Supplemental Information

9 Months Ended

Jun. 30, 2023

Disclosure Text Block Supplement [Abstract]

Supplemental Information

SUPPLEMENTAL INFORMATION

Related Party Transactions

We have related party sales to some of our equity affiliates and joint venture partners as well as other income primarily from fees charged for use of Air Products' patents and technology. Sales to and other income from related parties totaled approximately $105 and $290 for the three and nine months ended 30 June 2023, respectively, and approximately $75 and $200 for the three and nine months ended 30 June 2022, respectively. Sales agreements with related parties include terms that are consistent with those that we believe would have been negotiated at an arm’s length with an independent party. As of 30 June 2023 and 30 September 2022, our consolidated balance sheets included related party trade receivables of approximately $255 and $55, respectively.

Refer to Note 11, Debt, for information concerning debt owed to related parties.

Uzbekistan Asset Purchase

On 25 May 2023, we entered into an investment agreement with the Government of the Republic of Uzbekistan and Uzbekneftegaz JSC (“UNG”) to purchase a natural gas-to-syngas processing facility in Qashqadaryo Province, Uzbekistan, for $1 billion. Under the agreement, Air Products will acquire, own, and operate the facility and supply all offtake products to UNG under a 15-year on-site contract, with UNG supplying the feedstock natural gas and utilities.

We are accounting for the transaction as a financing arrangement because UNG has the right to reacquire the facility at the end of the contract term. Accordingly, progress payments of approximately $800, of which $600 was completed during the third quarter of fiscal year 2023, are reflected within "Financing Receivables" on our consolidated balance sheet as of 30 June 2023. The progress payments made during the third quarter are reflected within “Investment in financing receivables” on our consolidated statement of cash flows. We will complete our investment prior to facility on-stream, which is expected in 2024.

Changes in Estimates

Changes in estimates on projects accounted for under the cost incurred input method are recognized as a cumulative adjustment for the inception-to-date effect of such change. We recorded changes to project cost estimates that unfavorably impacted operating income by approximately $45 and $105 for the three and nine months ended 30 June 2023, respectively, and approximately $30 in the first nine months of fiscal year 2022.

Lessee Accounting

During the nine months ended 30 June 2023, we recorded noncash right-of-use asset additions of approximately $320, including a land lease associated with the NGHC joint venture. Refer to Note 3, Variable Interest Entities, for additional information.