What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-02-26 compared with 2024-02-28 · 309 added, 312 removed, 1451 unchanged (30% of the section changed)

12 unchanged sentences

Summary of Significant Accounting Policies

Acquisition s and Divestitures

Other Charges

Acquisitions and Divestitures

Cost reduction program and other charges

Earnings Per Share – Linde plc Shareholders

42 unchanged sentences

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A.

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting.

Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits.

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Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matter

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

1 unchanged sentence

Revenue Recognition - Estimated Costs at Completion

As described in Note 19 to the consolidated financial statements, $2,160 million of the Company’s total revenues for the year ended December 31, 2023 was generated from the sale of equipment contracts.

As described in Note 19 to the consolidated financial statements, $ 2,322 million of the Company’s total revenues for the year ended December 31, 2024 was generated from sale of equipment contracts.

Sales of equipment contracts are generally comprised of a single performance obligation.

Revenue from the sale of equipment is generally recognized over time as the Company has an enforceable right to payment for performance completed to date and performance does not create an asset with alternative use.

Revenue from sale of equipment is generally recognized over time as the Company has an enforceable right to payment for performance completed to date and performance does not create an asset with alternative use.

For contracts recognized over time, revenue is recognized primarily using a cost incurred input method.

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Costs incurred include material, labor, and overhead costs and represent work contributing and proportionate to the transfer of control to the customer.

The principal considerations for our determination that performing procedures relating to revenue recognition - estimated costs at completion is a critical audit matter are (i) the significant judgment by management when developing the estimated costs at completion for the sale of equipment contracts;

Changes to cost estimates and contract modifications are typically accounted for as part of the existing contract and are recognized as cumulative adjustments for the inception-to-date effect of such change.

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating audit evidence related to the estimated costs at completion and management’s significant assumptions related to the total estimated material and labor costs;

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Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the revenue recognition process, including controls over developing the estimated costs at completion for the sale of equipment contracts.

These procedures also included, among others, evaluating and testing management’s process for developing the estimated costs at completion for the sale of equipment contracts, which included evaluating the reasonableness of management’s significant assumptions related to the total estimated material and labor costs.

Evaluating the reasonableness of management’s significant assumptions involved evaluating management’s ability to reasonably estimate costs at completion for the sale of equipment contracts on a sample basis by (i) performing a comparison of the originally estimated and actual costs incurred on similar completed equipment contracts, and (ii) evaluating the timely identification of circumstances that may warrant a modification to estimated costs at completion, including actual costs in excess of estimates.

These procedures also included, among others, evaluating and testing management’s process for developing the estimated costs at completion for sale of equipment contracts, which included evaluating the reasonableness of management’s significant assumptions related to the total estimated material and labor costs.

Evaluating the reasonableness of management’s significant assumptions involved evaluating management’s ability to reasonably estimate costs at completion for sale of equipment contracts on a sample basis by (i) performing a comparison of the originally estimated and actual costs incurred on similar completed equipment contracts, and (ii) evaluating the timely identification of circumstances that may warrant a modification to estimated costs at completion, including actual costs in excess of estimates.

Professionals with specialized skill and knowledge were used to assist in evaluating the reasonableness of management’s estimates and significant assumptions related to the total estimated material and labor costs.

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Research and development 150 146 143

Other charges 40 1,029 273

Other income (expenses) – net ( 41 ) ( 62 ) ( 26 )

Cost reduction program and other charges 145 40 1,029

Other income (expense) - net 185 ( 41 ) ( 62 )

Operating Profit 8,635 8,024 5,369

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Income taxes 2,002 1,814 1,434

Income From Continuing Operations Before Equity Investments 6,174 4,109 3,837

Income Before Equity Investments 6,567 6,174 4,109

Income from equity investments 170 167 172

Income From Continuing Operations (Including Noncontrolling Interests) 6,341 4,281 3,956

Income from discontinued operations, net of tax — — 5

Net Income (Including Noncontrolling Interests) 6,737 6,341 4,281

noncontrolling interests from continuing operations ( 142 ) ( 134 ) ( 135 )

Net Income – Linde plc $ 6,199 $ 4,147 $ 3,826

noncontrolling interests ( 172 ) ( 142 ) ( 134 )

Net Income – Linde plc $ 6,565 $ 6,199 $ 4,147

Income from continuing operations $ 6,199 $ 4,147 $ 3,821

Income from discontinued operations $ — $ — $ 5

Per Share Data – Linde plc Shareholders

Basic earnings per share from continuing operations $ 12.70 $ 8.30 $ 7.39

Basic earnings per share from discontinued operations — — 0.01

Basic earnings per share $ 13.71 $ 12.70 $ 8.30

Diluted earnings per share from continuing operations $ 12.59 $ 8.23 $ 7.32

Diluted earnings per share from discontinued operations — — 0.01

Diluted earnings per share $ 13.62 $ 12.59 $ 8.23

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Linde plc Shareholders’ Equity:

Ordinary shares (€ 0.001 par value, authorized 1,750,000,000 shares, 2023 issued:

490,766,972 ordinary shares;

Ordinary shares, € 0.001 par value, authorized 1,750,000,000 shares, 2024 and 2023 issued:

490,766,972 ordinary shares

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Accumulated other comprehensive income (loss) ( 6,894 ) ( 5,805 )

Treasury shares, at cost (2023 – 8,321,827 shares and

2022 – 59,555,235 shares)

Treasury shares, at cost (2024 – 17,530,240 shares and 2023 – 8,321,827 shares)

( 7,252 ) ( 3,133 )

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Net income – Linde plc $ 6,565 $ 6,199 $ 4,147

income from discontinued operations, net of tax and noncontrolling interests — — ( 5 )

Noncontrolling interests from continuing operations 142 134 135

Income from continuing operations (including noncontrolling interests) $ 6,341 $ 4,281 $ 3,956

Noncontrolling interests 172 142 134

Net Income (including noncontrolling interests) $ 6,737 $ 6,341 $ 4,281

Adjustments to reconcile net income to net cash provided by operating activities:

Other charges, net of payments ( 118 ) 902 98

Cost reduction program and other charges 31 ( 118 ) 902

Depreciation and amortization 3,780 3,816 4,204

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Acquisitions, net of cash acquired ( 317 ) ( 953 ) ( 110 )

Divestitures and asset sales, net of cash divested 70 195 167

Divestitures, net of cash divested and asset sales 170 70 195

Net cash used for investing activities ( 4,644 ) ( 4,670 ) ( 3,088 )

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Income taxes paid $ 2,216 $ 1,955 $ 1,735

Interest paid, net of capitalized interest (Note 7) $ 451 $ 170 $ 233

Interest paid, net of capitalized interest $ 443 $ 451 $ 170

The accompanying Notes are an integral part of these financial statements.

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Income (Loss)

(Note 7) Treasury Stock Linde plc

Treasury Stock Linde plc

Shareholders’

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Balance, December 31, 2021

552,013 $ 1 $ 40,180 $ 18,710 $ ( 5,048 ) 43,332 $ ( 9,808 ) $ 44,035 $ 1,393 $ 45,428

Net Income available for Linde plc shareholders 4,147 4,147 134 4,281

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Dividends and other capital reductions — ( 81 ) ( 81 )

Additions (Reductions) — ( 876 ) ( 876 )

Additions (Reductions) (Note 14) — ( 56 ) ( 56 )

Dividends ($ 4.68 per ordinary share)

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Balance, December 31, 2022

552,013 $ 1 $ 40,005 $ 20,541 $ ( 5,782 ) 59,555 $ ( 14,737 ) $ 40,028 $ 1,346 $ 41,374

Net Income available for Linde plc shareholders 6,199 6,199 142 6,341

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Dividends and other capital reductions — ( 113 ) ( 113 )

Additions (Reductions) - (Note 14) — ( 56 ) ( 56 )

Additions (Reductions) ( 12 ) ( 12 ) ( 1 ) ( 13 )

Dividends ($ 5.10 per ordinary share)

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Share-based compensation 141 141 141

Intercompany reorganization (Note 14) ( 61,246 ) ( 15,300 ) ( 61,246 ) 15,300 —

Balance, December 31, 2023

490,767 $ 1 $ 39,812 $ 8,845 $ ( 5,805 ) 8,322 $ ( 3,133 ) $ 39,720 $ 1,362 $ 41,082

Net Income available for Linde plc shareholders 6,565 6,565 172 6,737

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Additions (Reductions) — 19 19

Dividends ($ 5.10 per common share)

Dividends ($ 5.56 per ordinary share)

( 2,655 ) ( 2,655 ) ( 2,655 )

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Share-based compensation 160 160 160

Intercompany reorganization (Note 14) ( 61,246 ) ( 15,300 ) ( 61,246 ) 15,300 —

Balance, December 31, 2024

490,767 $ 1 $ 39,603 $ 12,634 $ ( 6,894 ) 17,530 $ ( 7,252 ) $ 38,092 $ 1,383 $ 39,475

The accompanying Notes are an integral part of these financial statements.

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Linde trades on the Nasdaq under the symbol LIN.

On January 18, 2023, shareholders approved the company’s proposal for an intercompany reorganization that resulted in the delisting of its ordinary shares from the Frankfurt Stock Exchange, on March 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 holding company in exchange for each share of Linde plc that was previously owned.

The new holding company is also named “Linde plc” and trades under the existing ticker LIN.

Principles of Consolidation – The consolidated financial statements were prepared in conformity with accounting principles generally accepted in the United States of America ("U.S.

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Asset-Retirement Obligations – An asset-retirement obligation is recognized in the period in which sufficient information exists to determine the fair value of the liability with a corresponding increase to the carrying amount of the related property, plant and equipment which is then depreciated over its useful life.

