Q4/FY 2024 - Linde Plc - Full Analysis
"Here at Linde, we are often imitated, but never duplicated." - FY25 should capitalize on several growth levers
Today, Linde, the world’s leading industrial gases and engineering company, reported Q4 and full-year 2024 results. At the time of writing this recap, Linde stock is up .6%.
Today’s release and commentary by the CEO and CFO confirm that the long-term growth algorithm of >10% EPS growth remains intact. As such, it remains a core position in our high-quality growth portfolio aimed at achieving high risk-adjusted returns. That is: attractive returns with low risk of 1) permanent loss of capital, and 2) lost decades (incurring risk/volatility/bad timing and not earning a positive real return).
Linde’s Q4 Presentation
Of course, there will always be noise related to FX, trade wars, and other external factors. However, since the merger between Linde AG and Praxair, macro challenges have been consistently overcome; simply by implementing actions that preserve shareholder capital.
For Linde, these are:
being laser-focused on profitability;
having the densest supply network of the entire industry;
maintaining a healthy balance sheet;
embarking on larger projects with secured cash flows and mid-teens percent un-levered IRRs;
being proactive with share buyback optionality
Let’s take a closer look at Linde’s fourth-quarter performance and outlook for the new fiscal year, as well as our updated valuation model.
Solid Performance, Exceeding the Updated Guidance Provided Last October
In his opening remarks, CEO Lamba applauded the Linde team’s performance during calendar 2024. He stated that the excellent financial metrics are a testament to a decade-long corporate culture, while making sure to never become complement about past performance. Linde’s employee ownership mentality is expected to deliver steady growth again in FY25 (8-11% EPS growth excl. FX).
As CFO White stated:
And over the years, while many have claimed they'll simply copy this model, all have failed, because here at Linde, we're often imitated but never duplicated.
Linde’s FY24 Milestones - Linde Plc
