UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 1-11037
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Praxair, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 06-124-9050
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
39 Old Ridgebury Road, Danbury, CT 06810-5113
- --------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(203) 837-2000
--------------------------------------------------
Registrant's telephone number, including area code
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X] No [ ]
At June 30, 1997, 158,011,767 shares of common stock ($.01 par value) of the
Registrant were outstanding.
<PAGE>
FORWARD-LOOKING STATEMENTS
The forward-looking statements contained in this document concerning, among
other things, projected capital spending, continuation of acquisition
activities in the packaged gases and surface technologies businesses, tax
planning initiatives and effective tax rates, and the timing, proceeds and
other terms of the disposition of assets held for sale, involve risks and
uncertainties, and are subject to change based on various factors, including
the impact of changes in worldwide and national economies, pricing fluctuations
in foreign currencies, changes in interest rates, the continued timely
development and acceptance of new products and processes, the impact of
competitive products and pricing, the ability to continue to develop potential
acquisition opportunities, and the impact of tax and other legislation and
regulation in the jurisdictions in which the company operates.
<PAGE>
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statement of Income - Praxair, Inc. and Subsidiaries
Quarter and Six Months Ended June 30, 1997 and 1996 (Unaudited)
Condensed Consolidated Balance Sheet - Praxair, Inc. and Subsidiaries
June 30, 1997 (Unaudited) and December 31, 1996
Condensed Consolidated Statement of Cash Flows - Praxair, Inc. and
Subsidiaries Six Months Ended June 30, 1997 and 1996 (Unaudited)
Notes to Condensed Consolidated Financial Statements - Praxair, Inc.
and Subsidiaries (Unaudited)
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
Signature
Exhibit Index
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PRAXAIR, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
(Millions of dollars, except per share)
Quarter Ended Six Months Ended
June 30, June 30,
---------------- -----------------
1997 1996 1997 1996
------- ------- ------- ------
SALES $1,178 $1,093 $2,336 $2,183
Cost of sales, exclusive of
depreciation and amortization ....... 681 631 1,346 1,260
Selling, general and administrative ... 165 168 332 348
Depreciation and amortization ......... 110 105 220 206
Research and development .............. 20 18 39 35
CBI integration charges ............... - - - 85
Other income-net ...................... 11 6 21 10
------- ------- ------- -------
OPERATING PROFIT ...................... 213 177 420 259
Interest expense ...................... 52 49 103 99
------- ------- ------- -------
INCOME BEFORE INCOME TAXES ............ 161 128 317 160
Income taxes .......................... 40 35 79 37
------- ------- ------- -------
INCOME OF CONSOLIDATED ENTITIES ....... 121 93 238 123
Minority interests .................... (17) (14) (34) (29)
Income from equity investments ........ 3 2 5 4
------- ------- ------- -------
NET INCOME ............................ $ 107 $ 81 $ 209 $ 98
PER SHARE:
Net Income ............................ $ 0.65 $ 0.50 $ 1.27 $ 0.63
Cash dividends ........................ $ 0.11 $ 0.095 $ 0.22 $ 0.19
The accompanying notes are an integral part of these financial statements.
<PAGE>
PRAXAIR, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Millions of dollars)
June 30,
1997 December 31,
(Unaudited) 1996
----------- ------------
ASSETS
Cash and cash equivalents ....................... $ 48 $ 63
Accounts receivable ............................. 913 914
Inventories ..................................... 308 312
Prepaid and other ............................... 203 377
-------- --------
TOTAL CURRENT ASSETS ....................... 1,472 1,666
Property, plant and equipment-net ............... 4,418 4,269
Other assets .................................... 1,649 1,603
-------- --------
TOTAL ASSETS ............................... $ 7,539 $ 7,538
LIABILITIES AND EQUITY
Accounts payable ................................ $ 327 $ 408
Short-term debt ................................. 1,333 1,520
Current portion of long-term debt ............... 48 42
Other current liabilities ....................... 502 580
-------- --------
TOTAL CURRENT LIABILITIES .................. 2,210 2,550
Long-term debt .................................. 1,755 1,703
Other long-term obligations ..................... 846 793
-------- --------
TOTAL LIABILITIES .......................... 4,811 5,046
Minority interests .............................. 598 493
Preferred stock ................................. 75 75
Shareholders' equity ............................ 2,055 1,924
-------- --------
TOTAL LIABILITIES AND EQUITY ............... $ 7,539 $ 7,538
The accompanying notes are an integral part of these financial statements.
