Air Liquide Sa · EURONEXT:AI
Air Liquide Sa — H1 2023 Earnings Presentation
39 slides from Air Liquide Sa's earnings presentation, Jul 27, 2023
Slide 1: H1 2023 Results
H1 2023 Results François Jackow, Chief Executive Officer Jérôme Pelletan, Chief Financial Officer Pascal Vinet, Executive Vice President Marcelo Fioranelli, Group Vice President Paris, July 27, 2023 1 H1 2023 Results - July 27, 2023
Slide 2: Delivering Strong Performance, Building the Future
01 Delivering Strong Performance Building the Future François Jackow - Chief Executive Officer 2 THIS DOCUMENT IS PUBLIC H1 2023 Results - July 27, 2023
Slide 3: H1 2023: Reinforcing our Model
H1 2023: Reinforcing our Model Strong Performance Building the future Comparable Group OIR Investment Cash Flow(2) Sales growth margin(1) Backlog 5 + % + 80 + 13% € 3.5 bps bn In line with CO2 trajectory (1) Operating Income Recurring on Sales excluding energy passthrough impact (2) Growth of Cash F
Slide 4: 3 Levers Driving Operational Excellence
3 Levers Driving Operational Excellence H1 2023 figures Portfolio Pricing Efficiencies Management Performance Mindset 11% 24% (1) ■ 9 acquisitions + + ■ 2 divestitures (1) Industrial Merchant pricing impact in H1 2023 4 THIS DOCUMENT IS PUBLIC H1 2023 Results - July 27, 2023
Slide 5: Strengthening Leadership Position in Electronics in Asia
Strengthening Leadership Position in Electronics in Asia >€1bn Investment decisions over the last 18 months ■ 10 major projects ■ Start-ups from 2023 to 2025 ■ $200m capex for 2 new Advanced materials production centers EL investment decisions size New advanced materials center 55 H1 2023 Results -
Slide 6: 19 Projects in Energy Transition Awarded Fundings in Europe
19 Projects in Energy Transition Awarded Fundings in Europe 13 12 Projects Carbon capture & ▪ 8 projects CO2 export hubs ▪ -5,800kt/y CO2 emissions €2.7 ▪ Recently awarded: bn Projects capex Electrolysers ▪ 4 major projects awarded ▪ 0.6GW electrolysis capacity EU or national fundings under developm
Slide 7: Accelerating the Delivery of Decarbonization Roadmap in H1 2023
Accelerating the Delivery of Decarbonization Roadmap in H1 2023 Carbon capture H2 long distance Renewable Low-C H2 H2 for as a service transportation electricity sourcing production road mobility HRS(5) & infrastructure China: 1st long-term NH3 cracking for Worldwide leader in NH3 contract industria
Slide 8: H1 2023 Key Takeaways
H1 2023 Key Takeaways Active deployment of ADVANCE strategic plan ▪ Strong performance in a challenging environment ▪ Acceleration of developments in Energy Transition ▪ Demonstrating once again the strength of the business model 8 THIS DOCUMENT IS PUBLIC H1 2023 Results - July 27, 2023
Slide 9: Strong Performance, Continued Momentum in Project Development
02 Strong Performance Continued Momentum in Project Development Jérôme Pelletan - Chief Financial Officer 9 THIS DOCUMENT IS PUBLIC H1 2023 Results - July 27, 2023
Slide 10: Continuing to Deliver Solid Sales Growth
Continuing to Deliver Solid Sales Growth Sales in €m H1 22 H1 23 H1 23/22 H1 23/22 Q2 23/22 As published Comparable Comparable Gas & Services 13,600 13,405 -1.4% +5.3% +4.1% Engineering & 221 180 -18.4% -17.3% -16.0% Construction Global Markets & 386 395 +2.5% +3.9% +5.1% Technologies Group Total 14