The liability is initially measured at fair value and then accretion expense is recorded in each subsequent period.

The liability is initially measured at fair

value and then accretion expense is recorded in each subsequent period.

The company’s asset-retirement obligations are primarily associated with its on-site long-term supply arrangements where the company has built a facility on land leased from the customer and is obligated to remove the facility at the end of the contract term.

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The impairment test allows an entity to first assess qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than carrying value.

If it is determined that it is more likely than not that the fair value of a reporting unit is less than carrying value then the

company will estimate and compare the fair value of its reporting units to their carrying value, including goodwill.

If it is determined that it is more likely than not that the fair value of a reporting unit is less than carrying value then the company will estimate and compare the fair value of its reporting units to their carrying value, including goodwill.

Reporting units are determined based on one level below the operating segment level.

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Other Intangible Assets – Other intangible assets, primarily customer relationships, are amortized over the estimated period of benefit.

The determination of the estimated period of benefit will be dependent upon the use and underlying characteristics of the intangible asset.

The determination of the estimated period of benefit will be dependent upon the use and underlying

characteristics of the intangible asset.

Linde evaluates the recoverability of its intangible assets subject to amortization when facts and circumstances indicate that the carrying value of the asset may not be recoverable.

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Accounting Standards Implemented in 2024

There were no new accounting pronouncements implemented in 2023 that would materially impact the 2023 financial statements.

Accounting Standards to be Implemented

Improvements to Reportable Segments Disclosures - In November 2023, the FASB issued guidance requiring enhanced disclosure related to reportable segments.

The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

adoption of this standard will only impact disclosures within the company's consolidated financial statements and the company is evaluating the impact this guidance will have on those disclosures.

The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The adoption of this standard includes enhanced disclosure of the company's segment reporting as it relates to the CODM's title and position, how the CODM uses the reported measure of segment's profit or loss, and the inclusion of significant expense categories and amounts that are regularly provided to the CODM and included in reported segment profit or loss (See Note 18).

Accounting Standards to be Implemented

Improvements to Income Tax Disclosures - In December 2023, the FASB issued guidance requiring enhanced disclosure related to income taxes.

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The adoption of this standard will only impact disclosures within the company's consolidated financial statements and the company is evaluating the impact this guidance will have on those disclosures.

Disaggregation of Income Statement Expenses - In November 2024, the FASB issued guidance requiring disaggregated disclosure of income statement expenses.

The new standard is effective for fiscal years beginning after December 15, 2026, and interim periods with fiscal years after December 15, 2027, with early adoption permitted.

ACQUISITIONS AND DIVESTITURES

Acquisitions were $ 317 million, $ 953 million and $ 110 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Acquisitions in 2023 primarily related to the Americas.

Acquisitions in 2022 and 2021 primarily related to the Americas and EMEA.

Acquisitions in 2024 and 2023 primarily related to the Americas.

Acquisitions in 2022 primarily related to the Americas and EMEA.

2023 Acquisition of nexAir, LLC

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Pro forma results for 2022 have not been included as the impact of the acquisition is not material to the consolidated statements of income.

The company estimated the preliminary fair value of net assets acquired based on information currently available at the time of the acquisition and has continued to adjust those estimates as additional information has become available.

The company estimated the preliminary fair value of net assets acquired based on information available at the time of the acquisition and adjusted and finalized those estimates as additional information became available.

Measurement period adjustments totaled approximately $ 27 million, and related to working capital adjustments and deferred taxes.

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Total purchase price $ 866

nexAir, LLC’s assets and liabilities were measured at estimated fair values at January 5, 2023.

Estimates of fair value represent management's best estimate of assumptions about future events and uncertainties, including significant judgments related to future cash flows (sales, costs, customer attrition rates, and contributory asset charges), discount rates, competitive trends, and market comparables.

nexAir, LLC’s assets and liabilities were measured at fair value at January 5, 2023.

Fair value represents management's best estimate of assumptions about future events and uncertainties, including significant judgments related to future cash flows (sales, costs, customer attrition rates, and contributory asset charges), discount rates, competitive trends, and market comparables.

Inputs used were generally obtained from historical data supplemented by current and anticipated market conditions and growth rates.

The fair value of the previously held equity interest was based upon a purchase price valuation (excluding debt) multiplied by the company’s previously held ownership interest adjusted by a discount for lack of marketability.

The fair value of property, plant & equipment, net is based on assumptions that market participants would use in pricing an asset, based on the most advantageous market for the asset (i.e., its highest and best use).

The fair value of property, plant & equipment, net was based on assumptions that market participants 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 for the age and condition of the property, plant and equipment, was used to estimate fair value.

Identifiable intangible assets primarily consist of customer relationships of approximately $ 245 million that will be amortized over their estimated useful life of 20 years.

Identifiable intangible assets primarily consisted of customer relationships of approximately $ 245 million that will be amortized over their estimated useful life of 20 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 incorporates the estimated future cash flows to be generated from nexAir, LLC's existing customer base.

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The goodwill recorded as a result of the acquisition was allocated to the Americas reportable segment, which represents the reportable segment anticipated to experience operating synergies as a result of the acquisition.

Divestitures, net of cash divested and asset sales were $ 170 million, $ 70 million, and $ 195 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Divestiture proceeds in 2024 include $ 69 million in net proceeds for a divestiture in APAC and a settlement with a supplier in the Americas.

2022 Sale of GIST business

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Proceeds from the sale were $ 184 million, net of cash divested of $ 75 million, for net proceeds of $ 109 million.

The sale resulted in a loss of $ 21 million (benefit of $ 3 million, after tax), recorded within the other charges in the consolidated statement of income (see Note 3).

Other Charges

Other charges were $ 40 million for the year ended December 31, 2023.

The sale resulted in a loss of $ 21 million (benefit of $ 3 million, after tax), recorded within cost reduction program and other charges in the consolidated statement of income (see Note 3).

COST REDUCTION PROGRAM AND OTHER CHARGES

Cost reduction program and other charges were $ 145 million for the year ended December 31, 2024.

Costs include severance of $ 165 million, other cost reduction charges of $ 23 million, and a benefit of $ 43 million related to a divestiture in APAC.

Cost reduction program and other charges for 2024 included an income tax benefit of $ 35 million.

Cost reduction program and other charges were $ 40 million for the year ended December 31, 2023.

Costs primarily related to severance in the Engineering segment and expenses incurred due to the intercompany reorganization for the year ended December 31, 2023.

Other charges for 2023 included an income tax benefit of $ 81 million primarily comprised of a benefit of $ 124 million related to the resolution of an income tax audit, partially offset by an accrual of $ 85 million for the potential settlement of an international income tax matter, both recorded in the first quarter.

Other charges were $ 1 billion ($ 896 million, after tax and noncontrolling interests) for the year ended December 31, 2022, largely attributable to the Russia-Ukraine conflict.

Cost reduction program and other charges for 2023 included an income tax benefit of $ 81 million primarily comprised of a benefit of $ 124 million related to the resolution of an income tax audit, partially offset by an accrual of $ 85 million for the potential settlement of an international income tax matter.

Cost reduction program and other charges were $ 1 billion ($ 896 million, after tax and noncontrolling interests) for the year ended December 31, 2022, largely attributable to the Russia-Ukraine conflict.

Russia-Ukraine Conflict

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The fair value of Linde’s Russian subsidiaries was determined using a probability weighted discounted cash flow model, which resulted in the recognition of a $ 407 million loss on deconsolidation when compared to the carrying value of the entities.

This loss is recorded within Other charges in the consolidated statements of income.

This loss is recorded within c ost reduction program and other charges in the consolidated statements of income.

Upon deconsolidation an investment was recorded, which represents the fair value of net assets.

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Other Russia related charges

Other charges related specifically to the Russia-Ukraine conflict were $ 103 million ($ 73 million after tax) for the year ended December 31, 2022, and are primarily comprised of impairments of assets which are maintained by international entities in support of the Russian business.

Cost reduction program and other charges related specifically to the Russia-Ukraine conflict were $ 103 million ($ 73 million after tax) for the year ended December 31, 2022, and are primarily comprised of impairments of assets which are maintained by international entities in support of the Russian business.

Merger-Related Costs and Other Charges

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Total $ 787 $ 103 $ 890 $ 139 $ 1,029

Other charges were $ 273 million ($ 279 million after tax) for the year ended December 31, 2021.

Total cost reduction program related charges were $ 338 million ($ 253 million after tax), for the year ended December 31, 2021.

These expenses consisted primarily of severance charges of $ 259 million and other charges of $ 79 million for the year ended December 31, 2021.

Other charges related primarily to the execution of the company's synergistic actions including location consolidations and business rationalization projects, process harmonization, and associated non-recurring costs.

Merger-related and other charges were benefits of $ 65 million (benefit of $ 26 million, after tax) for the year ended December 31, 2021.

The 2021 pre-tax benefit was primarily due to a $ 52 million gain triggered by a joint venture deconsolidation in the APAC segment.

The following table provides a summary of the pre-tax charges by reportable segment for the year ended December 31, 2021:

Year Ended December 31, 2021

(millions of dollars) Severance costs Other cost reduction charges Total cost reduction program related charges Merger related and other charges Total

Americas $ 4 $ 2 $ 6 $ ( 6 ) $ —

EMEA 204 33 237 1 238

APAC 16 12 28 ( 50 ) ( 22 )

Engineering 20 6 26 — 26

Other 15 26 41 ( 10 ) 31

Total $ 259 $ 79 $ 338 $ ( 65 ) $ 273

Cash Requirements

The total cash requirements of the other charges incurred for the year ended December 31, 2023 are expected to be immaterial.

The total cash requirements of the c ost reduction program and other charges incurred for the year ended December 31, 2024 are expected to be immaterial.

