Analysis of Solvency Ratios
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
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- Income Statement
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Common Stock Valuation Ratios
- Enterprise Value to EBITDA (EV/EBITDA)
- Present Value of Free Cash Flow to Equity (FCFE)
- Net Profit Margin since 2005
- Operating Profit Margin since 2005
- Debt to Equity since 2005
- Price to Earnings (P/E) since 2005
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Solvency Ratios (Summary)
Linde plc, solvency ratios
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
Solvency ratios demonstrate a consistent trend of increasing leverage over the five-year period. While coverage ratios remain at acceptable levels, the increasing debt burden warrants monitoring. The company’s reliance on debt financing appears to be growing, potentially increasing financial risk.
- Debt Ratios (Debt to Equity, Debt to Capital, Debt to Assets)
- All debt ratios – Debt to Equity, Debt to Capital, and Debt to Assets – exhibit an upward trajectory from 2021 to 2025. Debt to Equity increases from 0.33 to 0.71, indicating a significantly larger proportion of financing derived from debt relative to equity. Similarly, Debt to Capital rises from 0.25 to 0.42, and Debt to Assets increases from 0.18 to 0.31. The inclusion of operating lease liabilities in these calculations results in slightly higher ratios, but the trend remains consistent. This suggests a deliberate or necessary shift towards greater debt utilization.
- Financial Leverage
- Financial leverage, measured as total assets to total equity, shows a steady increase from 1.85 in 2021 to 2.27 in 2025. This confirms the increasing use of debt to finance assets and operations. A higher financial leverage ratio amplifies both potential profits and potential losses.
- Coverage Ratios (Interest Coverage, Fixed Charge Coverage)
- Interest coverage declines from 45.60 in 2021 to 20.50 in 2025, although it remains substantially above 1.0, indicating the company continues to generate sufficient earnings to cover its interest obligations. Fixed charge coverage demonstrates more stability, fluctuating between 12.10 and 13.32 over the period, and ending at 12.67 in 2025. While both coverage ratios remain healthy, the downward trend in interest coverage, coupled with increasing debt, requires continued attention.
In summary, the observed trends suggest a growing reliance on debt financing. While the company currently maintains adequate coverage of its debt obligations, the increasing leverage could potentially elevate financial risk in the future. Continued monitoring of these ratios is recommended.
Debt Ratios
Coverage Ratios
Debt to Equity
Linde plc, debt to equity calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | ||||||
| Current portion of long-term debt | ||||||
| Current finance lease liabilities | ||||||
| Long-term debt, excluding current portion | ||||||
| Long-term finance lease liabilities | ||||||
| Total debt | ||||||
| Total Linde plc shareholders’ equity | ||||||
| Solvency Ratio | ||||||
| Debt to equity1 | ||||||
| Benchmarks | ||||||
| Debt to Equity, Competitors2 | ||||||
| Sherwin-Williams Co. | ||||||
| Debt to Equity, Sector | ||||||
| Chemicals | ||||||
| Debt to Equity, Industry | ||||||
| Materials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to equity = Total debt ÷ Total Linde plc shareholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The debt to equity ratio exhibits a consistent upward trend over the five-year period. This indicates a growing reliance on debt financing relative to equity financing.
- Debt to Equity Ratio Trend
- In 2021, the debt to equity ratio stood at 0.33. This value increased to 0.45 in 2022, representing a notable rise in leverage. The ratio continued to climb, reaching 0.49 in 2023 and further increasing to 0.57 in 2024. By 2025, the ratio had reached 0.71, signifying a substantial increase in financial leverage compared to the beginning of the period.
Total debt increased steadily throughout the period, moving from US$14,383 million in 2021 to US$27,203 million in 2025. Simultaneously, total shareholders’ equity experienced a decline from US$44,035 million in 2021 to US$38,245 million in 2025. This combination of increasing debt and decreasing equity is the primary driver of the observed trend in the debt to equity ratio.
- Total Debt
- Total debt demonstrates a consistent upward trajectory, increasing each year. The largest year-over-year increase occurred between 2024 and 2025, with an addition of US$5,376 million.
- Total Shareholders’ Equity
- Total shareholders’ equity experienced a gradual decline over the five-year period. While the decrease was relatively modest in 2022 and 2023, the trend persisted, indicating a reduction in the company’s equity base.
The increasing debt to equity ratio suggests a higher degree of financial risk. While utilizing debt can amplify returns, it also increases the potential for financial distress, particularly if earnings decline or interest rates rise.
