Air Liquide Sa · EURONEXT:AI
Air Liquide Sa — H1 2018 Earnings Presentation
48 slides from Air Liquide Sa's earnings presentation, Jul 30, 2018
Slide 1: H1 2018 Activity: Strong Growth in Line with NEOS
H1 2018 Activity Strong Growth in Line with NEOS Solid Performance Business Development Acceleration Paris, 30 July 2018
Slide 2: Agenda
Agenda 1. Strong growth in line with NEOS 2. Solid performance and strong cash flow 3. Business development acceleration and quality investment opportunities 4. Confirmed 2018 guidance 2 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 3: Strong Growth in Line with NEOS
Strong Growth in Line with NEOS Benoît Potier Chairman & Chief Executive Officer 3 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 4: Strong Growth and Solid Performance in H1 2018
Strong Growth and Solid Performance in H1 2018 Growth in all + 5.8% Business Lines + 12.1% As published Sales(1) Net Profit Driven by efficiencies + 30bps and synergies + 11.1% From operations G&S Operating Margin(2) Cash Flow(3) (1) Comparable growth (2) Excluding energy impact (3) After change in
Slide 5: Business Development Acceleration…
Business Development Acceleration… Group Sales Comparable Growth Investment Decisions - in €bn +5.8% 2.9bn 6% 5% +4.0% 1,4 4% 3% 2% 1,2 1% 0% H2 16 H1 17 H2 17 H1 18 1,0 -1% H2 16 H1 17 H2 17 H1 18 5 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and H
Slide 6: … While Deploying Key Strategic Initiatives …
… While Deploying Key Strategic Initiatives … Large Industries Industrial Merchant Digital operations Web portals in 3 zones in place New investments Increased density in key basins acquisitions in China Airgas fully integrated Healthcare Electronics e-Health Ramp up of etching gases running solutio
Slide 7: … Supported by
… Supported by Customer-centric initiatives Integrated digital solutions Sustained innovation strategy 7 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 8: Solid Performance and Strong Cash Flow
Solid Performance and Strong Cash Flow Fabienne Lecorvaisier Executive Vice President & Chief Financial Officer 8 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 9: Highlights
Highlights Group sales up ~+6% Strong momentum in all activities High base business growth Improved G&S OIR margin Strong operating cash flow and improved ROCE Quality investment opportunities 9 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 10: Growth at the Top of NEOS Range
Growth at the Top of NEOS Range Note: NEOS sales growth objective between +6% and +8% CAGR 2016-2020, including Airgas scope effect in 2017 contributing +2% to the CAGR 10 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 11: Favorable Global Environment, Softening FX Headwind
Favorable Global Environment, Softening FX Headwind High Industrial Production Level Lower Negative FX Impact(1) in Q2 Industrial Production Year on Year in % (3-month rolling average) (2) -6.8% -3 to -4% Estimated H1 2018 FY 2018 (1) On Group sales (2) With an annual average EUR/USD exchange rate e
Slide 12: Accelerating Growth Drivers in Q2
Accelerating Growth Drivers in Q2 +14% INDUSTRIAL +4.5% MERCHANT +11% +5 % HEALTHCARE +7 % ELECTRONICS +8 % AMERICAS DEVELOPING ASIA ECONOMIES Comparable G&S sales growth 12 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 13: Confirmed High Base Business Growth
Confirmed High Base Business Growth G&S Quarterly Growth Analysis +14% +31% +29% Strongest base business since Q2 11 (1) Comparable growth based on 2016 adjusted sales 13 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 14: Q2 - Very Robust Growth in Americas, Solid Europe
Q2 - Very Robust Growth in Americas, Solid Europe AMERICAS EUROPE H1 2018 H1 2018 €3,874m €3,464m G&S Comparable Sales Growth Dynamic IM and HC, high EL Very high organic HC and solid IM • LI: H2 customer turnarounds in the U.S. • LI: numerous H2 customer turnarounds • IM: high growth, broad-based e
Slide 15: Q2 - Booming Asia, Major Start-Up in South Africa
Q2 - Booming Asia, Major Start-Up in South Africa MIDDLE-EAST ASIA-PACIFIC & AFRICA H1 2018 H1 2018 €2,107m €324m G&S Comparable Sales Growth Very strong momentum in all activities Full impact of major start-up in LI • LI: high volumes in China, Singapore, South Korea • LI: Sasol start-up in South A
