Chief Executive Officer and Member of the Board of Directors at Linde
Thanks, Juan, and good morning, everyone. I'd like to start by addressing the $1 billion charge this quarter, primarily related to deconsolidating our Russian subsidiaries. Impairing assets is not something we take likely. However, the current situation in Russia is unprecedented with the extraordinary sanctions and capital restrictions. And while deconsolidation means we will not report Russian results going forward, we are actively working to safely and economically scale back operations. We fully intend to recover value for these assets, including potential divestitures, but it will take some time. Despite this noncash accounting charge, the global business continues to be resilient and performed quite well in the second quarter with strong pricing, solid cash flows and margins expanding sequentially and year-on-year, excluding cost pass-through. slide three demonstrates the defensive nature of our model. Now it may look familiar since many of these elements were presented in the second quarter of 2020.
The world may change, but our business model does not. We've been around for well over 100 years and through that demonstrated our resiliency during some of the most difficult periods in modern history. Approximately 2/3 of the business is protected through contractual fixed payments, such as facility fees and rent; and sales to resilient end markets like food and beverage, health care and electronics. This portfolio provides tremendous downside protection during typical times like the early 2000 recession, the great financial crisis, the 2020 pandemic and, of course, now in 2022. In addition, strong cash generation coupled with relentless price and cost management support the business when volumes contract. And of course, we can benefit from a recovery as demonstrated after each recession. These facts apply to all geographic segments, including EMEA, where there appears to be some potential investor misconceptions around our business. So you can see on the bottom right our exposure to EMEA and some additional color, specifically to Germany. We run our business in Europe like anywhere else in the world, safely, reliably and in a manner to contractually limit our financial exposure to customer volatility.
Now I'm not going to speculate what will happen in Europe regarding the energy situation. But I have confidence in our business model and contracts that we can weather challenges, and we will capitalize on opportunities that may lie ahead. Now before I hand it off to Matt, I'd like to provide some color on end markets by segment. slide four shows our organic growth is still quite positive across all end markets with the exception of health care, which is due to lapping COVID-related oxygen volumes in developing nations. Overall growth is driven by pricing action, project backlog even as base volumes are relatively stable, although underlying trends by geographic segments vary a little. Let me start off with the EMEA region since it seems to be getting most press recently. Volumes were down 1% from last year and flat sequentially, while price increased 12% and 3%, respectively. The team has done a great job pricing inflation while keeping a tight lid on costs, and I fully expect this to continue.
On-site volumes have been quite stable from a combination of highly competitive top-tier customer base and strong contracts. Merchant and packaged are slightly down as a reduction in COVID oxygen and lower manufacturing volumes more than offset growth in food and beverage, metals and mining and electronics. So far in July, we haven't seen any material change from June trends despite certain countries navigating their energy challenges. You will recall, in the second quarter of 2020, eurozone industrial production levels dropped roughly 20% due to COVID lockdowns. At that time, our EMEA segment organically declined only 7%. And since that time, the EMEA segment operating profit has grown approximately 80%. In other words, the EMEA business has successfully navigated unprecedented economic shocks in the past, and I see no reason why that won't continue going forward. The APAC segment had another solid quarter despite COVID lockdowns in China. Volumes increased 3% from prior year and 5% sequentially, while prices improved 5% and 1%. On-site customers across all end markets continue to run steady, including China. We saw similar trends in past recessions, which speaks to the quality of our customer base.
Now China merchant was weaker from the production curtailment of small- to medium-sized customers, which was partially offset by merchant growth in other countries as well as higher packaged gas volumes, especially our specialty gases used in electronics such as helium, neon and xenon. In July, China merchant volumes have recovered to levels more consistent with normal run rate as we've been seeing -- we haven't been seeing material COVID impact at this time. I do expect some volume ups and downs in the second half, but that should smooth out by the end year. Aside from China, organic growth across Korea, South Pacific, South and Southeast Asia remain healthy from a combination of project start-ups, pricing actions, and of course, our capability to supply gases across all three supply modes. Our largest segment, the Americas has some of the best growth trends and opportunities for the near term. Organic growth of 9% from the last year includes 3% volume and 6% price. All major end markets have expanded, led by food and beverage, electronics, manufacturing, chemicals and energy, excluding Latin American health care trends related to COVID.
In the U.S., our integrated model across all three supply modes enables reliable and seamless gas supply for all customers regardless of size or end market. In fact, our U.S. packaged gas business has been one of our fastest-growing businesses with underlying sales up 16% from prior year led by aerospace, construction, electronics and met fab. The underlying trend appears stable in July, although we expect some normal seasonal slowing for the summer holidays. Also, we continue to see more project backlog opportunities in the U.S. than anywhere else. Recent wins for electronics have been the largest driver, but progress on potential new U.S. Gulf Coast projects, especially for blue hydrogen are encouraging. And as I look at our overall current sale of gas backlog report, there are several projects we expect to sign before the year-end, which could take this number close to the $4 billion mark, even after starting up close to $1 billion in projects during the course of the year. Now I'd also like to highlight that we recently issued our annual sustainability report, which provides a comprehensive view of our SDG-based initiatives and tracks our progress.
I'm pleased to see that in this quarter we reported a reduction of 31% on our GHG emissions versus the 2018 baseline, well ahead of our projections to reach our target of 35% reduction by 2028. But we realized that an intensity goal was not enough. And therefore, last year, we communicated our ambitious 35 by 35 goal. As you know, we're committed in reducing absolute greenhouse gas emissions 35% by the year 2035, on the way to becoming climate-neutral by 2050. As you'd expect, our 35 by 35 target is science-based and aligned with the Paris accord goal. Overall, our technical capability, unrivaled network density, disciplined operating culture and a committed team allows us to quickly capitalize on any growth opportunities that meet our investment criteria. Now some investors mistakenly look at one or two countries in our portfolio and come to conclusions about growth prospects of profitability. But what they miss is our ability to capture that growth anywhere in the world while simultaneously rightsizing the businesses in an efficient manner. This ability has enabled us to consistently deliver double-digit EPS growth, and this year is no different. The Linde model is well suited for a fast-changing world, and our performance will continue to demonstrate its resilience. I'll now turn the call over to Matt to walk through the financial numbers.