Debt to Equity (including Operating Lease Liability)
Linde plc, debt to equity (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | ||||||
| Current portion of long-term debt | ||||||
| Current finance lease liabilities | ||||||
| Long-term debt, excluding current portion | ||||||
| Long-term finance lease liabilities | ||||||
| Total debt | ||||||
| Current operating lease liabilities | ||||||
| Long-term operating lease liabilities | ||||||
| Total debt (including operating lease liability) | ||||||
| Total Linde plc shareholders’ equity | ||||||
| Solvency Ratio | ||||||
| Debt to equity (including operating lease liability)1 | ||||||
| Benchmarks | ||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | ||||||
| Sherwin-Williams Co. | ||||||
| Debt to Equity (including Operating Lease Liability), Sector | ||||||
| Chemicals | ||||||
| Debt to Equity (including Operating Lease Liability), Industry | ||||||
| Materials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Total Linde plc shareholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The debt to equity ratio, inclusive of operating lease liabilities, demonstrates a consistent upward trend over the five-year period. Total debt has increased steadily, while total shareholders’ equity has experienced a decline, contributing to the increasing ratio.
- Debt to Equity Ratio Trend
- In 2021, the debt to equity ratio stood at 0.35. This increased to 0.47 in 2022, and continued to rise to 0.51 in 2023. The rate of increase accelerated in subsequent years, reaching 0.59 in 2024 and culminating in a ratio of 0.73 in 2025.
- Total Debt
- Total debt, including operating lease liabilities, increased from US$15,216 million in 2021 to US$28,069 million in 2025. This represents a substantial increase of approximately 84.5% over the period. The largest single-year increase occurred between 2024 and 2025, with an addition of US$5,460 million in debt.
- Total Shareholders’ Equity
- Total Linde plc shareholders’ equity decreased from US$44,035 million in 2021 to US$38,245 million in 2025. While the decline was not linear, a general downward trend is apparent. The most significant decrease occurred between 2021 and 2022, with a reduction of US$3,007 million. Subsequent declines were more moderate.
The combined effect of rising debt and declining equity has resulted in a significantly leveraged capital structure by 2025. The ratio’s movement suggests an increasing reliance on debt financing relative to equity.
Debt to Capital
Linde plc, debt to capital calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | ||||||
| Current portion of long-term debt | ||||||
| Current finance lease liabilities | ||||||
| Long-term debt, excluding current portion | ||||||
| Long-term finance lease liabilities | ||||||
| Total debt | ||||||
| Total Linde plc shareholders’ equity | ||||||
| Total capital | ||||||
| Solvency Ratio | ||||||
| Debt to capital1 | ||||||
| Benchmarks | ||||||
| Debt to Capital, Competitors2 | ||||||
| Sherwin-Williams Co. | ||||||
| Debt to Capital, Sector | ||||||
| Chemicals | ||||||
| Debt to Capital, Industry | ||||||
| Materials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to capital = Total debt ÷ Total capital
= ÷ =
2 Click competitor name to see calculations.
The debt to capital ratio exhibits a consistent upward trend over the five-year period. This indicates an increasing reliance on debt financing relative to total capital employed by the entity.
- Total Debt
- Total debt increased steadily from US$14,383 million in 2021 to US$27,203 million in 2025. The rate of increase appears to have accelerated in the later years of the period, with a more substantial rise between 2023 and 2025.
- Total Capital
- Total capital demonstrated a more moderate increase, moving from US$58,418 million in 2021 to US$65,448 million in 2025. While capital did increase overall, the growth rate was consistently lower than that of total debt.
- Debt to Capital Ratio
- The debt to capital ratio began at 0.25 in 2021 and rose to 0.42 in 2025. This represents a 68% increase over the period. The ratio increased from 0.25 to 0.31 between 2021 and 2022, then from 0.31 to 0.33 between 2022 and 2023, and finally from 0.33 to 0.36 between 2023 and 2024, before a more significant increase to 0.42 between 2024 and 2025. This pattern suggests a growing proportion of debt financing within the capital structure.
The observed trend in the debt to capital ratio warrants further investigation to assess the implications for financial risk and future financial flexibility. The increasing leverage could potentially elevate financial obligations and sensitivity to changes in interest rates or economic conditions.
