-looking statements in light of those risks.3 Table of Contents LINDE PLC AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF INCOME(Millions of dollars,except per share data)(UNAUDITED)Quarter Ended March 31,20232022Sales$8,193$8,211 Cost of sales,exclusive of depreciation

22、 and amortization4,431 4,798 Selling,general and administrative822 802 Depreciation and amortization948 1,112 Research and development36 35 Other charges18(4)Other income(expense)-net(5)12 Operating Profit1,933 1,480 Interest expense-net37 9 Net pension and OPEB cost(benefit),excluding service cost(

23、45)(64)Income Before Income Taxes and Equity Investments1,941 1,535 Income taxes430 369 Income Before Equity Investments1,511 1,166 Income from equity investments41 44 Net Income(Including Noncontrolling Interests)1,552 1,210 Less:noncontrolling interests(36)(36)Net Income Linde plc$1,516$1,174 Per

24、Share Data Linde plc ShareholdersBasic earnings per share$3.08$2.31 Diluted earnings per share$3.06$2.30 Weighted Average Shares Outstanding(000s):Basic shares outstanding491,817 507,152 Diluted shares outstanding495,676 511,410 The accompanying notes are an integral part of these financial statemen

25、ts.4 Table of Contents LINDE PLC AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(Millions of dollars)(UNAUDITED)Quarter Ended March 31,20232022NET INCOME(INCLUDING NONCONTROLLING INTERESTS)$1,552$1,210 OTHER COMPREHENSIVE INCOME(LOSS)Translation adjustments:Foreign currency translati

26、on adjustments229 60 Income taxes(12)Translation adjustments229 48 Funded status-retirement obligations(Note 8):Retirement program remeasurements(249)55 Reclassifications to net income(8)19 Income taxes63(21)Funded status-retirement obligations(194)53 Derivative instruments(Note 5):Current unrealize

27、d gain(loss)(75)18 Reclassifications to net income(6)(23)Income taxes16 2 Derivative instruments(65)(3)TOTAL OTHER COMPREHENSIVE INCOME(LOSS)(30)98 COMPREHENSIVE INCOME(LOSS)(INCLUDING NONCONTROLLING INTERESTS)1,522 1,308 Less:noncontrolling interests(34)(24)COMPREHENSIVE INCOME(LOSS)-LINDE PLC$1,48

28、8$1,284 The accompanying notes are an integral part of these financial statements.5 Table of Contents LINDE PLC AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(Millions of dollars)(UNAUDITED)March 31,2023December 31,2022AssetsCash and cash equivalents$4,962$5,436 Accounts receivable-net4,753 4

29、,559 Contract assets175 124 Inventories2,054 1,978 Prepaid and other current assets960 950 Total Current Assets12,904 13,047 Property,plant and equipment-net23,796 23,548 Goodwill26,418 25,817 Other intangible assets-net12,638 12,420 Other long-term assets4,552 4,826 Total Assets$80,308$79,658 Liabi

30、lities and equityAccounts payable$2,941$2,995 Short-term debt5,337 4,117 Current portion of long-term debt1,696 1,599 Contract liabilities3,070 3,073 Other current liabilities4,741 4,695 Total Current Liabilities17,785 16,479 Long-term debt11,744 12,198 Other long-term liabilities9,443 9,594 Total L

31、iabilities38,972 38,271 Redeemable noncontrolling interests13 13 Linde plc Shareholders Equity(Note 11):Ordinary shares,0.001 par value,authorized 1,750,000,000 shares,2023 issued:490,766,972 ordinaryshares;2022 issued:552,012,862 ordinary shares 1 Additional paid-in capital39,859 40,005 Retained ea

32、rnings6,092 20,541 Accumulated other comprehensive income(loss)(5,810)(5,782)Less:Treasury shares,at cost(2023 514,984 shares and 2022 59,555,235 shares)(171)(14,737)Total Linde plc Shareholders Equity39,970 40,028 Noncontrolling interests1,353 1,346 Total Equity41,323 41,374 Total Liabilities and E

33、quity$80,308$79,658 The accompanying notes are an integral part of these financial statements.6 Table of Contents LINDE PLC AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Millions of dollars)(UNAUDITED)Three Months Ended March 31,20232022Increase(Decrease)in Cash and Cash Equivalent

34、sOperationsNet income-Linde plc$1,516$1,174 Add:Noncontrolling interests36 36 Net Income(including noncontrolling interests)1,552 1,210 Adjustments to reconcile net income to net cash provided by operating activities:Other charges,net of payments(61)(34)Depreciation and amortization948 1,112 Deferre

35、d income taxes4(59)Share-based compensation30 34 Working capital:Accounts receivable(131)(340)Inventory(59)(35)Prepaid and other current assets(5)(107)Payables and accruals(64)51 Contract assets and liabilities,net(66)192 Pension contributions(10)(13)Long-term assets,liabilities and other(230)(11)Ne

36、t cash provided by(used by)operating activities1,908 2,000 InvestingCapital expenditures(829)(649)Acquisitions,net of cash acquired(808)(43)Divestitures,net of cash divested and asset sales3 27 Net cash provided by(used for)investing activities(1,634)(665)FinancingShort-term debt borrowings(repaymen

37、ts)-net1,199 1,416 Long-term debt borrowings60 2,296 Long-term debt repayments(542)(1,166)Issuances of ordinary shares13 10 Purchases of ordinary shares(859)(1,719)Cash dividends-Linde plc shareholders(623)(592)Noncontrolling interest transactions and other(12)(1)Net cash provided by(used for)financ

38、ing activities(764)244 Effect of exchange rate changes on cash and cash equivalents16 62 Change in cash and cash equivalents(474)1,641 Cash and cash equivalents,beginning-of-period5,436 2,823 Cash and cash equivalents,end-of-period$4,962$4,464 The accompanying notes are an integral part of these fin

39、ancial statements.7 Table of Contents INDEX TO NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTSNotes to Condensed Consolidated Financial Statements-Linde plc and Subsidiaries(Unaudited)Note 1.Summary of Significant Accounting Policies9Note 2.Other Charges9Note 3.Supplemental Information10Note 4.

40、Debt11Note 5.Financial Instruments11Note 6.Fair Value Disclosures13Note 7.Earnings Per Share Linde plc Shareholders14Note 8.Retirement Programs15Note 9.Commitments and Contingencies15Note 10.Segments17Note 11.Equity17Note 12.Revenue Recognition19Note 13.Business Acquisition218 Table of Contents 1.Su

41、mmary of Significant Accounting PoliciesLinde plc(Linde or the company)is an incorporated public limited company formed under the laws of Ireland.Lindes registered office is located at TenEarlsfort Terrace,Dublin 2,D02 T380 Ireland.Lindes principal executive offices are located at Forge,43 Church St

42、reet West,Woking,Surrey GU21 6HT,United Kingdom and 10 Riverview Drive,Danbury,Connecticut,06810,United States.On January 18,2023,shareholders approved the companys proposal for an intercompany reorganization that resulted in the delisting of its ordinary sharesfrom the Frankfurt Stock Exchange,on M

43、arch 1,2023,after the completion of legal and regulatory approvals.In connection with the closing of the intercompany reorganization on March 1,2023,Linde shareholders automatically received one share of the new holdingcompany,listed on the New York Stock Exchange,in exchange for each share of Linde

44、 plc that was previously owned.The new holding company is alsonamed“Linde plc”and trades under the existing ticker LIN(see Note 11).Presentation of Condensed Consolidated Financial Statements-In the opinion of Linde management,the accompanying condensed consolidated financialstatements include all a

45、djustments necessary for a fair presentation of the results for the interim periods presented and such adjustments are of a normalrecurring nature.The accompanying condensed consolidated financial statements should be read in conjunction with the notes to the consolidated financialstatements of Lind

46、e plc and subsidiaries in Lindes 2022 Annual Report on Form 10-K.There have been no material changes to the companys significantaccounting policies during 2023.Reclassifications Certain prior periods amounts have been reclassified to conform to the current years presentation.2.Other Charges2023 Othe

47、r ChargesOther charges were$18 million for the three months ended March 31,2023 and primarily related to costs incurred due to the intercompany reorganization.Other charges had an associated net income tax benefit of$45 million primarily comprised of a benefit of$124 million related to the resolutio

48、n of a U.S.income tax audit,partially offset by an accrual of$85 million for the potential settlement of an international income tax matter.The following table summarizes the activities related to the companys pre-tax Other charges for the three months ended March 31,2023:(millions of dollars)Severa

49、nce costsOther costreduction chargesTotal cost reductionprogram relatedchargesMerger-related andother chargesTotal other chargesBalance,December 31,2022$281$27$308$12$320 2023 Other charges 18 18 Less:Cash payments/receipts(79)(79)(79)Less:Non-cash charges Foreign currency translation and other(1)1

50、(2)(2)Balance,March 31,2023$201$28$229$28$257 2022 Other ChargesOther charges were a net benefit of$4 million for the three months ended March 31,2022,($1 million after tax).Total cost reduction program related chargeswere$4 million($4 million after tax),for the three months ended March 31,2022,prim

51、arily related to severance in the APAC segment.Merger-related costsand other charges were a benefit of$8 million for the three months ended March 31,2022,(benefit of$5 million after tax),primarily related to a gain on sale ofan interest in a joint venture.Classification in the condensed consolidated

52、 financial statementsThe costs are shown within operating profit in a separate line item on the consolidated statements of income.On the condensed consolidated statements of cashflows,the impact of these costs,net of cash payments,is shown as an adjustment to reconcile net income to net cash provide

53、d by operating activities.In Note10 Segments,Linde excluded these costs from its management9 Table of Contents definition of segment operating profit;a reconciliation of segment operating profit to consolidated operating profit is shown within the segment operating profittable.3.Supplemental Informa

54、tionReceivablesLinde applies loss rates that are lifetime expected credit losses at initial recognition of the receivables.These expected loss rates are based on an analysis of theactual historical default rates for each business,taking regional circumstances into account.If necessary,these historic

55、al default rates are adjusted to reflect theimpact of current changes in the macroeconomic environment using forward-looking information.The loss rates are also evaluated based on the expectations ofthe responsible management team regarding the collectability of the receivables.Gross trade receivabl

56、es aged less than one year were$4,691 million and$4,498 million at March 31,2023 and December 31,2022,respectively,and gross receivables aged greater than one year were$333 million and$321 millionat March 31,2023 and December 31,2022,respectively.Other receivables were$155 million and$145 million at

57、 March 31,2023 and December 31,2022,respectively.Receivables aged greater than one year are generally fully reserved unless specific circumstances warrant exceptions,such as those backed byfederal governments.Accounts receivable net of reserves were$4,753 million at March 31,2023 and$4,559 million a