<PAGE>
PRAXAIR, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
(Millions of dollars)
Six Months Ended June 30,
-------------------------
1997 1996
--------- ---------
OPERATIONS
Net income .......................................... $ 209 $ 98
Adjustments:
Depreciation and amortization ...................... 220 206
CBI integration charges ............................ (19) 69
Deferred income taxes .............................. 27 5
Gain on sale of fixed assets ....................... (4) (4)
Working capital .................................... (164) (105)
Long-term assets and liabilities ................... (16) (59)
Other non-cash charges ............................. 17 19
-------- --------
Net cash provided by operating activities........... 270 229
-------- --------
INVESTING
Capital expenditures ................................. (417) (437)
Investments .......................................... (34) (1,542)
Divestitures and asset sales ......................... 245 11
-------- --------
Net cash used for investing activities .............. (206) (1,968)
-------- --------
FINANCING
Short-term borrowings-net ............................ (187) 1,446
Long-term borrowings ................................. 140 280
Long-term debt repayments ............................ (74) (470)
Minority transactions and other ...................... 69 19
Issuances of common stock ............................ 75 541
Purchases of common stock ............................ (66) (7)
Cash dividends ....................................... (35) (29)
-------- --------
Net cash (used for) provided by financing activities. (78) 1,780
-------- --------
Effect of exchange rate changes on cash and
cash equivalents ..................................... (1) -
-------- --------
Change in cash and cash equivalents .................... (15) 41
Cash and cash equivalents beginning-of-year............. 63 15
-------- --------
Cash and cash equivalents end-of-period ................ $ 48 $ 56
The accompanying notes are an integral part of these financial statements.
<PAGE>
PRAXAIR INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Presentation of Condensed Consolidated Financial Statements
In the opinion of Praxair, Inc. (Praxair) management, the accompanying
condensed consolidated financial statements include all adjustments
necessary for a fair presentation of the results for the interim periods
presented. These adjustments consisted of only normal recurring
adjustments. The accompanying condensed consolidated financial statements
should be read in conjunction with the Notes to the Financial Statements
of Praxair, Inc. and subsidiaries in Praxair's 1996 Annual Report.
Certain prior years' amounts have been reclassified to conform to the
current years' presentation.
2. 1996 Acquisition of CBI Industries, Inc. (CBI)
ACQUISITION - On January 12, 1996, Praxair acquired approximately 94% of
the outstanding shares of CBI common stock and on March 13, 1996 Praxair
acquired the remaining common stock outstanding. The total purchase price
for CBI's common stock was $2.2 billion including assumed debt of $735
million. The results of CBI's operations have been included in the
consolidated financial statements effective January 1, 1996. (See Note 2
to Praxair's 1996 consolidated financial statements.)
ASSETS HELD FOR SALE - In connection with the acquisition, Praxair
determined that certain CBI businesses were not strategic to the combined
company and has sold or has taken actions to sell these businesses.
During the first half of 1997, Praxair sold 96% of Chicago Bridge & Iron
Company N.V. in an initial public offering transaction, and three small
businesses. Assets held for sale - net is included in the caption Prepaid
and other on Praxair's Condensed Consolidated Balance Sheet. Balances at
June 30, 1997 and December 31, 1996 were $73 million and $287 million,
respectively. During July, 1997, Praxair completed the sale of two
additional small businesses. The after-tax proceeds from these sales were
used by Praxair to repay outstanding short-term debt.
3. CBI Integration Charges
In March 1996, Praxair recorded a charge of $85 million pre-tax ($53
million after tax benefits of $30 million and minority interests of $2
million) for severance-related, lease termination and other exit costs
associated with the integration of the industrial gases businesses of CBI
and Praxair. (See Note 3 to Praxair's 1996 consolidated financial
statements.)
At June 30, 1997, most employee separations were completed and the
remaining accrual balance related to other exit costs was $32 million.
