Balance Sheet: Liabilities and Stockholders’ Equity

The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources of capital (its equity and liabilities). It normally also provides information about the future earnings capacity of a company assets as well as an indication of cash flows that may come from receivables and inventories.

Liabilities represents obligations of a company arising from past events, the settlement of which is expected to result in an outflow of economic benefits from the entity.

Air Products & Chemicals Inc., consolidated balance sheet: liabilities and stockholders’ equity

US$ in thousands

	Sep 30, 2020	Sep 30, 2019	Sep 30, 2018	Sep 30, 2017	Sep 30, 2016	Sep 30, 2015
Trade creditors	546,200)	528,200)	924,600)	659,500)	676,100)	638,900)
Contract liabilities	313,800)	247,400)	156,600)	438,900)	376,100)	195,300)
Dividends payable	296,200)	255,700)	241,500)	207,500)	186,900)	174,400)
Accrued payroll and employee benefits	196,800)	186,100)	201,400)	187,100)	262,600)	247,800)
Obligation for future contribution to an equity affiliate	94,400)	94,400)	—)	—)	—)	—)
Current operating lease liabilities	70,700)	—)	—)	—)	—)	—)
Derivative instruments	50,900)	91,200)	54,200)	95,900)	74,000)	114,600)
Pension and postretirement benefits	17,900)	26,000)	34,100)	22,600)	35,500)	26,100)
Other	246,300)	206,700)	205,400)	202,800)	199,400)	265,300)
Payables and accrued liabilities	1,833,200)	1,635,700)	1,817,800)	1,814,300)	1,810,600)	1,662,400)
Accrued income taxes	105,800)	86,600)	59,600)	98,600)	146,600)	55,800)
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)
Current liabilities of discontinued operations	—)	—)	—)	15,700)	19,000)	—)
Current liabilities	2,416,700)	1,820,900)	2,338,300)	2,489,000)	3,283,300)	3,648,100)
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)	—)	—)	—)
Pension benefits	614,200)	651,200)	417,200)	703,800)	1,186,800)	860,000)
Postretirement benefits	31,400)	36,000)	47,000)	57,000)	74,900)	76,500)
Noncurrent operating lease liabilities	335,800)	—)	—)	—)	—)	—)
Asset retirement obligations	236,200)	201,900)	189,500)	144,000)	116,100)	106,500)
Long-term accrued income taxes related to U.S. tax reform	190,900)	215,400)	184,400)	—)	—)	—)
Contingencies related to uncertain tax positions	138,600)	123,300)	113,200)	130,600)	95,600)	91,100)
Environmental liabilities	73,600)	59,100)	64,600)	72,300)	70,300)	71,600)
Contract liabilities	57,900)	49,200)	58,200)	39,000)	43,800)	135,100)
Derivative instruments	34,700)	21,200)	39,900)	36,000)	21,800)	10,600)
Noncurrent customer liability	—)	118,000)	92,400)	62,600)	—)	—)
Obligation for future contribution to an equity affiliate	—)	—)	94,400)	94,400)	94,400)	67,500)
Obligations associated with Energy-from-Waste	—)	57,800)	63,300)	65,300)	—)	—)
Other	202,700)	179,300)	172,800)	206,900)	169,700)	137,600)
Other noncurrent liabilities	1,916,000)	1,712,400)	1,536,900)	1,611,900)	1,873,400)	1,556,500)
Deferred income taxes	962,600)	793,800)	775,100)	778,400)	767,100)	903,300)
Noncurrent liabilities	10,308,700)	5,733,600)	5,663,700)	5,792,700)	7,558,600)	6,408,900)
Total liabilities	12,725,400)	7,554,500)	8,002,000)	8,281,700)	10,841,900)	10,057,000)
Common stock, par value $1 per share	249,400)	249,400)	249,400)	249,400)	249,400)	249,400)
Capital in excess of par value	1,094,800)	1,070,900)	1,029,300)	1,001,100)	970,000)	904,700)
Retained earnings	14,875,700)	14,138,400)	13,409,900)	12,846,600)	10,475,500)	10,580,400)
Accumulated other comprehensive loss	(2,140,100)	(2,375,600)	(1,741,900)	(1,847,400)	(2,388,300)	(2,125,900)
Treasury stock, at cost	(2,000,000)	(2,029,500)	(2,089,200)	(2,163,500)	(2,227,000)	(2,359,600)
Total Air Products shareholders’ equity	12,079,800)	11,053,600)	10,857,500)	10,086,200)	7,079,600)	7,249,000)
Noncontrolling interests	363,300)	334,700)	318,800)	99,300)	133,800)	132,100)
Total equity	12,443,100)	11,388,300)	11,176,300)	10,185,500)	7,213,400)	7,381,100)
Total liabilities and equity	25,168,500)	18,942,800)	19,178,300)	18,467,200)	18,055,300)	17,438,100)

Based on: 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30).

The financial position of the company is characterized by a significant expansion of the total balance sheet between 2015 and 2020, growing from 17.4 billion USD to 25.2 billion USD. This growth is primarily driven by a substantial increase in long-term debt and a steady accumulation of shareholders' equity, reflecting a strategic shift in capital structure and sustained profitability.

Current Liabilities and Short-Term Debt Management: A general downward trend in current liabilities was observed from 2015 through 2019, decreasing from 3.6 billion USD to 1.8 billion USD before rebounding to 2.4 billion USD in 2020. This trend was largely influenced by a drastic reduction in short-term borrowings, which fell from 1.5 billion USD in 2015 to 7.7 million USD by 2020. This indicates a systemic move away from short-term financing in favor of other funding sources.
Long-Term Debt and Leverage Evolution: Noncurrent liabilities experienced a volatile trajectory, culminating in a sharp increase in 2020. Long-term debt, excluding the current portion, remained relatively stable or declined between 2016 and 2019, but surged from 2.9 billion USD in 2019 to 7.1 billion USD in 2020. This represents the single largest change in the liability structure, suggesting a major capital raising event or significant investment funding in the final year of the period.
Equity Growth and Retained Earnings: Total shareholders' equity demonstrated a consistent upward trajectory, rising from 7.2 billion USD in 2015 to 12.1 billion USD in 2020. This growth was primarily underpinned by retained earnings, which increased steadily from 10.6 billion USD to 14.9 billion USD over the six-year period. The consistent growth in retained earnings indicates strong internal capital generation and a capacity to fund operations and growth through earnings.
Other Noncurrent Obligations: Pension and postretirement benefits showed fluctuation, with a peak in 2016 before stabilizing. Asset retirement obligations exhibited a steady increase, growing from 106.5 million USD in 2015 to 236.2 million USD in 2020, reflecting the long-term nature of the company's industrial obligations. Additionally, the introduction of operating lease liabilities in 2020, totaling approximately 406.5 million USD across current and noncurrent categories, indicates a change in accounting standards or leasing activity.
Total Capitalization and Solvency: While total liabilities increased significantly in 2020 to 12.7 billion USD, the simultaneous growth in total equity to 12.4 billion USD helped maintain a balanced capital structure. The ratio of debt to equity shifted markedly in 2020 due to the long-term debt spike, moving from a position of equity dominance in 2019 to a more leveraged position by the end of the period.

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Air Products & Chemicals Inc. (NYSE:APD)

Balance Sheet: Liabilities and Stockholders’ Equity