58、t December 31,2022.Allowances for expected credit losseswere$426 million at March 31,2023 and$405 million at December 31,2022.Provisions for expected credit losses were$53 million and$35 million for thethree months ended March 31,2023 and 2022,respectively.The allowance activity in the three months

59、ended March 31,2023 and 2022 related to write-offs ofuncollectible amounts,net of recoveries and currency movements is not material.InventoriesThe following is a summary of Lindes consolidated inventories:(Millions of dollars)March 31,2023December 31,2022InventoriesRaw materials and supplies$569$567

60、 Work in process391 368 Finished goods1,094 1,043 Total inventories$2,054$1,978 10 Table of Contents 4.DebtThe following is a summary of Lindes outstanding debt at March 31,2023 and December 31,2022:(Millions of dollars)March 31,2023December 31,2022SHORT-TERMCommercial paper$5,063$3,926 Other bank b

61、orrowings(primarily non U.S.)274 191 Total short-term debt5,337 4,117 LONG-TERM(a)(U.S.dollar denominated unless otherwise noted)2.70%Notes due 2023(c)501 2.00%Euro denominated notes due 2023(b)706 699 5.875%GBP denominated notes due 2023(b)371 367 1.20%Euro denominated notes due 2024596 588 1.875%E

62、uro denominated notes due 2024(b)327 324 4.800%Notes due 2024299 299 4.700%Notes due 2025598 598 2.65%Notes due 2025399 400 1.625%Euro denominated notes due 2025539 533 0.00%Euro denominated notes due 2026761 751 3.20%Notes due 2026725 724 3.434%Notes due 2026198 198 1.652%Euro denominated notes due

63、 202789 88 0.25%Euro denominated notes due 2027812 802 1.00%Euro denominated notes due 2027543 536 1.00%Euro denominated notes due 2028(b)765 749 1.10%Notes due 2030696 696 1.90%Euro denominated notes due 2030112 111 1.375%Euro denominated notes due 2031814 803 0.55%Euro denominated notes due 203280

64、8 798 0.375%Euro denominated notes due 2033536 529 1.625%Euro denominated notes due 2035860 849 3.55%Notes due 2042664 665 2.00%Notes due 2050296 296 1.00%Euro denominated notes due 2051741 731 Non U.S.borrowings175 152 Other10 10 13,440 13,797 Less:current portion of long-term debt(1,696)(1,599)Tot

65、al long-term debt11,744 12,198 Total debt$18,777$17,914 (a)Amounts are net of unamortized discounts,premiums and/or debt issuance costs as applicable.(b)March 31,2023 and December 31,2022 included a cumulative$47 million and$56 million adjustment to carrying value,respectively,related to hedgeaccoun

66、ting of interest rate swaps.Refer to Note 5.(c)In February 2023,Linde repaid$500 million of 2.70%notes that became due.The company maintains a$5 billion and a$1.5 billion unsecured revolving credit agreement with a syndicate of banking institutions that expire December 7,2027 and December 7,2023,res

67、pectively.There are no financial maintenance covenants contained within the credit agreements.No borrowings wereoutstanding under the credit agreements as of March 31,2023.5.Financial InstrumentsIn its normal operations,Linde is exposed to market risks relating to fluctuations in interest rates,fore

68、ign currency exchange rates,energy and commoditycosts.The objective of financial risk management at Linde is to minimize the negative impact of such fluctuations on the companys earnings and cash flows.To manage these risks,among other strategies,Linde routinely enters into various derivative financ

69、ial instruments(“derivatives”)including interest-rate swapand treasury rate lock agreements,currency-swap agreements,forward contracts,currency options,and commodity-swap agreements.These instruments arenot entered into for trading purposes and Linde only uses commonly traded and non-leveraged instr

70、uments.There are three types of derivatives that the company enters into:(i)those relating to fair-value exposures,(ii)those relating to cash-flow exposures,and(iii)those relating to foreign currency net investment exposures.Fair-value exposures relate to recognized assets or liabilities,and firm co

71、mmitments;cash-flowexposures relate to the variability of future cash flows associated with recognized assets or liabilities,or forecasted transactions;and net investment exposuresrelate to the impact of foreign currency exchange rate changes on the carrying value of net assets denominated in foreig

72、n currencies.When a derivative is executed and hedge accounting is appropriate,it is designated as either a fair-value hedge,cash-flow hedge,or a net investment hedge.Currently,Linde designates all interest-rate and treasury-rate locks as hedges for accounting purposes;however,cross-currency contrac

73、ts are generally notdesignated as hedges for accounting purposes.Certain currency contracts related to forecasted transactions are designated as hedges for accounting purposes.Whether designated as hedges for accounting purposes or not,all derivatives are linked to an appropriate underlying exposure

74、.On an ongoing basis,thecompany assesses the hedge effectiveness of all derivatives designated as hedges for accounting purposes to determine if they continue to be highly effective inoffsetting changes in fair values or cash flows of the underlying hedged items.If it is determined that the hedge is

75、 not highly effective through the use of aqualitative assessment,then hedge accounting will be discontinued prospectively.Counterparties to Lindes derivatives are major banking institutions with credit ratings of investment grade or better.The company has Credit Support Annexes(CSAs)in place for cer

76、tain entities with their principal counterparties to minimize potential default risk and to mitigate counterparty risk.Under the CSAs,the fair values of derivatives for the purpose of interest rate and currency management are collateralized with cash on a regular basis.As of March 31,2023,theimpact

77、of such collateral posting arrangements on the fair value of derivatives was insignificant.Management believes the risk of incurring losses on derivativecontracts related to credit risk is remote and any losses would be immaterial.The following table is a summary of the notional amount and fair valu

78、e of derivatives outstanding at March 31,2023 and December 31,2022 for consolidatedsubsidiaries:Fair Value Notional AmountsAssets(a)Liabilities(a)(Millions of dollars)March 31,2023December 31,2022March 31,2023December 31,2022March 31,2023December 31,2022Derivatives Not Designated as HedgingInstrumen

79、ts:Currency contracts:Balance sheet items$3,439$3,056$12$13$2$7 Forecasted transactions366 449 9 9 5 9 Cross-currency swaps11 42 2 1 Total$3,816$3,547$21$22$9$17 Derivatives Designated as Hedging Instruments:Currency contracts:Forecasted transactions$312$323$9$6$3$5 Commodity contractsN/AN/A 1 4 Int

80、erest rate swaps867 856 66 70 Total Hedges$1,179$1,179$9$6$70$79 Total Derivatives$4,995$4,726$30$28$79$96(a)Amounts as of March 31,2023 and December 31,2022 included current assets of$27 million and$24 million which are recorded in prepaid and other current assets;long-term assets of$3million and$4

81、 million which are recorded in other long-term assets;current liabilities of$15 million and$2311 million which are recorded in other current liabilities;and long-term liabilities of$64 million and$73 million which are recorded in other long-term liabilities.Balance Sheet ItemsForeign currency contra

82、cts related to balance sheet items consist of forward contracts entered into to manage the exposure to fluctuations in foreign-currencyexchange rates on recorded balance sheet assets and liabilities denominated in currencies other than the functional currency of the related operating unit.Certain fo

83、rward currency contracts are entered into to protect underlying monetary assets and liabilities denominated in foreign currencies from foreignexchange risk and are not designated as hedging instruments.For balance sheet items that are not designated as hedging instruments,the fair value adjustmentso

84、n these contracts are offset by the fair value adjustments recorded on the underlying monetary assets and liabilities.Forecasted TransactionsForeign currency contracts related to forecasted transactions consist of forward contracts entered into to manage the exposure to fluctuations in foreign-curre

85、ncy exchange rates on(1)forecasted purchases of capital-related equipment and services,(2)forecasted sales,or(3)other forecasted cash flowsdenominated in currencies other than the functional currency of the related operating units.For forecasted transactions that are designated as cash flow hedges,f

86、air value adjustments are recorded to accumulated other comprehensive income(loss)with deferred amounts reclassified to earnings over the same timeperiod as the income statement impact of the associated purchase.For forecasted transactions that do not qualify for cash flow hedging relationships,fair

87、 valueadjustments are recorded directly to earnings.Cross-Currency SwapsCross-currency interest rate swaps are entered into to limit the foreign currency risk of future principal and interest cash flows associated with intercompanyloans,and to a more limited extent bonds,denominated in non-functiona

88、l currencies.The fair value adjustments on the cross-currency swaps are recorded toearnings,where they are offset by fair value adjustments on the underlying intercompany loan or bond.Commodity ContractsCommodity contracts are entered into to manage the exposure to fluctuations in commodity prices,w

89、hich arise in the normal course of business from itsprocurement transactions.To reduce the extent of this risk,Linde enters into a limited number of electricity,natural gas,and propane gas derivatives.Forforecasted transactions that are designated as cash flow hedges,fair value adjustments are recor

90、ded to accumulated other comprehensive income(loss)withdeferred amounts reclassified to earnings over the same time period as the income statement impact of the associated purchase.Net Investment HedgesAs of March 31,2023,Linde has 8.5 billion($9.1 billion)Euro-denominated notes and intercompany loa

91、ns and 3.6 billion($0.5 billion)CNY-denominatedintercompany loans that are designated as hedges of the net investment positions in certain foreign operations.Since hedge inception,the deferred gainrecorded within cumulative translation adjustment component of accumulated other comprehensive income(l

92、oss)in the consolidated balance sheet and theconsolidated statement of comprehensive income is$265 million(deferred loss of$84 million for the three months ended March 31,2023).As of March 31,2023,exchange rate movements relating to previously designated hedges that remain in accumulated other compr

93、ehensive income(loss)is ata gain of$56 million.These movements will remain in accumulated other comprehensive income(loss),until appropriate,such as upon sale or liquidation ofthe related foreign operations at which time amounts will be reclassified to the consolidated statements of income.Interest

94、Rate SwapsLinde uses interest rate swaps to hedge the exposure to changes in the fair value of financial assets and financial liabilities as a result of interest rate changes.These interest rate swaps effectively convert fixed-rate interest exposures to variable rates;fair value adjustments are reco

95、gnized in earnings along with anequally offsetting charge/benefit to earnings for the changes in the fair value of the underlying financial asset or financial liability(See Note 4).12 Derivatives Impact on Consolidated Statements of IncomeThe following table summarizes the impact of the companys der

96、ivatives on the consolidated statements of income:Amount of Pre-Tax Gain(Loss)Recognized in Earnings*Quarter Ended March 31,(Millions of dollars)20232022Derivatives Not Designated as Hedging InstrumentsCurrency contracts:Balance sheet itemsDebt-related$(39)$51 Other balance sheet items(1)(12)Total$(

