Air Products and Chemicals (APD) 1 Aug 242024 Q3 Earnings call transcript

Company Profile

Participants

Siddharth Manjeshwar	executive
Seifollah Ghasemi	executive
Melissa Schaeffer	executive
John McNulty	analyst
Jeffrey Zekauskas	analyst
Vincent Andrews	analyst
David Begleiter	analyst
Christopher Parkinson	analyst
Patrick Fischer	analyst
Michael Leithead	analyst
Michael Sison	analyst
John Roberts	analyst
Joshua Spector	analyst
Patrick Cunningham	analyst
Daniel Rizzo	analyst

Call transcript

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Operator

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

Siddharth Manjeshwar

Samira. you, Thank everyone. Good morning, Air Products' Earnings to Quarter Third Teleconference. Results Welcome XXXX of Manjeshwar, Sid is Investor Vice This President Relations. Schaffer, Officer; pleased by President, our Chairman, Melissa incoming Seifi am General Ghasemi, Chief I to and Investor our President be Counsel and Head and Eric Executive of Major, our Sean joined Secretary; today our Vice Financial Guter, CEO; Relations. be questions. After your our take comments, pleased to we will

forward-looking airproducts.com. opportunities. statements, outlook call release those are for available is Today's our release and discussion note website our and to provided earnings and contains Our earnings earnings that cautionary this and at including business about forward-looking capital Please the on guidance, Slide statements on regarding in the slides expenditure refer investment #X.

refer specifically per including will measures. referring and state directly EBITDA total financial otherwise, financial statements found Additionally, segment adjusted measures release our in rate operating effective margin, relevant section. can a of Unless discussion, on to comparable share, earnings EBITDA income, ROCE, measures Reconciliations non-GAAP most GAAP the we throughout earnings be are margin, the and to company basis. our and tax we to website these our measures, regarding operating on various both these measures financial today's

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

Seifollah Ghasemi

to and our call to you, taking everyone. schedules day your good busy join Thank time today. Sidd, Thank you from for

Eric the with that this like words? say challenge. to bring and Vice Gutter, will Eric, our most would Before to take I few company a hydrogen serving on knowledge years, is discuss He XX been new experience I of our nearly recently who results, for President introduce agreed today. Investor to a for happy Relations. Eric like I'm has us of would he has you with as to mobility. wealth

Unknown Executive

role within words, taking team Thank we great continuing tremendous Air with the this analysts and meeting and honored new humbled forward continue work looking to on team be be and have you, We're growth execute strategy. your I and Sid I'm to appreciate as to part this Seifi. our our and investors done kind to of and Products. the

Seifollah Ghasemi

leaving to Thank build transition. have closely pursue few work continuing made working you, over want Air for opportunities. Products. and to years will his and career other and the great be Eric. Sidd relationship And to has company thank Sid strong contribution a ensure announced, company. the with investors the Sid to for past at Eric smooth we to as are analysts already I him together

to turn please Slide #X. Now

like our As to record on always, Air I would safety, begin Products. at priority is with our top which

both since rate progress injury We have XXXX. rate our significant made and lost on time recordable employee injury

in strive We That best ultimate is have record management our always are proud achieve #X, this and to safety summarizes proud industry. we X we our the goal. and philosophy. incidents to But very of are improvement, the X accidents. Slide

times We have many you with before. shared this

We and day. the committed them been practice are, we past years, as every single XX principles to have for these

Now please #X. Slide to turn

to $X.XX of improved of of upper share exceeded range quarter our per third Our the prior $X.XX last earnings over guidance $X adjusted end year. X% and

performance Our Americas Europe. the strong results in reflect and underlying

improvements our and driven our across price productivity saw we organization, Additionally, by actions.

hydrogen. energy execute on our gas industrial to We in while clean which and business continue focused operational our transition X-pillar growth projects strategy, includes our driving growth excellence executing

Now #X. to turn Slide please

range be year in our our share the CapEx $XX.XX adjusted full of still to are to guidance $XX.XX We XXXX. maintaining $X.X billion of billion fiscal $X we and in per to year expect earnings

#X. Now to Slide please turn

validates will with XX,XXX pioneering interest strategy hydrogen for green which XXXX, other Total XX with generated reached growth, strong very overall have Products announced In Air for hydrogen. customers, demonstrates large demand long-term agreement of hydrogen achieving tons significant to also long-term earnings Energies During we Energies. has share X% from green a green already This our per scale, agreement, in Beginning our June, year supply years. fiscal third quarter, and milestones. in significant addition per supply a we Total

while demand of We and hydrogen are business seeing to our of in process even the July, to planned and an technology to this Also will sale are to sheet July, with announced result, strategy announce roughly of In $X.X all-cash and decarbonize to help transport collaboration to pioneer position. divestment equipment our in our as development The the allow price in business hydrogen. a heavy we bolstering a business billion. of And more for for our the sector. our Mercedes of significant balance liquidity green we Honeywell our excited pleased the we on core Benz Europe. committed be us LNG focus production clean were