<PAGE>
4. Inventories
The following is a summary of Praxair's consolidated inventories:
(Millions of dollars)
June 30,
1997 December 31,
(Unaudited) 1996
----------- ------------
Raw materials and supplies...... $ 126 $ 118
Work in process................. 33 40
Finished goods.................. 149 154
------ ------
$ 308 $ 312
5. Shareholders' Equity
Changes in Shareholders' Equity were as follows:
(Thousands of shares)
Common Treasury
Stock Issued Stock
------------ ---------
Balance, January 1, 1997................ 157,501 12
Common stock activity (a) .............. 1,783 1,260
--------- ---------
Balance, June 30, 1997.................. 159,284 1,272
(Millions of dollars) Additional Cumulative
Common Paid-In Retained Translation Treasury
Stock Capital Earnings Adjustment Stock Total
------ ---------- -------- ----------- ------ -------
Balance, January 1, 1997..$ 2 $1,350 $ 698 $(126) $ - $1,924
Net income................ 209 209
Dividends - common stock.. (35) (35)
Common stock activity (a). 71 (62) 9
Translation adjustments... (52) (52)
--- ------ ----- ----- ------ -------
Balance, June 30, 1997....$ 2 $1,421 $ 872 $(178) $ (62) $2,055
=== ====== ===== ===== ====== =======
(a) Relates to issuances of common stock for the Dividend Reinvestment and
Stock Purchase Plan, and employee savings and incentive plans, and
purchases of common stock.
During the quarter and six months ended June 30, 1997, Praxair granted
options for 73,325 and 661,150 shares, respectively, of common stock
having option prices ranging from $43.88 to $55.50 per share, the closing
market price of Praxair's common stock on the day of the grants. At June
30, 1997 there were 10,861,414 shares under option at prices ranging from
$9.80 to $55.50 per share (weighted average of $23.15) of which options
for 7,415,614 shares were exercisable at prices ranging from $9.80 to
$34.13 per share (weighted average of $15.19). During the quarter and six
months ended June 30, 1997, 431,235 and 1,237,256 options were exercised,
respectively.
<PAGE>
6. Earnings Per Share
Earnings per share is computed by dividing net income for the period by
the weighted average number of common shares outstanding and common stock
equivalents (see Exhibit 11). Weighted average common shares and common
stock equivalents used to compute earnings per share amounts were as
follows:
Quarter ended June 30,1997................. 164,541,606
Quarter ended June 30,1996................. 161,680,019
Six-months ended June 30, 1997............. 164,471,563
Six-months ended June 30, 1996............. 155,080,980
RECENTLY ISSUED ACCOUNTING STANDARD ON EARNINGS PER SHARE
Statement of Financial Accounting Standards (SFAS) No. 128, "Earnings per
Share," issued in February 1997, establishes new standards for computing
and presenting earnings per share (EPS) effective for December 31, 1997
reporting. At that time, all previous EPS disclosures will be restated to
comply with the new standard. SFAS No. 128 requires a dual presentation
of basic and diluted EPS and a reconciliation of the numerator and
denominator amounts used in the computations. Basic EPS is new for
Praxair and is essentially net income divided by the weighted average
common shares outstanding during the period. Diluted EPS is consistent
with Praxair's current EPS disclosures which reflects the potential
dilution of outstanding stock options and other common stock equivalents.
The basic and diluted EPS, using the new standard are as follows:
Quarter Ended June 30, Six Months Ended June 30,
--------------------- -------------------------
1997 1996 1997 1996
------ ------ ------ ------
Basic EPS $0.68 $0.52 $1.32 $0.66
Diluted EPS $0.65 $0.50 $1.27 $0.63
7. Debt and Financial Instruments
Debt - The following is a summary of Praxair's outstanding debt at June
30,1997 and December 31, 1996:
(Millions of dollars) June 30,
1997 December 31,
(Unaudited) 1996
----------- ------------
Short-term:
Commercial paper....................... $ 821 $ 880
Other U.S. bank borrowings............. 134 318
Canadian borrowings.................... 95 167
South American borrowings.............. 222 106
Other International borrowings......... 61 49
------- -------
Total Short-term Debt.................... 1,333 1,520
<PAGE>
Long-term:
U.S.:
6.75% Notes due 2003................... 300 300
8.70% Debentures due 2022.............. 300 300
6.70% Notes due 2001................... 250 250
6.90% Notes due 2006................... 250 250
6.85% Notes due 2005................... 150 150
6.25% Notes due 2000................... 75 75
6.625% Notes due 2003................... 75 75
Other borrowings........................ 65 67
Canadian subsidiary borrowings............ 163 90
South American subsidiary borrowings...... 112 109
Other International borrowings............ 63 79
------ -------
1,803 1,745
Less: Current portion of long-term debt .. 48 42
------- -------
Total Long-term Debt...................... 1,755 1,703
------- -------
Total Debt................................ $3,136 $3,265
During the second quarter of 1997, Praxair's Canadian subsidiary exchanged
short term debt of $74 million dollars for long term debt.