97、40)$39*The gains(losses)on balance sheet items are offset by gains(losses)recorded on the underlying hedged assets and liabilities.Accordingly,the gains(losses)for the derivatives and the underlyinghedged assets and liabilities related to debt items are recorded in the consolidated statements of inc

98、ome as interest expense-net.Other balance sheet items and anticipated net income gains(losses)are generally recorded in the consolidated statements of income as other income(expenses)-net.The amounts of gain or loss recognized in accumulated other comprehensive income(loss)and reclassified to the co

99、nsolidated statement of income was notmaterial for the three months ended March 31,2023 and 2022,respectively.Net impacts expected to be reclassified to earnings during the next twelve monthsare also not material.6.Fair Value DisclosuresThe fair value hierarchy prioritizes the inputs to valuation te

100、chniques used to measure fair value into three broad levels as follows:Level 1 quoted prices in active markets for identical assets or liabilitiesLevel 2 quoted prices for similar assets and liabilities in active markets or inputs that are observableLevel 3 inputs that are unobservable(for example c

101、ash flow modeling inputs based on assumptions)Assets and Liabilities Measured at Fair Value on a Recurring BasisThe following table summarizes assets and liabilities measured at fair value on a recurring basis:Fair Value Measurements Using Level 1Level 2Level 3(Millions of dollars)March 31,2023Decem

102、ber 31,2022March 31,2023December 31,2022March 31,2023December 31,2022AssetsDerivative assets$30$28$Investments and securities*20 20 12 13 Total$20$20$30$28 12$13 LiabilitiesDerivative liabilities$79$96$*Investments and securities are recorded in prepaid and other current assets and other long-term a

103、ssets in the companys condensed consolidated balancesheets.Level 1 investments and securities are marketable securities traded on an exchange.Level 2 investments are based on market prices obtained from independentbrokers or determined using quantitative models that use as their basis readily observ

104、able market parameters that are actively quoted and can be validatedthrough external sources,including third-party pricing services,brokers and market transactions.Level 3 investments and securities consist of a venture fund.For the valuation,Linde uses the net asset value received as part of the fu

105、nds quarterly reporting,which for the most part is not based on quoted prices inactive markets.In order to reflect current market conditions,Linde proportionally adjusts by observable market data(stock exchange prices)or currenttransaction prices.13 Table of Contents Changes in level 3 investments a

106、nd securities were immaterial.The fair value of cash and cash equivalents,short-term debt,accounts receivable-net,and accounts payable approximate carrying value because of the short-term maturities of these instruments.The fair value of long-term debt is estimated based on the quoted market prices

107、for the same or similar issues.Long-term debt is categorized within eitherLevel 1 or Level 2 of the fair value hierarchy depending on the trading volume of the issues and whether or not they are actively quoted in the market asopposed to traded through over-the-counter transactions.At March 31,2023,

108、the estimated fair value of Lindes long-term debt portfolio was$11,774 millionversus a carrying value of$13,440 million.At December 31,2022,the estimated fair value of Lindes long-term debt portfolio was$11,994 million versus acarrying value of$13,797 million.Differences between the carrying value a

109、nd the fair value are attributable to fluctuations in interest rates subsequent to whenthe debt was issued and relative to stated coupon rates.7.Earnings Per Share Linde plc ShareholdersBasic and diluted earnings per share is computed by dividing Net income Linde plc for the period by the weighted a

110、verage number of either basic or dilutedshares outstanding,as follows:Quarter Ended March 31,20232022Numerator(Millions of dollars)Net Income Linde plc$1,516$1,174 Denominator(Thousands of shares)Weighted average shares outstanding491,321 506,716 Shares earned and issuable under compensation plans49

111、6 436 Weighted average shares used in basic earnings per share491,817 507,152 Effect of dilutive securitiesStock options and awards3,859 4,258 Weighted average shares used in diluted earnings per share495,676 511,410 Basic Earnings Per Share$3.08$2.31 Diluted Earnings Per Share$3.06$2.30 There were

112、no antidilutive shares for any period presented.14 Table of Contents 8.Retirement ProgramsThe components of net pension and postretirement benefits other than pensions(“OPEB”)costs for the three months ended March 31,2023 and 2022 areshown below:Quarter Ended March 31,(Millions of dollars)20232022Am

113、ount recognized in Operating ProfitService cost$21$33 Amount recognized in Net pension and OPEB cost(benefit),excluding service costInterest cost92 53 Expected return on plan assets(129)(136)Net amortization and deferral(8)19(45)(64)Net periodic benefit cost(benefit)$(24)$(31)Components of net perio

114、dic benefit expense for other post-retirement plans for three months ended March 31,2023 and 2022 were not material.Linde estimates that 2023 required contributions to its pension plans will be in the range of approximately$40 million to$50 million,of which$10 millionhave been made through March 31,

115、2023.9.Commitments and ContingenciesContingent LiabilitiesLinde is subject to various lawsuits and government investigations that arise from time to time in the ordinary course of business.These actions are based uponalleged environmental,tax,antitrust and personal injury claims,among others.Linde h

116、as strong defenses in these cases and intends to defend itself vigorously.It is possible that the company may incur losses in connection with some of these actions in excess of accrued liabilities.Management does not anticipate thatin the aggregate such losses would have a material adverse effect on

117、 the companys consolidated financial position or liquidity;however,it is possible that thefinal outcomes could have a significant impact on the companys reported results of operations in any given period(see Note 17 to the consolidated financialstatements of Lindes 2022 Annual Report on Form 10-K).S

118、ignificant matters are:During 2009,the Brazilian government published Law 11941/2009 instituting a new voluntary amnesty program(“Refis Program”)which allowedBrazilian companies to settle certain federal tax disputes at reduced amounts.During 2009,the company decided that it was economically benefic

119、ial tosettle many of its outstanding federal tax disputes and such disputes were enrolled in the Refis Program,subject to final calculation and review by theBrazilian federal government.The company recorded estimated liabilities based on the terms of the Refis Program.Since 2009,Linde has been unabl

120、eto reach final agreement on the calculations and initiated litigation against the government in an attempt to resolve certain items.Open issues relate tothe following matters:(i)application of cash deposits and net operating loss carryforwards to satisfy obligations and(ii)the amount of tax reducti

121、onsavailable under the Refis Program.It is difficult to estimate the timing of resolution of legal matters in Brazil.At March 31,2023,the most significant non-income tax claims in Brazil,after enrollment in the Refis Program,relate to state VAT tax matters.Thetotal estimated exposure relating to suc

122、h claims,including interest and penalties,as appropriate,is approximately$110 million.Linde has not recordedany liabilities related to such claims based on management judgment and opinions of outside counsel.During the first quarter of 2023,the Brazilian Supreme Court issued a decision related to a

123、federal tax matter that the company previously disclosed asa contingency in Note 17 to the consolidated financial statements of Lindes 2022 Annual report on Form 10-K.As a result of this decision,thecompany recorded a reserve based on its best estimate of potential settlement(see Note 2).Because lit

124、igation in Brazil historically takes many years toresolve,it is very difficult to estimate the timing of resolution of these matters;however,it is possible that certain of these matters may be resolvedwithin the near term.The company is vigorously defending against the proceedings.15 Table of Conten

125、ts On September 1,2010,CADE(Brazilian Administrative Council for Economic Defense)announced alleged anticompetitive activity on the part of fiveindustrial gas companies in Brazil and imposed fines.Originally,CADE imposed a civil fine of$2.2 billion Brazilian reais($435 million)on WhiteMartins,the Br

126、azil-based subsidiary of Linde Inc.The fine was reduced to$1.7 billion Brazilian reais($336 million)due to a calculation error made byCADE.The fine against White Martins was overturned by the Ninth Federal Court of Brasilia.CADE appealed this decision,and the Federal Court ofAppeals rejected CADEs a

127、ppeal and confirmed the decision of the Ninth Federal Court of Brasilia.CADE has filed an appeal with the Superior Courtof Justice and a decision is pending.Similarly,on September 1,2010,CADE imposed a civil fine of$237 million Brazilian reais($47 million)on Linde Gases Ltda.,the former Brazil-based

128、subsidiary of Linde AG,which was divested to MG Industries GmbH on March 1,2019 and with respect to which Linde provided a contractualindemnity.The fine was reduced to$188 million Brazilian reais($37 million)due to a calculation error made by CADE.The fine against Linde GasesLtda.was overturned by t

129、he Seventh Federal Court in Brasilia.CADE appealed this decision,and the Federal Court of Appeals rejected CADEs appealand confirmed the decision of the Seventh Federal Court of Brasilia.CADE filed an appeal with the Superior Court of Justice which was denied.Inparallel,CADE filed(i)an appeal with t

130、he Supreme Court of Justice,which was denied,and(ii)a subsequent appeal to a panel of the Supreme Courtof Justice where a final decision is pending.Linde has strong defenses and is confident that it will prevail on appeal and have the fines overturned.Linde strongly believes that the allegations ofa

131、nticompetitive activity against our current and former Brazilian subsidiaries are not supported by valid and sufficient evidence.Linde believes that thisdecision will not stand up to judicial review and deems the possibility of cash outflows to be extremely unlikely.As a result,no reserves have been

132、recorded as management does not believe that a loss from this case is probable.On and after April 23,2019 former shareholders of Linde AG filed appraisal proceedings at the District Court(Landgericht)Munich I(Germany),seeking an increase of the cash consideration paid in connection with the previous

133、ly completed cash merger squeeze-out of all of Linde AGs minorityshareholders for 189.46 per share.Any such increase would apply to all 14,763,113 Linde AG shares that were outstanding on April 8,2019,when thecash merger squeeze-out was completed.The period for plaintiffs to file claims expired on J

134、uly 9,2019.The company believes the consideration paidwas fair and that the claims lack merit,and no reserve has been established.We cannot estimate the timing of resolution.On December 30,2022,the Russian Arbitration Court of the St.Petersburg and Leningrad Region issued an injunction preventing(i)

135、the sale of anyshares in Lindes subsidiaries and joint ventures in Russia,and(ii)the disposal of any of assets in those entities exceeding 5%of the relevantcompanys overall asset value.The injunction is not expected to have any impact on the operations of Lindes Russian businesses.The injunction was

136、requested by RusChemAlliance(RCA)as a preliminary measure to secure payment of an eventual award under an arbitration proceeding RCA intendsto file against Linde Engineering for alleged breach of contract under the agreement to build a gas processing plant in Ust Luga,Russia entered intobetween a co

137、nsortium of Linde Engineering and Renaissance Heavy Industries LLC,and RCA on July 7,2021.Performance of the agreement waslawfully suspended by Linde Engineering on May 27,2022 in compliance with applicable sanctions and in accordance with a decision by the sanctionsauthority in Germany.On March 1,2