Slide 16: Q2 - Solid IM, Turnarounds in LI
Q2 - Solid IM, Turnarounds in LI H1 18 : +4% H1 18 : +5% +6% +4.5% +4,5% +4% INDUSTRIAL +4% LARGE MERCHANT INDUSTRIES H1 2018 H1 2018 €4,501m €2,718m Q1 18 Q2 18 Q1 18 Q2 18 G&S Comparable Sales Growth Robust activity Strong contribution from SU/RU • Strong Manufacturing and • Ramp-ups in South Afri
Slide 17: Q2 - Very Dynamic HC and EL
Q2 - Very Dynamic HC and EL H1 18 : +6% H1 18 : +7% +8% +7% +6% +5% HEALTHCARE ELECTRONICS H1 2018 H1 2018 €1,714m €836m Q1 18 Q2 18 Q1 18 Q2 18 G&S Comparable Sales Growth Very strong organic activity Double-digit growth in Asia • Dynamic HHC despite pricing pressure • Very strong IC and FPD market
Slide 18: Stronger Order Intake in E&C, Very Dynamic GM&T
Stronger Order Intake in E&C, Very Dynamic GM&T Sales and Order intake(1) – in €m E&C GM&T 200 200 (2) (2) +33% +4% 100 100 0 0 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Sales Order intake Sales Order intake (1) Group and third-party order intake (2) Comparable growth 1
Slide 19: Improved G&S OIR Margin
Improved G&S OIR Margin 19 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 20: Efficiencies above NEOS Target
Efficiencies above NEOS Target H1 18 Efficiencies NEOS Cumulated Efficiencies >€1,200m 2020 >€900m 2019 €174m >€600m 2018 €497m Target €323m 2017 20 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 21: Airgas Synergies Further Accelerated
Airgas Synergies Further Accelerated US$300m now by mid-2019 Initial (1) Update target Mid- >300m >300m 2019 US$ 2019 >280m 260m 2018 >235m 215m >175m 2017 Costs ~US$215m Revenue ~US$45m • H1 2018 synergies = US$45m 45m 45m 2016 (1) Defined in 2016 In US$ In US$ 21 30 July 2018 H1 2018 Results The w
Slide 22: Net Profit +12%
Net Profit +12% 22 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 23: Strong Cash Flow
Strong Cash Flow CASH FLOW +11.1% Gearing(1) 90% Gearing Gearing(1) 80% 79% (1) June 30 gearings adjusted for dividend seasonality. (2) Including acquisitions, transactions with minority shareholders, net of divestitures. (3) Including share purchases and capital increases. 23 30 July 2018 H1 2018 R
Slide 24: Continued Improvement in ROCE
Continued Improvement in ROCE ROCE 10.3% >10% 10% (1) 8.0% 8% 7.7%(1) 7.4% 6.9% 6% Dec. 15 Dec. 16 June 17 Dec. 17 June 18 2021/22 adjusted NEOS Airgas objective acquisition (1) Excluding 2017 positive impact on net profit of non-cash one-off items. 24 30 July 2018 H1 2018 Results The world leader i
Slide 25: Business Development Acceleration and Quality Investment Opportunities
Business Development Acceleration and Quality Investment Opportunities Fabienne Lecorvaisier Executive Vice President & Chief Financial Officer 25 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 26: Increasing Opportunities
Increasing Opportunities Investment H1 2018 H1 2018 Investment Opportunities(1) Start-up/Ramp-up Decisions(1) 12-month portfolio Sales Growth Contribution €2.5bn €1.4bn €136m • Thriving bidding activity • Major long-term contracts in LI, • Asia and Africa • Medium-size opportunities EL Carrier Gas c
Slide 27: Updated Start-Up Timeline
Updated Start-Up Timeline 2018 2019 2017 Q1 Q2 Q3 Q4 Q1 Q2 Sasol OCI Chinese Pemex Electronics Yanchang Middle- Electronics RSA U.S. Project Mexico Projects China East Projects Asia Projects Asia Fujian Shenyuan China OCI started end Q2 2018 forecasted additional sales between €250 and €300 million
Slide 28: Increased Backlog
Increased Backlog Investment Backlog(1) in €bn Decisions Start-ups €2.3bn €2.3bn €2.1bn €2.1bn € 0.9bn Dec 2015 Dec 2016 Dec 2017 Decisions Start-ups June 2018 Yearly Sales Backlog(1) after full Ramp-ups (1) See definitions in appendix 28 30 July 2018 H1 2018 Results The world leader in gases, techn
Slide 29: 2018 Outlook
2018 Outlook Strong growth with “Assuming a comparable H1 Group sales up ~+6% environment, Air Liquide is 2018 2018 confident in its ability to deliver Performance well on net profit growth in 2018, track calculated at constant Accelerating business exchange rate and excluding development 2017 excep
