Stock Analysis on Net

Air Products & Chemicals Inc. (NYSE:APD)

$22.49

This company has been moved to the archive! The financial data has not been updated since August 9, 2021.

Analysis of Geographic Areas

Microsoft Excel

Air Products & Chemicals Inc. operates in 3 regions: United States; China; and Other foreign operations.

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Area Asset Turnover

Air Products & Chemicals Inc., asset turnover by geographic area

Microsoft Excel
Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
United States
China
Other foreign operations

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 analysis of the annual geographic area asset turnover data reveals distinct trends and patterns across the United States, China, and other foreign operations from 2015 to 2020.

United States
The asset turnover ratio in the United States demonstrates a consistent downward trend over the observed period. Starting at 1.13 in 2015, the ratio steadily declines each year, reaching 0.73 by 2020. This represents a significant decrease, suggesting a reduction in efficiency in utilizing assets to generate sales within the U.S. market.
China
The asset turnover ratio in China shows relative stability initially but follows a declining trend from 2017 onwards. Beginning at 0.65 in 2015 and slightly increasing to 0.68 in 2016, it then decreases to 0.46 by 2020. The ratio remains below 0.7 throughout, indicating comparatively lower asset turnover in this market with a gradual worsening efficiency over time.
Other Foreign Operations
This category exhibits the highest asset turnover ratios amongst the three areas throughout the period. The ratio peaks at 1.36 in 2016 following an initial value of 1.09 in 2015. Although a gradual decline is observed afterward, the ratio remains relatively strong at 1.05 in 2020. This suggests that asset utilization outside of the United States and China is comparatively more effective and has been better maintained over time.

In summary, asset turnover ratios within the United States and China have experienced a noticeable decline over the analyzed years, signaling reduced efficiency in converting assets into sales. Conversely, other foreign operations maintain a comparatively higher and more stable turnover, despite a moderate decrease after 2016.


Area Asset Turnover: United States

Air Products & Chemicals Inc.; United States; area asset turnover calculation

Microsoft Excel
Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
Selected Financial Data (US$ in thousands)
Sales to external customers
Long-lived assets
Area Activity Ratio
Area asset turnover1

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).

1 2020 Calculation
Area asset turnover = Sales to external customers ÷ Long-lived assets
= ÷ =


The data reflecting the United States geographic area over the six-year period reveals several notable trends in sales, asset levels, and efficiency metrics.

Sales to External Customers

Sales exhibited a declining trend from 2015 through 2017, dropping from approximately $4.28 billion to $2.89 billion. Starting in 2018, sales showed a moderate recovery, increasing steadily to around $3.36 billion by 2020. Despite this rebound, the sales level in 2020 remained below the 2015 peak, indicating a partial recovery rather than a return to previous highs.

Long-lived Assets

Long-lived assets remained relatively stable from 2015 to 2016, with a slight decrease observed in subsequent years through 2017 and 2018. However, from 2019 onward, there was a significant increase, culminating in a sharp rise in 2020 to approximately $4.63 billion. This rise suggests substantial investment or capitalization of assets in the latest year, potentially connected to strategic expansion or upgrades.

Area Asset Turnover

The asset turnover ratio, which measures the efficiency of asset use to generate sales, consistently declined over the period. Starting at 1.13 in 2015, the ratio decreased steadily each year, reaching a low of 0.73 in 2020. This decreasing trend points to reduced efficiency in utilizing assets to produce sales, particularly notable given the increase in asset base in the most recent years.

In summary, the data indicates a contraction in sales during the mid-period followed by a moderate recovery. Concurrently, the asset base underwent significant growth in the later years, particularly in 2020, but asset utilization efficiency diminished throughout the entire period. The divergence between increasing assets and declining turnover suggests potential challenges in optimizing asset productivity or changing business dynamics within the United States geographic area.


Area Asset Turnover: China

Air Products & Chemicals Inc.; China; area asset turnover calculation

Microsoft Excel
Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
Selected Financial Data (US$ in thousands)
Sales to external customers
Long-lived assets
Area Activity Ratio
Area asset turnover1

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).