Debt to Capital (including Operating Lease Liability)
Linde plc, debt to capital (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | ||||||
| Current portion of long-term debt | ||||||
| Current finance lease liabilities | ||||||
| Long-term debt, excluding current portion | ||||||
| Long-term finance lease liabilities | ||||||
| Total debt | ||||||
| Current operating lease liabilities | ||||||
| Long-term operating lease liabilities | ||||||
| Total debt (including operating lease liability) | ||||||
| Total Linde plc shareholders’ equity | ||||||
| Total capital (including operating lease liability) | ||||||
| Solvency Ratio | ||||||
| Debt to capital (including operating lease liability)1 | ||||||
| Benchmarks | ||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | ||||||
| Sherwin-Williams Co. | ||||||
| Debt to Capital (including Operating Lease Liability), Sector | ||||||
| Chemicals | ||||||
| Debt to Capital (including Operating Lease Liability), Industry | ||||||
| Materials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= ÷ =
2 Click competitor name to see calculations.
The debt to capital ratio, inclusive of operating lease liabilities, demonstrates a consistent upward trend over the five-year period. Total debt and total capital both increased in absolute terms, but the rate of increase in debt exceeded that of capital, resulting in a rising ratio.
- Debt to Capital Ratio Trend
- The ratio began at 0.26 in 2021 and increased to 0.42 in 2025. This represents a 62% increase over the period. The most significant increase occurred between 2024 and 2025, with a rise from 0.37 to 0.42.
Examining the underlying components, total debt increased from US$15,216 million in 2021 to US$28,069 million in 2025, representing an 84% increase. Total capital experienced a more moderate increase, moving from US$59,251 million in 2021 to US$66,314 million in 2025, a 12% increase.
- Total Debt
- Total debt exhibited year-over-year increases throughout the period. The largest absolute increase in total debt was observed between 2024 and 2025, adding US$5,460 million.
- Total Capital
- Total capital remained relatively stable between 2021 and 2023, with a slight decrease in 2022. More substantial growth in total capital was observed in 2024 and 2025, though not at the same pace as the growth in total debt.
The increasing debt to capital ratio suggests a growing reliance on debt financing relative to equity and other capital sources. While not inherently negative, this trend warrants further investigation into the reasons for increased debt levels and the associated financial implications.
Debt to Assets
Linde plc, debt to assets calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | ||||||
| Current portion of long-term debt | ||||||
| Current finance lease liabilities | ||||||
| Long-term debt, excluding current portion | ||||||
| Long-term finance lease liabilities | ||||||
| Total debt | ||||||
| Total assets | ||||||
| Solvency Ratio | ||||||
| Debt to assets1 | ||||||
| Benchmarks | ||||||
| Debt to Assets, Competitors2 | ||||||
| Sherwin-Williams Co. | ||||||
| Debt to Assets, Sector | ||||||
| Chemicals | ||||||
| Debt to Assets, Industry | ||||||
| Materials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to assets = Total debt ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
The debt-to-assets ratio exhibits a consistent upward trend over the five-year period. This indicates a growing reliance on debt financing relative to the company’s asset base.
- Debt to Assets Ratio Trend
- In 2021, the debt-to-assets ratio stood at 0.18. This value increased to 0.23 in 2022, representing a 27.8% rise. The ratio continued to climb, reaching 0.24 in 2023, a 4.3% increase from the prior year.
- The rate of increase accelerated in 2024, with the ratio reaching 0.27, a 12.5% increase. This trend persisted into 2025, where the ratio reached 0.31, representing a 14.8% increase. This signifies a continued and strengthening dependence on debt to finance assets.
The consistent increase in the debt-to-assets ratio suggests a potential shift in the company’s capital structure. While not inherently negative, this trend warrants further investigation to assess the sustainability of the debt levels and the associated financial risk. The company’s ability to service this debt and generate sufficient returns on assets should be considered in conjunction with this increasing ratio.
- Magnitude of Change
- The overall increase from 2021 to 2025 represents a 72.2% rise in the debt-to-assets ratio. This substantial change highlights the growing proportion of assets financed by debt over the observed period.
The observed pattern suggests a deliberate strategy to leverage debt, or potentially a need to finance growth through borrowing. Further analysis, including a review of the company’s debt maturity schedule and interest coverage ratios, is recommended to provide a more comprehensive understanding of the implications of this trend.