138、023,RCA filed a claim in St.Petersburg against Linde GmbH for recovery of advance payments under theagreement(Russian Claim).On March 4,2023,in accordance with the dispute resolution provisions of the agreement,Linde GmbH filed a notice ofarbitration with the Hong Kong International Arbitration Cent

139、re(HKIAC)against RCA to claim that(i)RCA has no entitlement to payment,(ii)RCAs Russian claim is in breach of the arbitration agreement,and(iii)RCA must compensate Linde for the losses and damages caused by theinjunction.Additionally,Linde GmbH filed for and on March 17,2023 obtained an anti-suit in

140、junction from a Hong Kong court against RCA directingRCA to seek a stay of the Russian Claim and ordering it to resolve any disputes in accordance with HKIAC arbitration.As of March 31,2023,Linde had approximately$1.2 billion of advance payments recorded in contract liabilities related to engineerin

141、g projects withRCA which are subject to sanctions and have been suspended accordingly as of May 27,2022.Contract liabilities are typically recognized as revenueas performance obligations are satisfied under contract terms.Linde deconsolidated its Russian gas and engineering business entities as of J

142、une 30,2022,and the remaining investment value of its Russia subsidiaries is immaterial.As such,the obligation to satisfy any residual contract liabilities isnot expected to have an adverse impact on earnings,but may result in net cash outflows.It is difficult to estimate the timing of resolution of

143、 this matter.The company intends to vigorously defend its interests in both the injunction andarbitration proceedings.16 Table of Contents 10.SegmentsFor a description of Linde plcs operating segments,refer to Note 18 to the consolidated financial statements on Linde plcs 2022 Annual Report on Form

144、10-K.The table below presents sales and operating profit information about reportable segments and Other for the three months ended March 31,2023 and 2022.Quarter Ended March 31,(Millions of dollars)20232022SALESAmericas$3,551$3,241 EMEA2,177 2,148 APAC1,598 1,602 Engineering540 728 Other327 492 Tot

145、al sales$8,193$8,211 Quarter Ended March 31,(Millions of dollars)20232022SEGMENT OPERATING PROFITAmericas$1,025$904 EMEA607 503 APAC423 399 Engineering149 143 Other2(44)Segment operating profit2,206 1,905 Other charges(Note 2)(18)4 Purchase accounting impacts-Linde AG(255)(429)Total operating profit

146、$1,933$1,480(a)Sales reflect external sales only.Intersegment sales,primarily from Engineering to the industrial gases segments,were$294 million for the three months ended March 31,2023 and$231 millionfor the respective 2022 period.11.EquityEquityOn March 1,2023,in connection with the shareholder ap

147、proved intercompany reorganization that resulted in the delisting of old Linde plc from the New YorkStock Exchange(NYSE)and the Frankfurt Stock Exchange(FSE),and the subsequent relisting of new Linde plc to the NYSE,Linde shareholdersautomatically received one share of the new holding company,listed

148、 on the NYSE in exchange for each share of Linde plc that was previously owned.Thecompany issued 490,766,972 new Linde shares.Linde plcs historical treasury shares were immediately canceled which resulted in an approximately$15 billion decrease in treasury shares and retained earnings in Shareholder

149、s Equity for the period ended March 31,2023.A summary of the changes in total equity for the three months ended March 31,2023 and 2022 is provided below:(a)17 Table of Contents Quarter Ended March 31,(Millions of dollars)20232022ActivityLinde plcShareholdersEquityNoncontrollingInterestsTotalEquityLi

150、nde plcShareholdersEquityNoncontrollingInterestsTotalEquityBalance,beginning of period$40,028$1,346$41,374$44,035$1,393$45,428 Net income(a)1,516 36 1,552 1,174 36 1,210 Other comprehensive income(loss)(28)(2)(30)110(12)98 Noncontrolling interests:Additions(reductions)2 2 4 4 Dividends and other cap

151、ital changes(29)(29)(7)(7)Dividends to Linde plc ordinary share holders($1.275 per share in 2023 and$1.17 per share in2022)(623)(623)(592)(592)Issuances of ordinary shares:For employee savings and incentiveplans(63)(63)(46)(46)Purchases of ordinary shares(890)(890)(1,752)(1,752)Share-based compensat

152、ion30 30 34 34 Balance,end of period$39,970$1,353$41,323$42,963$1,414$44,377(a)Net income for noncontrolling interests excludes net income related to redeemable noncontrolling interests which is not significant for the three months ended March 31,2023 and 2022 and whichis not part of total equity.Th

153、e components of Accumulated other comprehensive income(loss)are as follows:March 31,December 31,(Millions of dollars)20232022Cumulative translation adjustment-net of taxes:Americas$(3,754)$(3,942)EMEA(1,016)(1,249)APAC(881)(835)Engineering(190)(241)Other288 483(5,553)(5,784)Derivatives-net of taxes(

154、3)62 Pension/OPEB(net of$9 million tax benefit and$54 million tax obligation at March 31,2023 and December 31,2022,respectively)(254)(60)$(5,810)$(5,782)18 Table of Contents 12.Revenue RecognitionRevenue is accounted for in accordance with ASC 606.Revenue is recognized as control of goods or service

155、s are transferred to customers in an amount thatreflects the consideration to which an entity expects to be entitled to receive in exchange for the goods or services.Contracts with CustomersLinde serves a diverse group of industries including healthcare,chemicals and energy,manufacturing,metals and

156、mining,food and beverage,and electronics.Industrial GasesWithin each of the companys geographic segments for industrial gases,there are three basic distribution methods:(i)on-site or tonnage;(ii)merchant or bulkliquid;and(iii)packaged or cylinder gases.The distribution method used by Linde to supply

157、 a customer is determined by many factors,including thecustomers volume requirements and location.The distribution method generally determines the contract terms with the customer and,accordingly,the revenuerecognition accounting practices.Lindes primary products in its industrial gases business are

158、 atmospheric gases(oxygen,nitrogen,argon,rare gases)andprocess gases(carbon dioxide,helium,hydrogen,electronic gases,specialty gases,acetylene).These products are generally sold through one of the threedistribution methods.Following is a description of each of the three industrial gases distribution

159、 methods and the respective revenue recognition policies:On-site.Customers that require the largest volumes of product and that have a relatively constant demand pattern are supplied by cryogenic and process gas on-site plants.Linde constructs plants on or adjacent to these customers sites and suppl

160、ies the product directly to customers by pipeline.Where there are largeconcentrations of customers,a single pipeline may be connected to several plants and customers.On-site product supply contracts generally are totalrequirement contracts with terms typically ranging from 10-20 years and contain mi

161、nimum purchase requirements and price escalation provisions.Many of thecryogenic on-site plants also produce liquid products for the merchant market.Therefore,plants are typically not dedicated to a single customer.Additionally,Linde is responsible for the design,construction,operations and maintena

162、nce of the plants and our customers typically have no involvement in these activities.Advanced air separation processes also allow on-site delivery to customers with smaller volume requirements.The companys performance obligations related to on-site customers are satisfied over time as customers rec

163、eive and obtain control of the product.Linde haselected to apply the practical expedient for measuring progress towards the completion of a performance obligation and recognizes revenue as the company hasthe right to invoice each customer,which generally corresponds with product delivery.Accordingly

164、,revenue is recognized when product is delivered to thecustomer and the company has the right to invoice the customer in accordance with the contract terms.Consideration in these contracts is generally based onpricing which fluctuates with various price indices.Variable components of consideration e

165、xist within on-site contracts but are considered constrained.Merchant.Merchant deliveries generally are made from Lindes plants by tanker trucks to storage containers at the customers site.Due to the relatively highdistribution cost,merchant oxygen and nitrogen generally have a relatively small dist

166、ribution radius from the plants at which they are produced.Merchantargon,hydrogen and helium can be shipped much longer distances.The customer agreements used in the merchant business are usually three-to seven-yearsupply agreements based on the requirements of the customer.These contracts generally

167、 do not contain minimum purchase requirements or volumecommitments.The companys performance obligations related to merchant customers are generally satisfied at a point in time as the customers receive and obtain control ofthe product.Revenue is recognized when product is delivered to the customer a

168、nd the company has the right to invoice the customer in accordance with thecontract terms.Any variable components of consideration within merchant contracts are constrained;however,this consideration is not significant.Packaged Gases.Customers requiring small volumes are supplied products in contain

169、ers called cylinders,under medium to high pressure.Linde distributesmerchant gases from its production plants to company-owned cylinder filling plants where cylinders are then filled for distribution to customers.Cylinders maybe delivered to the customers site or picked up by the customer at a packa

170、ging facility or retail store.Linde invoices the customer for the industrial gases andthe use of the cylinder container(s).The company also sells hardgoods and welding equipment purchased from independent manufacturers.Packaged gases aregenerally sold under one to three-year supply contracts and pur

171、chase orders and do not contain minimum purchase requirements or volume commitments.The companys performance obligations related to packaged gases are satisfied at a point in time.Accordingly,revenue is recognized when product is deliveredto the customer or when the customer picks up product from a

172、packaged gas facility or19 Table of Contents retail store and the company has the right to payment from the customer in accordance with the contract terms.Any variable consideration is constrained andwill be recognized when the uncertainty related to the consideration is resolved.EngineeringThe comp

173、any designs and manufactures equipment for air separation and other industrial gas applications manufactured specifically for end customers.Sale ofequipment contracts are generally comprised of a single performance obligation.Revenue from sale of equipment is generally recognized over time as Lindeh

174、as an enforceable right to payment for performance completed to date and performance does not create an asset with alternative use.For contracts recognizedover time,revenue is recognized primarily using a cost incurred input method.Costs incurred to date relative to total estimated costs at completi

175、on are used tomeasure progress toward satisfying performance obligations.Costs incurred include material,labor,and overhead costs and represent work contributing andproportionate to the transfer of control to the customer.Changes to cost estimates and contract modifications are typically accounted f

176、or as part of the existingcontract and are recognized as cumulative adjustments for the inception-to-date effect of such change.Contract Assets and LiabilitiesContract assets and liabilities result from differences in timing of revenue recognition and customer invoicing.Contract assets primarily rel

177、ate to sale ofequipment contracts for which revenue is recognized over time.The balance represents unbilled revenue which occurs when revenue recognized under themeasure of progress exceeds amounts invoiced to customers.Customer invoices may be based on the passage of time,the achievement of certain

178、 contractualmilestones or a combination of both criteria.Contract liabilities include advance payments or right to consideration prior to performance under the contract.Contract liabilities are recognized as revenue as performance obligations are satisfied under contract terms.Linde has contract ass

179、ets of$175 million and$124million at March 31,2023 and December 31,2022,respectively.Total contract liabilities are$3,997 million at March 31,2023(current of$3,070 million and$927 million within other long-term liabilities in the condensed consolidated balance sheets).As of March 31,2023,Linde has a

