Stock Analysis on Net
Stock Analysis on Net

Air Products & Chemicals Inc. (NYSE:APD)

Analysis of Debt

Advanced level

Total Debt (Carrying Amount)

Air Products & Chemicals Inc., balance sheet: debt

US$ in thousands

Microsoft Excel LibreOffice Calc
Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
Short-term borrowings 7,700  58,200  54,300  144,000  935,800  1,494,300 
Current portion of long-term debt 470,000  40,400  406,600  416,400  371,300  435,600 
Long-term debt, excluding current portion 7,132,900  2,907,300  2,967,400  3,402,400  4,918,100  3,949,100 
Long-term debt, related party 297,200  320,100  384,300  —  —  — 
Total debt (carrying amount) 7,907,800  3,326,000  3,812,600  3,962,800  6,225,200  5,879,000 

Based on: 10-K (filing date: 2020-11-19), 10-K (filing date: 2019-11-26), 10-K (filing date: 2018-11-20), 10-K (filing date: 2017-11-16), 10-K (filing date: 2016-11-21), 10-K (filing date: 2015-11-24).

Debt item Description The company
Total debt (carrying amount) Sum of the carrying values as of the balance sheet date of all debt plus capital lease obligations. Air Products & Chemicals Inc.’s total debt decreased from 2018 to 2019 but then increased from 2019 to 2020 exceeding 2018 level.

Total Debt (Fair Value)

Microsoft Excel LibreOffice Calc
Sep 30, 2020
Selected Financial Data (US$ in thousands)
Short-term borrowings 7,700 
Long-term debt, including current portion and related party 8,278,400 
Total debt (fair value) 8,286,100 
Financial Ratio
Debt, fair value to carrying amount ratio 1.05

Based on: 10-K (filing date: 2020-11-19).


Weighted-average Interest Rate on Debt

Weighted average interest rate of debt: 1.98%

Interest rate Debt amount1 Interest rate × Debt amount Weighted-average interest rate2
8.75% 18,400  1,610 
7.60% 17,200  1,307 
3.00% 400,000  12,000 
2.75% 400,000  11,000 
3.35% 400,000  13,400 
1.50% 550,000  8,250 
1.85% 650,000  12,025 
2.05% 900,000  18,450 
2.70% 750,000  20,250 
2.80% 950,000  26,600 
0.10% 631,900  632 
0.38% 410,300  1,539 
1.00% 351,700  3,517 
0.50% 586,200  2,931 
0.80% 586,200  4,690 
5.50% 338,500  18,618 
10.90% 9,200  1,003 
1.60% 7,700  123 
Total 7,957,300  157,944 
1.98%

Based on: 10-K (filing date: 2020-11-19).

1 US$ in thousands

2 Weighted-average interest rate = 100 × 157,944 ÷ 7,957,300 = 1.98%


Interest Costs Incurred

Air Products & Chemicals Inc., interest costs incurred

US$ in thousands

Microsoft Excel LibreOffice Calc
12 months ended: Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
Interest expense 109,300  137,000  130,500  120,600  115,500  103,500 
Capitalized interest 15,900  13,500  19,500  19,000  32,900  49,100 
Interest costs incurred 125,200  150,500  150,000  139,600  148,400  152,600 

Based on: 10-K (filing date: 2020-11-19), 10-K (filing date: 2019-11-26), 10-K (filing date: 2018-11-20), 10-K (filing date: 2017-11-16), 10-K (filing date: 2016-11-21), 10-K (filing date: 2015-11-24).

Debt item Description The company
Interest expense Amount of the cost of borrowed funds accounted for as interest expense for debt. Air Products & Chemicals Inc.’s interest expense increased from 2018 to 2019 but then decreased significantly from 2019 to 2020.
Capitalized interest Amount of interest costs capitalized disclosed as an adjusting item to interest costs incurred. Air Products & Chemicals Inc.’s capitalized interest decreased from 2018 to 2019 but then slightly increased from 2019 to 2020.
Interest costs incurred Total interest costs incurred during the period and either capitalized or charged against earnings. Air Products & Chemicals Inc.’s interest costs incurred increased from 2018 to 2019 but then decreased significantly from 2019 to 2020.

Adjusted Interest Coverage Ratio

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Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
Selected Financial Data (US$ in thousands)
Net income attributable to Air Products 1,886,700  1,760,000  1,497,800  3,000,400  631,100  1,277,900 
Add: Net income attributable to noncontrolling interest 44,400  49,400  35,100  20,800  30,400  39,700 
Less: Income (loss) from discontinued operations, net of tax (14,300) —  42,200  1,866,000  (884,200) — 
Add: Income tax expense 478,400  480,100  524,300  260,900  586,500  415,900 
Add: Interest expense 109,300  137,000  130,500  120,600  115,500  103,500 
Earnings before interest and tax (EBIT) 2,533,100  2,426,500  2,145,500  1,536,700  2,247,700  1,837,000 
 
Interest costs incurred 125,200  150,500  150,000  139,600  148,400  152,600 
Financial Ratio With and Without Capitalized Interest
Interest coverage ratio (without capitalized interest)1 23.18 17.71 16.44 12.74 19.46 17.75
Adjusted interest coverage ratio (with capitalized interest)2 20.23 16.12 14.30 11.01 15.15 12.04

Based on: 10-K (filing date: 2020-11-19), 10-K (filing date: 2019-11-26), 10-K (filing date: 2018-11-20), 10-K (filing date: 2017-11-16), 10-K (filing date: 2016-11-21), 10-K (filing date: 2015-11-24).

2020 Calculations

1 Interest coverage ratio (without capitalized interest) = EBIT ÷ Interest expense
= 2,533,100 ÷ 109,300 = 23.18

2 Adjusted interest coverage ratio (with capitalized interest) = EBIT ÷ Interest costs incurred
= 2,533,100 ÷ 125,200 = 20.23


Solvency ratio Description The company
Adjusted interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments (including capitalized interest). Air Products & Chemicals Inc.’s adjusted interest coverage ratio improved from 2018 to 2019 and from 2019 to 2020.