1 2020 Calculation
Area asset turnover = Sales to external customers ÷ Long-lived assets
= ÷ =


Sales to external customers
Sales demonstrated a mixed trend over the observed period. From 2015 to 2016, sales increased moderately, rising from $1,129,100 thousand to $1,176,200 thousand. However, there was a slight decrease in 2017 to $1,143,400 thousand. Starting in 2018, sales experienced a significant increase, reaching a peak of $1,730,200 thousand in 2019, before slightly declining to $1,719,700 thousand in 2020. Overall, the sales figures showed strong growth from 2017 onward, nearly doubling compared to 2015 levels.
Long-lived assets
Long-lived assets remained relatively stable between 2015 and 2017, fluctuating slightly around $1,730,000 thousand. In 2018, there was a marked increase in assets to $3,066,600 thousand, followed by continued growth in 2019 and 2020, reaching $3,719,400 thousand. This represents more than a doubling of long-lived assets from 2017 to 2020, indicating substantial capital investment or asset acquisition during this period.
Area asset turnover
The area asset turnover ratio exhibited a declining trend throughout the period. Beginning at 0.65 in 2015, the ratio increased marginally to 0.68 in 2016 but then decreased steadily to 0.66 in 2017, 0.52 in both 2018 and 2019, and further down to 0.46 in 2020. This trend suggests a reduced efficiency in generating sales from the assets located in this geographic area, potentially reflecting the rapid growth in long-lived assets outpacing sales growth.
Summary
The data reveals a pattern of significant asset growth from 2018 to 2020, more than doubling the base level seen in 2017. Sales figures grew notably during the same period, particularly between 2017 and 2019, before stabilizing. Despite rising sales, the asset turnover ratio declined consistently in recent years, indicating that the company’s efficiency in utilizing its assets to generate sales in the China geographic area has diminished. This could suggest that the recent investments in long-lived assets have not yet fully translated into proportional sales increases or that there may be an overcapacity relative to sales.

Area Asset Turnover: Other foreign operations

Air Products & Chemicals Inc.; Other foreign operations; area asset turnover calculation

Microsoft Excel
Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
Selected Financial Data (US$ in thousands)
Sales to external customers
Long-lived assets
Area Activity Ratio
Area asset turnover1

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).

1 2020 Calculation
Area asset turnover = Sales to external customers ÷ Long-lived assets
= ÷ =


Sales to External Customers
The sales figures demonstrate a general downward trend over the six-year period. Starting at approximately $4.49 billion in 2015, sales slightly increased to $4.56 billion in 2016, marking the peak within this timeframe. From 2017 onwards, sales consistently declined, reaching around $3.78 billion by 2020. This reflects an overall decrease of approximately 16% from the highest sales point in 2016.
Long-lived Assets
The value of long-lived assets shows fluctuation over the years. Initially, there is a significant decrease from $4.13 billion in 2015 to $3.35 billion in 2016. The asset base then stabilizes between 2016 and 2019, maintaining levels close to the $3.3 billion mark. In 2020, a notable increase occurs, with assets rising to about $3.61 billion, suggesting possible reinvestments or acquisitions in that year.
Area Asset Turnover Ratio
The asset turnover ratio, indicating sales efficiency relative to assets, shows an increasing trend from 1.09 in 2015 to a peak of 1.36 in 2016, reflecting improved utilization of assets during that period. Following this peak, the ratio gradually declines each year, reaching 1.05 by 2020. The steady decrease suggests diminishing efficiency in generating sales from the asset base over the latter part of the period.
Summary of Trends
Overall, the "Other foreign operations" segment experienced declining sales and asset turnover ratios after 2016, despite maintaining a relatively stable asset base until 2019, followed by an increase in assets in 2020. The reduction in sales combined with decreased turnover could imply challenges in market conditions or competitive pressures abroad. The increase in long-lived assets in 2020 has not yet translated into improved sales efficiency, which warrants further monitoring in subsequent periods.

