Air Products and Chemicals, Inc.

Good morning and welcome to Air Products and Chemicals' third quarter earnings release call. Today's call is being recorded at the request of Air Products. Please note that the presentation and the comments made on behalf of Air Products are subject to copyright by Air Products and all rights are reserved. Beginning today's call is Mr. Simon Moore, Vice President of Investor Relations.

Thank you, Leanne. Good morning, everyone. Welcome to Air Products' third quarter 2020 earnings results teleconference. This is Simon Moore, Vice President of Investor Relations. I am pleased to be joined today by Sefi Ghasemi, our Chairman, President, and CEO, Scott Krakow, our Executive Vice President and Chief Financial Officer, and Sean Major, our Executive Vice President, General Counsel, and Secretary. After our comments, we will be pleased to take your questions. Our earnings release and the slides for this call are available on our website at airproducts.com. This discussion contains forward-looking statements. Please refer to the forward-looking statement disclosure that can be found in our earnings release and on slide number two. In addition, throughout today's discussion, we will refer to various financial measures. Unless we specifically state otherwise, when we refer to earnings per share, EBITDA, EBITDA margin, and ROCE, both on a company-wide and segment basis, we are referring to our adjusted non-GAAP financial measures. adjusted earnings per share, adjusted EBITDA, adjusted EBITDA margin, and return on capital employed. Reconciliations can be found on our website in the relevant earnings release section. Now, I'm pleased to turn the call over to Safey.

Thank you, Simon, and good morning, everyone. As always, we thank you for taking time from your busiest schedule to be on our call today. Before we talk about our result this quarter, please turn to slide number three. As I said last quarter, the true character and leadership of individuals and companies are revealed during times of crisis. And unfortunately, this crisis continues at different levels in different places around the world. Our number one priority has been and will continue to be the safety and well-being of our people. We have provided all the necessary protective equipment and instituted protocols focused on the safety and health of our people. I want to thank our employees for following these procedures and working hard to serve our customers and their challenging conditions. In addition, as we mentioned last quarter, to ensure the peace of mind during this time of highest stress with COVID-19, we have not reduced the staff nor cut everybody's salaries. Our people are doing a great job in keeping all of our 750 plants running around the world. All of our corporate and business functions are running smoothly. We continue to win mega projects around the world and serve our customers and deliver good results despite the significant crisis facing our world. Our robust business model is proving its resilience globally. Our on-site business remains a stadium. In addition, We have maintained our focus on pricing discipline despite the lower volumes, and as you can see, our merchant businesses delivered improved pricing in all of our regions. Our business model supports and enables our strong financial position, and we successfully accessed the debt markets in April to ensure they are ready for our exciting growth opportunities, which there are plenty of. We continue to execute on our growth opportunities, including the $7 billion carbon-free hydrogen project we announced earlier in July, and the $2 billion coal-to-methanol project in Indonesia. We remain confident and optimistic it can successfully deploy a very strong balance sheet and ongoing cash flow to create significant value for our shareholders. As Scott will explain in more detail later, we set a goal for ourselves in 2018 to commit $15 billion of growth projects by end of 2022. We are actually two and a half years ahead of the schedule And as of now, we have already committed almost $16 billion. A great job for our business development team around the world. And while we are proud of succeeding our goal, we still have substantial capacity and projects for additional projects to continue our growth path. Please now turn to slide number four. I'm pleased that our team stayed focused on working safely throughout these challenging operating conditions. Look at the slide number five, which is the goal we set for ourselves in 2014. I am proud to say that today Air Products is the safest and most profitable industrial gas company in the world. The slide number six, We have showed you many times before and we continue to believe in our management philosophy that cash is king and that prudent capital allocation is one of the most important jobs of any CEO. Slide number seven lays out our five-point strategy moving forward with an emphasis on our higher purpose as a company. Now please turn to slide number eight. There you can see the exciting, innovative carbon-free hydrogen project we announced a few weeks ago. This is a unique world-class project to produce carbon-free hydrogen, zero carbon, zero footprint carbon hydrogen for the global markets. Air Products, Neom, and Aqua Power will invest about $5 billion to produce green ammonia from wind and solar power in Neom, Saudi Arabia. Air Products will take all the green ammonia and invest an additional $2 billion to develop the infrastructure to convert the ammonia to carbon-free hydrogen and deliver it to bus and truck depots around the world. Therefore, air products overall investment in the total project will be about 3.7 billion, and we expect the financial returns to exceed our previous commitments. This project is a true game changer for the carbon-free hydrogen market, which, as we have always said, we expect to grow significantly in the next decade, and we are positioning air products to continue to be the leader in the hydrogen space. On slide number nine, you can see another great project, our $2 billion investment in Indonesia to gasify coal to methanol. Air products will take coal from Bakri and Ithaca and provide methanol under a long-term on-site business model. Once again, This demonstrates the expansion of our on-site business model, enabling us to offer customers a one-stop and complete solution, providing the products they need from the feedstocks that they have. The fundamental drivers of this project are the national security and energy independence policies of the government of Indonesia, and we expect to do more projects like this in Indonesia. Please turn to slide number 10, our gasification strategy. All the projects you see here continue to move forward. There are fundamental drivers creating significant growth opportunities in gasification. Countries and large companies around the world continue to focus on gasification to utilize the abundant natural resources they have to produce chemicals, transportation fuels, and energy in a sustainable manner. We continue to make progress on our important $12 billion Gazan gasification project for Saudi Aramco. Despite the current challenging times, I am very happy to report today that we have now launched the $7 billion financing required for this project, and we expect to close the transaction in October of 2020. Scott will have some more to say about this thing in his portion. As I'm sure the investors and analysts will notice, we have removed the YK project from our project list and our backlog. This was a large coal gasification project in China. We have always told investors over the past two years that we will only do this project if we can get formal allocation of coal reserves dedicated entirely to this specific project. We have now come to the conclusion that this might not happen in the near future. It might happen later, but it's not happening in the near future. And as a result, we are removing this project from our backlog. If we ever get the allocation, then we can add it to our backlog. But right now, it is not appropriate to count on it. Now, please, to slide number 11. Thanks to the hard work of our team and the strength of our business model, our EBITDA margin remained over 40%, which is up 1,700 basis points from early 2014. Now, I would like to turn the call over to Mr. Scott Krakow, our Executive Vice President and Chief Financial Officer, to provide a financial overview. Scott?