Slide 11: Industrial Merchant and Healthcare Driving Growth in Q2
Industrial Merchant and Healthcare Driving Growth in Q2 Q2 2023 Gas & Services comparable sales growth by Activities Europe +10% +4 % Asia-Pacific +9% +3 % Americas +5 % Middle-East +3% Africa +7 % -4% Group Comparable sales growth +4 % 11 THIS DOCUMENT IS PUBLIC H1 2023 Results - July 27, 2023
Slide 12: Q2 – Strong IM and HC in Americas and Europe
Q2 – Strong IM and HC in Americas and Europe Americas Dynamic HC, softening pricing in IM ▪ Resilient volumes in the U.S., solid Cogen ● LI ▪ Customer turnarounds FY 22: +10.2% FY 23: ▪ +5.3% pricing Sales ● IM ▪ Positive volumes Q2 2023 €2,530m ● HC ▪ +16% growth, high pricing & volumes up ▪ Strong
Slide 13: Q2 – Contrasted Asia, Increasing Growth in AMEI
Q2 – Contrasted Asia, Increasing Growth in AMEI Asia IM driving growth ▪ Low activity FY 22: +7.0% FY 23: ● LI ▪ Extended customer stoppage in China Sales ▪ +8.5% pricing, especially in Japan & Australia Q2 2023 ● IM ▪ Higher volumes in China €1,378m ▪ Strong Carrier Gases ● EL ▪ Low volumes of Mate
Slide 14: Q2 – High Growth in IM, Improved LI from Low H2 2022
Q2 – High Growth in IM, Improved LI from Low H2 2022 Industrial Merchant Large Industries Sustained high pricing, Positive volumes Demand overall stable at low level FY 23: Sales FY 23: Sales FY 22: +14.2% FY 22: -6.6% Q2 2023 Q2 2023 €3,012m €1,858m ● High +8.6% pricing, although softening vs. high
Slide 15: Q2 – Slowing Electronics, Sustained High Growth in Healthcare
Q2 – Slowing Electronics, Sustained High Growth in Healthcare Electronics Healthcare Comparing with high growth in 2022 Growth well balanced between HHC & Medical gases FY 22: +16.4% FY 23: FY 22: +3.6% FY 23: Sales Sales Q2 2023 Q2 2023 €624m €1,018m ● High Medical gases pricing in all regions ● >+
Slide 16: Delivering +80bps of OIR Margin Improvement
Delivering +80bps of OIR Margin Improvement H1 23/22 H1 23/22 In €m H1 22 H1 23 As published Comparable Revenue 14,207 13,980 -1.6% +4.9% Purchases (6,516) (5,737) -12.0% Personnel Expenses (2,380) (2,546) +7.0% Other net income and expenses (1,836) (1,987) +8.2% Operating profit before depreciation
Slide 17: Pursued Focus on Performance
Pursued Focus on Performance IM Pricing Efficiencies Portfolio Management YTD +14.4% 9 acquisitions +8.6% €206m U.S., Italy, China, India Sweden €400m Germany H1 2023 2018 2019 2020 2021 2022 2 divestitures ▪ Continued active price management ▪ +24% vs. H1 22 ▪ Rebound of industrial efficiencies Trinida
Slide 18: Still High IM Pricing
Still High IM Pricing H1 23 Pricing context +7.5% ▪ Continued smart pricing Americas management +19.0% ▪ Decrease of Energy prices Europe ▪ Inflationary environment Asia-Pacific +9.2% ▪ Continued tightness in several molecules Middle-East & Africa +8.7% Bulk specificities ▪ Time lag effect Total ▪ Ener
Slide 19: Strong Leverage on Recurring Net Profit
Strong Leverage on Recurring Net Profit H1 23/22 H1 23/22 In €m H1 22 H1 23 As published Excl. FX Revenue 14,207 13,980 -1.6% +0.5% Operating income recurring 2,286 2,481 +8.5% +4.9% Other non-recurring operating income & expenses (270) 33 comparable Operating income 2,016 2,514 Net financial costs an