180、pproximately$1.8 billionrecorded in contract liabilities related to engineering projects in Russia subject to sanctions.Total contract liabilities were$3,986 million at December 31,2022(current contract liabilities of$3,073 million and$913 million within other long-term liabilities in the condensed

181、consolidated balance sheets).Revenuerecognized for the three months ended March 31,2023 that was included in the contract liability at December 31,2022 was$403 million.Contract assets andliabilities primarily relate to the Linde Engineering business.Payment Terms and OtherLinde generally receives pa

182、yment after performance obligations are satisfied,and customer prepayments are not typical for the industrial gases business.Payment terms vary based on the country where sales originate and local customary payment practices.Linde does not offer extended financing outside ofcustomary payment terms.A

183、mounts billed for sales and use taxes,value-added taxes,and certain excise and other specific transactional taxes imposed onrevenue producing transactions are presented on a net basis and are not included in sales within the consolidated statement of income.Additionally,salesreturns and allowances a

184、re not a normal practice in the industry and are not significant.Disaggregated Revenue InformationAs described above and in Note 19 to Linde plcs 2022 Annual Report on Form 10-K,the company manages its industrial gases business on a geographic basis,while the Engineering and Other businesses are gen

185、erally managed on a global basis.Furthermore,the company believes that reporting sales by distributionmethod by reportable geographic segment best illustrates the nature,timing,type of customer,and contract terms for its revenues,including terms and pricing.The following tables show sales by distrib

186、ution method at the consolidated level and for each reportable segment and Other for the three months ended March31,2023 and March 31,2022.(Millions of dollars)Quarter Ended March 31,2023SalesAmericasEMEAAPACEngineeringOtherTotal%Merchant$1,043$699$551$55$2,348 29%On-Site804 538 643 1,985 24%Package

187、d Gas1,638 928 354 20 2,940 36%Other66 12 50 540 252 920 11%Total$3,551$2,177$1,598$540$327$8,193 100%20 Table of Contents (Millions of dollars)Quarter Ended March 31,2022SalesAmericasEMEAAPACEngineeringOtherTotal%Merchant$874$614$516$39$2,043 25%On-Site883 631 655 2,169 26%Packaged Gas1,432 891 361

188、 7 2,691 33%Other52 12 70 728 446 1,308 16%Total$3,241$2,148$1,602$728$492$8,211 100%Remaining Performance ObligationsAs described above,Lindes contracts with on-site customers are under long-term supply arrangements which generally require the customer to purchase theirrequirements from Linde and a

189、lso have minimum purchase requirements.Additionally,plant sales from the Linde Engineering business are primarilycontracted on a fixed price basis.The company estimates the consideration related to future minimum purchase requirements and plant sales was approximately$48 billion(excludes Russian pro

190、jects which are impacted by sanctions).This amount excludes all on-site sales above minimum purchase requirements,whichcan be significant depending on customer needs.In the future,actual amounts will be different due to impacts from several factors,many of which are beyondthe companys control includ

191、ing,but not limited to,timing of newly signed,terminated and renewed contracts,inflationary price escalations,currencyexchange rates,and pass-through costs related to natural gas and electricity.The actual duration of long-term supply contracts ranges up to twenty years.Thecompany estimates that app

192、roximately half of the revenue related to minimum purchase requirements will be earned in the next five years and the remainingthereafter.13.Business AcquisitionAcquisition of nexAir,LLCOn January 5,2023,Linde completed the acquisition of nexAir,LLC,a gas distribution and welding supply company in t

193、he United States,in order to furtherexpand the companys geographic footprint into different regions.Prior to completion of the acquisition,Linde held a 23%interest in nexAir,LLC.Pursuant toa signed purchase agreement between Linde and nexAir,LLC,Linde purchased the remaining 77%ownership interest in

194、 an all cash transaction with a totalpurchase price of$859 million,or$804 million net of cash acquired.The fair value of Lindes equity interest in nexAir,LLC immediately preceding theacquisition date was$183 million,which resulted in a gain on remeasurement of the companys previously held equity int

195、erest which was not material;thisgain is recorded within“Other income(expenses)net”on the consolidated statements of income.Preliminary Allocation of Purchase PriceThe acquisition of nexAir,LLC was accounted for as a business combination.Following the acquisition date,100%of nexAir,LLCs results were

196、 consolidatedin the Americas business segment.Lindes first quarter 2023 consolidated income statement includes sales of$103 million related to nexAir,LLC.Pro formaresults for 2022 have not been included as the impact of the acquisition is not material to the consolidated statements of income.The com

197、pany has estimated the preliminary fair value of net assets acquired based on information currently available and will continue to adjust thoseestimates as additional information becomes available.The following table summarizes the fair value of identifiable assets acquired and liabilities assumed i

198、nthe acquisition of nexAir,LLC as of the acquisition date.21 Table of Contents (Millions of dollars)January 5,2023Assets:Cash and cash equivalents$55 Other current assets-net48Property,plant and equipment,net241Other intangible assets-net245Other long-term liabilities-net(5)Total identifiable net as

199、sets$584 Goodwill$458 Fair value of previously held equity interest$183 Total purchase price$859 nexAir,LLCs assets and liabilities were measured at estimated fair values at January 5,2023.Estimates of fair value represent managements best estimate ofassumptions about future events and uncertainties

200、,including significant judgments related to future cash flows(sales,costs,customer attrition rates,andcontributory asset charges),discount rates,competitive trends,and market comparables.Inputs used were generally obtained from historical data supplementedby current and anticipated market conditions

201、 and growth rates.The fair value of the previously held equity interest was based upon a purchase price valuation(excluding debt)multiplied by the companys previously heldownership interest adjusted by a discount for lack of marketability.The fair value of property,plant&equipment,net is based on as

202、sumptions that marketparticipants would use in pricing an asset,based on the most advantageous market for the asset(i.e.,its highest and best use).The cost approach,adjusted forthe age and condition of the property,plant and equipment,was used to estimate fair value.Identifiable intangible assets pr

203、imarily consist of customer relationships of approximately$245 million that will be amortized over their estimated useful life of20 years.The fair value of the customer relationships intangible asset was valued using a multi-period excess earnings method,a form of the income approach,which incorpora

204、tes the estimated future cash flows to be generated from nexAir,LLCs existing customer base.There were no indefinite-lived intangible assetsidentified in conjunction with the acquisition.The excess of the consideration for the acquisition over the preliminary fair value of net assets acquired was re

205、corded as goodwill.The acquisition resulted in$458 million of goodwill,the majority of which is expected to be deductible for tax purposes.The goodwill balance is primarily attributable to the assembledworkforce and operating synergies expected to result from the acquisition.The goodwill recorded as

206、 a result of the acquisition was allocated to the Americasreportable segment,which represents the reportable segment anticipated to experience operating synergies as a result of the acquisition.22 Table of Contents Item 2.Managements Discussion and Analysis of Financial Condition and Results of Oper

207、ations(MD&A)Non-GAAP MeasuresThroughout MD&A,the company provides adjusted operating results exclusive of certain items such as Other charges,net gains or losses on sale ofbusinesses,purchase accounting impacts of the Linde AG merger and pension settlement charges.Adjusted amounts are non-GAAP measu

208、res which areintended to supplement investors understanding of the companys financial information by providing measures which investors,financial analysts andmanagement find useful in evaluating the companys operating performance.Items which the company does not believe to be indicative of on-going

209、businessperformance are excluded from these calculations so that investors can better evaluate and analyze historical and future business trends on a consistent basis.Inaddition,operating results,excluding these items,is important to managements development of annual and long-term employee incentive

210、 compensation plans.Definitions of these non-GAAP measures may not be comparable to similar definitions used by other companies and are not a substitute for similar GAAPmeasures.The non-GAAP measures and reconciliations are separately included in a later section in the MD&A titled Non-GAAP Measures

211、and Reconciliations.23 Table of Contents Consolidated ResultsThe following table provides summary information for the three months ended March 31,2023 and 2022.The reported amounts are GAAP amounts from theConsolidated Statements of Income.The adjusted amounts are intended to supplement investors un

212、derstanding of the companys financial information and arenot a substitute for GAAP measures:Quarter Ended March 31,(Millions of dollars,except per share data)20232022VarianceSales$8,193$8,211%Cost of sales,exclusive of depreciation and amortization$4,431$4,798(8)%As a percent of sales54.1%58.4%Selli

213、ng,general and administrative$822$802 2%As a percent of sales10.0%9.8%Depreciation and amortization$948$1,112(15)%Other charges(b)$18$(4)(550)%Other income(expense)-net$(5)$12 142%Operating profit$1,933$1,480 31%Operating margin23.6%18.0%Interest expense-net$37$9 311%Net pension and OPEB cost(benefi

214、t),excluding service cost$(45)$(64)(30)%Effective tax rate22.2%24.0%Income from equity investments$41$44(7)%Noncontrolling interests$(36)$(36)%Net Income Linde plc$1,516$1,174 29%Diluted earnings per share$3.06$2.30 33%Diluted shares outstanding495,676 511,410(3)%Number of employees65,831 72,507(9)%

215、Adjusted Amounts(a)Operating profit$2,206$1,905 16%Operating margin26.9%23.2%Effective tax rate24.1%24.3%Net Income Linde plc$1,693$1,500 13%Diluted earnings per share$3.42$2.93 17%Other Financial Data(a)EBITDA$2,922$2,636 11%As percent of sales35.7%32.1%Adjusted EBITDA$2,963$2,663 11%As percent of

216、sales36.2%32.4%(a)Adjusted Amounts and Other Financial Data are non-GAAP performance measures.A reconciliation of reported amounts to adjusted amounts can be found in the Non-GAAP Measures andReconciliations section of this MD&A.(b)See Note 2 to the condensed consolidated financial statements.Report

217、edIn the first quarter of 2023,Lindes sales were$8,193 million,$18 million below prior year.Currency translation decreased sales by 3%in the quarter.Divestitures,net of acquisitions,decreased sales by 2%in the quarter,primarily due to the divestment of the GIST business,partially offset by the nexAi

218、r,LLCacquisition.Engineering decreased sales by 2%in the quarter.Cost pass-through,representing the contractual billing of energy cost variances primarily toonsite customers,decreased sales by 1%in the quarter,with minimal impact on operating profit.Volumes were flat in the quarter versus the 2022 r

219、espectiveperiod.The aforementioned drivers were offset by the 8%price attainment in the quarter.Reported operating profit for the first quarter of 2023 of$1,933 million,or 23.6%of sales,was 31%above prior year.The reported year-over-year increase wasprimarily due to higher pricing,productivity initi

220、atives and lower depreciation and amortization driven by merger related intangible assets.The reportedeffective tax rate(ETR)was 22.2%in the first quarter 2023 versus 24.0%in the first quarter 2022 driven by a net decrease in the uncertain tax positions foraudit settlements,partially offset by addit