Remaining cash requirements are expected to be paid primarily through 2025.

Other charges, net of payments in the consolidated statements of cash flows for the twelve months ended December 31, 2023 and 2022 also reflect the impact of cash payments of liabilities, including merger-related tax liabilities, accrued as of December 31, 2022 and 2021, respectively.

The following table summarizes the activities related to the company's cost reduction programs and other charges during 2022 and 2023:

(millions of dollars) Total Russia charges Severance costs Other cost reduction charges Total cost reduction program related charges Merger related and other charges Total

Balance, December 31, 2021 $ — $ 384 $ 38 $ 422 $ 31 $ 453

2022 Russia-Ukraine conflict and other charges 890 41 24 65 74 1,029

Cash payments — ( 122 ) ( 24 ) ( 146 ) 19 ( 127 )

Non-cash charges ( 890 ) — ( 7 ) ( 7 ) ( 109 ) ( 1,006 )

Foreign currency translation and other — ( 22 ) ( 4 ) ( 26 ) ( 3 ) ( 29 )

Balance, December 31, 2022 $ — $ 281 $ 27 $ 308 $ 12 $ 320

2023 Other Charges — 26 — 26 14 40

Cash payments — ( 134 ) ( 1 ) ( 135 ) ( 23 ) ( 158 )

Non-cash charges — — — — 12 12

Foreign currency translation and other — ( 1 ) — ( 1 ) 1 —

Balance, December 31, 2023 $ — $ 172 $ 26 $ 198 $ 16 $ 214

Cost reduction program and other charge s, net of payments in the consolidated statements of cash flows for the twelve months ended December 31, 2024 and 2023 also reflect the impact of cash payments of liabilities accrued as of December 31, 2023 and 2022, respectively.

Classification in the consolidated financial statements

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In Note 18 Segment Information, Linde excluded these charges from its management definition of segment operating profit;

a reconciliation of segment operating profit to consolidated operating profit is shown within the segment operating profit table.

a reconciliation of segment operating profit to consolidated income before income taxes and equity investments is shown within the operating profit table.

In the normal course of its business, Linde enters into various leases as the lessee, primarily involving manufacturing and distribution equipment and office space.

Linde determines whether a contract is or contains a lease at contract inception.

Total lease and rental expenses related to operating lease right of use assets for the twelve months ended December 31, 2023 and 2022 was $ 284 million.

Total lease and rental expenses related to operating lease right of use assets for the twelve months ended December 31, 2024 and 2023 were $ 303 million and $ 284 million, respectively.

Operating lease costs are included in selling, general and administrative expenses and cost of sales, exclusive of depreciation and amortization.

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Gains and losses on sale and leaseback transactions were immaterial.

Operating cash flows used for operating leases for the twelve months ended December 31, 2023 and 2022 were $ 249 million and $ 254 million, respectively.

Operating cash flows used for operating leases for the twelve months ended December 31, 2024 and 2023 were $ 249 million.

Cash flows used for finance leases for the same period were immaterial.

Supplemental balance sheet information related to leases is as follows:

(Millions of dollars) December 31, 2023 December 31, 2022

(Millions of dollars)

December 31, 2024 2023

Operating Leases

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Supplemental operating lease information:

December 31, 2023 December 31, 2022

(Millions of dollars)

December 31, 2024 2023

Weighted average lease term (years) 8 8

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Year Ended December 31,

2024 2023 2022

Current tax expense (benefit)

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Effective Tax Rate Reconciliation

Linde plc is not subject to tax in Ireland, its country of domicile.

For purposes of the effective tax rate reconciliation, the company utilizes the U.S.

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Tax on Non-U.S.

activities (a) 169 2.1 % 176 3.2 % 219 4.3 %

activities (a)(b) 186 2.2 % 169 2.1 % 176 3.2 %

Share-Based compensation ( 66 ) ( 0.8 ) % ( 66 ) ( 0.8 ) % ( 41 ) ( 0.7 ) %

Russia/Ukraine Charges — — % 108 1.9 % — — %

Other (b) ( 71 ) ( 0.9 ) % ( 57 ) ( 1.0 ) % ( 55 ) ( 1.1 ) %

Russia charges (Note 3) — — % — — % 108 1.9 %

Other (c) ( 20 ) ( 0.2 ) % ( 71 ) ( 0.9 ) % ( 57 ) ( 1.0 ) %

Provision for income taxes $ 2,002 23.4 % $ 1,814 22.7 % $ 1,434 25.9 %

________________________

(a) Primarily related to differences between the U.S.

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permanent items and tax rate changes.

Excluding 2021, which included an $ 83 million deferred income tax charge related to a tax rate increase in the U.K., these other items were not material.

(b) Includes net tax benefits related to tax audit settlements of $ 54 million in 2023, of $ 71 million in 2022, and $ 47 million in 2021.

These other items were not material.

(b) 2024 includes the tax effect of Pillar II, the 15 % global minimum tax rate provisions of the OECD's framework for Pillar Two, which was not material.

In 2024, the tax effect of these items was not material.

Net Deferred Tax Liabilities

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$ 5,231 $ 5,523

________________________

(a) Includes $ 221 million in 2023 and $ 206 million in 2022 related to right-of-use lease assets.

(b) Includes deferred tax asset of $ 60 million and deferred tax liability of $ 54 million in 2023 and 2022, respectively, related to pension / OPEB funded status (see Notes 7 and 16).

(a) Includes $ 235 million in 2024 and $ 221 million in 2023 related to right-of-use lease assets and includes $ 335 million in 2024 and $ 170 million in 2023 related to timing differences regarding certain engineering projects accounted for on the cost incurred input method.

(b) Includes deferred tax liabilities of $ 95 million and deferred tax assets of $ 60 million in 2024 and 2023, respectively, related to pension / OPEB funded status (see Notes 7 and 16).

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Additions for current year tax positions 11 — —

Reductions for settlements with taxing authorities (a)(b) ( 1 ) ( 23 ) ( 60 )

Other (c) ( 7 ) ( 20 ) ( 24 )

Reductions for settlements with taxing authorities ( 12 ) ( 1 ) ( 23 )

Other (b) ( 21 ) ( 7 ) ( 20 )

Unrecognized income tax benefits, December 31 $ 292 $ 304 $ 325

________________________

(a) 2023 and 2022 amounts are primarily related to the settlement of tax audits.

(b) Settlements are uncertain tax positions that were effectively settled with the taxing authorities, including positions where the company has agreed to amend its tax returns to eliminate the uncertainty.

(a) 2023 and 2022 amounts are primarily related to the closure of tax audits.

(b) Other includes reductions for statute of limitation lapses and foreign currency translation.

The company classifies interest income and expense related to income taxes as tax expense in the consolidated statements of income.

The company recognized net interest benefit of $ 17 million and $ 3 million and expense of $ 15 million for the years ended December 31, 2023, 2022 and 2021, respectively.

The company had $ 14 million and $ 35 million of accrued interest and penalties as of December 31, 2023 and 2022, respectively, which were recorded in other long-term liabilities in the consolidated balance sheets (See Note 7).

The company recognized net interest expense of $ 3 million and net interest benefit of $ 17 million and of $ 3 million for the years ended December 31, 2024, 2023, and 2022, respectively.

The company had $ 16 million and $ 14

million of accrued interest and penalties as of December 31, 2024 and 2023, respectively, which were recorded in other long-term liabilities in the consolidated balance sheets (See Note 7).

As of December 31, 2024, the company remained subject to examination in the following major tax jurisdictions for the tax years as indicated below:

Major tax jurisdictions Open Years

North and South America

United States 2021 through 2024

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Brazil 2008 through 2024

Europe and Africa

France 2020 through 2024

Germany 2018 through 2024

Spain 2010 through 2023

United Kingdom 2022 through 2024

Asia and Australia

Australia 2020 through 2024

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EARNINGS PER SHARE – LINDE PLC SHAREHOLDERS

Basic and Diluted earnings per share - Linde plc shareholders is computed by dividing Income from continuing operations, Income from discontinued operations, net of tax, and Net income – Linde plc for the period by the weighted average number of either basic or diluted shares outstanding, as follows:

Basic and Diluted earnings per share - Linde plc shareholders is computed by dividing Net income – Linde plc for the period by the weighted average number of either basic or diluted shares outstanding, as follows:

2024 2023 2022

Numerator (Millions of dollars)

Income from continuing operations $ 6,199 $ 4,147 $ 3,821

Income from discontinued operations, net of tax — — 5

Net Income – Linde plc $ 6,565 $ 6,199 $ 4,147

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Weighted average shares used in diluted earnings per share 482,092 492,290 504,038

Basic earnings per share from continuing operations $ 12.70 $ 8.30 $ 7.39

Basic earnings per share from discontinued operations — — 0.01

Basic Earnings Per Share $ 13.71 $ 12.70 $ 8.30

Diluted earnings per share from continuing operations $ 12.59 $ 8.23 $ 7.32

Diluted earnings per share from discontinued operations — — 0.01

Diluted Earnings Per Share $ 13.62 $ 12.59 $ 8.23

There were no antidilutive shares for the years ended December 31, 2023, 2022 and 2021.

The weighted-average of antidilutive securities excluded from the calculation of diluted earnings per share was 268 thousand for the twelve months ended December 31, 2024.

There were no antidilutive securities in the respective 2023 and 2022 periods.

SUPPLEMENTAL INFORMATION

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Asset divestiture gains (losses) – net 60 6 ( 9 )

Insurance recoveries 45 10 2

Other – net gains (losses) 104 — ( 42 )

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The loss rates are also evaluated based on the expectations of the responsible management team regarding the collectability of the receivables.