Financial Instruments - The following table is a summary of the notional
amount of interest rate swap and cap agreements at June 30, 1997 and
December 31, 1996:
(Millions of dollars) June 30,
1997 December 31,
(Unaudited) 1996
----------- -------------
Maturing within one year:
Fixed Rate Swaps . . . . . . $ 600* $950*
Floating Rate Swaps . . . . $ 165 $ 15
Caps . . . . . . . . . . . . $ - $200
Maturing between 1-5 years:
Fixed Rate Swaps . . . . . . $100 $100
Floating Rate Swaps . . . . $ - $150
*Also, at June 30, 1997, the expiration dates for $500 million of these
swaps have effectively been extended to later dates within the one-year
maturity period through the use of forward starting fixed rate swaps.
At June 30, 1997, Praxair had $316 million of currency exchange forward
contracts outstanding ($262 million at December 31, 1996), primarily to
hedge balance sheet exposures. These contracts generally mature within one
to five years.
<PAGE>
Item 2.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Consolidated Results
The following provides summary data for the quarter and six months ended June
30, 1997 and 1996.
(Millions of dollars, except percent)
Percent
Quarter Ended June 30, 1997 1996 Change
- ------------------------- ------ -------- ---------
Sales................................. $1,178 $1,093 + 8%
Operating profit...................... $ 213 $ 177 + 20%
Interest expense...................... $ 52 $ 49 + 6%
Effective tax rate.................... 25% 27% - 2%
Net income............................ $ 107 $ 81 + 32%
Percent
Six Months Ended June 30, 1997 1996(a) Change
- ------------------------- ------ -------- --------
Sales................................. $2,336 $2,183 + 7%
Operating profit...................... $ 420 $ 259
Operating profit, excluding the 1996
CBI integration charges............. $ 420 $ 344 + 22%
Interest expense...................... $ 103 $ 99 + 4%
Effective tax rate.................... 25% 23%
Effective tax rate, excluding the 1996
CBI integration charges............. 25% 27% - 2%
Net income............................ $ 209 $ 98
Net income, excluding the 1996
CBI integration charges............. $ 209 $ 151 + 38%
(a) During the first quarter of 1996, Praxair recorded a charge of $85 million
pre-tax ($53 million after tax) to cover CBI integration costs (see Note 3
to Praxair's 1996 consolidated financial statements).
The sales growth for the quarter and six months ended June 30, 1997, of 8% and
7%, respectively, was predominately due to increased sales volumes and the
effect of newly acquired packaged gases' and Surface Technologies'
subsidiaries. This increase was partly offset by modest pricing decreases and
unfavorable currency translation effects. Surface Technologies posted record
sales, increasing approximately 23% for the quarter and 21% for the six month
period primarily due to volume growth and acquisitions.
The operating profit growth of 20% for the quarter ended June 30, 1997 and 22%
for the six months ended June 30, 1997 (excluding the 1996 CBI integration
charges), was primarily due to the sales growth and productivity gains
associated with the integration of the Liquid Carbonic business. Increased
depreciation and amortization reflected new projects coming on-stream, as well
as packaged gases' and Surface Technologies' acquisitions. Selling, general
and administrative expenses decreased primarily due to productivity
improvements and cost synergies associated with the integration of the Liquid
Carbonic business.
<PAGE>
Interest expense increased for both the quarter and six month periods due to
higher debt levels. The effective tax rate for both the quarter and six month
period was 25%, a 2% decrease from the 1996 effective tax rate (excluding the
tax benefit associated with the CBI integration charges). This decrease is due
primarily to planned tax synergies.
Net Income for the quarter and six months ended June 30, 1997 increased over
the 1996 amounts (excluding the CBI integration charges) due principally to
higher operating profit and the lower effective tax rate, partially offset by
negative currency translation effects.
The number of employees at June 30, 1997 was approximately 25,200 which, when
adjusted for acquisitions, reflects a decrease of approximately 400 from
December 31, 1996. The decrease is principally the result of the integration
of the Liquid Carbonic business and other cost improvement efforts partially
offset by the addition of employees to support volume growth.