Sales to external customers

Air Products & Chemicals Inc., sales to external customers by geographic area

US$ in thousands

Microsoft Excel
Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
United States
China
Other foreign operations
Total

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).


United States Sales Trend
Sales to external customers in the United States exhibited a downward trend from 2015 to 2017, decreasing from approximately $4.28 billion to $2.89 billion. This decline was followed by a modest recovery in 2018 and 2019, with sales increasing to around $3.15 billion and $3.35 billion respectively. In 2020, sales stabilized at approximately $3.36 billion, indicating a plateau after the prior recovery phase.
China Sales Trend
Sales in China demonstrated an overall upward trajectory over the observed period. Starting at about $1.13 billion in 2015, sales experienced moderate growth through 2016 and 2017. A more pronounced increase occurred in 2018 and 2019, reaching a peak close to $1.73 billion. In 2020, sales slightly declined but remained near the peak level at approximately $1.72 billion, signaling relatively stable high sales after significant growth.
Other Foreign Operations Sales Trend
Sales from other foreign operations showed a generally decreasing pattern. Beginning at roughly $4.49 billion in 2015, sales remained relatively steady into 2016, followed by a downturn from 2017 onward. By 2020, the sales had decreased to about $3.78 billion, marking a continuous decline for several years.
Total Sales Overview
Total sales to external customers reflected a declining trend from 2015 through 2017, diminishing from nearly $9.89 billion to $8.19 billion. Subsequent years saw a partial recovery in 2018 and a plateau thereafter, with total sales values stabilizing around the $8.85 to $8.93 billion range in 2019 and 2020. This pattern suggests the losses in the United States and other foreign operations were partially offset by growth in China.
Insights and Summary
The data indicates regional disparities in sales performance. The United States experienced a decline followed by stabilization, while China showed consistent growth, particularly after 2017. Other foreign operations faced a steady decline. Overall, despite challenges in key markets outside China, the total sales remained relatively stable in recent years, reflecting a shift in market dynamics and possible strategic focus on the Chinese market to mitigate losses elsewhere.

Long-lived assets

Air Products & Chemicals Inc., long-lived assets by geographic area

US$ in thousands

Microsoft Excel
Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
United States
China
Other foreign operations
Total

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 analysis of long-lived assets across geographic areas reveals varied trends over the six-year period ending September 30, 2020.

United States
Long-lived assets initially showed a marginal increase from approximately 3.78 billion USD in 2015 to about 3.78 billion USD in 2016, followed by a decline to 3.41 billion USD in 2017. Subsequently, there was a moderate recovery in 2018 and 2019, reaching 3.72 billion USD, culminating in a significant increase to 4.63 billion USD by 2020. This indicates a renewed investment or asset acquisition trend domestically in the final period.
China
Assets in China remained relatively stable around 1.73 billion USD between 2015 and 2017. A pronounced increase occurred from 2017 onward, nearly doubling by 2018 to approximately 3.07 billion USD, and further rising to 3.72 billion USD in 2020. This sharp escalation suggests substantial growth and asset accumulation in this region during the latter years.
Other Foreign Operations
Assets in other foreign operations displayed a decreasing trend from 4.13 billion USD in 2015 to approximately 3.29 billion USD in 2017. Post-2017, the values stabilized around the mid-3.3 billion USD range, with a modest increase to 3.61 billion USD by 2020. This reflects relative stabilization with slight recovery in assets outside the dominant geographic regions.
Total Assets
The total long-lived assets experienced a decline from nearly 9.64 billion USD in 2015 to 8.44 billion USD in 2017. Thereafter, a strong rebound occurred, with total assets increasing to nearly 12.0 billion USD by 2020. The recovery and growth in total assets in the final three years were mainly driven by significant increases in the United States and China.

Overall, while other foreign operations showed modest declines and stabilization, the primary growth drivers for the company's long-lived assets in recent years were the United States and China. These trends indicate strategic asset expansion in these key markets, particularly notable from 2018 to 2020.