Air Liquide Sa · EURONEXT:AI
Air Liquide Sa — Investor Day (July 2016)
94 slides from Air Liquide Sa's investor day presentation, Jul 6, 2016
Slide 1: NEOS 2016-2020: A Customer-centric Transformation
aq ee Creative Ongen NEOS.2016-2020 A Customer-centric Transformation Capital Markets Day 2016 London - July 6
Slide 2: Agenda
Agenda » Introduction » Part | - NEOS Objectives = Converting Trendsin Opportunities = Proven Model for Sustainable Growth = Delivered Investor Day 2013 Targets » NEOS Objectives = Part Il - World Business Lines = Large Industries » Industrial Merchant = Healthcare * Electronics * Global Markets & T
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Slide 4: A Changing Environment
A Changing Environment Energy. and Environment Transition Changes in Healthcare Digitization ‘DAY\
Slide 5: Agility and Strengths to Build on Opportunities
Agility and Strengths to Build on Opportunities China Sales €16.4bn Sales €3.0bn Rise of Out of Hi lig h-tech Cresnet Developing le Manufacturing Hospital vices economies . Mid Early Mid Early Mid Early Mid 1980s 1990s 1990s 2000s 2000s 2010s 2010s a ‘ DA
Slide 6: Major Step Change
Major Step Change Sales Customer reach >€20bn * Cylinders 22 million = Customers x2» 2 million Larger base for value creation
Slide 7: A New Group
A New Group Creative Ongen “ “= @
Slide 8: Air Liquide Ambition
Air Liquide Ambition Lead our industry Deliver long-term performance Contribute to sustainability
Slide 9: Strategy: a Customer-centric Transformation
Strategy: a Customer-centric Transformation =» Operational Excellence —— =» Selective Investments =s Open Innovation =« Network Organization o Customer experience o Cost competitiveness For | __— Profitable Growth over the Long-term o Aligned with Air Liquide new business profile o Core o Disruptive
Slide 10: Financial Objectives
Financial Objectives fficiencies >€300m on average/year?} + Airgas synergies >$300m +6% to +8% CAGR 2016-2020(1) Maintain “A” range rating >10% after 5-6 years (oon ny) wars (1) Including Airgas scope effect in 2017 contributing +2% to the CAGR . (2) Over the 2017-2020 period * eaaciaci 10 }
Slide 11: Corporate Sustainability Objectives
Corporate Sustainability Objectives nnn For better health For better environment eg. eg. + Foster clean mobility * Develop Healthcare * Help customers lower GHG* emissions * Grow with reduced carbon intensity eg. * Continue to improve Safety + Do business responsibly + Extend Air Liquide Foundation
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Slide 13: Part I: NEOS Objectives
lf) /) AIR LIQUIDE oe : Dodd ” NEOS @hiosites 1. Converting Trends in Opportunities 2. Proven Model for Sustainable Growth 3. Delivered Investor Day 2013 Targets 4. NEOS Objectives ———_SEEEewa Fabienne Lecorvaisier Chief Financial Officer Francois Jackow Vice President Strategy & Customers
Slide 14: I. NEOS Objectives: Converting Trends in Opportunities
|. NEOS Objectives 1. Converting Trends in Opportunities
Slide 15: Major Trends in a Changing Environment
Major Trends in a Changing Environment ‘DAY\ Energy. and Environment Transition Changes in Healthcare Digitization
Slide 16: Hydrogen for Energy and Environment Transition
Hydrogen for Energy and Environment aaa Transition all Oxygenfor energy efficiencies 70: Photovoltaics LNG technologies Biogas Hydrogen mobility Emissions control Recycling | me" LIQUIDE Fie )
Slide 17: New ways of working
2 i New ways of working e-Commerce Supply Chain Smart & Innovative Operations (SIO) More Components = Higher performance through Advanced Materials AIR LIQUIDE a 7)
Slide 18: Changes in Healthcare
Medical gases for hospitals New geographies >» e-Healthcare Disinfectants & Home Healthcare antiseptics services for chronic diseases AIR LIQUIDE 1
Slide 19: I. NEOS Objectives: Proven Model for Sustainable Growth
|. NEOS Objectives 2. Proven Model for Sustainable Growth
Slide 20: Air Liquide Achievements
Air Liquide Achievements MESSER© Lurgi Voltaix +6.2% Sales CAGR OIR/Sales 17.6% +7.8% OIR CAGR =F TOUT TRIPP Oe Maa = | ey ay
Slide 21: Value Creation Through Integrated Model