221、ional accruals in non-U.S.jurisdictions.Diluted earnings per share(EPS)was$3.06,or 33%above EPS of$2.30 inthe first quarter of 2022 primarily due to higher net income-Linde plc and lower diluted shares outstanding.24 Table of Contents AdjustedIn the first quarter of 2023,adjusted operating profit of

222、$2,206 million,or 26.9%of sales,was 16%higher as compared to 2022,driven by higher pricing andproductivity initiatives,partially offset by inflation.The adjusted ETR was 24.1%in the first quarter 2023 versus 24.3%in the 2022 quarter.On an adjustedbasis,EPS was$3.42,17%above the 2022 adjusted EPS of$

223、2.93,driven by higher adjusted net income-Linde plc and lower diluted shares outstanding.OutlookLinde provides quarterly updates on operating results,material trends that may affect financial performance,and financial guidance via quarterly earningsreleases and investor teleconferences.These updates

224、 are available on the companys website,but are not incorporated herein.25 Table of Contents Results of operationsThe changes in consolidated sales compared to the prior year are attributable to the following:Quarter Ended March 31,2023 vs.2022%ChangeFactors Contributing to Changes-SalesVolume%Price/

225、Mix8%Cost pass-through(1)%Currency(3)%Acquisitions/divestitures(2)%Engineering(2)%SalesSales decreased$18 million for the first quarter of 2023 versus the respective 2022 period.Currency translation decreased sales by 3%in the quarter,driven bythe weakening of the Euro,Chinese yuan,British pound and

226、 Australian dollar against the U.S.dollar.The impact of divestitures,net of acquisitions decreasedsales by 2%in the quarter.Engineering decreased sales by 2%in the quarter.Cost pass-through decreased sales by 1%in the quarter,with minimal impact onoperating profit.Volumes were flat in the quarter ve

227、rsus the respective 2022 period.Higher pricing across all geographic segments contributed 8%to sales inthe quarter.Cost of sales,exclusive of depreciation and amortizationCost of sales,exclusive of depreciation and amortization decreased$367 million,or 8%,for the first quarter of 2023,primarily due

228、to currency,lower costpass-through,the net impact of acquisitions and divestitures and productivity gains which more than offset inflation.Cost of sales,exclusive of depreciationand amortization was 54.1%for the first quarter of 2023 versus 58.4%for the respective 2022 period.The decrease as a perce

229、ntage of sales for the first quarterof 2023 was due primarily to higher pricing.Selling,general and administrative expensesSelling,general and administrative expense(SG&A)increased$20 million,or 2%,for the first quarter of 2023.SG&A was 10.0%of first quarter salesversus 9.8%for the respective 2022 p

230、eriod.Currency impacts decreased SG&A by approximately$19 million for the quarter.Excluding currency impacts,underlying SG&A increased in the first quarter of 2023 primarily due to higher costs largely related to the acquisition of nexAir.Depreciation and amortizationReported depreciation and amorti

231、zation expense decreased$164 million,or 15%,for the first quarter of 2023.The decrease is related primarily to lowerdepreciation and amortization of intangible assets acquired in the merger and currency impacts.On an adjusted basis,depreciation and amortization increased$4 million,for the first quar

232、ter of 2023.Currency impacts decreased depreciation andamortization by$21 million for the first quarter of 2023.Excluding currency,underlying depreciation and amortization increased due to the net impact ofacquisitions and new project start ups.Other chargesOther charges were a charge of$18 million

233、and a benefit of$4 million for the first quarter of 2023 and 2022,respectively.The charge for the three monthsended March 31,2023 relates primarily to the intercompany reorganization.2022 benefit of$4 million includes severance of$4 million and an other netbenefit of$8 million related to a gain on s

234、ale of an interest in a joint venture(see Note 2 to the condensed consolidated financial statements).On an adjusted basis,these benefits and costs have been excluded in both periods.Operating profitOn a reported basis,operating profit increased$453 million,or 31%,for the first quarter of 2023.The in

235、crease was primarily due to higher pricing,savingsfrom productivity initiatives,and lower depreciation and amortization driven by merger related intangible assets.These increases more than offset the adverseimpacts of inflation and currency in the first quarter of 2023.On an adjusted basis,which exc

236、ludes the impacts of merger-related purchase accounting as well as other charges,operating profit increased$301 million,or16%in the first quarter of 2023.Operating profit growth was driven by higher pricing and26 Table of Contents productivity initiatives,which more than offset the effects of inflat

237、ion and currency during the periods.A discussion of operating profit by segment is includedin the segment discussion that follows.Interest expense-netReported interest expense-net increased$28 million for the first quarter of 2023.On an adjusted basis,interest expense increased$27 million for the fi

238、rstquarter of 2023 versus the respective 2022 period.The increase in the quarter is driven primarily by higher borrowing costs on short-term debt.Net pension and OPEB cost(benefit),excluding service costReported net pension and OPEB cost(benefit),excluding service cost were benefits of$45 million fo

239、r first quarter of 2023 versus$64 million for therespective 2022 period.The decrease in benefit primarily relates to higher interest cost reflective of the higher discount rate environment year-over-year.Effective tax rateThe reported effective tax rate(ETR)for the quarter was 22.2%versus 24.0%for t

240、he respective 2022 period.The decrease is primarily related to a netdecrease in uncertain tax positions for audit settlements partially offset by additional accruals in non-U.S.jurisdictions(see Note 2 to the condensedconsolidated financial statements).On an adjusted basis,the ETR for the quarter wa

241、s 24.1%versus 24.3%for the respective 2022 period.Income from equity investmentsReported income from equity investments for the first quarter of 2023 was$41 million,versus$44 million for the respective 2022 period.On an adjusted basis,income from equity investments for the first quarter of 2023 was$

242、59 million,versus$64 million in the prior year respective period.Noncontrolling interestsAt March 31,2023,noncontrolling interests consisted primarily of non-controlling shareholders investments in APAC(primarily China).Reportednoncontrolling interest was flat for the quarter ended March 31,2023 ver

243、sus the respective 2022 period.Net Income Linde plcReported net income-Linde plc increased$342 million,or 29%,for the first quarter of 2023 versus the respective 2022 period.On an adjusted basis,whichexcludes the impacts of purchase accounting and other charges,net income-Linde plc increased$193 mil

244、lion,or 13%,for the quarter versus the respective2022 period.On both a reported and adjusted basis,the increase was driven by higher operating profit.Diluted earnings per shareReported diluted earnings per share increased$0.76,or 33%,for the first quarter of 2023 versus the comparable 2022 period.On

245、 an adjusted basis,diluted EPSincreased$0.49,or 17%,for the first quarter of 2023 versus the respective 2022 period.The increase on both a reported and adjusted basis is primarily due tohigher net income-Linde plc and lower diluted shares outstanding.EmployeesThe number of employees at March 31,2023

246、 was 65,831,a decrease of 6,676 employees from March 31,2022,driven primarily by the sale of the GISTbusiness,cost reduction initiatives and the deconsolidation of Russian subsidiaries in the EMEA and Engineering segments.Other Financial DataEBITDA was$2,922 million for the first quarter of 2023 as

247、compared to$2,636 million in the respective 2022 period.The increase of$286 million was drivenby higher net income-Linde plc versus prior year.Adjusted EBITDA increased to$2,963 million for the first quarter 2023 from$2,663 million in therespective 2022 period.The higher EBITDA was primarily due to

248、higher net income-Linde plc versus the respective prior period.See the Non-GAAP Measures and Reconciliations section for definitions and reconciliations of these adjusted non-GAAP measures to reported GAAPamounts.Other Comprehensive Income(Loss)Other comprehensive loss for the first quarter of 2023

249、was$30 million,resulting primarily from$194 million associated with retirement programs and$65million relating to current unrealized loss on derivatives instruments,partially offset by favorable currency translation adjustments of$229 million during thequarter.The translation adjustments reflect the

250、 impact of translating local currency foreign subsidiary financial statements to U.S.dollars,and are largelydriven by the movement of the U.S.dollar against major currencies including the Euro,British pound and the Chinese yuan.See the Currency section of theMD&A for exchange rates used for translat

251、ion purposes and Note 11 to the condensed consolidated financial statements for a summary of the currencytranslation adjustment component of accumulated other comprehensive income(loss)by segment.27 Table of Contents Segment DiscussionThe following summary of sales and operating profit by segment pr

252、ovides a basis for the discussion that follows.Linde plc evaluates the performance of itsreportable segments based on operating profit,excluding items not indicative of ongoing business trends.The reported amounts are GAAP amounts from theConsolidated Statements of Income.Quarter Ended March 31,(Mil

253、lions of dollars)20232022VarianceSALESAmericas$3,551$3,241 10%EMEA2,177 2,148 1%APAC1,598 1,602%Engineering540 728(26)%Other327 492(34)%Total sales$8,193$8,211%SEGMENT OPERATING PROFITAmericas$1,025$904 13%EMEA607 503 21%APAC423 399 6%Engineering149 143 4%Other2(44)105%Segment operating profit$2,206

254、$1,905 16%Reconciliation to reported operating profit:Other charges(Note 2)(18)4 Purchase accounting impacts-Linde AG(255)(429)Total operating profit$1,933$1,480 28 Table of Contents Americas Quarter Ended March 31,(Millions of dollars)20232022VarianceSales$3,551$3,241 10%Operating profit$1,025$904

255、13%As a percent of sales28.9%27.9%Quarter Ended March 31,2023 vs.2022%ChangeFactors Contributing to Changes-SalesVolume1%Price/Mix7%Cost pass-through(1)%Currency%Acquisitions/divestitures3%10%The Americas segment includes Lindes industrial gases operations in approximately 20 countries including the

256、 United States,Canada,Mexico,and Brazil.SalesSales for the Americas segment increased$310 million,or 10%,in the first quarter versus the respective 2022 period.Higher pricing contributed 7%to sales inthe quarter.Volumes increased sales by 1%for the first quarter,driven by higher demand primarily in

257、the manufacturing and food and beverage end markets.Cost pass-through decreased sales by 1%for the first quarter with minimal impact on operating profit.The impact of net acquisitions increased sales by 3%inthe quarter,primarily due to the acquisition of nexAir,LLC(See Note 13 to the condensed conso

258、lidated financial statements).Operating profitOperating profit in the Americas segment increased$121 million,or 13%,in the first quarter versus the respective 2022 period,driven primarily by higherpricing,volumes,acquisitions and continued productivity initiatives which more than offset inflation du