Slide 20: Strong Cash Flow, ROCE >10%
Strong Cash Flow, ROCE >10% Cash Flow(3) <12,010> +13% <1,675> <134> +26 <10,550> <10,261> +3,211 Gearing <1,466> 46.0% <251> Gearing Gearing(4) 41.8% 39.2% Net Debt Net Debt Cash Flow WCR + Other Net Dividends(2) Lease liabilities Currency & Net Debt 30 June 2022 31 Dec. 2022 Investments(1) (IFRS 1
Slide 21: Continued Positive Momentum in Project Development
Continued Positive Momentum in Project Development 12-months investment Investment Decisions(1) Investment Backlog(1) Opportunities(1) Financial Industrial High level of opportunities: Sustained level of decisions in Q2: Sustained strong backlog: ▪ >40% in Energy Transition, including ▪ 2 major EL p
Slide 22: SU and RU Contributing to Sales in H1 2023
SU and RU Contributing to Sales in H1 2023 Start-up/Ramp-up Start-up date of major projects Sales Contribution(1) 2023 Q1 Q1 Q2 Q2 Q3 H2 Q4 H1 2023 €139m US Asia Asia, US, Europe (1) Europe US US, Europe €300 FY 2023 - US, Asia Guidance 330m Large Industries Electronics GM&T (1) At constant exchange
Slide 23: Confirmed 2023 Guidance
Confirmed 2023 Guidance Air Liquide is confident in its ability to further increase its operating margin and to deliver recurring net profit growth, at constant exchange rates.(1) (1) Operating margin excluding energy passthrough impact. Recurring net profit excluding exceptional and significant transact
Slide 24: Appendix
03 Appendix 24 THIS DOCUMENT IS PUBLIC H1 2023 Results - July 27, 2023
Slide 25: H1 2023 - Beneficial Mix of Geographies and Activities
H1 2023 - Beneficial Mix of Geographies and Activities H1 2023 Gas & Services Revenue €13,405m 3% Global Markets & Technologies Engineering & Construction 1% 9% Electronics Europe Asia-Pacific 43% Industrial Americas Merchant €5.0bn Africa €2.8bn €5.2bn 15% Healthcare Middle-East €13,980m €0.5bn H1 20
Slide 26: Main Components of Sales Growth
Main Components of Sales Growth +12.6% +3.2% Base business 2019 2020 2021 2022 2023 Start-ups, Ramp-ups, Site takeovers Base business Significant M&A 26 THIS DOCUMENT IS PUBLIC H1 2023 Results - July 27, 2023
Slide 27: Q2 Sales and H1 2023 OIR margin by Geographies
Q2 Sales and H1 2023 OIR margin by Geographies Americas Europe Asia 5% 2% 10% IM 30% 33% 33% 29% LI Q2 sales €2,530m €2,336m €1,378m 15% split HC 70% EL 35% 3% 35% +4.6% +4.0% +2.8% Q2 23/22 Comparable Sales Growth Growth as Comparable Growth as Comparable Growth as Comparable in €m H1 2023 H1 2023
Slide 28: H1 2023 - High Order Intake in E&C and GM&T
H1 2023 - High Order Intake in E&C and GM&T Comparable sales growth Engineering & Construction Global Markets & Technologies FY 22 : +20.6% FY 22: +25.8% Sales Sales Q2 2023 Q2 2023 €93m €201m Total Sales(1) in Q2 23 -6% Organic sales growth(2) in Q2 23 +18% Order intake €530m +1 % Order intake €496
Slide 29: Sustained Strong Backlog at €3.5bn Level
Sustained Strong Backlog at €3.5bn Level Decisions Start-ups €1.2bn Yearly Sales Backlog after full Ramp-ups See definitions in appendix 29 THIS DOCUMENT IS PUBLIC H1 2023 Results - July 27, 2023
Slide 30: Consolidated P&L
Consolidated P&L In €m H1 22 H1 23 Revenue 14,207 13,980 Operating costs (10,732) (10,270) Operating profit before depreciation 3,475 3,710 Depreciation and amortization (1,189) (1,229) Operating income recurring 2,286 2,481 Other non-recurring operating income & expenses (270) 33 Operating income 2,