Gross trade receivables aged less than one year were $ 4,667 million and $ 4,498 million at December 31, 2023 and December 31, 2022, respectively, and gross receivables aged greater than one year were $ 354 million and $ 321 million at December 31, 2023 and December 31, 2022, respectively.

Gross trade receivables aged less than one year were $ 4,573 million and $ 4,667 million at December 31, 2024 and December 31, 2023,

respectively, and gross receivables aged greater than one year were $ 322 million and $ 354 million at December 31, 2024 and December 31, 2023, respectively.

Gross other receivables were $ 148 million and $ 154 million at December 31, 2024 and December 31, 2023, respectively.

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Unrealized gains on derivatives (Note 12)

Other (c) 206 93

$ 1,264 $ 927

December 31, 2024 2023

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Pension assets (Note 16)

Insurance contracts (c) 38 39

Long-term receivables, net (d) 163 164

$ 1,106 $ 380

Insurance contracts (d) 32 38

Long-term receivables, net (e) 28 163

Lease assets (Note 4)

Deposits 73 76

Investments carried at cost (e) 187 184

Investments carried at cost (f) (Note 17) 106 187

Deferred charges 58 60

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$ 3,926 $ 4,156

Linde has agreements to provide supplier finance programs which facilitate participating suppliers' ability to finance payment obligations of the company with designated third-party financial institutions.

The outstanding payment obligations under the company’s supplier finance programs are included in the consolidated balance sheets and were not material as of December 31, 2024 or 2023.

December 31, 2024 2023

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Tax liabilities for uncertain tax positions (Note 5)

Tax Act liabilities (f) 80 139

Tax Act liabilities (g) — 80

Lease liability (Note 4)

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Deferred income taxes (Note 5)

$ 5,659 $ 5,749

Contract liabilities (Note 19)

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Cumulative translation adjustment - net of taxes:

Americas (g) $ ( 3,618 ) $ ( 3,942 )

EMEA (g) ( 737 ) ( 1,249 )

APAC (g) ( 1,037 ) ( 835 )

Americas (h) $ ( 4,422 ) $ ( 3,618 )

EMEA (h) ( 1,235 ) ( 737 )

APAC (h) ( 1,736 ) ( 1,037 )

Engineering ( 432 ) ( 93 )

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Derivatives – net of taxes ( 6 ) 7

Pension/OPEB funded status obligation (net of $ 60 million tax benefit in 2023 and $( 54 ) million tax obligation in 2022) (Note 16)

( 440 ) ( 60 )

Pension/OPEB funded status obligation (net of $ 95 million tax obligation in 2024 and $ 60 million tax benefit in 2023) (Note 16)

$ ( 6,894 ) $ ( 5,805 )

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(b) Includes estimated income tax payments of $ 221 million in 2024 and $ 173 million in 2023.

(c) Consists primarily of insurance contracts and other investments to be utilized for non-qualified pension and OPEB obligations.

(d) The balances at December 31, 2023 and 2022 are net of reserves of $ 42 million and $ 36 million, respectively.

The amounts relate primarily to long-term notes receivable from customers in APAC, government receivables in Brazil and receivables from the sale of GIST.

(e) Includes investments from the deconsolidation of Russian subsidiaries.

(f) Represents tax payable related to the deemed repatriation tax pursuant to the U.S.

(d) Consists primarily of insurance contracts and other investments to be utilized for non-qualified pension and OPEB obligations.

(e) The balances at December 31, 2024 and 2023 are net of reserves of $ 36 million and $ 42 million, respectively.

In 2023, the amounts relate primarily to long-term notes receivable from customers in APAC, government receivables in Brazil and receivables from the sale of GIST.

(f) Includes investments from the deconsolidation of Russian subsidiaries.

(g) Represents tax payable related to the deemed repatriation tax pursuant to the U.S.

Tax Cuts and Jobs Act of 2018.

The company is required to fund the balance in annual installments through 2025.

(g) Americas consists of currency translation adjustments primarily in Canada, Mexico, and Brazil.

EMEA relates primarily to Germany, the U.K., the Netherlands, Hungary, Norway and Sweden.

In 2024, the final annual installment was reclassified to accrued taxes.

(h) Americas consists of currency translation adjustments primarily in Canada, Mexico, and Brazil.

EMEA relates primarily to Germany, the U.K., the Netherlands, Norway and Sweden.

APAC relates primarily to China, South Korea, India, and Australia.

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Balance, December 31, 2022 $ 9,136 $ 9,492 $ 4,550 $ 2,349 $ 290 $ 25,817

Acquisitions 44 28 — — — 72

Acquisitions (Note 2) 550 — 3 — — 553

Foreign currency translation and other 17 347 ( 54 ) 73 3 386

Disposals (Note 2 & Note 3) — ( 41 ) — ( 1 ) ( 20 ) ( 62 )

Disposals — ( 5 ) — — — ( 5 )

Balance, December 31, 2023 9,703 9,834 4,499 2,422 293 26,751

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Foreign currency translation and other ( 56 ) ( 538 ) ( 253 ) ( 150 ) ( 21 ) ( 1,018 )

Disposals — ( 5 ) — — — ( 5 )

Disposals (Note 2) — — ( 4 ) — — ( 4 )

Balance, December 31, 2024 $ 9,838 $ 9,296 $ 4,259 $ 2,272 $ 272 $ 25,937

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The following is a summary of Linde’s other intangible assets at December 31, 2024 and 2023:

(Millions of dollars) For the year ended December 31, 2023 Customer Relationships Brands/Tradenames Other Intangible Assets Total

(Millions of dollars) For the year ended December 31, 2024

Customer Relationships Brands/Tradenames Other Intangible Assets Total

Balance, December 31, 2023 $ 11,479 $ 2,609 $ 1,913 $ 16,001

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Balance, December 31, 2024 ( 2,571 ) ( 265 ) ( 1,244 ) ( 4,080 )

Net balance at December 31, 2023 $ 9,209 $ 2,376 $ 814 $ 12,399

(Millions of dollars) For the year ended December 31, 2022 Customer Relationships Brands/Tradenames Other Intangible Assets Total

Net Balance, December 31, 2024 $ 8,401 $ 2,239 $ 690 $ 11,330

(Millions of dollars) For the year ended December 31, 2023

Customer Relationships Brands/Tradenames Other Intangible Assets Total

Balance, December 31, 2022 $ 11,062 $ 2,565 $ 1,697 $ 15,324

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Foreign currency translation 185 38 41 264

Disposals (Note 2) ( 140 ) — ( 45 ) ( 185 )

Disposals ( 3 ) — ( 20 ) ( 23 )

Other * ( 23 ) — 145 122

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Foreign currency translation ( 36 ) ( 1 ) ( 24 ) ( 61 )

Disposals (Note 2) 34 — 16 50

Disposals — — 21 21

Other * 30 — ( 138 ) ( 108 )

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The following is a summary of Linde’s outstanding debt at December 31, 2024 and 2023 :

(Millions of dollars) December 31, 2023 December 31, 2022

(Millions of dollars)

December 31, 2024 2023

Commercial paper $ 3,964 $ 4,483

Other borrowings (primarily non U.S.) 230 191

Other bank borrowings (primarily non U.S.) 259 230

Total short-term debt 4,223 4,713

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dollar denominated unless otherwise noted)

2.70 % Notes due 2023 (c)

2.00 % Euro denominated notes due 2023 (d)

5.875 % GBP denominated notes due 2023 (d)

1.20 % Euro denominated notes due 2024

1.875 % Euro denominated notes due 2024 (b)

4.800 % Notes due 2024

1.20 % Euro denominated notes due 2024 (c)

1.875 % Euro denominated notes due 2024 (b,e)

4.800 % Notes due 2024 (g)

4.700 % Notes due 2025

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1.625 % Euro denominated notes due 2025

3.625 % Euro denominated notes due 2025 (e)

3.625 % Euro denominated notes due 2025

0.00 % Euro denominated notes due 2026

3.20 % Notes due 2026

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1.00 % Euro denominated notes due 2028 (b)

3.375 % Euro denominated notes due 2029 (e)

3.00 % Euro denominated notes due 2028 (d)

3.375 % Euro denominated notes due 2029

1.10 % Notes due 2030

1.90 % Euro denominated notes due 2030

3.375 % Euro denominated notes due 2030 (f)

1.375 % Euro denominated notes due 2031

3.20 % Euro denominated notes due 2031 (d)

0.550 % Euro denominated notes due 2032

0.375 % Euro denominated notes due 2033

3.625 % Euro denominated notes due 2034 (e)

3.625 % Euro denominated notes due 2034

3.50 % Euro denominated notes due 2034 (f)

1.625 % Euro denominated notes due 2035

3.40 % Euro denominated notes due 2036 (d)

3.55 % Notes due 2042

3.75 % Euro denominated notes due 2044 (f)

2.00 % Notes due 2050

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Total debt $ 21,623 $ 19,373

________________________

(a) Amounts are net of unamortized discounts, premiums and/or debt issuance costs as applicable.

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(d) In April 2023, Linde repaid € 650 million of 2.00 % notes and £ 300 million of 5.875 % notes that became due.

(e) In June 2023, Linde issued € 500 million of 3.625 % notes due in 2025, € 750 million of 3.375 % notes due in 2029 and € 650 million of 3.625 % notes due in 2034.

(d) In February 2024, Linde issued € 700 million of 3.00 % notes due in 2028, € 850 million of 3.20 % notes due in 2031 and € 700 million of 3.40 % notes due in 2036.

(e) In May 2024, Linde repaid € 300 million of 1.875 % notes that became due.

(f) In June 2024, Linde issued € 750 million of 3.375 % notes due in 2030, € 750 million of 3.500 % notes due in 2034 and € 700 million of 3.750 % notes due in 2044.