259、ring the quarter.EMEA Quarter Ended March 31,(Millions of dollars)20232022VarianceSales$2,177$2,148 1%Operating profit$607$503 21%As a percent of sales27.9%23.4%Quarter Ended March 31,2023 vs.2022%ChangeFactors Contributing to Changes-SalesVolume(3)%Price/Mix13%Cost pass-through1%Currency(6)%Acquisi

260、tions/divestitures(4)%1%29 Table of Contents The EMEA segment includes Lindes industrial gases operations in approximately 45 European,Middle Eastern and African countries including Germany,United Kingdom,France,the Republic of South Africa and Sweden.SalesEMEA segment sales increased by$29 million,

261、or 1%,in the first quarter as compared to the respective 2022 period.Higher price attainment increased sales by13%in the quarter.Cost pass-through contributed 1%to sales in the quarter,with minimal impact on operating profit.Currency translation decreased sales by6%in the quarter,due largely to the

262、weakening of the Euro and British pound against the U.S.Dollar.Volumes decreased sales by 3%in the quarter.Theimpact of net divestitures decreased sales by 4%in the quarter,primarily due to the deconsolidation of the Russian business in June 2022.Operating ProfitOperating profit for the EMEA segment

263、 increased by$104 million,or 21%,in the first quarter as compared to the respective 2022 period.The increase inoperating profit in the quarter was driven primarily by higher pricing and continued productivity initiatives,partially offset by currency translation,lowervolumes and divestitures.APAC Qua

264、rter Ended March 31,(Millions of dollars)20232022VarianceSales$1,598$1,602%Operating profit$423$399 6%As a percent of sales26.5%24.9%Quarter Ended March 31,2023 vs.2022%ChangeFactors Contributing to Changes-SalesVolume/Equipment1%Price/Mix5%Cost pass-through%Currency(6)%Acquisitions/divestitures%The

265、 APAC segment includes Lindes industrial gases operations in approximately 20 Asian and South Pacific countries and regions including China,Australia,India,and South Korea.SalesSales for the APAC segment decreased$4 million,for the first quarter versus the respective 2022 period.Higher pricing contr

266、ibuted 5%to sales in the quarter.Volumes increased 1%in the quarter including project start-ups in the electronics and chemicals and energy end markets.Currency translation decreased salesby 6%in quarter,driven primarily by the weakening of the Australian dollar,Indian rupee and Chinese yuan against

267、 the U.S.dollar.Cost pass-through was flatin the quarter versus the respective 2022 period.Operating profitOperating profit in the APAC segment increased$24 million,or 6%,in the first quarter versus the respective 2022 period,driven by higher volumes andpricing and continued productivity initiatives

268、 which more than offset the impact of currency and inflation during the quarter.30 Table of Contents Engineering Quarter Ended March 31,(Millions of dollars)20232022VarianceSales$540$728(26)%Operating profit$149$143 4%As a percent of sales27.6%19.6%Quarter Ended March 31,2023 vs.2022%ChangeFactors C

269、ontributing to Changes-SalesCurrency(4)%Other(22)%(26)%SalesEngineering segment sales decreased$188 million in the first quarter as compared to the respective 2022 period.The decrease was driven by project timing andnegative currency translation.Projects for Russia that were sanctioned and have been

270、 wound down represented$61 million of the Engineering segment sales during the first quarter of 2023.Operating profitEngineering segment operating profit increased,$6 million in the first quarter as compared to the respective 2022 period.The decline from lower sales wasmore than offset by higher mar

271、gin on wind down of projects subject to sanctions in Russia.31 Table of Contents Other Quarter Ended March 31,(Millions of dollars)20232022VarianceSales$327$492(34)%Operating profit(loss)$2$(44)105%As a percent of sales0.6%(8.9)%Quarter Ended March 31,2023 vs.2022%ChangeFactors Contributing to Chang

272、es-SalesVolume/price6%Currency(1)%Acquisitions/divestitures(39)%(34)%Other consists of corporate costs and a few smaller businesses including Surface Technologies and global helium wholesale,which individually do not meet thequantitative thresholds for separate presentation.SalesSales for Other decr

273、eased$165 million for the first quarter versus the respective 2022 period.The impact of net divestitures decreased sales by 39%in thequarter,primarily due to sale of GIST business in third quarter of 2022.Currency translation decreased sales by 1%in the quarter.Underlying sales increased6%in the qua

274、rter,driven primarily by price in the global helium business.Operating profitOperating profit in Other increased$46 million,or 105%in the first quarter versus the respective 2022 period,due primarily to higher pricing and lowercorporate costs in the quarter.32 Table of Contents CurrencyThe results o

275、f Lindes non-U.S.operations are translated to the companys reporting currency,the U.S.dollar,from the functional currencies.For mostoperations,Linde uses the local currency as its functional currency.There is inherent variability and unpredictability in the relationship of these functionalcurrencies

276、 to the U.S.dollar and such currency movements may materially impact Lindes results of operations in any given period.To help understand the reported results,the following is a summary of the significant currencies underlying Lindes consolidated results and the exchange ratesused to translate the fi

277、nancial statements(rates of exchange expressed in units of local currency per U.S.dollar):Percentage of YTD 2023Consolidated SalesExchange Rate forIncome StatementExchange Rate forBalance Sheet Year-To-Date AverageMarch 31,December 31,Currency2023202220232022Euro20%0.93 0.89 0.92 0.93 Chinese yuan8%

278、6.84 6.35 6.87 6.90 British pound5%0.82 0.75 0.81 0.83 Australian dollar4%1.46 1.38 1.50 1.47 Brazilian real4%5.19 5.22 5.06 5.28 Canadian dollar3%1.35 1.27 1.35 1.36 Korean won3%1,275 1,203 1,302 1,266 Mexican peso3%18.66 20.50 18.05 19.50 Indian rupee2%82.24 75.21 82.18 82.73 South African rand1%1

279、7.74 15.23 17.80 17.04 Swedish krona1%10.45 9.34 10.40 10.43 Thailand bhat1%33.94 33.04 34.20 34.61 33 Table of Contents Liquidity,Capital Resources and Other Financial DataThe following selected cash flow information provides a basis for the discussion that follows:(Millions of dollars)Three months

280、 ended March 31,20232022NET CASH PROVIDED BY(USED FOR):OPERATING ACTIVITIESNet income(including noncontrolling interests)$1,552$1,210 Non-cash charges(credits):Add:Depreciation and amortization948 1,112 Add:Deferred income taxes4(59)Add:Share-based compensation30 34 Add:Other charges,net of payments

281、(a)(61)(34)Net income adjusted for non-cash charges2,473 2,263 Less:Working capital(325)(239)Less:Pension contributions(10)(13)Other(230)(11)Net cash provided by(used for)operating activities$1,908$2,000 INVESTING ACTIVITIESCapital expenditures(829)(649)Acquisitions,net of cash acquired(808)(43)Dive

282、stitures,net of cash divested and asset sales3 27 Net cash provided by(used for)investing activities$(1,634)$(665)FINANCING ACTIVITIESDebt increase(decrease)-net717 2,546 Issuances(purchases)of common stock-net(846)(1,709)Cash dividends-Linde plc shareholders(623)(592)Noncontrolling interest transac

283、tions and other(12)(1)Net cash provided by(used for)financing activities$(764)$244 Effect of exchange rate changes on cash and cash equivalents$16$62 Cash and cash equivalents,end-of-period$4,962$4,464(a)See Note 2 to the condensed consolidated financial statements.Cash Flow from OperationsCash prov

284、ided by operations of$1,908 million for the three months ended March 31,2023 decreased$92 million,or 5%,versus 2022.The decrease was drivenprimarily by higher working capital requirements,including lower inflows from contract liabilities from engineering customer advanced payments.Othercharges were

285、a charge of$18 million and a benefit of$4 million,for the three months ended March 31,2023 and 2022,respectively.Related cash outflowswere$79 million and$30 million for the same respective periods.Linde estimates that total 2023 required contributions to its pension plans will be in the range of app

286、roximately$40 million to$50 million,of which$10million has been made through March 31,2023.As of March 31,2023,Linde has approximately$1.8 billion recorded in contract liabilities within the condensed consolidated balance sheet related toengineering projects in Russia.Any obligation to satisfy the r

287、elated residual contract liabilities may have an adverse effect on Lindes cash flows.34 Table of Contents InvestingNet cash used for investing of$1,634 million for the three months ended March 31,2023 increased$969 million versus 2022,due to higher acquisitions,net ofcash acquired and higher capital

288、 expenditures.Capital expenditures for the three months ended March 31,2023 were$829 million,$180 million higher than the prior year due primarily to investments innew plant and production equipment for operating and growth requirements.At March 31,2023,Lindes sale of gas backlog of large projects u

289、nder construction was approximately$4.2 billion.This represents the total estimated capitalcost of large plants under construction.Acquisitions,net of cash acquired for the three months ended March 31,2023 and 2022 were$808 million and$43 million,respectively,and related primarilyto the acquisition

290、of nexAir in the Americas(see Note 13 to the condensed consolidated financial statements).Divestitures,net of cash divested and asset sales for the three months ended March 31,2023 and 2022 were$3 million and$27 million,respectively.FinancingCash used for financing activities was$764 million for the

291、 three months ended March 31,2023 as compared to cash provided by financing activities of$244million for the three months ended March 31,2022.Cash provided by debt was$717 million versus$2,546 million in 2022 driven primarily by lowercommercial paper borrowings and lower net debt issuances in 2023.I

292、n February 2023,Linde repaid$500 million of 2.70%notes that became due.Net purchases of ordinary shares were$846 million in 2023 versus$1,709 million in 2022.On February 28,2022,the companys Board of Directors approvedthe additional repurchase of$10.0 billion of its ordinary shares.For additional in

293、formation related to the share repurchase programs,see Part II Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.Cash dividends of$623 million increased$31 million from 2022 driven primarily by a 9%increase in quarterly dividends per share from$1.17 per share to$1.275 per share,part

294、ially offset by lower shares outstanding.Cash used for Noncontrolling interest transactions and other was$12 million for the threemonths ended March 31,2023 versus cash used of$1 million for the respective 2022 period.The company continues to believe it has sufficient operating flexibility,cash,and

295、funding sources to meet its business needs around the world.The companyhad$5.0 billion of cash as of March 31,2023,and has a$5 billion and a$1.5 billion unsecured and undrawn revolving credit agreement with no associatedfinancial covenants.No borrowings were outstanding under the credit agreement as

296、 of March 31,2023.The company does not anticipate any limitations on itsability to access the debt capital markets and/or other external funding sources and remains committed to its strong ratings from Moodys and Standard&Poors.Legal ProceedingsSee Note 9 to the condensed consolidated financial stat

297、ements.35 Table of Contents NON-GAAP MEASURES AND RECONCILIATIONS(Millions of dollars,except per share data)(UNAUDITED)The following non-GAAP measures are intended to supplement investors understanding of the companys financial information by providing measures whichinvestors,financial analysts and