Debt to Assets (including Operating Lease Liability)
Linde plc, debt to assets (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | ||||||
| Current portion of long-term debt | ||||||
| Current finance lease liabilities | ||||||
| Long-term debt, excluding current portion | ||||||
| Long-term finance lease liabilities | ||||||
| Total debt | ||||||
| Current operating lease liabilities | ||||||
| Long-term operating lease liabilities | ||||||
| Total debt (including operating lease liability) | ||||||
| Total assets | ||||||
| Solvency Ratio | ||||||
| Debt to assets (including operating lease liability)1 | ||||||
| Benchmarks | ||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | ||||||
| Sherwin-Williams Co. | ||||||
| Debt to Assets (including Operating Lease Liability), Sector | ||||||
| Chemicals | ||||||
| Debt to Assets (including Operating Lease Liability), Industry | ||||||
| Materials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
The debt to assets ratio, inclusive of operating lease liabilities, demonstrates a consistent upward trend over the five-year period. Total debt has increased steadily, while total assets have exhibited more moderate fluctuations.
- Debt to Assets Ratio Trend
- The ratio began at 0.19 in 2021 and increased to 0.32 in 2025. This represents a 68% increase over the period. The most significant increase occurred between 2024 and 2025, with a rise from 0.28 to 0.32.
- Total Debt Evolution
- Total debt increased from US$15,216 million in 2021 to US$28,069 million in 2025, representing an 84% increase. Growth was relatively consistent year-over-year, with a notable acceleration between 2023 and 2024 (US$2,294 million increase) and again between 2024 and 2025 (US$5,460 million increase).
- Total Asset Behavior
- Total assets decreased slightly from US$81,605 million in 2021 to US$79,658 million in 2022, before recovering to US$80,811 million in 2023. A minor decrease was observed in 2024 (US$80,147 million), followed by a more substantial increase to US$86,817 million in 2025. While assets increased overall during the period, the rate of asset growth has been slower than the rate of debt accumulation.
The increasing debt to assets ratio suggests a growing reliance on debt financing relative to the company’s asset base. The accelerated increase in both the ratio and total debt in the later years of the period warrants further investigation to understand the drivers behind these changes and their potential implications for financial risk.
Financial Leverage
Linde plc, financial leverage calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Total assets | ||||||
| Total Linde plc shareholders’ equity | ||||||
| Solvency Ratio | ||||||
| Financial leverage1 | ||||||
| Benchmarks | ||||||
| Financial Leverage, Competitors2 | ||||||
| Sherwin-Williams Co. | ||||||
| Financial Leverage, Sector | ||||||
| Chemicals | ||||||
| Financial Leverage, Industry | ||||||
| Materials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Financial leverage = Total assets ÷ Total Linde plc shareholders’ equity
= ÷ =
2 Click competitor name to see calculations.
An examination of the financial information reveals a consistent increase in financial leverage over the five-year period from 2021 to 2025. This trend is accompanied by fluctuations in total assets and a decline in total shareholders’ equity.
- Total Assets
- Total assets experienced a decrease from US$81,605 million in 2021 to US$79,658 million in 2022. A subsequent increase was observed in 2023, reaching US$80,811 million, followed by a slight decrease to US$80,147 million in 2024. By 2025, total assets rose significantly to US$86,817 million, representing the highest value within the observed period.
- Total Shareholders’ Equity
- Total Linde plc shareholders’ equity demonstrated a consistent downward trend from 2021 to 2024. Beginning at US$44,035 million in 2021, equity decreased to US$40,028 million in 2022, then to US$39,720 million in 2023, and further to US$38,092 million in 2024. A marginal increase was noted in 2025, with equity reaching US$38,245 million, but remained below the 2021 level.
- Financial Leverage
- The financial leverage ratio increased steadily throughout the period. Starting at 1.85 in 2021, it rose to 1.99 in 2022, 2.03 in 2023, and 2.10 in 2024. This upward trend continued into 2025, with the ratio reaching 2.27. This indicates an increasing reliance on debt financing relative to equity.
The combination of decreasing shareholders’ equity and increasing financial leverage suggests a growing proportion of the company’s assets are financed by debt. While the increase in total assets in 2025 is positive, the continued rise in financial leverage warrants further investigation to assess potential risks associated with higher debt levels.
Interest Coverage
Linde plc, interest coverage calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income, Linde plc | ||||||
| Add: Net income attributable to noncontrolling interest | ||||||
| Less: Income from discontinued operations, net of tax | ||||||
| Add: Income tax expense | ||||||
| Add: Interest expense | ||||||
| Earnings before interest and tax (EBIT) | ||||||
| Solvency Ratio | ||||||
| Interest coverage1 | ||||||
| Benchmarks | ||||||
| Interest Coverage, Competitors2 | ||||||
| Sherwin-Williams Co. | ||||||
| Interest Coverage, Sector | ||||||
| Chemicals | ||||||
| Interest Coverage, Industry | ||||||
| Materials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Interest coverage = EBIT ÷ Interest expense
= ÷ =
2 Click competitor name to see calculations.
The period under review demonstrates a fluctuating pattern in the company’s ability to meet its interest obligations. Earnings before interest and tax (EBIT) increased overall, while interest expense also rose significantly, impacting the interest coverage ratio.
