You are given a text that consists of multiple sentences. Your task is to perform abstractive summarization on this text. Use your understanding of the content to express the main ideas and crucial details in a shorter, coherent, and natural sounding text. 
Text: Please read the forward looking statement disclosure on page two of the slides and note that it applies to all statements made during this teleconference.
Linde employees delivered another solid quarter, continuing Q2's record earnings per share performance, despite increasingly challenging market conditions.
Operating cash flow and return on capital reached record levels, and our project backlog nearly doubled, providing a strong foundation for high quality, long term growth.
We also stepped up our commitment to reducing our greenhouse gases emissions footprint, and Sanjiv will share that road map with you.
But frankly, this isn't something new.
It's what we committed to our shareholders since the merger and had been delivering on ever since, irrespective of the macro environment.
Most of you know this, but I think it bears repeating: our operating culture runs deep at Linde, our people take great pride in demonstrating continuous improvement across the key operating metrics in their business.
The best day of the month for our management team is when we review the operating performance of each of our regional business units.
This is what we do for fun in Danbury, among other things.
While I'm sure you've seen the announcement earlier this week where I will become the Chairman of the Board, and Sanjiv will become CEO effective March first.
His appointment is the culmination of a diligent three year succession planning process, in which Sanjiv clearly demonstrated he was the right choice to lead this company going forward.
I will continue to provide guidance, both from the perspective of a Director and a significant shareholder.
But my primary responsibility shifts to chairing the Board of Directors, while Sanjiv takes over day to day management of the company.
Supporting Sanjiv is a highly capable and experienced leadership team.
I have been CEO for 15 years, and I have never felt better about how the company is positioned.
Obviously, our strategy is working well and the team is executing at a high level.
Some say we are a well oiled machine.
We are a company for all seasons, and I'm confident Linde's best days lie ahead.
I'll now hand the call over to Sanjiv.
I'm honored to be given the opportunity to lead this outstanding company into the future.
I appreciate your confidence and support over the years.
Before I jump into the slides, I wanted to build on Steve's comment of a seamless leadership transition.
Here at Linde, we are proud of our industry leading performance, which starts with living our core values while maintaining a disciplined execution culture.
As CEO, I fully intend to build upon our foundation.
My focus will be on areas that are aligned with the interest of our shareholders: profitable growth, optimize the business, cash generation and, of course, the truth serum for our industry, ROC.
Linde will remain focused on the things that create value for Linde owners such as strong pricing and productivity culture, an active commitment to sustainability, a disciplined investment philosophy, a shareholder friendly capital policy, and of course, pursuing high quality and sustainable growth initiatives with emphasis on ROC.
Ultimately, it's about being the best performing industrial gases and engineering company in the world.
Stated differently, you can expect a seamless transition with minimal change.
Now with that said, let's move on to slide three for an update on our growth initiatives.
Last quarter, I mentioned some key growth drivers, including the secured project backlog, accretive base capex investments and the strength of our growth in low capital intensity areas such as healthcare, food and beverage, engineering and our packaged gas business.
Today, I'm happy to report that our project backlog has increased from $7.5 billion to $13.4 billion or up 81% sequentially from the last quarter.
You will recall, this backlog only includes contractually secured incremental growth with fixed payments to ensure targeted returns.
We're also beginning to see a return of the capital cycle, especially in upstream operations, such as natural gas production that bodes well for our overall pipeline of opportunities.
On top of that, the electronics sector continues to be very active.
We recently announced a $600 million investment, sale of gas investment indeed to supply a world class fab in Phoenix, Arizona.
This will supply only the first phase of this project, and we expect to see further opportunities as that area builds out.
Overall, I'm pleased to see how the entire Linde team has come together and is leveraging our combined strengths to secure high quality growth opportunities through our leading high density industrial gas network combined with the world class engineering capabilities.
This backlog, combined with our supply network density, enables profitable and secured growth for years to come.