X permanent the eventual related companies was a trucks. trucks. among that took hydrogen milestone significant heavy-duty we of toward to commercial also other cell network. fuel of production a In announced hydrogen along Air fueling mass stations transport Mercedes-Benz build Products hydrogen trans-European This is have fuel delivery a network development, of cell plans the

XX turn which illustrates or adjusted years. Now #X, greater our for Slide than per in earnings growth share rate to the XX% please average past

the is the XX most world. to this most in remaining another years, industrial and while gas profitable company safest, goal extend Our diverse for trend

We confident do I'm this before, again. will it we have and done

a Now approach please #X. to our to turn Slide dividends. determining We balanced take

cash cash meeting strategic raise flows other ability our capital We and dividends us shareholders financing through needs rewarding through our that operations to from of and strategy. our will to allow continue our initiatives while are the growth confident increased

[indiscernible] #XX, base It at and to EBITDA stands now by my have . always that the say, our effectively leading margins focus it demonstrating favorite on I running industry grown significantly persistent is and as our Now shows business. XX%, our Slide which, far turning

for over like a delivering focused economic challenging conditions. very these provide Chief I financial Financial to turn employees Schaeffer, and results. Melissa? our Melissa to segment on our third Officer, is of I outstanding the slide very business At this quarter point, thank summary living are and results to all would of this that. in We much profitability, of a to want proof

Melissa Schaeffer

Thank you, Seifi.

please XX. Slide as year, positive volume well company's X% and to Compared for by assets. most the line again driven X% sales hydrogen primarily together due from was segments. price reduction Now across up on was were last unfavorable positive On-site top The new and to reporting underlying strong contributions demand quarter, volume this currencies. as to turn

to for volume overall due products. flat However, lower merchant was demand

America improved lower which energy improved contribution increased natural and of business Declining billion mix. and has $X.X impact contribution X% on Overall in cost performance costs, in at profit. which positive margin lower continued gas resulted strong no power X% price primarily driven pass-through, by Americas margin. in Europe modestly favorable North with with coupled X%, the EBITDA prices

organization. modestly productivity was momentum this the actions positive across heavy on see cost Although planned with maintenance unfavorable to our quarter, starting this are we

ROCE of improved XX% down segments. relatively the points is flat reporting cash, was XX%. for and Sequentially, XX sequentially. volume Adjusted ROCE across basis about our

turn a please our discussion to for Slide per Now of XX earnings share.

to offset this results. and higher of was share net or year Price, Our third mainly on-site, driven lower per power due $X.XX volume $X.XX by operating $X.XX, to costs variable compared including pricing assets, X% quarter gains on adjusted Overall, earnings partially up new contributed costs. $X.XX merchant quarter last better lower by up demand. was both

Asia maintenance inflation. in implementing offset mainly actions we good making productivity control of to unfavorable much weaker cost and and the throughout America. to $X.XX exercising were due related as Again, Costs currencies actions was are significant the the $X.XX, organization. productivity and Currency cost planned progress negative South

the lower debt items Additional to quarter. tax contributed this expense of interest higher helped effective $X.XX rate onetime

Our full XX%. rate to effective expected year be tax is about

results. each in detail, provide The business please items I the a to discussion our discussion our key of results Instead viewing Now of and would turn like segment for Slide for quarter. focused summarizing business our highlighting segment XX. segment to

segments individual find slides the appendix. the of each will covering business You in

each the business overall at volume segment, in X% underlying higher, price which and sales Looking for together resulted Merchant was gain a were price positive X%. with X% region. pricing up Americas

for despite higher EBITDA maintenance. weaker offset X% Volume primarily costs basis was EBITDA strong to demand strong XXX increased increased was increased planned and margin demand points driven by hydrogen. merchant stable price about due relatively by as

up region's outages planned unfavorable, Europe region, X%, primarily with were our stable. X% maintenance products for was Looking merchant in planned was our combined the Volume as due demand largely EBITDA segment, contribution down in The firm outages. by Switching were underlying to Merchant relatively was Uzbekistan. offset and to maintenance by at cost assets pricing new margin sales and our were results. driven Volume new and lower Asia drove margin. improved EBITDA power held assets. the declining

mainly due EBITDA increased nearly improved contribution and XXX XX% volume margin EBITDA margin. improved to basis points,

was Equity costs. Sales and segment. price Middle Moving to due lower X% and unfavorable higher due volume. income to India income merchant and to our East operating declined affiliate

were to productivity across quarter, this For our on Corporate primarily making equipment, all of and our Other segment, and profit up of higher progress segments due LNG. company. actions good including We're the sale sales