Segment Discussion
This summary of Sales, Operating profit and Operating profit excluding the 1996
CBI integration charges by geographic segment provides a basis for the
discussion that follows:
(Millions of dollars)
Quarter Ended June 30, Six Months Ended June 30,
1997 1996 1997 1996
------- ------- ------ -------
SALES
United States....... $ 591 $ 529 $1,179 $1,051
South America....... 249 241 497 484
Europe.............. 155 153 305 308
Canada, Mexico,
Asia and Other... 183 170 355 340
------- ------- ------- -------
$1,178 $1,093 $2,336 $2,183
OPERATING PROFIT
United States....... $ 117 $ 90 $ 229 $ 132
South America....... 50 46 102 81
Europe.............. 29 32 58 57
Canada, Mexico,
Asia and Other... 22 16 42 7
Corporate........... (5) (7) (11) (18)
------- ------- ------- -------
$ 213 $ 177 $ 420 $ 259
OPERATING PROFIT
EXCLUDING 1996 CBI
INTEGRATION CHARGES
United States....... $ 117 $ 90 $ 229 $ 169
South America....... 50 46 102 94
Europe.............. 29 32 58 61
Canada, Mexico,
Asia and Other... 22 16 42 35
Corporate........... (5) (7) (11) (15)
------- ------- ------- -------
$ 213 $ 177 $ 420 $ 344
<PAGE>
United States
Strong volume growth and the effect of newly acquired package gases' and
Surface Technologies' subsidiaries accounted for the sales increase for the
quarter and six months ended June 30, 1997 as compared to the 1996 periods.
For the quarter and six month periods, U.S. industrial gases volumes increased
8% and 7%, respectively.
Operating profit improved 30% for the quarter and 36% for the six month period
(excluding the 1996 CBI integration charges) as compared to the 1996 periods.
Operating margin for the quarter increased to 19.8% from 17.0% in 1996. The
improvement in both periods is due primarily to the increased sales, cost
synergies associated with the integration of the Liquid Carbonic business,
higher profitability in the Surface Technologies' business and other cost
improvements.
South America
Sales for the quarter and six months ended June 30, 1997 increased 3%, as
compared to the 1996 periods, primarily due to sales volume growth partly
offset by unfavorable pricing and currency translation effects.
Operating profit for the quarter and six months ended June 30, 1997 increased
9% compared to the 1996 periods (excluding the CBI integration charges). This
was due to the increased sales and cost improvements partly offset by
unfavorable currency translation effects and higher energy and distribution
costs.
Europe
Sales for the quarter and six months ended June 30, 1997 increased 1% and
decreased 1%, respectively, as compared to the 1996 periods. The increase for
the quarter was due primarily to volume increases and increased sales
associated with Surface Technologies' acquisitions mostly offset by unfavorable
currency translation effects. The decrease for the six month period was
predominately due to unfavorable currency translation effects mostly offset by
volume growth and the increased sales associated with the Surface Technologies'
acquisitions. Excluding the currency translation effects for the quarter and
six months ended June 30, 1997, sales increased by 12% and 8%, respectively.
Operating profit for the quarter and six months ended June 30, 1997 decreased
9% and 5%, respectively, as compared to the 1996 periods (excluding the CBI
integration charges). Excluding the currency translation effects for the
quarter and six months ended June 30, 1997, operating profit increased 3% and
8%, respectively, primarily due to increased volumes and Surface Technologies'
acquisitions.
Canada, Mexico, Asia and Other
Sales for the quarter and six months ended June 30, 1997 increased 8% and 4%,
respectively, as compared to the 1996 periods, due to volume growth in Mexico
and Asia and pricing improvement in Mexico partly offset by unfavorable
currency translation effects.
Operating Profit for the quarter and six months ended June 30, 1997 increased
38% and 20%, respectively, as compared to the 1996 periods (excluding the CBI
integration charges), primarily due to the sales growth and synergies realized
from the integration of the Liquid Carbonic business in Canada. This was partly
offset by increased business development costs in Asia.
<PAGE>
Liquidity, Capital Resources and Other Financial Data
Cash Flow From Operations
Cash flow from operations in the first six months of 1997, as compared to the
same period in 1996, increased from $229 million to $270 million, primarily due
to increased net income partly offset by payments related to the CBI
integration and prior years' incentive compensation programs. Excluding the
incentive compensation payments, working capital remained consistent with the
first six months of 1996.