(g) In December 2024, Linde repaid $ 300 million of 4.800 % notes that became due.

Credit Facilities

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The objective of financial risk management at Linde is to minimize the negative impact of such fluctuations on the company’s earnings and cash flows.

To manage these risks, among other strategies, Linde routinely enters into various derivative financial instruments (“derivatives”) including interest-rate swap and treasury rate lock agreements, currency-swap agreements, forward contracts, currency options, and commodity-swap agreements.

These instruments are not entered into for trading purposes and Linde only uses commonly traded and non-leveraged instruments.

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168 335 2 11 6 6

Cross-currency swaps

Commodity contracts N/A N/A — — — —

Total $ 10,103 $ 4,902 $ 258 $ 57 $ 70 $ 32

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Forecasted transactions $ 780 $ 749 $ 7 $ 20 $ 11 $ 4

Forward exchange contracts 1,059 — 30 — — —

Commodity contracts N/A N/A 11 3 20 7

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Total Derivatives $ 11,942 $ 6,865 $ 306 $ 81 $ 101 $ 47

(a) Amounts at December 31, 2023 and 2022 included current assets of $ 73 million and $ 24 million, which are recorded in prepaid and other current assets;

(a) Amounts at December 31, 2024 and 2023, respectively, included current assets of $ 302 million and $ 73 million, which are recorded in prepaid and other current assets;

long-term assets of $ 4 million and $ 8 million, which are recorded in other long-term assets;

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and long-term liabilities of $ 9 million and $ 6 million, which are recorded in other long-term liabilities.

In addition, during 2024, Linde issued credit default swaps (“CDS”) to third-party financial institutions.

The CDS relate to secured borrowings provided by the financial institutions to a government customer in Mexico, that were utilized to pay certain of Linde’s outstanding receivables.

The notional amount of the CDS, which was $ 198 million and $ 60 million for the two programs as of December 31, 2024, will reduce on a monthly basis over their respective 24 -month and 22 -month terms.

As of December 31, 2024, the fair value of both derivative liabilities were not material.

Balance Sheet Items

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Linde is hedging forecasted transactions for a maximum period of three years .

Cross-Currency Swaps

Cross-currency interest rate swaps are entered into to limit the foreign currency risk of future principal and interest cash flows associated with intercompany loans, and to a more limited extent bonds, denominated in non-functional currencies.

The fair value adjustments on the cross-currency swaps are recorded to earnings, where they are offset by fair value adjustments on the underlying intercompany loan or bond.

Commodity Contracts

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Net Investment Hedges

As of December 31, 2023, Linde has € 10.7 billion ($ 11.7 billion) Euro-denominated notes and intercompany loans and ¥ 4.7 billion ($ 0.7 billion) CNY-denominated intercompany loans that are designated as hedges of the net investment positions in certain foreign operations.

Since hedge inception, the deferred gain recorded within cumulative translation adjustment component of accumulated other comprehensive income (loss) in the consolidated balance sheet is $ 45 million (deferred loss of $ 305 million in the consolidated statement of comprehensive income for the year ended December 31, 2023).

Foreign Currency-Denominated Debt Designations

As of December 31, 2024, Linde has € 17.9 billion ($ 19.0 billion) Euro-denominated notes and intercompany loans, ¥ 3.7 billion ($ 0.5 billion) CNY-denominated intercompany loans, and C$ 1.4 billion ($ 1.0 billion) CAD-denominated intercompany loans that are designated as hedges of the net investment positions in certain foreign operations.

Since hedge inception, the deferred gain recorded within the cumulative translation adjustment component of accumulated other comprehensive income (loss) in the consolidated balance sheet is $ 1,220 million (deferred gain of $ 1,175 million in the consolidated statement of comprehensive income for the year ended December 31, 2024), which is largely offset by an offsetting loss or gain on the underlying foreign net investment being hedged.

Foreign Currency Forward Exchange Contract Designations

In 2024, the Company entered into forward exchange contracts to partially hedge its net investment in certain foreign-denominated subsidiaries.

The Company assesses the forward exchange contracts used as net investment hedges under the spot method.

This results in the difference between the spot rate and the forward rate of the forward exchange contract being excluded from the assessment of hedge effectiveness and recorded as incurred as a reduction in interest expense - net in the consolidated statements of income.

Since hedge inception and for the year ended December 31, 2024, the deferred gain recorded within the cumulative translation adjustment component of accumulated other comprehensive income (loss) in the consolidated balance sheet is $ 30 million, which is largely offset by an offsetting loss or gain on the underlying foreign net investment being hedged.

The amount of net interest income recorded in 2024 for all forward exchange contracts was immaterial.

Effects of Previous Hedge Designations

As of December 31, 2024, exchange rate movements relating to previously designated hedges that remain in accumulated other comprehensive income (loss) is a gain of $ 56 million.

1 unchanged sentence

Interest Rate Swaps

Linde 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 recognized in earnings along with an equally offsetting charge/benefit to earnings for the changes in the fair value of the underlying financial asset or financial liability (see Note 11).

Certain interest rate swaps in a designated fair value hedge relationship were terminated during 2023.

Upon termination, adjustments are no longer recorded to the hedged items for changes in respective fair values attributable to the risk being hedged.

The unrecognized

loss on the terminated interest rate swaps is shown as a discount to long-term debt of $ 56 million, and will be amortized to interest expense over the remaining life of the debt, which extends through April 2028.

In addition, as of December 31, 2023, Linde is using interest rate swaps with a notional value of € 1 billion to hedge the variability of future cash flows of forecasted transactions due to interest rate risk and has designated this as a cash flow hedge.

Linde has historically used 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.

When used, these interest rate swaps would effectively convert fixed-rate interest exposures to variable rates;

fair value adjustments were recognized in earnings along with an equally offsetting charge/benefit to earnings for the changes in the fair value of the underlying financial asset or financial liability (see Note 11).

In addition, as of December 31, 2023, Linde was using interest rate swaps with a notional value of € 1 billion to hedge the variability of future cash flows of forecasted transactions due to interest rate risk and had designated this as a cash flow hedge.

The interest rate swaps were terminated during the first quarter of 2024 with the February debt issuance and the settlement values were immaterial .

Derivatives Impact on Consolidated Statements of Income

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Recognized in Earnings *

December 31, 2023 2022 2021

Year Ended December 31, 2024 2023 2022

Derivatives Not Designated as Hedging Instruments

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Other balance sheet items and anticipated net income gains (losses) are 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 consolidated statement of income was not material for the years ended December 31, 2023, 2022, and 2021.

The amounts of gain or loss recognized in accumulated other comprehensive income (loss) and reclassified to the consolidated statements of income were not material for the years ended December 31, 2024, 2023, and 2022.

Net impacts expected to be reclassified to earnings during the next twelve months are also not material.

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Level 3 investments and securities consist of a venture fund.

valuation, Linde uses the net asset value received as part of the fund's quarterly reporting, which for the most part is not based on quoted prices in active markets.

For the valuation, Linde uses the net asset value received as part of the fund's quarterly reporting, which for the most part is not based on quoted prices in active markets.

In order to reflect current market conditions, Linde proportionally adjusts these by observable market data (stock exchange prices) or current transaction prices.

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Linde completed the repurchases under this program in the first quarter of 2022.

On January 25, 2021 the company's board of directors approved the additional repurchase of $ 5.0 billion of its ordinary shares under which Linde had repurchased 16,662,678 shares through December 31, 2022.

Linde completed the repurchases under this program in the first quarter of 2022.

On February 28, 2022, the company's board of directors authorized a new share repurchase program for up to $ 10.0 billion of its ordinary shares ("2022 program") under which Linde had repurchased 29,552,394 shares through December 31, 2024.

This program expires on July 31, 2024.

On October 23, 2023, the company's board of directors approved a new share repurchase program for up to $ 15.0 billion of its ordinary shares ("2023 program") under which Linde has no repurchases as of December 31, 2023.

This program will

terminate on the earlier of the date as the maximum authority under the 2023 program is reached or the board terminates the 2023 program.

Linde completed the repurchases under this program in the second quarter of 2024.

program will terminate on the earlier of the date as the maximum authority under the 2023 program is reached or the board terminates the 2023 program.

Noncontrolling Interests

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There are no minimum funding requirements.

The pension obligations in Germany are partly funded by a Contractual Trust Agreement (CTA).

The pension obligations in Germany are partly funded by a Contractual Trust Agreement.

Defined benefit commitments in the U.K.

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The collective bargaining agreements expire on different dates through 2029.

In connection with such agreements, the company is required to make periodic contributions to the MEPs in accordance with the terms of the respective collective bargaining agreements.

In connection with such agreements, the company is required to make periodic contributions to the MEPs in accordance with the terms of the respective collective bargaining

Linde’s participation in these plans is not material either at the plan level or in the aggregate.

For all MEPs, Linde’s contributions were significantly less than 1 % of the total contributions to each plan for 2022 and 2021.

Total 2023 contr ibutions were not yet available from the MEPs.

For all MEPs, Linde’s contributions were less than 1 % of the total contributions to each plan for 2024, 2023 and 2022 .

Linde has obtained the most recently available Pension Protection Act ("PPA") annual funding notices from the Trustees of the MEPs.

As of December 31, 2023, there were two Red Zone plans, deemed to be in "critical" or "critical and declining" status that have implemented financial improvement or rehabilitation plans.

As of December 31, 2024 , there were four Red Zone plans, deemed to be in "critical" or "critical and declining" status that have implemented financial improvement or rehabilitation plans.

Linde does not currently anticipate significant future obligations due to the funding status of these plans and any such obligation would be immaterial.