Seifi, the Before for moment to teams take our me call to world results. back outstanding let a the I these turn around thank delivering

Now I Seifi would remarks. to back like to to turn provide closing the call

Seifollah Ghasemi

Thank you, Melissa.

to Slide #XX. turn Now please

and business great Our a it. to are business, gases and we grow is committed industrial invest

just to announcements to separation Louis the Georgia and membrane air St. X in production our units in expand examples. recent are Our Carolina build new facility and North latest

decarbonize the deliver to leading industrial low economy. heavy-duty of transportation carbon also help hydrogen the at are and We to way scale, the sectors

demonstrates results that strategy. I Our of this right to significant able we quarter X-pillar project parallel. employees drives and happen. these outstanding the we to always our the X as it towards say, growth goals strategy make motivation we were in The and have have commitment our company achieve And the milestones that

some Board to questions, to senior The to management close I the delegate formation more a the our business. to of our succession executives I was who planning. up comments responsibility want it before are open Management make Now about Board strategic and for step

and intend seen pillar have growth are many with basis, a am that all and growth announcements I is on are times, I strategy our I our changes, fully as projects have carbon mega built, Products, low customers our and continue additional we and X-K to leading serving our On And filing them. organizational fully X our our on I ensuring carbon make hydrogen. articulated strategy. Air know public that comments these really don't to committed have that personal to you firmly any You X implemented,

However, should President. Officer with a to With happen succession in at me. commitment good of my be be fully a who and and I Air good governance company a or and member potential our unexpected something success, individual relationships. international to X public Directors. bring if of the in clear planning, preferably Board can to of share Chief known as successor Executive CEO company successor of person the qualified current roles fully investors well mind, governance into decided with and prudent a Board I a it of and qualified to President Chairman continued significant record is were Products. currently practice experience to This have our a good to with have former

we our questions. have find the take and time job. this your person I will point, will delighted right I -- for be all this to we At answer started delighted process, the be to will

Operator

[Operator Instructions]

from And take question first Capital John McNulty Markets. we'll with BMO our

John McNulty

the about morning thanks management to color on and in think all how forward. committee. Seifi, terms commentary helpful of going It's Good definitely the around and the for things the

came was of guess dig Total. quarter. up that into, the the to wanted one guess, of one announcement I things events the during the green I hydrogen with on newer, I So

than It it we in were what came earlier came arrangements. of thinking offtake -- terms admittedly,

guess, expected? maybe kind over little speak brought out brought can of bit of a kind or we spoke timing or potential demand I what how that as than to XX the Can one, And to, So and that's hydrogen. for maybe the you for of green then you further speak two, it earlier maybe months heightened next to that so? offtake incremental arrangements the you look forward

Seifollah Ghasemi

commitment, own. so depends conditions it their of X have John, to customers our have customers Good the regulatory years. industry they for that. since a It for talking of the they on Neo, to conditions. these decide and project morning with to even public on want the a for John, before announcement potential their things, hydrogen the make It Their needs. all about of made thanks announced past very we been a good we on question. need depends and depends And life when having in

to green a contract his not and of very convert, time, is for difficult I'm at northern to visionary him on our first hydrogen, And he that Perner see decided put the had make refineries to hydrogen. to he committed and together and been happy too talking announced committed of was to and reader Since commitment Mr. get act like to is long kind to be both we Total least it earlier Patrick that mover a a sides. together the

obviously application hydrogen. of better not or We have for delighted. We found are a could significant better customer amount a a

terms them, we an But I want Energies out do In preempt is Products. they it I the then what additional that of has find made have those volumes possible Total Air happened to to statements. go best it proven has make anything. leave to people and alternative for since the not want announcement, through that auction process to

They the are if do? refineries customers are other the to going of they their to going lot a So is taking to Energy. Total to have from what Obviously, convert refinery follow. are other green, cue

other being has we little being become puts in we dynamic of contacted by we before and well, a steelmakers contacted Products a position. now So bit it Air a to of good by maybe which us they obviously should are -- get refineries, out very product, are run -- of who

actually contracts future it very I so that keep lead we to very have -- give like of I'd to do acting on, a hint and anything or been not responsibly And way. terms something. always In until

with It But is question with comes time, an us. We make. sell working are a appropriate at agreement Total no is that new people. will obviously up the significant But if our intention beginning other we is is everything obviously we for announcement. that make there -- to anything

