Linde has delivered a strong second quarter, posting record sales and earnings per share as robust demand from the electronics sector and pricing gains drove growth across key markets. 

The industrial gases giant reported a second-quarter net income of $1.93 billion ($4.15 per share), up 9% and 11% from last year, while adjusted net income rose 8% to $2.09 billion ($4.50 per share) excluding purchase accounting impacts. 

Quarterly sales increased 9% year over year to $9.29 billion, supported by a 2% favorable currency impact. Underlying sales grew 4%, driven by 2% higher pricing and 2% volume growth, led by the electronics, manufacturing, and chemicals and energy end markets. Acquisitions added another 1% to revenue.

 

Adjusted operating profit rose 7% to $2.74 billion, producing an industry-leading adjusted operating margin of 29.5%. While operating margin slipped 60 basis points from a year ago as inflation weighed on costs, pricing actions and productivity improvements helped offset much of the pressure.

 

Operating cash flow increased 3% to $2.27 billion during the quarter. After $1.44 billion in capital expenditures, free cash flow totaled $833 million. Linde returned $1.59 billion to shareholders through dividends and share repurchases, net of issuances.

 

Commenting on the results, Chief Executive Officer Sanjiv Lamba said, “Linde employees delivered another solid quarter, generating record sales and EPS while maintaining industry-leading profitability with 29.5% operating margin and 23.5% return on capital. During the quarter, we also signed another long-term electronics supply contract in the U.S., increasing the sale of gas backlog to a record $8.1 billion.”

 

Lamba added, “Customer proposal activity remains robust, primarily across the electronics end market, giving us confidence to further grow the backlog. Regardless of the economic climate, I’m confident the Linde team will continue to secure high-quality future growth projects while delivering long-term shareholder value.”

 

Looking ahead, Linde expects third-quarter adjusted diluted earnings per share of $4.45 to $4.55, representing growth of 6% to 8% from the prior-year period, assuming no impact from foreign currency translation.

 

For the full year, the company reaffirmed its growth outlook, forecasting adjusted diluted earnings per share of $17.70 to $17.90, up 8% to 9% year over year, assuming a 1% favorable currency impact. Capital expenditures are projected at $5.5 billion to $6.0 billion, supporting expansion projects and an $8.1 billion contractual sale-of-gas project backlog.

 

The Americas remained Linde's largest market, with sales rising 7% to $4.08 billion as stronger pricing and higher volumes in electronics and manufacturing lifted underlying sales by 4%. Operating profit reached $1.27 billion, representing 31.2% of sales.

 

In Asia Pacific, sales jumped 13% to $1.87 billion, marking the strongest regional growth. Underlying sales increased 8%, fueled by higher volumes in electronics and chemicals and energy, along with project start-ups. Operating profit totaled $531 million, or 28.4% of sales.

 

EMEA sales rose 7% to $2.30 billion despite weaker manufacturing volumes. Higher pricing helped offset lower demand, while operating profit reached $823 million, equal to 35.7% of sales.

 

Linde Engineering also delivered solid growth, with sales increasing 13% to $625 million and operating profit reaching $100 million. Quarterly order intake totaled $871 million, lifting third-party equipment backlog to $3.0 billion.