62 unchanged sentences

Deferred tax obligation (benefit) (Note 7)

( 21 ) 116 ( 67 ) 7

Amount recognized in accumulated other comprehensive income (loss) (Note 7)

$ 61 $ ( 140 ) $ 213 $ 227

Comparative funded status information as of December 31, 2024 and 2023 for select non-U.S.

20 unchanged sentences

Total recognized in other comprehensive income $ ( 674 ) $ 494

________________________

* Pension net actuarial losses in 2023 are largely driven by the decrease in the discount rate environment resulting in actuarial losses from a higher PBO, which is partially offset by favorable plan asset experience for non-U.S plans.

* Pension net actuarial gains in 2024 are largely driven by continued increase in the discount rate environment in U.S.

plans resulting in actuarial gains from a lower PBO as well as favorable plan asset experience for the U.S.

In 2023, the actuarial losses were largely driven by the decrease in the discount rate environment resulting from a higher PBO, which was partially offset by favorable plan asset experience for non-U.S plans.

plan derived a benefit from the actual return on plan assets.

In 2022, the actuarial gains were largely driven by the significant increase in the discount rate environment resulting in actuarial gains from a lower PBO, which is partially offset by unfavorable plan asset experience for both non-U.S.

The following table provides information for pension plans where the accumulated benefit obligation exceeds the fair value of plan assets:

The following table provides information only for those individual pension plans where the accumulated benefit obligation exceeds the fair value of plan assets:

(Millions of dollars)

2 unchanged sentences

Fair value of plan assets $ — $ 1,384 $ 1,945 $ 1,385

The following table provides information for pension plans where the projected benefit obligation exceeds the fair value of plan assets:

The following table provides information only for those individual pension plans where the projected benefit obligation exceeds the fair value of plan assets:

(Millions of dollars)

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plans, the expected rate of return of 7.00 % was derived based on the target asset allocation of 50 %- 70 % equity securities (approximately 7.20 % expected return), 20 %- 50 % fixed income securities (approximately 4.70 % expected return) and 2 %- 8 % alternative investments (approximately 4.30 % expected return).

For the non-U.S.

For the main non-U.S.

plans, the expected rate of return was derived based on the weighted average target asset allocation of 15 %- 25 % equity securities (approximately 5.30 % expected return), 30 %- 50 % fixed income securities (approximately 5.80 % expected return), and 30 %- 50 % alternative investments (approximately 5.60 % expected return).

4 unchanged sentences

For 2025, the expected long-term rate of return on plan assets will be 7.00 % for the U.S.

plans and 5.83 %.

plans and 6.02 % for non-U.S.

Pension Plan Assets

6 unchanged sentences

pension plans, as well as respective asset allocation ranges by major asset category, are generally as follows:

Asset Category Target 2023 Target 2022 2023 2022 Target 2023 Target 2022 2023 2022

Asset Category Target 2024

Equity securities 50 % - 70 % 50 % - 70 % 62 % 59 % 15 % - 25 % 15 % - 25 % 24 % 22 %

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Insurance contracts — — — — 54 51 54 51

Liquid alternative — — 1,022 982 — — 1,022 982

Liquid alternatives — — 1,087 1,022 — — 1,087 1,022

Other investments 2 1 23 22 — — 25 23

56 unchanged sentences

Such funds focus on diversification and employ a variety of investing strategies including long/short equity, multi-strategy, and global macro.

The fair value of these investments is determined by reference to the net asset value of the underlying holdings of the fund, which can be determined using

observable data (e.g., indices, yield curves, quoted prices of similar securities), and is classified within level 2 of the valuation hierarchy.

The fair value of these investments is determined by reference to the net asset value of the underlying holdings of the fund, which can be determined using observable data (e.g., indices, yield curves, quoted prices of similar securities), and is classified within level 2 of the valuation hierarchy.

Insurance Contracts – This category is comprised of purchased annuity insurance contracts (annuity contract buy-ins) and is intended to mitigate the Company's exposure to certain risks, such as longevity risk.

20 unchanged sentences

2025 $ 212 $ 371

2029-2033 824 1,974

Thereafter 833 2,093

COMMITMENTS AND CONTINGENCIES

The company accrues non income-tax liabilities for contingencies when management believes that a loss is probable and the amounts can be reasonably estimated, while contingent gains are recognized only when realized.

In the event any losses are sustained in excess of accruals, they will be charged against income at that time.

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It is difficult to estimate the timing of resolution of legal matters in Brazil.

• At December 31, 2023, the most significant non-income tax claims in Brazil, after enrollment in the Refis Program, relate to state VAT tax matters.

The total estimated exposure relating to such claims, including interest and penalties, as appropriate, is approximately $ 115 million.

Linde has not recorded any 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 confirming the constitutionality of a specific federal income tax, with retroactive effect.

As a result of this decision, the company recorded a reserve based on its best estimate of potential settlement (see Note 3).

This decision has not yet been finalized and is subject to ongoing motions for clarification.

Because litigation in Brazil historically takes many years to resolve, it is very difficult to estimate the timing of resolution of these matters;

however, it is possible that certain of these matters may be resolved within the near term.

The company is vigorously defending against the proceedings.

• On September 1, 2010, CADE (Brazilian Administrative Council for Economic Defense) announced alleged anticompetitive activity on the part of five industrial gas companies in Brazil and imposed fines.

CADE imposed a civil fine of R$ 1.7 billion Brazilian reais ($ 350 million) on White Martins, the Brazil-based subsidiary of Linde Inc., and R$ 0.2 billion Brazilian reais ($ 41 million) on Linde Gases Ltda., the former Brazil-based subsidiary of Linde AG, which was divested to MG Industries GmbH on March 1, 2019 and with respect to which Linde provided a contractual indemnity.

The fine against White Martins and Linde Gases Ltda.

was overturned by the Ninth and Seventh Federal Courts of Brasilia, respectively.

CADE appealed these decisions, and the Federal Court of Appeals rejected CADE's appeals and confirmed the decision of the Ninth and Seventh Federal Courts of Brasilia.

CADE had filed appeals for both subsidiaries with the Superior Court of Justice which were denied.

CADE filed subsequent appeals to a panel of the Supreme Court of Justice and final and binding decisions were issued by the Supreme Court of Justice annulling the fine imposed against Linde Gases Ltda and White Martins in September 2023 and January 2024, respectively.

• 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 previously completed cash merger squeeze-out of all of Linde AG’s minority shareholders 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

the cash merger squeeze-out was completed.

Any such increase would apply to all 14,763,113 Linde AG shares that were outstanding on April 8, 2019, when the cash merger squeeze-out was completed.

The period for plaintiffs to file claims expired on July 9, 2019.

In November 2023, the court issued a decision rejecting the plaintiffs’ claims in their entirety and determining that the cash merger squeeze-out consideration was appropriate.

The plaintiffs are entitled to appeal this decision.

November 2023, the court issued a decision rejecting the plaintiffs’ claims in their entirety and determining that the cash merger squeeze-out consideration was appropriate.

The plaintiffs have appealed this decision.

The company believes the consideration paid was fair and that the claims are not supported by sufficient evidence, 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 ("St.

• On May 27, 2022, performance of all Linde Engineering agreements in Russia were lawfully suspended in compliance with applicable sanctions.

In December 2022, at RusChemAlliance’s (RCA) request a Russian St.

Petersburg court (“St.

Petersburg Court”) issued an injunction preventing sale of Linde Russia subsidiaries and assets.

During 2023 and 2024, in accordance with the dispute resolution provisions of the related engineering agreements Linde secured judgements reenforcing jurisdiction of the agreements with RCA outside of Russia and ordering the St.

Petersburg proceedings stayed and injunctions lifted.

However, RCA has continued to pursue its claims in Russia and during the fourth quarter of 2024 two Linde Russian joint ventures were sold locally pursuant to a St.

Petersburg court order and the proceeds provided to RCA.

Linde does not expect a material adverse impact on earnings given the $ 1.7 billion liabilities recorded as of December 31, 2024 and the immaterial investment value of its remaining deconsolidated Russia subsidiaries.

Please see further detail on the Russia legal cases below.

RCA LNG and GPP

In December 2022, the St.

Petersburg Court issued an injunction preventing (i) the sale of any shares in Linde’s subsidiaries and joint ventures in Russia, and (ii) the disposal of any of the assets in those entities exceeding 5 % of the relevant company’s overall asset value.

The injunction was requested by RusChemAlliance (RCA) as a preliminary measure to secure payment of a possible eventual award under an arbitration proceeding RCA intended to file against Linde Engineering for alleged breach of contract under the agreement to build a gas processing plant in Ust Luga, Russia entered into between a consortium of Linde Engineering, Renaissance Heavy Industries LLC, and RCA on July 7, 2021.

Performance of the agreement was lawfully suspended by Linde Engineering on May 27, 2022 in compliance with applicable sanctions and in accordance with a decision by the sanctions authority in Germany.

On March 1, 2023, RCA filed a claim in St.

Petersburg against Linde GmbH for recovery of advance payments under the agreement ("Russian Claim"), and subsequently (i) added Linde and other Linde subsidiaries as defendants, and (ii) is seeking payment of alleged damages from Linde (pursuant to corporate guarantees) and guarantor banks.

On March 4, 2023, in accordance with the dispute resolution provisions of the agreement, Linde GmbH filed a notice of arbitration with the Hong Kong International Arbitration Centre ("HKIAC") against RCA to claim that (i) RCA has no entitlement to payment, (ii) RCA’s Russian claim is in breach of the arbitration agreement which requires HKIAC arbitration, and (iii) RCA must compensate Linde for the losses and damages caused by the injunction.