John McNulty

should opening blue. the cost-effective quickly give Maybe just would more you making can arrangement. It seems you're update up to as follow-up, even I Total project? progress that the more Louisiana if a an on I And it's us a so somewhat for which for be market be green, the like is solution, with imagine guess, what the opening up tied would

as speak well? you maybe dynamic that can to So

Seifollah Ghasemi

Sure. Again, confident well. very about the have And our it good another I feel announced. that Louisiana, very Daro have moving that in done call good project we we feel our question. project homework. is very Number capital one, We we

approval most critical we is permits that in of milestone starts And that, filed which is have X terms and of done testing the Louisiana. week all state to the major We and in That be a that. running last to our project of clock Class for getting for viable. the the item

I XXXX. lot about good We plant the that to for feel is proven space have sometime able be have, on other in we a the we a very have that bring we should we poor very people. that poor think of we are And space, challenge stream that which confident

right, the demand. is hydrogen, are In had demand going number blue have the then shipment one, the plants. product, terms to lot about discussions hydrogen a that Japan like there of the be Blue we of ammonia target product is discussions. you to for put And for Hydrogen. we And converted for to to existing are The a the in part Korea, and pipeline places significant power will serve our decarbonize our their with and customers it of to:

good very have about feel position ever definitive, will we that. obviously if if be anything -- And So you announce. we in sign to a we

Operator

our next with take Zekauskas JP we'll Morgan. question Jeff And from

Jeffrey Zekauskas

what's calendar your project the dissociation Neon still the the hydrogen technology? to state at And end stream of come XXXX? on Is of

Seifollah Ghasemi

is #X, on plant our schedule. Neo Jeff, in

December expect early commissioned we We complete XXXX, in be and that mechanically for you hopefully sale have as should product by, plan to of and said, XXXX.

in you're and we that have deploy I [ which and technology, with technology, ammonia other obviously cracking proven to is will Total the of ] in places. it what associated, referring think terms like we the In

Jeffrey Zekauskas

which Products are time. look also [ a or at over price Air from I slowdown dissimilar in been happening what's there's I ] with When Air think not And results, Liquide a slowdown been Linda, there's change. volume in

volume have probably gas change the you moved hard and But sequential industrial -- matter about on-site whether prices much. slowdown so can in in in the end, raw merchant prices very the doesn't talk and it's Now to materials industry? the down, have overall moved really down, which know

Seifollah Ghasemi

Jeff, I in an say that wouldn't have overall gases. industrial reduction we

look okay. place volumes a Products, obviously Air in the at in that overall the U.S. that slowdown and numbers. where is at Our merchant seeing you we is And affects are when China, our

to destructive. demand don't at comment price can In start a pricing, a the only what not on alternatives. prices, I increase there terms is when when improvement the I amount because certain you comment obviously, show on a but you price future, can is And being limit of which you too you past. increase year-to-year, comes time will people the because huge there there of find

our in So steady, question about our have is that. I but in China. what feel good. U.S. it it's overall pricing. And people No very is Europe, volumes In good done the with weak about

We have principal part we talked seeing we the that about not in first quarter stabilized, much it but estimate one of our of are growth was that. has -- reasons That but that world. and the missed the in

Operator

comes Our Stanley. Vincent next from Andrews Morgan with question

Vincent Andrews

in update can of you out the Energy aviation Angeles, if terms the give Los Wondering going how relationship on both an World is sustainable fuel in with us the in project JV anything expectations are, update permitting terms there's any of we what or time or itself, line well should and as process incrementally the just if know in there? your as customers

Seifollah Ghasemi

will a with standards in for and relationship with our probably permits. Energy, them. project very expect we said until We our take that relationship get the of of hold a on process good working we project, terms we that. we put been few Obviously, year terms them that, still we have years. have the with a World In that have of always

very demand. the that, to And demand I A world. have seen, much be make for are Vincent, mean, all in trying all over you're as terms informed. seems of [indiscernible] product and the very, very you In to lot people of of the [indiscernible]

to hydrogen just to contract in we a supply got unit So Europe.