Now before moving to the quarterly results, I want to update you on Linde's new and more ambitious greenhouse gas emission goals.
A good way to stop this is to first explain the role our products play in people's lives and the overall economy.
You'll find this on slide four.
We make products that are critical for society, products such as medical oxygen for hospitals, ultra high purity nitrogen for semiconductors, liquid nitrogen for food freezing, krypton to insulate windows and hydrogen to produce cleaner fuels to give you just a few examples.
In order to make these products, we expect to have a total of 39 million metric tons of Scope one and Scope two emissions this year.
As you know, the production of gases require significant amounts of electricity.
When such electricity is generated using hydrocarbons, we're penalized for those indirect emissions called Scope two emissions.
We also have Scope one emissions, which are significantly lower than our Scope two emissions, but are significant nonetheless.
Now these emissions are largely as a result of using natural gas to make hydrogen, which is used by refiners to produce cleaner fuels.
Our gases play a critical role in the economy.
In addition to saving lives, improving energy efficiency, increasing shelf life, our products also help our customers eliminate or reduce greenhouse gas emissions.
In 2020, we generated a total of 37 million metric tons of emissions to make products that helped our customers avoid more than twice our emissions or 85 million metric tons of CO2 equivalent.
In other words, without Linde's products, there would be significantly higher net carbon emissions in our world.
At Linde, we have been doing our part to support our planet for many decades, but we know we need to do more.
In 2019, we set a goal to reduce the carbon intensity of Linde 35% by 2028.
We are well ahead of that goal and expect to exceed it, which is, of course, good news.
But an intensity goal doesn't fully address the absolute Scope one and Scope two emissions.
So we are determined to continue on our mission of making our world more productive, enabling our customers to decarbonize and commit to reducing our own carbon footprint.
With that in mind, I'd like to announce Linde's new medium and long term emission goals, which you will find on slide five.
The first goal is to achieve a 35% reduction in our Scope one and Scope two emissions by the year 2035 or simply 35 by 35.
To achieve this goal, we must materially reduce our Scope one emissions, which are driven by hydrogen production.
We will do this by focusing our efforts on carbon capture and sequestration, developing blue and green hydrogen production and progressively transitioning to a zero emission fleet.
Our Scope two emissions are related to electricity consumption.
Today, we consume approximately 45 terawatt hours of power, a 1/3 of which is from renewable and low carbon sources.
In order to achieve the 35 by 35 goal, we will triple, triple our renewable and low carbon power sourcing by 2035 through new PPAs and by supporting renewable energy projects with offtake agreements and even co-investment.
To put this goal in perspective, the amount of renewable energy we were planned to purchase is equivalent of all the power consumed annually in New York City.
That's a big number.
Of course, in addition to that, we will continue improving the energy efficiency of our plants as well.
These goals are being embedded across the entire global organization, being reviewed as part of our operating rhythm and will be incorporated into our annual variable compensation.
This is what gives me the confidence in our ability to deliver these goals, which is no different than how we would approach anything of importance in our company.
Now in addition to the 35 by 35 goal, we are also committed to pursuing our goal of becoming climate-neutral by 2050.
We will do our part to achieve this goal, but we also need strong policy support and regulatory support.
Let me summarize this journey on slide six.
We have defined a road map to reach climate neutrality.
The road map is underpinned by numerous initiatives and milestones, which will be embedded into our operating system, providing us the greatest opportunity for success.
Going forward, we will continue to share our progress, ensuring accountability and transparency for our stakeholders.
Sales of $7.7 billion increased 12% over last year, and 1% from the second quarter.
Cost pass through, which represents the contractual billing of energy cost variances, primarily in the on site business, rose 3% over last year and 2% sequentially.
Recall that cost pass-through has no effect on profit dollars, but will impact profit margins as we gross up or down sales and variable costs.