Additionally, Linde GmbH filed for and on March 17, 2023 obtained an anti-suit injunction from a Hong Kong court against RCA directing RCA to seek a stay of the Russian Claim and ordering it to resolve any disputes in accordance with HKIAC arbitration.

On September 27, 2023, the anti-suit injunction was confirmed by the same Hong Kong court.

On January 4, 2024, the Hong Kong court issued a final judgment in Linde’s favor (i) granting a permanent anti-suit injunction against RCA, (ii) granting a permanent, global anti-enforcement injunction against RCA, and (iii) ordering that the injunction issued by the St.

Petersburg Court be lifted.

As of December 31, 2023, Linde has a contingent liability of $ 1.1 billion recorded in Other long-term liabilities, which represents advance payments previously recorded in contract liabilities as of December 31, 2022 related to terminated engineering projects with RCA.

RusChemAlliance is owned 50 % by PJSC Gazprom.

The injunction was requested by RCA to secure payment of a possible award under an arbitration proceeding RCA intended to file against Linde Engineering for alleged breach of contract under the agreement to build a gas processing plant in Russia entered into in July 2021.

In March 2023, RCA filed a claim in St.

Petersburg against Linde GmbH for recovery of advance payments under the agreement ("GPP Claim"), and subsequently (i) added Linde and other Linde subsidiaries as defendants, and (ii) is seeking payment of alleged damages from Linde and guarantor banks.

In March 2024, RCA filed a similar claim for repayment and damages against Linde for alleged breach of contract under the agreement to build a liquefied natural gas plant in Russia entered into in September 2021 (“LNG Claim”, and together with the GPP Claim, the “Russian Claims”).

Dispute resolution provisions

In accordance with the dispute resolution provisions of the agreements, in 2023, Linde filed a notice of arbitration with the Hong Kong International Arbitration Centre ("HKIAC") against RCA to claim that (i) RCA has no entitlement to payment, (ii) RCA’s Russian Claims are in breach of the arbitration agreement which requires HKIAC arbitration, and (iii) RCA must compensate Linde for the losses and damages caused by the injunction.

During 2024, Linde secured awards on exclusive jurisdiction with HKIAC.

In January 2024, the Hong Kong court issued a final judgment in Linde’s favor (i) granting a permanent anti-suit injunction against RCA to seek a stay of the GPP claim and not start an LNG claim, (ii) granting a permanent, global anti-enforcement injunction against RCA for the GPP claim, and (iii) ordering that the injunction issued by the St.

Petersburg Court be lifted (“HK Court Judgement”).

Despite the judgments of the Hong Kong court and similar orders issued by the HKIAC arbitration tribunals, RCA is continuing to pursue its claims in Russia and neither the St.

Petersburg injunction affecting Linde’s shares and assets has been lifted, nor the proceeding in St.

Petersburg been stayed.

Local seizures

In February 2024, the St.

Petersburg Court decided the GPP Claim in favor of RCA (the “GPP Decision”) and in October 2024, decided the LNG Claim in favor of RCA (the “LNG Decision”).

Linde unsuccessfully appealed the GPP Decision in March and September 2024.

During the fourth quarter of 2024, RCA executed enforcement actions related to the GPP Decision within Russia for Linde’s shares in two Linde Russian joint ventures and locally RCA received payment from the purchase of these shares by Linde’s joint venture partners.

RCA previously initiated the enforcement process for the GPP Decision within Russia for the remainder of Linde’s local assets, and these proceedings are currently pending a court appointed local valuation of Linde’s assets.

Additionally, during November 2024, RCA seized the ruble equivalent of approximately € 238 million from one of the guarantor bank’s accounts in Russia.

Linde intends to claim all damages related to or rising from RCA's enforcement of the GPP and LNG Decisions in the HKIAC arbitration proceedings.

Linde subsidiaries affected by the GPP Decision have also filed claims for damages against RCA in the Southern District of New York, the Netherlands and Germany.

As of December 31, 2024, Linde has a contingent liability of $ 1.0 billion, which represents advance payments previously recorded in contract liabilities related to terminated engineering projects with RCA.

As a result of the contract terminations, Linde no longer has future performance obligations for these projects.

Linde deconsolidated its Russian gas and engineering business entities as of June 30, 2022, and the remaining investment value of its Russia subsidiaries is immaterial.

Despite the January 4, 2024 decision of the Hong Kong court, the injunction affecting Linde’s shares and assets has not been lifted, the proceeding in St.

Petersburg has not been stayed and RCA is continuing to pursue its claim in Russia.

On February 20, 2024, the St.

Petersburg Court issued its decision and granted the Russian Claim in RCA’s favor.

Linde has 30 days to appeal this decision and expects to do so prior to the expiration of that deadline.

If Linde appeals, RCA cannot enforce the decision (including foreclosing on the shares of the Russian entities) until after the appeal is decided.

Linde does not expect an adverse impact on earnings from this decision given the contingent liability recorded as of December 31, 2023 and the immaterial remaining investment value of its deconsolidated Russia subsidiaries.

It is difficult to estimate the timing of resolution of these matters.

The company intends to vigorously defend its interests in the Russian Claims, Hong Kong arbitration proceedings and other jurisdictions.

In July 2015, Gazprom Pererabotka Blagoveshchensk LLC ("Gazprom") entered into an engineering, procurement and construction contract with OJSC NIPIgazpererabotka ("Nipigas") for the construction of a gas processing plant and other components located in the Amur Region, Russia (“Amur GPP”).

Subsequently, in December 2015, Nipigas and Linde Engineering, executed a subcontract for engineering, procurement, and site services for licensed production units for the Amur GPP project.

Additionally, Linde also entered into (i) a license agreement with Gazprom in 2017 for the operation of the plants, and (ii) a direct owner agreement with Gazprom and Nipigas which included limitation of liability provisions.

Performance of the Amur GPP agreements were lawfully suspended in compliance with applicable sanctions on May 27, 2022.

On October 8, 2021 and January 5, 2022, fires occurred at the Amur GPP facility.

Following the initial fire in 2021, Linde undertook a comprehensive review of the incident, including a detailed local inspection conducted by Linde employees.

The Linde report concluded that the fire was attributable to the quality of construction and assembly work, responsibilities falling under the scope of Nipigas.

On October 29, 2024, Gazprom submitted a claim to the Arbitration State Court in the Amur Region, Russia (“Amur Court”) against Linde claiming damages and lost profits arising from the fire incidents.

As of December 31, 2024, Linde has a contingent liability of $ 0.7 billion for this and other Amur GPP contract matters.

It is difficult to estimate the timing of resolution of this matter.

The company intends to vigorously defend its interests in both the Russian Claim and arbitration proceedings.

The company intends to vigorously defend its interests in this case.

At December 31, 2024, Linde had undrawn outstanding letters of credit, bank guarantees and surety bonds valued at approximately $ 3,377 million from financial institutions.

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Other consists of corporate costs and a few smaller businesses, which individually do not meet the quantitative thresholds for separate presentation.

The industrial gases product line centers on the manufacturing and distribution of atmospheric gases (oxygen, nitrogen, argon, rare gases) and process gases (carbon dioxide, helium, hydrogen, electronic gases, specialty gases, acetylene).

The industrial gases product line centers on the manufacturing and distribution of atmospheric gases (oxygen, nitrogen, argon, rare gases) and process gases (hydrogen, helium, carbon dioxide, carbon monoxide, electronic gases, specialty gases, acetylene).

Many of these products are co-products of the same manufacturing process.

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Therefore, the distribution economics are specific to the various geographies in which the company operates and are consistent with how management assesses performance.

The CODM consists of the CEO, CFO and senior or executive vice president of each respective segment.

The company’s measure of profit/loss for segment reporting is segment operating profit.

Segment operating profit is defined as operating profit excluding purchase accounting impacts of the Linde AG merger, intercompany royalties, and items not indicative of ongoing business trends.

This is the manner in which the company’s CODM assesses performance and allocates resources.

Similarly, total assets have not been included as this is not provided to the CODM for their assessment.

Segment operating profit is defined as operating profit excluding purchase accounting impacts of the Linde AG merger, cost reduction and other charges, and items not indicative of ongoing business trends.

The CODM uses operating profit to assess overall segment performance, which

includes monitoring opportunities for growth and to make capital decisions across the respective segments, while assessing both industry and macroeconomic conditions.

Total assets have not been included as this is not provided to the CODM for their assessment.

The table below presents information about reportable segments for the years ended December 31, 2024, 2023 and 2022.