So we California, our but it project, And works how that we out. on to the feel see about and good in have state are of considering that we hold we get permits. pretty that is until just operating wait

Vincent Andrews

follow-up, came Should lower in rate had quarter? that little than assume the we tax rate same in in as fourth the a the quarter expected. we And a tax bit

Seifollah Ghasemi

that. on a I to would that question give turn like Melissa to to color you

Melissa Schaeffer

Thank you, that. Seifi. I appreciate

we -- a mentioned So we We as a full expect quarter. at did this for items the this X%. for to had the year, But do tax that see rate quarter. we lower in onetime comments, number it occurred of be

For example, lower some the there year. what foreign you XX% stock which was option and tax again, support forecast restructuring a rate. for But significant did the exercise is should

Operator

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

David Begleiter

Do to when XX and the you update contribute project Alberta an as it start have will on to up will earnings?

Seifollah Ghasemi

in to have sometimes and will project when we project Alberta whether and our -- it to 'XX stream. come stream results fiscal will on that Our wait year on exactly contribute comes see

a of middle are the building plant Alberta. in We

are know vendors You what the like.

anybody's construction fast and we this winter. how can do during So guess it's much construction how

I any So date. don't want to commit to specific

you, and no 'XX. We the project guidance we year, are be to assume conservative going contribution from give to going we that for issue our when are in

David Begleiter

a at or the guidance on the the come in wide? just end Why guidance, range? it wide. And And lower is Understood. higher -- end what you bit to so of cause would QX it's is

Seifollah Ghasemi

change didn't David, good the guidance the year, to for honestly. want point. you one, quite we make Number a very

the we year, you and you reason a So good the that range, guidance top bottom default, end for by if the up the wide had changing it start to there get Because we for down I the -- but is Because might misinterpreted. either thought the or numbers David. up move have. with

news, very the situation You'll is geopolitical in see unstable. the the world

now. hasn't We about try should their worried did But was of the quarter $X.XX is as because thread rather last quarter Reserve overall are do. a needle to focus your through up kind not about an range I -- year the they going as lot therefore, the to unknowns. -- to We election made a guidance so want focus you appreciate was geopolitical guidance. exactly and I the of mind with think Yes. cycle. The Federal and come on. up And situation what that than overall, on I it just am There

right? going between be We to and are somewhere XX.XX XX.XX ,

Operator

question our Parkinson take we'll Research. And Chris from Wolf with next

Christopher Parkinson

together I you're you've geographies the and put a of between decent right quarters, say, been yet, navigating and moving you of should if choppy all -- across kind the a fairly U.S. board the and So I difficulties macro, direction in of good and lot the across now. been couple Europe yet think, has

manufacturing of in quick electronics, update So a what's kind together on the in just and us on can thoughts you a favorable to entering on we everything the XXXX. things regional perhaps more that you're basis, hear key now helium seeing putting on Just update latest of some Asia? love give that your a just a specifically little I'd in are trajectory,

Seifollah Ghasemi

optimistic. That's optimist, I'm an On generally I'm excellent and macro question, Chris. always basis, a an

the everybody think economy stronger expected. moving I than is wrong has U.S. it proven one

volumes, especially on-site in U.S. business the is very and is hydrogen Our merchant the fine. doing strong

unless feel rates. for XXXX, with U.S., the interest the unexpected into going So something significantly very comfortable happens I

other. expect. all either one or what And with know we the the you It's election,

with think much. relatively up Then don't that to that I will holding things change Europe respect well. So is Europe,

to going would in I don't margins good We increases any have Asia it been price China only on is have considering then is holding how develop? right that get into sure there. to we making now, 'XX successful And worse. that concern where But is the expect my

especially as and Some people electronics in will improve, things are you the will sector, we predicting mentioned, but see. wait that

year And Air growth XX% growth which about deliver every want, in general, our going Products. our in we of So optimistic overall, that on EPS. ability the to for I'm XXXX, terms into sure very is

Operator

question Goldman next Fischer with from Duffy our take We'll Sachs.

Patrick Fischer

mean you the and the like? is what's that Roughly much there? then Will California? and to that? Europe you some maybe through what the model And Or stations then it capital the can that called you economics that one do rough of out, own I project you give it? and will could, business push own in going your hydrogen through hydrogen scope just for us people how you If look us from you source the in talk then like were what one looks other X the stations just

Seifollah Ghasemi

our intention we Duffy, we is move build Sure. that the chain. that whole of own liquid crack, ammonia informed in of then kind we supply whether or it then hydrogen, green it's of we form produce the We the station.

