Business and Asset Actions

6 Months Ended

Mar. 31, 2025

Restructuring and Related Activities [Abstract]

BUSINESS AND ASSET ACTIONS

Our consolidated income statements for the three and six months ended 31 March 2025 and 2024 include charges for business and asset actions of $2,934.7 ($2,290.6 attributable to Air Products after tax) and $57.0 ($43.8 after tax), respectively, for the strategic business and asset actions described below. These charges were not allocated to our reportable segments.

Project Exit Costs

During the second quarter of fiscal year 2025, our Board of Directors and Chief Executive Officer initiated a project review in an effort to streamline our backlog and allow us to focus resources on projects that we believe will enhance value for our shareholders. In connection with this review, we decided to exit various projects related to clean energy generation and distribution.

As a result of these decisions, we recorded project exit costs of $2,861.8 and $6.8 through operating loss and equity affiliates' income, respectively. The majority of these costs related to projects in the Americas segment. The charge reflected in operating loss primarily includes the write down of project assets to their estimated net realizable value as well as estimated costs required to terminate various contractual commitments. The non-cash portion of this charge totaled approximately $2.4 billion, which was largely attributable to plant and equipment and other noncurrent assets associated with the sustainable aviation fuel expansion project with World Energy. The $6.8 recorded to equity affiliates' income reflects an other-than-temporary impairment of a joint venture in China that had been formed to develop clean hydrogen infrastructure in the region. The amount of these charges attributable to our noncontrolling partners was $3.5.

We expect cash expenditures associated with these actions to total approximately $500, of which approximately $90 was paid during the second quarter of fiscal year 2025. This estimate primarily reflects amounts to settle open purchase commitments, customer contracts, and expected asset retirement obligations. The remaining amount accrued on our consolidated balance sheet as of 31 March 2025 is reflected within "Payables and accrued liabilities".

Our estimates related to exiting these projects, including the net realizable value of assets to be disposed and expected future cash obligations, reflect our best judgment based on information available at the time the project exit costs were recorded. Final settlement of these items may differ materially from our current estimates, which could impact our consolidated financial statements in future periods. Additionally, while we expect to complete exit activities within the next twelve months, we cannot predict the occurrence of future events and circumstances that could extend this process beyond one year in certain cases.

Global Cost Reduction Plan

We initiated a global cost reduction plan in June 2023 that provides severance and other postemployment benefits to employees identified for involuntarily separation. Benefits provided under the plan are calculated according to our ongoing benefit arrangements. During the second quarter of fiscal year 2025, we committed to taking additional actions under the plan and recorded related separation costs of $66.1. Our consolidated income statement for the comparative period reflects costs of $57.0 for actions identified during the second quarter of fiscal year 2024. Costs incurred since the plan was initiated in 2023 total $150.1 for approximately 2,400 employees globally.

As of 30 September 2024, the liability for unpaid benefits reflected within "Payables and accrued liabilities" on our consolidated balance sheet was $34.0. The table below reconciles this balance to the remaining liability as of 31 March 2025:









Amount accrued as of 30 September 2024			$34.0
Charge for severance and other benefits			66.1
Cash payments			(23.9)
Currency translation adjustment			(0.9)
Amount accrued as of 31 March 2025			$75.3

The remaining liability as of 31 March 2025 primarily relates to employees identified during the second quarter of fiscal year 2025. We expect implementation of these actions to be substantially complete by the end of the second quarter of fiscal year 2026. However, position eliminations are subject to legal requirements that vary by jurisdiction, which may extend this process beyond one year in certain cases.