Value Creation Through Integrated Model Customers & Patients ml ml ci Dat Os BA 4 4 4 4 4 Large Industries Industrial Merchant Electronics Healthcare = —s i212 a. -f Win oh al. ib = Fie il @ Innovation | DAY’ ‘Engineering & Construction A 201.5) na LIQUIDE ®@
Slide 22: Both Growth and Resilience
Both Growth and Resilience Air Liquide Sales & OIR versus Worldwide Industrial Production over 10 Years ‘] (Base 100 in 2005) 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 “<OWorlwide IP* OSales <OOIR ‘Source: coe-rexecode a" LIQUIDE (2)
Slide 23: Key Success Factors for Growth and Resilience
Key Success Factors for Growth and Resilience IDEAL FOOTPRINT TO WIDE AND STRONG SOLID CONTRACT CAPTURE GROWTH CUSTOMER BASE Se ee AS UMILES STRUCTURE Presentin over 80 countries >50% of AL growth (2010-2015) from top 10 growing economies Serving 90% of industrial segments 80% of top 50 customers ar
Slide 24: Proven Growth and Cash Model
Proven Growth and Cash Model 20 YEARS OF STRONG PERFORMANCE = Sales CAGR >+6% = Net Debt/FFO <2.5x = Total Shareholder Return +11.2%
Slide 25: I. NEOS Objectives: Delivered Investor Day 2013 Targets
|. NEOS Objectives 3. Delivered Investor Day 2013 Targets
Slide 26: Reminder of Targets Disclosed at Investor Day 2013
Reminder of Targets Disclosed at Investor Day 2013 > eADAY 2013) 4) Keep Sales Growth (2) Deliver Efficiencies ® Maintain ROCE 4) Embed Responsibility +1% to +2% above market €1.3bn over 5 years between 11% and 13% in the way we act and manage our operations and initiatives a" s0U88 23 }
Slide 27: Keep Sales Growth +1% to +2% Above Market
Hit a “Keep Sales Growth +1% to +2% Above Market” (Base 100 in 2010) 130 125 120 115 110 105 il | 100 2010 2011 2012 2013 2014 2015 = Gas Market() Air Liquide 2010 2015 A CAGR 2010-2015 > 100 bps Outperforming Gas Market hardgoods, non respiratory homecare, hygiene and specialty ingredients; excludi
Slide 28: Keep Sales Growth: Incremental Sales from Projects
= = &® “Keep Sales Growth +1% to +2% Above Market” Current investment decisions will deliver 5) Incremental sales from industrial projects >€10m In€m = Forecatied in 2013 = “ i ‘ 7 Jt “ial = \ 300 Actual figures I A Sales: ws I aa Unfavorable sales I mostly AaEEEEEE EE io —— passthrough. | pass-thro
Slide 29: Deliver Efficiencies €1.3bn over 5 Years
ee “Deliver Efficiencies €1.3bn over 5 Years” Share of total efficiencies —— Pa Healthcare Electronics Others on ape - ‘ae a €1.5bn generated eevrer-- cm) China USA Europe Korea E&c a> ,900 new projects Bulk Energ ee ESG sourcing Augmented every year optimization consumption & logistic Teality in re
Slide 30: Maintain ROCE between 11% to 13%
© Hit “Maintain ROCE between 11% to 13%” mae ap Average ROCE Impact of larger projects 5 7 2011 2012 2013 2014 2015 2010 2015 ROCE vs. Inflation Work in Progress in €bn Pursued value creation with ROCE-WACC at 500 bps in 2015 (aneDAY A 2015) (1) Over 2011-2015 (2) Adjusted ROCE AIR LIQUIDE 20)
Slide 31: Embed Responsibility in the Way We Act
&® “Embed Responsibility in the Way We Act and Manage our Operations and Initiatives” (net 201 5 Accident frequency) 1.6 . 2 86% Customer/Patient surveys) Pee H, desulfurization) 1.2 million Women) 29% a lb 221 Communities sca CON Shareholders) 2.60€/share vs. 2010 -15% x3. +60% From 24% x2 (1) Acci
Slide 32: I. NEOS Objectives: NEOS Objectives
|. NEOS Objectives 4. NEOS Objectives
Slide 33: Solid Foundations, Unique Differentiating Factors
Solid Foundations, Unique Differentiating Factors ) XL. #1") #1) —————— 3) = 50% more sales than #2 player \ * , « High density: national market leader ng = >€30bn sales ensured with 15 years f for >70% of sales Take-or-Pay contracts = #1 in e-commerce business Healthcare Electronics = Strong Home H
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Slide 35: Financial Objectives
Financial Objectives Efficiencies >€300m on average/year?) + Airgas synergies >$300m +6% to +8% CAGR 2016-2020(1) Maintain “A” range rating >10% after 5-6 years Capex/Sales 2017-2020: 10% to 12% aay (1) Including Airgas scope effect in 2017 contributing +2% to the CAGR . (2) Over the 2017-2020 perio
Slide 36: II. World Business Lines