We will own sell the jointly company over the the some to control we have station, own we or to the station. company We the with anybody train will customer, the else. might and but it station truck people, or other will end

to we the of want own and depends depends products to development of a capital on number of of these I right we -- fully supply is bit build in building same stations economics, going in out sell will that California. California. refineries, stations will all in Europe [indiscernible] it we whole in deployed, and all much if the chain. then gradual stations intend be a that. in delayed. application have why their depending terms we mean, and for And we now, are So how Obviously, it That the on build. be Europe, build obviously, new And will to little decarbonizing therefore, thing we But

much So on it depends market how very the develops.

depends. either so the them might through sure It not we sell and will people make Air going are that Products XXX% with control, the idea it. we that the molecules that we molecules. stations you our or the the said, if build that But share molecules we ownership own are other exactly And what or stations, might is

Patrick Fischer

a a When the let's going that? And a guide, QX $X.XX better the drives be sequentially that you that walk from second What to then and or EPS in headwind Can $X.XX, say, the us to from having tax just talked dime. bridge QX, if could. nickel sequential of QX? Melissa the might getting, up for about midpoint at at QX look I one, we it's but

Seifollah Ghasemi

years drives of not very -- look quarters. a results It of What is last you that quarter. or our drives in question. one X that that's obviously is year that XX good What years, strongest our quarter XX is is fourth our years the strongest of #X is is when XX at our it only or fiscal

So better XXX that the of would because cyclicality. just we we expect the have than results

have we is productivity The taken second serious reason actions. that

You results that but this you'll in some of quarter, lot are more in next see of a the the seeing quarter.

then the do some that projects smaller we stream And third on thing is coming will new contribute. that have

pretty what deliver the So bridge have midpoint to, the said, confident of and as midpoint $X.XX should our be we able we feel that you get the that we of to that delivered to need guidance. X.XX we

Operator

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

Unknown Analyst

in for filling [indiscernible] This Steve.

made the that would on I XXXX a start-up Louisiana you firstly, for little comment go to So track want blue ammonia to energy. export a back bit mentioned you're still and the be to market the project sold where for you

that ammonia, X X seems any utilities companies need However, that the it at Japanese at like of some will if wait have years. probably time, major you not to much or perhaps such as all,

that to there assume on not safe you start you until So XXXX? perhaps other any ammonia for it Or up? are when that focus is will outlets

Seifollah Ghasemi

Thank hearing is view your developing But ammonia marine you demand. they for story Obviously, us there you, shipping. don't that sector pretty there they a question. of and or them. but a are is we know that lot as what also is a is for different rapidly, from another tell tell I

we by that pretty facility. able feel start will to confident that we loading So be XXXX,

might the instead capability I think existing our want have also a and pipeline do capacity hydrogen. by XXXX, [indiscernible] ammonia We customers of of we the balancing between and hydrogen and lot of blue have hydrogen and

Unknown Analyst

go little a back to Energy project. the wanted I to World bit And

a on mentioned line time the to it's X-year that You get your roughly permit.

announced X was the ago. think years over project I itself

proceed actually So to kind go is for assume know that the with when X-year And of to? it after mean apply going the to will we that or alluded you safe point, go? you does permits a at over didn't year -- if you're a this it's we're deadline And FID and little of to going a no kind final that? is

Seifollah Ghasemi

Well, we we to issue because hope more. we or that out finish is permit have with find we and and the we for get to permits there wait have the plant, but then permit, hope our wait an want the some don't to to commit we

not to if anything there is I'm me sure for So more add.

We finding that. of that challenged ahead did FID all hurry last We final and then bulletproof getting want it sure we up waiting ourselves that to just to make have We permit. of like and don't for decision. and are gets the time is the want we before start permit

Operator

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

Michael Leithead

Seifi, I you green hydrogen ask appreciate I them talk the about wanted to agreement. won't pricing. total likely

us a to a you I'd to mover. first take price, return agreement? being of speak the If agreed-upon it. You've you hurdle can obviously this lot risk want taken happily give But the by of

So traditional validation, are your in project return hurdle? getting you above this that materially profile is a

Seifollah Ghasemi

you them the should to we we we have public to taken Well, have do me sympathy can we always with yes. money, in So do risk question. to reward things people here have that, I not answer a that lot on cautious some and with you're when good But negotiating of be than the but higher -- saying, asking a sure risky. are be I and be you a call terms we you me our very something comments Obviously, right? to "Hey, make be that what of sitting said, are we're therefore, as that going to hope sell the expect is have don't

Michael Leithead

clean other about announcing you I just think NEOM-X -- signed said, want energy but being excited Makes a projects time, much large before you've like to for same tangible offtake the you or sense. lot of then until didn't agreements there. at have to And already building commit about talked you you've out what

months should with say, now the in, you're clean other project far Total so? have negotiations, energy further sounds contract, So that expect like XX we the we it announcements or some along next