Investing
Cash flow used for investing in the first six months of 1997 totaled $206
million versus an unusually high $1,968 million in 1996. This decrease was due
primarily to the 1996 acquisition of CBI and the proceeds received in the
current quarter on the initial public offering of Chicago Bridge & Iron
Company, N.V. (see Note 2 to the condensed consolidated financial statements).
Construction expenditures for the first six months of 1997 totaled $417
million, down $20 million from the corresponding period in 1996, largely due to
the timing of cash payments.
Investment expenditures for the first six months of 1997 totaled $34 million
primarily relating to investments in India, a Surface Technologies' acquisition
in the United Kingdom and the continuation of packaged gases' acquisitions in
North America.
On a worldwide basis, construction and investment expenditures for the full
year 1997 are expected to be approximately $1 billion primarily from growth
opportunities in the United States, South America, Europe and Asia and the
continuation of Praxair's packaged gases and Surface Technologies acquisition
strategies.
Financing
At June 30, 1997, Praxair's total debt outstanding was $3,136 million, a
decrease of $129 million versus December 31, 1996. In March of 1997, a
wholly-owned subsidiary issued preferred shares for $96 million and the
proceeds were used to repay short-term debt. Also during the second quarter of
1997 a Canadian subsidiary of Praxair refinanced $74 million of short-term debt
on a long-term basis.
Praxair's debt-to-capital ratio was reduced from 56.7% at December 31, 1996 to
53.5% at the end of the current quarter. As of June 30, 1997, there were no
borrowings under Praxair's $1.5 billion U. S. bank credit facility.
Recently Issued Accounting Standard on Earnings per Share
See Note 6 to the condensed consolidated financial statements.
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
Exhibits
11. Computation of Earnings per Share
27. Financial Data Schedule
Reports on Form 8-K
Non-Applicable
<PAGE>
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PRAXAIR, INC.
-------------
(Registrant)
Date: August 6, 1997 By: J. ROBERT VIPOND
------------------------ -----------------------------
J. ROBERT VIPOND
Vice President and Controller
(On behalf of the Registrant
and as Chief Accounting Officer)
<PAGE>
Exhibit Index
-------------
Exhibit No.
- -----------------------------------------------------------------------------
11. Computation of Earnings per Share
27. Financial Data Schedule
Exhibit 11
PRAXAIR, INC. AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER SHARE
(Millions of dollars except share and per share amounts)
Quarter ended June 30, Six Months ended June 30,
------------------------ -------------------------
1997 1996 1997 1996
----------- ----------- ----------- -----------
Net income $ 107 $ 81 $ 209 $ 98
Weighted average common
shares and common
stock equivalents:
Weighted average common
shares outstanding 158,275,940 155,307,282 158,198,456 148,734,209
Dilutive effect of
convertible debt 154,378 154,378 154,378 154,378
Dilutive effect of
stock options 6,111,288 6,218,360 6,118,729 6,192,393
----------- ----------- ----------- -----------
164,541,606 161,680,019 164,471,563 155,080,980
Earnings per share $ 0.65 $ 0.50 $ 1.27 $ 0.63
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 48
<SECURITIES> 0
<RECEIVABLES> 945
<ALLOWANCES> 32
<INVENTORY> 308
<CURRENT-ASSETS> 1472
<PP&E> 7797
<DEPRECIATION> 3379
<TOTAL-ASSETS> 7539
<CURRENT-LIABILITIES> 2210
<BONDS> 1755
75
0
<COMMON> 2
<OTHER-SE> 2053
<TOTAL-LIABILITY-AND-EQUITY> 7539
<SALES> 2336
<TOTAL-REVENUES> 2336
<CGS> 1346<F1>
<TOTAL-COSTS> 1346<F1>
<OTHER-EXPENSES> 220<F1>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 103
<INCOME-PRETAX> 317
<INCOME-TAX> 79
<INCOME-CONTINUING> 238
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 209
<EPS-PRIMARY> 1.27
<EPS-DILUTED> 0
<FN>
<F1>Cost of Goods Sold and Total Costs are exclusive of depreciation and
amortization which is shown on the Other Expense line in the Financial Data
Schedule.
</FN>
</TABLE>