(Millions of dollars) 2023 2022 2021

Americas $ 14,304 $ 13,874 $ 12,103

EMEA 8,542 8,443 7,643

APAC 6,559 6,480 6,133

Engineering 2,160 2,762 2,867

Other 1,289 1,805 2,047

Total Sales $ 32,854 $ 33,364 $ 30,793

2023 2022 2021

Segment Operating Profit

Americas $ 4,244 $ 3,732 $ 3,368

EMEA 2,486 2,013 1,889

APAC 1,806 1,670 1,502

Engineering 491 555 473

Other 43 ( 66 ) ( 56 )

Reported Segment operating profit 9,070 7,904 7,176

Other charges (Note 3) ( 40 ) ( 1,029 ) ( 273 )

Purchase accounting impacts - Linde AG ( 1,006 ) ( 1,506 ) ( 1,919 )

Total operating profit $ 8,024 $ 5,369 $ 4,984

2023 2022 2021

(Millions of dollars) Americas EMEA APAC Engineering Other Total

Sales (a) $ 14,442 $ 8,352 $ 6,632 $ 2,322 $ 1,257 $ 33,005

Variable Costs (b) 5,375 3,129 3,304 920 408 13,136

Fixed Costs and other (c) 3,067 1,803 769 959 694 7,292

Depreciation and amortization (d) 1,450 640 641 33 93 2,857

Operating Profit (e) 4,550 2,780 1,918 410 62 9,720

Expenditures for long-lived assets $ 2,805 $ 702 $ 1,059 $ 25 $ 223 $ 4,814

Sales (a) $ 14,304 $ 8,542 $ 6,559 $ 2,160 $ 1,289 $ 32,854

Variable Costs (b) 5,524 3,614 3,317 676 433 13,564

Fixed Costs and other (c) 3,113 1,802 803 960 717 7,395

Depreciation and amortization (d) 1,423 640 633 33 96 2,825

Operating Profit (e) 4,244 2,486 1,806 491 43 9,070

Expenditures for long-lived assets $ 2,999 $ 635 $ 975 $ 24 $ 107 $ 4,740

Sales (a) $ 13,874 $ 8,443 $ 6,480 $ 2,762 $ 1,805 $ 33,364

Variable Costs (b) 6,002 4,034 3,423 1,263 892 15,614

Fixed Costs and other (c) 2,820 1,735 794 911 863 7,123

Depreciation and amortization (d) 1,320 661 593 33 116 2,723

Operating Profit (e) 3,732 2,013 1,670 555 ( 66 ) 7,904

Expenditures for long-lived assets $ 1,698 $ 550 $ 889 $ 28 $ 118 $ 3,283

(a) Sales reflect external sales only.

Intersegment sales from Engineering to the industrial gases segments, were $ 1,958 million, $ 1,479 million and $ 1,035 million for the year ended December 31, 2024, 2023 and 2022, respectively.

Intersegment sales from Helium, were $ 477 million, $ 509 million, $ 442 million for the year ended December 31, 2024, 2023 and 2022, respectively.

(b) Variable costs represents the variable portion of cost of sales, exclusive of depreciation and amortization.

(c) Fixed costs and other represents the fixed portion of cost of sales, exclusive of depreciation and amortization, selling, general and administrative, research and development and other income (expenses) - net.

(d) Refer to reconciliation of depreciation and amortization to consolidated results below.

(e) Refer to reconciliation of operating profit to consolidated results below.

Reconciliations to Consolidated Results

Depreciation and Amortization

Americas $ 1,423 $ 1,320 $ 1,243

EMEA 640 661 752

APAC 633 593 611

Engineering 33 33 39

Other 96 116 127

Segment depreciation and amortization 2,825 2,723 2,772

The table below reconciles total depreciation and amortization disclosed in the table above to consolidated depreciation and amortization as reflected on our consolidated statements of income:

(Millions of dollars) 2024 2023 2022

Total segment depreciation and amortization $ 2,857 $ 2,825 $ 2,723

Purchase accounting impacts - Linde AG 923 991 1,481

Total depreciation and amortization $ 3,780 $ 3,816 $ 4,204

2023 2022 2021

Capital Expenditures and Acquisitions

Americas $ 2,999 $ 1,698 $ 1,354

EMEA 635 550 669

APAC 975 889 995

Engineering 24 28 25

Other 107 118 131

Total Capital Expenditures and Acquisitions $ 4,740 $ 3,283 $ 3,174

2023 2022 2021

Income Before Income Taxes and Equity Investments

The table below reconciles total operating profit disclosed in the table above to consolidated income before income taxes and equity investments as reflected on our consolidated statements of income:

(Millions of dollars) 2024 2023 2022

Total segment operating profit $ 9,720 $ 9,070 $ 7,904

Cost reduction program and other charges 145 40 1,029

Purchase accounting impacts - Linde AG 940 1,006 1,506

Interest expense - net 256 200 63

Net pension and OPEB cost (benefit), excluding service cost ( 190 ) ( 164 ) ( 237 )

Total consolidated income before income taxes and equity investments $ 8,569 $ 7,988 $ 5,543

Geographic Information

The geographic information presented below is based on country of origin.

Sales by Major Country

(Millions of dollars) 2024 2023 2022

United States $ 11,497 $ 10,566 $ 10,553

Germany (c) 2,827 3,662 3,601

China 2,649 2,585 2,643

Germany (a) 2,509 2,827 3,662

United Kingdom 1,540 1,507 1,954

Australia 1,354 1,303 1,372

Mexico 1,346 1,292 1,044

Brazil 1,263 1,302 1,158

2 unchanged sentences

Total Sales $ 33,005 $ 32,854 $ 33,364

2023 2022 2021

Long-lived Assets by Major Country (b)

(a) Sales in Germany include Engineering sales to third parties, locally and internationally, which represent 28 %, 35 % and 44 % of Germany sales in 2024, 2023 and 2022, respectively.

Long-lived Assets

(Millions of dollars) 2024 2023 2022

United States $ 9,663 $ 8,490 $ 7,663

Germany 1,584 1,678 2,003

China 2,022 2,063 2,176

Germany 1,386 1,584 1,678

Brazil 738 836 720

Mexico 704 768 707

United Kingdom 668 684 704

Australia 573 654 688

Brazil 836 720 705

Other – non-U.S.

9,021 9,473 9,212

Total long-lived assets $ 24,552 $ 23,548 $ 26,003

________________________

(a) Sales reflect external sales only.

Intersegment sales, primarily from Engineering to the industrial gases segments, were $ 1,479 million, $ 1,035 million and $ 896 million for the year ended December 31, 2023, 2022 and 2021, respectively.

(b) Long-lived assets include property, plant and equipment - net.

(c) Sales in Germany include Engineering sales to third parties, locally and internationally, which represent 35 %, 44 % and 53 % of Germany sales in 2023, 2022 and 2021, respectively.

Total long-lived assets (a) $ 24,775 $ 24,552 $ 23,548

(a) Long-lived assets include property, plant and equipment - net.

REVENUE RECOGNITION

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The distribution method generally determines the contract terms with the customer and, accordingly, the revenue recognition accounting practices.

Linde's primary products in its industrial gases business are atmospheric gases (oxygen, nitrogen, argon, rare gases) and process gases (carbon dioxide, helium, hydrogen, electronic gases, specialty gases, acetylene).

Linde's primary products in its industrial gases business are atmospheric gases (oxygen, nitrogen, argon, rare gases) and process gases (hydrogen, helium, carbon dioxide, carbon monoxide, electronic gases, specialty gases, acetylene).

These products are generally sold through one of the three distribution methods.

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Revenue is recognized when product is delivered to the customer and the company has the right to invoice the customer in accordance with the contract terms.

Any variable components of consideration within merchant contracts are constrained however this consideration is not significant.

Packaged Gases.

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Accordingly, revenue is recognized when product is delivered to the customer or when the customer picks up product from a packaged gas facility or retail store, and the company has the right to payment from the customer in accordance with the contract terms.

Any variable consideration is constrained and will be recognized when the uncertainty related to the consideration is resolved.

The company designs and manufactures equipment for air separation and other industrial gas applications manufactured specifically for end customers.

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Costs incurred include material, labor, and overhead costs and represent work contributing and proportionate to the transfer of control to the customer.

Changes to cost estimates and contract modifications are typically accounted for as part of the existing contract and are recognized as a cumulative adjustments for the inception-to-date effect of such change.

Contract Assets and Liabilities

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Contract liabilities are recognized as revenue as performance obligations are satisfied under contract terms.

Linde has contract assets of $ 196 million at December 31, 2023 and $ 124 million at December 31, 2022.

Total contract liabilities are $ 2,950 million at December 31, 2023 (current of $ 1,901 million and $ 1,049 million within deferred credits in the consolidated balance sheets).

As of December 31, 2023, Linde has $ 418 million recorded in contract liabilities related to engineering projects in Russia subject to sanctions and therefore suspended and lawfully wound down.

Linde has contract assets of $ 263 million at December 31, 2024 and $ 196 million at December 31, 2023, respectively.

Total contract liabilities are $ 2,292 million at December 31, 2024 (current contract liabilities of $ 1,194 million and $ 1,098 million within deferred credits in the consolidated balance sheets).

Total contract liabilities were $ 2,950 million at December 31, 2023 (current contract liabilities of $ 1,901 million and $ 1,049 million within deferred credits in the consolidated balance sheets).

The decrease in contract liabilities is primarily related to a reclassification of contract liabilities to a contingent liability in other long-term liabilities associated with an engineering project in Russia (see Note 17).

Revenue recognized for the twelve months ended December 31, 2024 that was included in the contract liability at December 31, 2023 was $ 993 million.

Contract assets and liabilities primarily relate to the Engineering business.

Contract assets and liabilities primarily relate to the Engineering business and customer repayments for certain on-site supply agreements.

Payment Terms and Other

32 unchanged sentences

Additionally, plant sales from the Linde Engineering business are primarily contracted 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 projects which are impacted by sanctions).

The company estimates the consideration related to future minimum purchase requirements and plant sales was approximately $ 58 billion.

This amount excludes all on-site sales above minimum purchase requirements, which can be significant depending on customer needs.

1 unchanged sentence

The actual duration of long-term supply contracts ranges up to twenty years .

The company estimates that approximately half of the revenue related to minimum purchase requirements will be earned in the next five years and the remaining thereafter.

The company estimates that approximately half of the revenue related to minimum purchase requirements will be earned in the next six years and the remaining thereafter.

SUBSEQUENT EVENTS

In February 2024, Linde issued € 700 million of 3.00 % notes due in 2028, € 850 million of 3.20 % notes due in 2031 and € 700 million of 3.40 % notes due in 2036.

In February 2025, Linde issued € 850 million o f 2.625 % notes due in 2029, € 750 million of 3.00 % notes due in 2033 and € 650 million of 3.25 % notes due in 2037.

Linde redeemed $ 600 million of 4.70 % notes that were due in 2025.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data