Seifollah Ghasemi

to sold have that, commit want say Neom. Neom the then will see that that have sold and if until of NeomX. of have I'd announced sold we we projects go investors to XX% I should we XX% to build like so out. I that. only we and that commit to wait don't we rush Therefore, are enough okay, and

to we some in is demonstrated be that of our volume there months the demand writing a not and is ago, a for that sign because put until that it demand of but [indiscernible] we green get cautious going is there no where they . are to the So fact good conservative have from ourselves, slides significant ahead have competitors, seen you few

production. before come, for that right, we sold fast it those out it will things in you're additional it commit depend current year, to how announce Depending might fast to different project, obviously think is demand story. how for on it the the with contracts we now will be but signing projects. would are investors -- have some that I I There And things bit a So is enough a hydrogen. we give -- truly of and signed green on a little Neom like progress it's that to confidence but

Operator

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

Michael Sison

your have Nice outlook. projects outlook. will you can support give much sort I of or And by maybe color bit of any support it's growth and Seifi, you to year? year? next do when much that kind how know early specific in How a about help any you think of little of think anchored earnings could sort 'XX, and be next some quarter terms growth earnings

Seifollah Ghasemi

difficult for Thanks comment. details. to your you would It right very give now be

we details are we to XX But for are we delivering do say we of same. would earnings. results. next average committing today, committed And that like in give those Products, the quarter years ago, will our to XX fourth years, Air the announce to XX% growth an when in We going you that I general, all

our So year. our goal, target, at XX% to our growth challenge a deliver for next for next quarter, is least

obviously will through -- we are But budgeting process. the going we

then have our November. are in when all early of a you October the We or and give number we'll we results announce details late

Operator

with Roberts And Mizuho. take John we'll question next our from

John Roberts

hydrogen you the give I gray know Eric, assume, and a terms want in above plus been, with is all And Neom, wide you're in customers? there any have details, of really carbon that I hydrogen a they credit? range And seeing on between Welcome, for you discussions your but Alberta, don't Man, to Louisiana, did. Best price thanks Seifi, being discussions rock. in clean is

Seifollah Ghasemi

is the blew green that the gray that. twice people if price we is the John, least been telling guidance the overall twice and they have at guidance something is that, prices that price

table then So for and is for guidance that green blue it's pricing. -- and double of blue for the kind overall

that that. are improve the I we for, forward supply. we demand So have looking the the are the that think we pretty idea getting exceeds of I pricing and go as of think And thing will good a all you then pricing kind

John Roberts

level across because, pretty next at be various door. netback price that's pricing Neom, different significantly And away. and be going for customer And obviously, Alberta will some your right it's far in to the receipt the customers

Seifollah Ghasemi

the next the difficult into if then if thing but significantly is higher of price we pricing. there somebody will -- that that a to I said, is serve is [indiscernible] mean consideration be we is customer some it to do very give that, as you Well, take element obviously, when the than

Operator

We'll next Spector take our with UBS. from Josh question

Joshua Spector

So to commitment on additional follow to your question the I earlier around up projects. wanted announce

to during think we FID, I get I language. And that quarter, any offtakes. should more you've been how won't I projects you explicit see more until that be believe, precise wanted you taking the

Or your talked need think you about we we anything that? XX% is to before as announce reach than Neom about you to to else? those think loose So But about Louisiana, be should both of expectation earlier. offtakes

Seifollah Ghasemi

working loaded see are project. you other and before we hydrogen, interpretation project, not announce, that total But the FID, Northern this not have what hydrogen on project project taken of any the is rules we take for our another of we of fully Edmonton, green clarity Neom, talked are FID on, loading think have about, X way we hydrogen. project IRA that should Louisiana did There in I that we an that which make until expect kind for FID green that to those is Texas. would one we facilities we plan you do

that, expect our of investors. until clearly. don't I other fundamental very respectful this So And we make any issue us quite to the to being see is, frankly, announcements than way

many, and is XXX, very stock the is a many and concerned. that announced XXX, XXX. be why, the mean, that -- know, think didn't our that investors without should investors projects it. the I are that I are for we that reason I is it think concerned $XXX got with We don't But I And having a the that now, building sell got we certainly, never about was to getting investors where a of the but impression. plans the the clue we bit ahead impression was but That think was so, that little ourselves. we case,

projects. announce again. get we to want mood to that FID, make demand don't I fully demonstrate major We before into So is there any want any

Joshua Spector

that you is whatever I Texas without credits Louisiana out your appreciate guess, X are project if into that. coal don't on their IRA sold project? And So then takes blue you something we going the next or that project IR the get clarity factor in quick production project specifically, FID, be to the a I follow-up say energy view? hydrogen just that new Japan X, out? utility but Or is months, sold Louisiana do consider clarity, Texas, know, a would project I limiting for that in what to longer --