Slide 30: H1 2018 Appendix
H1 2018 Appendix 30 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 31: H1 2018 G&S Revenue Breakdown by Region
H1 2018 G&S Revenue Breakdown by Region EUROPE €3.5bn ASIA- AMERICAS PACIFIC €3.9bn €2.1bn €9,769m Industrial Merchant Large Industries Healthcare Electronics 31 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 32: Americas
Americas Q2 Gas & Services Sales: €1,973m INDUSTRIAL MERCHANT LARGE INDUSTRIES HEALTHCARE ELECTRONICS • Very solid demand for cylinders • Several customer turnarounds • Dynamic growth in the U.S. • Better Q2 at +5% and hardgoods in the U.S. in the U.S. for cogen and H2 for medical gases and in • Ver
Slide 33: Europe
Europe Q2 Gas & Services Sales: €1,711m INDUSTRIAL MERCHANT LARGE INDUSTRIES HEALTHCARE • Strong growth in Germany, Italy and • High number of customer • Accelerating growth Eastern Europe turnarounds in H2 • Limited bolt-on acquisitions • Dynamic manufacturing and • Strong growth in Eastern Europe
Slide 34: Asia-Pacific
Asia-Pacific Q2 Gas & Services Sales: €1,091m INDUSTRIAL MERCHANT LARGE INDUSTRIES ELECTRONICS • China again >+15%, strong volume • Several ramp-ups in China • Strong demand for new increase in cylinders and in liquid • High demand in China (chemical molecules particularly in Taiwan argon ; higher p
Slide 35: Industrial Merchant Pricing
Industrial Merchant Pricing 35 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 36: Consolidated P&L
Consolidated P&L (1) H1 2017 Basic earnings per share adjusted for the free share attribution of October 2, 2017 36 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 37: Operating Margin (OIR/Revenue)
Operating Margin (OIR/Revenue) H1 2018 G&S operating margin excluding energy improved +30bps compared to H1 2017 37 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 38: Consolidated Balance Sheet Simplified
Consolidated Balance Sheet Simplified - In €m * Including fair value of derivatives 38 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 39: Cash Flow Statement
Cash Flow Statement * PPE: Property, plant and equipment. 39 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 40: Impact of Currency and Energy on G&S Revenue
Impact of Currency and Energy on G&S Revenue 40 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 41: Revenue Analysis by Quarter and by Business Line
Revenue Analysis by Quarter and by Business Line 41 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 42: Revenue Analysis by Quarter and by Geography
Revenue Analysis by Quarter and by Geography 42 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 43: G&S Revenue Growth by Quarter and by Impact
G&S Revenue Growth by Quarter and by Impact 43 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 44: 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 replac
Slide 45: Gas & Services Industrial Capex by Geography
Gas & Services Industrial Capex by Geography G&S H1 2018 capex(1) G&S capex(1) / sales €1.0bn (1) Gross industrial investments. 45 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 46: Financing Structure
Financing Structure As of June 30, 2018 > 5 years Between 1 and 5 years < 1 year (1) Others: Finance leases and put options granted to minority shareholders. 46 30 July 2018 H1 2018 Results The world leader in gases, technologies and services for Industry and Health
Slide 47: Regular and Sustained Performance
Regular and Sustained Performance 21 000 Revenue (in €m) +6.0% EPS(1) (in €) +7.5% 18 000 CAGR 5,0 CAGR 15 000 over 30 years (2) (2) over 30 years 4,0 12 000 3,0 9 000 2,0 6 000 1,0 3 000 0 0,0 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 1987 1989 1991 1993 1995 1
Slide 48: For further information, please contact: Investor Relations
For further information, please contact: Investor Relations Communication Aude Rodriguez + 33 (0)1 40 62 57 08 Alexandra Rocca + 33 (0)1 40 62 50 93 Louis Laffont + 33 (0)1 40 62 57 18 Annie Fournier + 33 (0)1 40 62 51 31 Ludmilla Binet + 33 (0)1 40 62 57 37 Jérôme Zaman + 33 (0)1 40 62 59 38 Joseph