LIN Linde Group 10-Q 2026-09-30 section summaries

Linde plc — Q3 and nine months ended September 30, 2026

Sales grew year over year, but consolidated operating profit and net income declined in Q3. A $425 million cost-reduction and other charge drove the operating-profit decline, despite higher segment operating profit. For the first nine months, sales, operating profit and net income were above the prior-year period.

Consolidated results

The $425 million Q3 charge compared with an $11 million benefit in Q3 2025, a $436 million year-over-year swing. It included $200 million of global severance, $42 million of other cost-reduction charges and $183 million of primarily noncash charges, mainly related to the U.S. homecare business. Nine-month charges were $425 million versus $44 million. Lower weighted-average diluted shares partly supported EPS.

Segment results and operating-profit reconciliation

Segment operating profit excludes merger purchase-accounting impacts, cost-reduction and other charges, and items not indicative of ongoing trends. Other segment profit fell despite higher revenue. In Q3, Linde moved its U.S. homecare business from Americas to Other to reflect a revised management structure; prior-period segment figures were recast, with no effect on consolidated results.

Q3 revenue by distribution method was merchant $2,922 million versus $2,619 million; on-site $2,157 million versus $2,034 million; packaged gas $3,147 million versus $3,033 million; and other $1,178 million versus $929 million. Merchant and other revenue grew faster than packaged gas. Engineering intersegment sales were $693 million versus $728 million; Helium intersegment sales were $114 million versus $104 million.

Cash flow and capital allocation

Cash declined $1.109 billion over the nine months. Ordinary-share dividends were $1.60 per share in Q3 and $4.80 for 9M, versus $1.50 and $4.50, respectively, in 2025.

Balance sheet and liquidity

Total debt was $26.702 billion, including $4.645 billion of short-term borrowings and $22.057 billion of long-term debt before current-portion presentation; balance-sheet long-term debt was $20.593 billion. Linde repaid notes due in 2026 and issued €1.6 billion of Euro-denominated notes in three tranches in May. Short-term borrowings had a 3.3% weighted-average rate, up from 3.0% at year-end. The company had $6.5 billion of revolving credit facilities available and no borrowings outstanding under them.

Contracts, exposures and material risks

Estimated consideration under on-site minimum-purchase and Engineering plant-sale contracts was approximately $66 billion; about half is expected to be earned over the next six years. This excludes potentially significant on-site purchases above contractual minimums. On-site contracts typically run 10–20 years, and some long-term supply contracts extend up to 30 years. Engineering contracts are often fixed-price and recognized over time based on costs incurred relative to estimated total costs, making profitability sensitive to cost estimates and contract modifications.

Expected-credit-loss allowances were $257 million, down from $581 million at year-end; nine-month credit-loss provisions were $128 million versus $158 million. Gross receivables more than one year past due were $350 million and are generally fully reserved, subject to exceptions. Derivative notional totaled $17.202 billion versus $13.653 billion at year-end; derivative assets and liabilities at fair value were $262 million and $156 million. Euro-denominated notes and intercompany loans designated as net-investment hedges totaled €17.7 billion ($20.1 billion); the related deferred translation loss was $795 million, largely offset by changes in the hedged foreign investments.

Russia-related legal matters remain uncertain: Linde reported a $1.1 billion contingent liability tied to advance payments on terminated RusChemAlliance projects and approximately €0.8 billion of reimbursement claims from guarantor banks following Russian asset seizures. Separately, it disclosed a $0.7 billion contingent liability for the Amur GPP dispute and related contract matters. After period-end, on October 15, 2026, a Stockholm tribunal ruled that Gazprom’s claims must proceed under contractual arbitration provisions and barred enforcement of the Russian judgment; the award may be challenged. Linde reported $1.8 billion of liabilities recorded for Russia matters and said these, together with the immaterial value of remaining deconsolidated Russian subsidiaries, were not expected to materially adversely affect earnings. Other litigation and tax matters include unresolved Brazilian Refis calculations and an appeal of a German appraisal ruling; outcomes of contingencies could significantly affect results in an individual period.

Linde plc — Q3 and nine months ended September 30, 2026

Consolidated results

Sales increased 9% in both periods. Price/mix and volume each contributed 3% and 2%, respectively, in Q3 and 9M. Acquisitions and cost pass-through each contributed 1% in both periods; currency added 1% in Q3 and 2% in 9M, while Engineering sales added 1% in Q3 and were flat year to date. Volume growth was principally from electronics, chemicals and energy, and manufacturing. Pass-through largely reflected contractual energy-cost billings and had minimal operating-profit impact.

Cost of sales rose faster than sales, reaching 52.8% of sales in Q3 versus 50.8%, and 52.2% in 9M versus 50.9%, as higher costs and pass-through outweighed productivity gains. Adjusted operating profit rose 8% in both periods, supported by pricing and productivity, partly offset by inflation. Reported Q3 operating profit and net income declined, principally reflecting significant cost-reduction charges and cost inflation. Reported 9M operating profit and net income increased.