Seifollah Ghasemi

can cost can project that the California. out demand hydrogen, of to in for transport so California for up we when at hydrogen, that is liquid green market a the green California. you the demand easily you that you green significant hydrogen to and come fill look stations on, project without and it years the with And easily can any directed targeted number up. The because at demonstrate making in and fully Northern is in sold is in project We to that few Texas, that liquid

reason that other qualify definition to of that what understand is to or the know to a is see want very we $X. good can $X very we fact very, are get kilogram. selling prices. that that that because about the $XX hydrogen am not. sell into to that a on to But qualify holding confident if we close market for are $XX the get we The kilogram, we green project we want I We And at green. main Right product now, people

beginning -- If will until the very we is have probably the And you in think I so IRA. of next project we year. for as -- that do are don't waiting clarity the on you the definition makes Texas of math, everything said, Northern much that

X time have do please? are questions, not anything for we So other going to then. Operator, until we

Operator

question comes The Citi. Cunningham Patrick next from with

Patrick Cunningham

follow to just up. wanted Maybe

times. the multiple mentioned election You

might I mean pillars mean And your just of understand greatest each thoughts X maybe either what business? and for outcome the your specifically, might interpretation the think So to more on latest for of want the IRA outcome then you rules? what

Seifollah Ghasemi

can fully I I'm on. not you sure, understood. I'm hold if Sidd, Can just you...

Siddharth Manjeshwar

with think mean? coming question related in, and to that the I was new incumbents the Yes, a administration IRA or guidance does the what

Seifollah Ghasemi

sequester. X dimension that that Well, XXQ it get you the is ton is of us, part per IRA is the which related has so-called to you dimensions. COX $XX the is, One that

I [ I $X XXV, Louisiana. project the that. on will subsidy The And have, challenge the there we feel get are why you which is rule building part, think in called think that about not matter is very is is much We which other which for that controversy green around the support. administration that ] no is hydrogen. confident

hydrogen? X that that green definition and the crystal And me the controversy the it green from the enough that it Air Obviously, you I that we very that made is been fact hydrogen is the believe simple. on therefore, down Is the What getting I'm say, electricity of making means Products "Oh, I'm to therefore, electricity to controversy. are grid. is irrespective That and by -- clear connect is green the green electricity. $X be using hydrogen of water positioned breaking coal. day has burning I give using might has

are not then is not you green electricity, using If it green hydrogen.

green That green day. XX prove to hours electricity. a hour, that need should available be every have you electricity means also you And

going to of lot the shines You can't and in that make the green during electricity say, connect now then a to the the grid. sun night, okay, day I'm

rules saying is are hear, think administration that are rules the what now. administration our the public to from And we been they have the issue of the and the after is with have I with is pillars going X they election. green. has The definition they issued So that the that not current the -- are rules. they finalized very right not is clear agreed we us, The way what until finalize have

not interpretation the to or a good So to not going modify? what they building bad we the administration, have And knowing those is of would we call as exact a billions facility, or the issue is. change dollars are see new of do rules if administration commit want and

we are on approved, rules to have and until that count we that proceed. then have department press and the can treasury certainly will wait been going we So we

long the for just all I Sorry answer, to issues. but wanted address

last question, operator, please. Okay,

Operator

Alexander question last the from take Laurence with We'll Jefferies.

Daniel Rizzo

recently. I I is Laurence. And don't Dan project on in have missed if that for this, for This you update provided hydrogen remember Rizzo the I'm York? sorry green an Upstate the New being on but mentioned status

Seifollah Ghasemi

Yes.

a New in building project are Upstate We green York. hydrogen

for we hydropower have hydropower plant, part in day. demand a the put And plant because using that small could are the the green XX-tonne of a to from get of And significant is is the it mobility. obviously Niagara Falls power we that we We It's coming huge. power. is is not world And see capacity reason from.

the moving in are hydrogen, by we that green significant and in project is machine, and going serve and on that. liquefied all way that of to the we We produce optimistic time. about or that is New very being part therefore, all can world demand for That it see we to project. Pennsylvania because York forward are And of

Daniel Rizzo

me remind when just sorry, online? I'm estimate

Seifollah Ghasemi

terms your to questions. again, you. safe, be fourth in I do Please very thank insightful do appreciate in results. thank everybody. and appreciate we time announce Products. 'XX. Well, everybody we or And you we your some forward like to then our the healthy, timing, look Thanks, and good and we you, very thank talking you call. for stay said and to interest Air quarter I'd joining thank In much, think our 'XX have operator, We of we

Operator

concludes for your participation. call. This today's Thank you

disconnect. You may now

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