- Earnings Before Interest and Tax (EBIT)
- EBIT exhibited an upward trajectory throughout the period. Starting at US$5,335 million in 2021, it increased to US$5,895 million in 2022, then experienced a substantial rise to US$8,552 million in 2023. This growth continued, albeit at a slower pace, reaching US$9,223 million in 2024 and US$9,511 million in 2025.
- Interest Expense
- Interest expense showed a consistent increase over the five-year period. From US$117 million in 2021, it rose to US$180 million in 2022. A more pronounced increase was observed in 2023, reaching US$397 million, followed by further increases to US$484 million in 2024 and US$464 million in 2025. While the increase slowed in 2025, the expense remained substantially higher than in earlier years.
- Interest Coverage Ratio
- The interest coverage ratio, which indicates the company’s ability to pay interest expenses from its earnings, decreased from 45.60 in 2021 to 32.75 in 2022. This downward trend continued, reaching 21.54 in 2023 and 19.06 in 2024. A slight recovery was observed in 2025, with the ratio increasing to 20.50. Despite the recovery, the ratio remained considerably lower than its value in 2021 and 2022, suggesting a diminished capacity to cover interest obligations compared to the earlier part of the period. The ratio remains above 1, indicating the company can still cover its interest expense, but the margin of safety has decreased.
The increasing interest expense, coupled with a slower relative growth in EBIT after 2023, contributed to the declining interest coverage ratio. While EBIT continued to grow in absolute terms, the rate of growth was insufficient to offset the rising interest costs, resulting in a reduced ability to comfortably meet interest payments.
Fixed Charge Coverage
Linde plc, fixed charge coverage calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income, Linde plc | ||||||
| Add: Net income attributable to noncontrolling interest | ||||||
| Less: Income from discontinued operations, net of tax | ||||||
| Add: Income tax expense | ||||||
| Add: Interest expense | ||||||
| Earnings before interest and tax (EBIT) | ||||||
| Add: Lease and rental expenses related to operating lease right of use assets | ||||||
| Earnings before fixed charges and tax | ||||||
| Interest expense | ||||||
| Lease and rental expenses related to operating lease right of use assets | ||||||
| Fixed charges | ||||||
| Solvency Ratio | ||||||
| Fixed charge coverage1 | ||||||
| Benchmarks | ||||||
| Fixed Charge Coverage, Competitors2 | ||||||
| Sherwin-Williams Co. | ||||||
| Fixed Charge Coverage, Sector | ||||||
| Chemicals | ||||||
| Fixed Charge Coverage, Industry | ||||||
| Materials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= ÷ =
2 Click competitor name to see calculations.
The company demonstrates a consistently strong ability to meet its fixed financial obligations, as indicated by the fixed charge coverage ratio. Earnings before fixed charges and tax have generally increased over the observed period, contributing to this stability.
- Earnings Before Fixed Charges and Tax
- Earnings before fixed charges and tax increased from US$5,652 million in 2021 to US$6,179 million in 2022, representing a growth of approximately 9.3%. A significant increase was then observed, reaching US$8,836 million in 2023. This upward trend continued, with earnings reaching US$9,526 million in 2024 and US$9,822 million in 2025, though the rate of increase slowed in the latter two years.
- Fixed Charges
- Fixed charges experienced a moderate increase from US$434 million in 2021 to US$464 million in 2022, a rise of roughly 6.9%. A more substantial increase occurred in 2023, reaching US$681 million. This growth continued into 2024, with fixed charges reaching US$787 million, before decreasing slightly to US$775 million in 2025.
- Fixed Charge Coverage Ratio
- The fixed charge coverage ratio remained above 13.0 throughout the period, indicating a comfortable margin of safety. The ratio peaked at 13.32 in 2022, then decreased slightly to 12.98 in 2023. A more noticeable decline was observed in 2024, with the ratio falling to 12.10. The ratio partially recovered in 2025, increasing to 12.67. Despite the decline from the peak, the ratio consistently demonstrates a strong capacity to cover fixed charges with available earnings.
While earnings have generally increased, the growth in fixed charges, particularly between 2022 and 2024, contributed to a slight weakening in the fixed charge coverage ratio. The stabilization of fixed charges in 2025, coupled with continued earnings growth, resulted in a modest improvement in the ratio during that year.