Cost-reduction and other charges were $425 million in Q3 and 9M 2026, compared with an $11 million credit in Q3 2025 and $44 million of charges in 9M 2025. The 2026 charges included $200 million of global severance, $42 million of other cost-reduction charges, and $183 million of primarily non-cash charges, mainly related to the U.S. homecare business. Adjustments to reported operating profit totaled $613 million versus $191 million in Q3 and $994 million versus $647 million in 9M; they principally comprised these charges and Linde AG purchase-accounting impacts. Adjusted results are non-GAAP measures.

Q3 segment results

Americas growth reflected pricing, volume, productivity and currency, partly offset by inflation. EMEA benefited from price, productivity and pass-through; Q3 volumes rose 1%, although 9M volumes declined 1%. APAC benefited from volume and project start-ups, pricing and currency, with inflation a partial offset. Engineering results primarily reflected project timing. Other includes corporate costs and businesses such as Linde Advanced Material Technologies (LAMT), U.S. homecare and global helium wholesale. Its profit decline reflected U.S. homecare weakness, which outweighed LAMT growth; the homecare business moved from Americas to Other in Q3, with prior periods recast.

Cash flow and investment

Operating cash flow rose 5%; higher net income adjusted for noncash items was partly offset by increased working-capital use of $775 million versus $461 million. Capital expenditures, primarily for new plants and production equipment supporting backlog growth, increased $369 million. The sale-of-gas large-projects-under-construction backlog was approximately $7.9 billion at September 30, 2026, representing estimated capital cost of plants under construction.

Acquisitions, net of cash acquired, were $411 million versus $393 million; divestiture and asset-sale proceeds, net of cash divested, were $178 million versus $31 million. Financing included $504 million of net debt issuance versus $1.917 billion. Linde issued €1.6 billion of euro-denominated notes and repaid $925 million and €700 million of notes. Net share purchases were $2.606 billion versus $3.191 billion. Dividends to Linde plc shareholders were $2.214 billion versus $2.113 billion, reflecting a 7% quarterly per-share dividend increase from $1.50 to $1.60, partly offset by fewer shares outstanding.

Management stated liquidity was sufficient. At quarter-end, $6.5 billion of unsecured revolving credit facilities were undrawn and had no financial covenants. The company expects continued debt-market access and remains committed to strong credit ratings. Required 2026 pension contributions were estimated at $25–$35 million, with $23 million paid through September 30.

Additional developments

Other income was $107 million in 9M versus $47 million, including a gain on an Americas divestiture. Currency translation gains were the principal contributor to other comprehensive income. The euro represented 16% of 9M sales, the Chinese yuan 8%, and the British pound, Brazilian real, Australian dollar and Mexican peso 4% each. Employees totaled 64,512 at September 30, down 977 year over year, primarily from cost-reduction programs, partly offset by acquisitions.

Summarized financial information for the Linde plc/Linde Inc./Linde GmbH/Linde Finance guarantor group, after intercompany eliminations and excluding non-guarantor investments and earnings, showed 9M 2026 sales of $6.833 billion, operating profit of $1.112 billion and a net loss of $302 million; FY 2025 comparatives were sales of $8.844 billion, operating profit of $1.512 billion and net income of $3 million. At September 30, 2026, the group had $4.593 billion of current assets, $17.256 billion of long-term assets, $9.986 billion of current liabilities and $77.398 billion of long-term liabilities, including $52.878 billion due to non-guarantor subsidiaries. Linde filed a registration statement in May 2026 for potential debt and equity offerings and maintains a €25.0 billion European debt issuance program, with subsidiary guarantees supporting specified debt securities.

Item 3 — Quantitative and Qualitative Disclosures About Market Risk

This section directs readers to Item 7A of Part II of Linde’s 2025 Annual Report on Form 10-K for its market-risk disclosures.

Disclosure Controls and Internal Control

Management, including Linde’s principal executive and financial officers, concluded that the company’s disclosure controls and procedures were effective as of the end of the quarter. No changes to internal control over financial reporting during the quarter materially affected, or were reasonably likely to materially affect, those controls.

No material changes occurred during the quarter to the risk factors disclosed in Linde’s Form 10-K for the year ended December 31, 2025. The filing provides no new or updated risk-factor details.

Rule 10b5-1 Trading Plan

On August 10, 2026, Ben Glazer, Linde plc’s Senior Vice President of Americas, adopted a written Rule 10b5-1 trading plan. The plan allows exercise of a previously granted stock option and sale of 17,785 ordinary shares if a specified minimum market sale price is reached. It is scheduled to terminate on February 25, 2028, or earlier once all covered transactions are completed.

This disclosure reports no company financial results or material business developments.