Foreign exchange was a 2% tailwind versus prior year, but a 1% headwind sequentially, as most currencies have recently devalued against the U.S. dollar.
Excluding these items, underlying sales grew 11% over prior year and 1% sequentially.
The 8% volume increase over last year was broad based across all geographies and end markets, as we continue to see recovery from the pandemic.
Sequentially, volumes are flat as contribution from project start-ups were mostly offset by lower volumes in China.
Pricing levels are up 3% from last year and 1% from the second quarter, as we continue to adjust merchant and packaged gas product pricing in line with local inflation.
Note that some of these contracts have lagging recovery mechanisms, which may not take effect for two to six months, depending upon the terms and conditions.
Operating margin of 23.6% is 150 basis points above 2020, but 60 basis points below the high mark set in the second quarter.
Excluding the impact of cost pass-through, operating margin would have increased 220 basis points above last year and had a negligible decline sequentially.
As mentioned, merchant and package cost recovery can lag one to two quarters.
So going forward, I expect continued pricing momentum.
EPS of $2.73 is up 27% over last year from higher volumes and price over a relatively stable cost base.
As both Steve and Sanjiv mentioned, Linde has a strong productivity culture, which enables consistent profit growth, irrespective of the economic climate.
This is also evident in the 16.7% return on capital, which represents another record as profit continues to grow double digit percent over a flat capital base.
The reason we've been able to maintain such a steady capital base is due to a combination of disciplined capital management and healthy cash generation, which I'll cover on slide eight.
You can see to the left, our operating cash progression resulting in a record level of $2.6 billion in the third quarter.
The three main drivers are stronger earnings, timing benefits from last quarter and engineering contract prepayments.
In light of the record sale of plant backlog, I anticipate further project repayments into the next few quarters.
As far as how we allocated year to date cash, the pie chart to the right shows $2.3 billion invested into the business and $4.8 billion distributed back to shareholders through dividends and stock repurchases.
Note that investments exclude sale of plant since we are paid in advance for engineering projects, which means that we are committing much larger amounts toward contractually secured growth than what's shown on this chart.
In addition to generating significant surplus cash we have access to very attractive capital through the debt markets.
In September, we issued almost EUR two billion at five, 12 and 30 year maturities, with all-in coupons of 0%, 0.38% and 1%, respectively.
Overall, the combination of excess cash generation and low cost incremental debt gives us a high degree of confidence to maintain shareholder friendly allocation policies over the long term.
I'll wrap things up with guidance on slide nine.
The fourth quarter earnings per share guidance range of $2.60 to $2.70 is 13% to 17% above last year and 38% to 43% above 2019.
Consistent with prior quarters, we believe it's important to distinguish true multiyear growth from mere recovery of 2020 recessionary conditions.
Versus the third quarter, this range represents a sequential decrease due to normal seasonal declines plus an estimated 1% foreign currency headwind.
Underlying volumes are assumed to be roughly in line with the third quarter, but if current conditions hold, I'd expect to be at the upper end of this range.
This quarterly update results in a new full year guidance of $10.52 to $10.62, which represents a growth rate of 28% to 29% over 2020 and 43% to 45% over 2019.
In summary, another solid quarter despite some challenging conditions.
And regardless of the macro, we remain confident in Linde's ability to continue delivering industry-leading performance.

user
increased full-year 2021 adjusted earnings per share guidance to $10.52 - $10.62, representing 28% to 29% growth.
q3 operating profit margin 16.8%; adjusted operating profit margin 23.6%, up 150 basis points.
q3 sales $7.7 billion, up 12% versus prior-year quarter.
q3 operating cash flow $2.6 billion, up 36%.
outlook 2021: has updated its adjusted diluted earnings per share guidance to be in range of $10.52 to $10.62, up 43% to 45% versus 2019 and 28% to 29% versus prior year.
outlook 2021: guidance assumes 3% currency tailwind versus 2020.

assistant