Slide 31: Consolidated Balance Sheet Simplified
Consolidated Balance Sheet Simplified In €m ASSETS 31/12/2022 30/06/2023 EQUITY AND LIABILITIES 31/12/2022 30/06/2023 Goodwill 14,587 14,300 Shareholders' equity 23,736 23,240 Fixed assets 25,459 25,323 Minority interests 836 806 Other non-current assets * 1,234 1,150 Total equity 24,572 24,046 Total
Slide 32: Cash Flow Statement
Cash Flow Statement in €m H1 22 H1 23 Funds provided by operations 2,907 3,211 Changes in Working Capital (634) (299) Other cash items (32) 48 Net cash from operating activities 2,241 2,960 Purchases of PPE* and intangible assets (1,574) (1,714) Purchases of financial assets (54) (32) Proceeds from s
Slide 33: Reconciliation of OIR Margin Excluding Energy Impact
Reconciliation of OIR Margin Excluding Energy Impact H1 23 Variation Natural gas Electricity H1 22 H1 23 excl. energy excl. energy impact(1) impact(1) impact impact Revenue Group 14,207 13,980 (565) (118) 14,663 Gas & Services 13,600 13,405 (565) (118) 14,088 Operating Income Recurring (OIR) Group 2
Slide 34: Impact of Currency and Energy on G&S Revenue
Impact of Currency and Energy on G&S Revenue in €m Q1 22 Q2 22 Q3 22 Q4 22 Q1 23(*) Q2 23 €/USD +141 +271 +373 +274 +102 (50) €/ARS (5) (4) (7) (62) (40) (62) €/JP¥ (5) (10) (16) (23) (20) (17) €/Rmb +52 +59 +62 +6 (18) (51) €/ZAR +4 +2 +1 (1) (14) (31) €/SGD +10 +18 +24 +18 +11 +1 €/TRY (13) (13) (
Slide 35: Financing Structure as of June 30, 2023
Financing Structure as of June 30, 2023 Fixed / Variable rates Sources Maturity (gross debt) Private placements Commercial paper 6% €m Fixed 6% 12,000 rate 89% Bank debt > 5 years 12% 8,000 Between 1 and Others(1) 5 years 1% 4,000 < 1 year Bonds 0 Variable 75% Market debt rate 87% 11% (1) Others: pu
Slide 36: Investment Cycle – Definitions
Investment Cycle – Definitions Investment opportunities at end of the period ▪ Investment opportunities under consideration by the Group for decision within 12 months. ▪ Industrial projects with investment value > €5m for Large Industries and > €3m for other business lines. ▪ Includes asset replaceme
Slide 37: Regular and Sustained Performance
Regular and Sustained performance CAGR over 30 years(1) Revenue (in €m) EPS (2) (in €) +6.5% +6.8% Cash Flow (in €m) Dividend (2) (in € per share) +7.2% +8.4% (1) Calculated according to prevailing accounting rules over 30 years (2) Dividend based on current year results and proposed for payment the
Slide 38: For further information, please contact
For further information, please contact: Upcoming events 2023 Third Quarter Revenue: October 25, 2023 Investor Relations www.airliquide.com IRTeam@airliquide.com Follow us on Twitter @AirLiquideGroup Corporate Headquarters: Phone: +33 (0)1 40 62 51 50 75, Quai d’Orsay 75321 Paris Cedex 07 Communicat
Slide 39: Disclaimer
Disclaimer This presentation may contain forward-looking statements (including objectives and trends) about Air Liquide’s financial situation, operating results, business activities and strategy. Although Air Liquide believes that the expectation reflected in such forward-looking statements are reason