298、management use to help evaluate the companys operating performance and liquidity.Items which the company does notbelieve to be indicative of on-going business trends are excluded from these calculations so that investors can better evaluate and analyze historical and futurebusiness trends on a consi

299、stent basis.Definitions of these non-GAAP measures may not be comparable to similar definitions used by other companies and arenot a substitute for similar GAAP measures.Quarter Ended March 31,20232022Adjusted Operating Profit and Operating MarginReported operating profit1,933$1,480 Add:Other charge

300、s18(4)Add:Purchase accounting impacts-Linde AG(c)255 429 Total adjustments273 425 Adjusted operating profit$2,206$1,905 Reported percentage change31%22%Adjusted percentage change16%13%Reported sales$8,193$8,211 Reported operating margin23.6%18.0%Adjusted operating margin26.9%23.2%Adjusted Depreciati

301、on and amortizationReported depreciation and amortization$948$1,112 Less:Purchase accounting impacts-Linde AG(c)(250)(418)Adjusted depreciation and amortization$698$694 Adjusted Other Income(Expense)-netReported Other Income(Expense)-net$(5)$12 Less:Purchase accounting impacts-Linde AG(c)(5)(11)Adju

302、sted Other Income(Expense)-net$23 Adjusted Net Pension and OPEB Cost(Benefit),Excluding Service CostReported net pension and OPEB cost(benefit),excluding service cost$(45)$(64)Adjusted Net Pension and OPEB cost(benefit),excluding service costs$(45)$(64)Adjusted Interest Expense-NetReported interest

303、expense-net$37$9 Add:Purchase accounting impacts-Linde AG(c)9 10 Adjusted interest expense-net$46$19 36 Table of Contents Adjusted Income Taxes(a)Reported income taxes$430$369 Add:Purchase accounting impacts-Linde AG(c)57 108 Add:Other charges45(3)Total adjustments102 105 Adjusted income taxes$532$4

304、74 Adjusted Effective Tax Rate(a)Reported income before income taxes and equity investments$1,941$1,535 Add:Purchase accounting impacts-Linde AG(c)246 419 Add:Other charges18(4)Total adjustments264 415 Adjusted income before income taxes and equity investments$2,205$1,950 Reported Income taxes$430$3

305、69 Reported effective tax rate22.2%24.0%Adjusted income taxes$532$474 Adjusted effective tax rate24.1%24.3%Income from Equity InvestmentsReported income from equity investments$41$44 Add:Purchase accounting impacts-Linde AG(c)18 20 Adjusted income from equity investments$59$64 Adjusted Noncontrollin

306、g InterestsReported noncontrolling interests$(36)$(36)Add:Purchase accounting impacts-Linde AG(c)(3)(4)Adjusted noncontrolling interests$(39)$(40)Adjusted Net Income-Linde plc(b)Reported net income-Linde plc$1,516$1,174 Add:Other charges(27)(1)Add:Purchase accounting impacts-Linde AG(c)204 327 Total

307、 adjustments177 326 Adjusted net income-Linde plc$1,693$1,500 37 Table of Contents Adjusted Diluted EPS(b)Reported diluted EPS$3.06$2.30 Add:Other charges(0.05)Add:Purchase accounting impacts-Linde AG(c)0.41 0.63 Total adjustments0.36 0.63 Adjusted diluted EPS$3.42$2.93 Reported percentage change33%

308、24%Adjusted percentage change17%18%Adjusted EBITDA and%of SalesNet Income-Linde plc$1,516$1,174 Add:Noncontrolling interests36 36 Add:Net pension and OPEB cost(benefit),excluding service cost(45)(64)Add:Interest expense37 9 Add:Income taxes430 369 Add:Depreciation and amortization948 1,112 EBITDA$2,

309、922$2,636 Add:Other charges18(4)Add:Purchase accounting impacts-Linde AG(c)23 31 Total adjustments41 27 Adjusted EBITDA$2,963$2,663 Reported sales$8,193$8,211%of salesEBITDA35.7%32.1%Adjusted EBITDA36.2%32.4%(a)The income tax expense(benefit)on the non-GAAP pre-tax adjustments was determined using t

310、he applicable tax rates for the jurisdictions that were utilized in calculating the GAAP income taxexpense(benefit)and included both current and deferred income tax amounts.(b)Net of income taxes which are shown separately in“Adjusted Income Taxes and Adjusted Effective Tax Rate”.(c)The company beli

311、eves that its non-GAAP measures excluding Purchase accounting impacts-Linde AG are useful to investors because:(i)the 2018 business combination was a merger of equalsin an all-stock merger transaction,with no cash consideration,(ii)the company is managed on a geographic basis and the results of cert

312、ain geographies are more heavily impacted by purchaseaccounting than others,causing results that are not comparable at the reportable segment level,therefore,the impacts of purchase accounting adjustments to each segment vary and are notcomparable within the company and when compared to other compan

313、ies in similar regions,(iii)business management is evaluated and variable compensation is determined based on resultsexcluding purchase accounting impacts,and;(iv)it is important to investors and analysts to understand the purchase accounting impacts to the financial statements.A summary of each of

314、the adjustments made for Purchase accounting impacts-Linde AG are as follows:Adjusted Operating Profit and Margin:The purchase accounting adjustments for the periods presented relate primarily to depreciation and amortization related to the fair value step up of fixed assetsand intangible assets(pri

315、marily customer related)acquired in the merger and the allocation of fair value step-up for ongoing Linde AG asset disposals(reflected in Other Income/(Expense).Adjusted Interest Expense-Net:Relates to the amortization of the fair value of debt acquired in the merger.Adjusted Income Taxes and Effect

316、ive Tax Rate:Relates to the current and deferred income tax impact on the adjustments discussed above.The income tax expense(benefit)on the non-GAAP pre-taxadjustments was determined using the applicable tax rates for the jurisdictions that were utilized in calculating the GAAP income tax expense(be

317、nefit)and included both current and deferred incometax amounts.Adjusted Income from Equity Investments:Represents the amortization of increased fair value on equity investments related to depreciable and amortizable assets.Adjusted Noncontrolling Interests:Represents the noncontrolling interests own

318、ership portion of the adjustments described above determined on an entity by entity basis.38 Table of Contents Net Debt and Adjusted Net DebtNet debt is a financial liquidity measure used by investors,financial analysts and management to evaluate the ability of a company to repay its debt.Purchaseac

319、counting impacts have been excluded as they are non-cash and do not have an impact on liquidity.March 31,2023December 31,2022(Millions of dollars)Debt$18,777$17,914 Less:cash and cash equivalents(4,962)(5,436)Net debt13,815 12,478 Less:purchase accounting impacts-Linde AG(13)(22)Adjusted net debt$13

320、,802$12,456 39 Table of Contents Supplemental Guarantee InformationOn June 6,2020,the company filed a Form S-3 Registration Statement with the SEC(the Registration Statement).Linde plc may offer debt securities,preferred shares,depositary shares and ordinary shares under the Registration Statement,a

321、nd debt securities exchangeablefor or convertible into preferred shares,ordinary shares or other debt securities.Debt securities of Linde plc may be guaranteed by Linde Inc and/or LindeGmbH.Linde plc may provide guarantees of debt securities offered by its wholly owned subsidiaries Linde Inc.or Lind

322、e Finance under the RegistrationStatement.Linde Inc.is a wholly owned subsidiary of Linde plc.Linde Inc.may offer debt securities under the Registration Statement.Debt securities of Linde Inc.willbe guaranteed by Linde plc,and such guarantees by Linde plc may be guaranteed by Linde GmbH.Linde Inc.ma

323、y also provide(i)guarantees of debt securitiesoffered by Linde plc under the Registration Statement and(ii)guarantees of the guarantees provided by Linde plc of debt securities of Linde Finance offeredunder the Registration Statement.Linde Finance B.V.is a wholly owned subsidiary of Linde plc.Linde

324、Finance may offer debt securities under the Registration Statement.Linde plc willguarantee debt securities of Linde Finance offered under the Registration Statement.Linde GmbH and Linde Inc.may guarantee Linde plcs obligations underits downstream guarantee.Linde GmbH is a wholly owned subsidiary of

325、Linde plc.Linde GmbH may provide(i)guarantees of debt securities offered by Linde plc under the RegistrationStatement and(ii)upstream guarantees of downstream guarantees provided by Linde plc of debt securities of Linde Inc.or Linde Finance offered under theRegistration Statement.In September 2019,L

326、inde plc provided downstream guarantees of all of the pre-business combination Linde Inc.and Linde Finance notes,and Linde GmbHand Linde Inc.,respectively,provided upstream guarantees of Linde plcs downstream guarantees.For further information about the guarantees of the debt securities registered u

327、nder the Registration Statement(including the ranking of such guarantees,limitations on enforceability of such guarantees and the circumstances under which such guarantees may be released),see“Description of Debt Securities Guarantees”and“Description of Debt Securities Ranking”in the Registration St

328、atement,which subsections are incorporated herein by reference.The following tables present summarized financial information for Linde plc,Linde Inc.,Linde GmbH and Linde Finance on a combined basis,aftereliminating intercompany transactions and balances between them and excluding investments in and

329、 equity in earnings from non-guarantor subsidiaries.40 Table of Contents (Millions of dollars)Statement of Income DataThree Months Ended March 31,2023Twelve Months Ended December 31,2022Sales$2,078$8,850 Operating profit398 1,337 Net income265 675 Transactions with non-guarantor subsidiaries548 2,24

330、1 Balance Sheet Data(at period end)Current assets(a)$5,918$11,478 Long-term assets(b)14,158 13,949 Current liabilities(c)13,032 11,767 Long-term liabilities(d)46,488 48,210(a)From current assets above,amount due from non-guarantorsubsidiaries$2,473$7,260(b)From long-term assets above,amount due from

331、 non-guarantor subsidiaries1,813 1,982(c)From current liabilities above,amount due to non-guarantorsubsidiaries1,397 1,334(d)From long-term liabilities above,amount due to non-guarantor subsidiaries32,174 33,268 Item 3.Quantitative and Qualitative Disclosures About Market RiskRefer to Item 7A.to Par

332、t II of Lindes 2022 Annual Report on Form 10-K for discussion.Item 4.Controls and Procedures(a)Based on an evaluation of the effectiveness of Lindes disclosure controls and procedures,which was made under the supervision and with theparticipation of management,including Lindes principal executive of

333、ficer and principal financial officer,the principal executive officer and principalfinancial officer have each concluded that,as of the end of the quarterly period covered by this report,such disclosure controls and procedures areeffective in ensuring that information required to be disclosed by Linde in reports that it files under the Exchange Act of 1934 is recorded,processed,summarized and rep