Stock Analysis on Net
Stock Analysis on Net

Linde plc (NASDAQ:LIN)

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

Linde plc, balance sheet: goodwill and intangible assets

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Goodwill 26,751 25,817 27,038 28,201 27,019
Customer relationships 11,479 11,062 11,859 13,776 13,205
Brands/tradenames 2,609 2,565 2,685 2,895 2,764
Other intangible assets 1,913 1,697 1,629 1,697 1,612
Other intangible assets, cost 16,001 15,324 16,173 18,368 17,581
Accumulated amortization (3,602) (2,904) (2,371) (2,184) (1,444)
Other intangible assets, net 12,399 12,420 13,802 16,184 16,137
Goodwill and other intangible assets 39,150 38,237 40,840 44,385 43,156

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Item Description The company
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Linde plc goodwill decreased from 2021 to 2022 but then increased from 2022 to 2023 not reaching 2021 level.
Other intangible assets, net Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Linde plc other intangible assets, net decreased from 2021 to 2022 and from 2022 to 2023.
Goodwill and other intangible assets Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Linde plc goodwill and other intangible assets decreased from 2021 to 2022 but then slightly increased from 2022 to 2023.

Adjustments to Financial Statements: Removal of Goodwill

Linde plc, adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Adjustment to Total Assets
Total assets (as reported) 80,811 79,658 81,605 88,229 86,612
Less: Goodwill 26,751 25,817 27,038 28,201 27,019
Total assets (adjusted) 54,060 53,841 54,567 60,028 59,593
Adjustment to Total Linde Plc Shareholders’ Equity
Total Linde plc shareholders’ equity (as reported) 39,720 40,028 44,035 47,317 49,074
Less: Goodwill 26,751 25,817 27,038 28,201 27,019
Total Linde plc shareholders’ equity (adjusted) 12,969 14,211 16,997 19,116 22,055

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Linde plc, Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

Linde plc, adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Total Asset Turnover
Reported total asset turnover 0.41 0.42 0.38 0.31 0.33
Adjusted total asset turnover 0.61 0.62 0.56 0.45 0.47
Financial Leverage
Reported financial leverage 2.03 1.99 1.85 1.86 1.76
Adjusted financial leverage 4.17 3.79 3.21 3.14 2.70
Return on Equity (ROE)
Reported ROE 15.61% 10.36% 8.69% 5.29% 4.66%
Adjusted ROE 47.80% 29.18% 22.51% 13.08% 10.36%
Return on Assets (ROA)
Reported ROA 7.67% 5.21% 4.69% 2.83% 2.64%
Adjusted ROA 11.47% 7.70% 7.01% 4.17% 3.83%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Linde plc adjusted total asset turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Linde plc adjusted financial leverage ratio increased from 2021 to 2022 and from 2022 to 2023.
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Linde plc adjusted ROE improved from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Linde plc adjusted ROA improved from 2021 to 2022 and from 2022 to 2023.

Linde plc, Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Sales 32,854 33,364 30,793 27,243 28,228
Total assets 80,811 79,658 81,605 88,229 86,612
Activity Ratio
Total asset turnover1 0.41 0.42 0.38 0.31 0.33
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Sales 32,854 33,364 30,793 27,243 28,228
Adjusted total assets 54,060 53,841 54,567 60,028 59,593
Activity Ratio
Adjusted total asset turnover2 0.61 0.62 0.56 0.45 0.47

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Total asset turnover = Sales ÷ Total assets
= 32,854 ÷ 80,811 = 0.41

2 Adjusted total asset turnover = Sales ÷ Adjusted total assets
= 32,854 ÷ 54,060 = 0.61

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Linde plc adjusted total asset turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Total assets 80,811 79,658 81,605 88,229 86,612
Total Linde plc shareholders’ equity 39,720 40,028 44,035 47,317 49,074
Solvency Ratio
Financial leverage1 2.03 1.99 1.85 1.86 1.76
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets 54,060 53,841 54,567 60,028 59,593
Adjusted total Linde plc shareholders’ equity 12,969 14,211 16,997 19,116 22,055
Solvency Ratio
Adjusted financial leverage2 4.17 3.79 3.21 3.14 2.70

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Financial leverage = Total assets ÷ Total Linde plc shareholders’ equity
= 80,811 ÷ 39,720 = 2.03

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Linde plc shareholders’ equity
= 54,060 ÷ 12,969 = 4.17

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Linde plc adjusted financial leverage ratio increased from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income, Linde plc 6,199 4,147 3,826 2,501 2,285
Total Linde plc shareholders’ equity 39,720 40,028 44,035 47,317 49,074
Profitability Ratio
ROE1 15.61% 10.36% 8.69% 5.29% 4.66%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income, Linde plc 6,199 4,147 3,826 2,501 2,285
Adjusted total Linde plc shareholders’ equity 12,969 14,211 16,997 19,116 22,055
Profitability Ratio
Adjusted ROE2 47.80% 29.18% 22.51% 13.08% 10.36%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROE = 100 × Net income, Linde plc ÷ Total Linde plc shareholders’ equity
= 100 × 6,199 ÷ 39,720 = 15.61%

2 Adjusted ROE = 100 × Net income, Linde plc ÷ Adjusted total Linde plc shareholders’ equity
= 100 × 6,199 ÷ 12,969 = 47.80%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Linde plc adjusted ROE improved from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income, Linde plc 6,199 4,147 3,826 2,501 2,285
Total assets 80,811 79,658 81,605 88,229 86,612
Profitability Ratio
ROA1 7.67% 5.21% 4.69% 2.83% 2.64%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income, Linde plc 6,199 4,147 3,826 2,501 2,285
Adjusted total assets 54,060 53,841 54,567 60,028 59,593
Profitability Ratio
Adjusted ROA2 11.47% 7.70% 7.01% 4.17% 3.83%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROA = 100 × Net income, Linde plc ÷ Total assets
= 100 × 6,199 ÷ 80,811 = 7.67%

2 Adjusted ROA = 100 × Net income, Linde plc ÷ Adjusted total assets
= 100 × 6,199 ÷ 54,060 = 11.47%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Linde plc adjusted ROA improved from 2021 to 2022 and from 2022 to 2023.