I]. World Business Lines 1. Large Industries 2. Industrial Merchant 3. Healthcare 4. Electronics 5. Global Markets & Technologies
Slide 37: II. World Business Lines: Large Industries
Il. World Business Lines 1. Large Industries
Slide 38: Large Industries
Large Industries Pursued growth and increased peas! elope 3 wi
Slide 39: Large Industries Strategy
Large Industries Strategy es « Turn technology into = Execute flawlessly long-term cash flow = Focus on key projects = Expand opportunities = Continued outsourcing trend geographies and markets « Strengthen integration * Build on leadership in dynamic industrial basins, other Business industrial bas
Slide 40: Unique Positioning for Value Creation
Unique Positioning for Value Creation aaa s= Leader in majority of Synergies anal Capital intensive projects with _ Top 10 Flexibility 70° industrial basins %o Strong Cash of secured Flow Visibility Support by sales 250 ——~ worldwide Engineering ey proprie . s technologies. organization IRR nvestmen
Slide 41: Growing Faster than End Markets
Growing Faster than End Markets Building on success ... ... to outperform 180 | (Base 100 in 2010) Air Liquide bd H, vol. to O&G End markets outlook S ; CAGR 2016-2020 ss, Worldwide ér0%} 420 refinery oil throughput 110 100 2010 2011 2012 2013 2014 2015 mate 1901 SEAGER SOG Air Liquide jase in a" ;
Slide 42: Strengthen Outsourcing Trend
Strengthen Outsourcing Trend Gm = ExXample: air gases volumes Worldwide Outsourcing versus Self-production Growth between 2010 and 2015 Total HUNTSMAN Foro ha tourp neater covestro| Developing Economies SasoL ef = uxamaeemnm roan) [a BANDON FANGNLAN NONFERONS METALS GOCE Scudi Avorn 2010 2015 frvene
Slide 43: Efficiencies Boosted by Digitization of Operations
Efficiencies Boosted by Digitization of Operations Reinforced Higher Level of Predictive Real-time Remote Matitenance Optimizations Operation ae u 14 Coacabon contol Centers Target zero unplanned shutdowns Big Data Analytics | 1 billion of datapoints archived every day frvents DA) a" s0U88 «3 )
Slide 44: Large Industries NEOS Objectives
Large Industries NEOS Objectives +5 to +6% Digitized CAGR sales operations * 2x greater -20% Capex — ae (asrapyay) was *Over 2016-2020 as compared to 2011-2015 pa uou0e (4)
Slide 45: II. World Business Lines: Industrial Merchant
Il. World Business Lines 2. Industrial Merchant
Slide 46: Industrial Merchant
March wviercn 2015) yn sov08 46 )
Slide 47: Industrial Merchant Strategy
Industrial Merchant Strategy = Customer loyalty «Extend customer reach through Airgas & multi-channels = Multiple products serving «Enrich product, application and multiple end markets service mix through innovation * Optimized supply chain to = Reinforce competitiveness ensure customer proximity th
Slide 48: Increased Customer Reach
Increased Customer Reach 1 million customers in 75 countries + 1 million customers in 1 country ’ Specialists Stores ~ 850 Telesales Experts Digital Platform A 201.5) ) * Bulk and Speciality Gases, Safety, Construction, Weld Process, Healthcare & Life Sciences .
Slide 49: Building on Air Liquide and Airgas Strengths
Building on Air Liquide and Airgas Strengths Proximity - Expertise Additional key markets
Slide 50: Supply Chain Transformation
Supply Chain Transformation AIR LIQUIDE Creative Ongen = >1,000 production plants = 6,600 trailers = 32,000 bulk tanks = 11.5m cylinders -- Airgas = >30 production plants = 5,500 trailers = 27,000 bulk tanks = 10.8m cylinders
Slide 51: Supply Chain Transformation
Supply Chain Transformation = Reliability = Assets optimization o Increase operations density o Improve asset loading = Optimize logistics o Predictive o Real-time
Slide 52: Industrial Merchant NEOS Objectives
Industrial Merchant NEOS Objectives +7 to +10% CAGR sales* Optimized asset utilization (oon ny) OIR margin +250 bps *Including Airgas scope effect in 2017 contributing +5% to the CAGR
Slide 53: II. World Business Lines: Healthcare
Il. World Business Lines 3. Healthcare
Slide 54: Healthcare
Healthcare ‘DAY\
Slide 55: Healthcare Strategy
Healthcare Strategy aaa a = Patient-centric services Home Health = Organic & external growth Care = Strong back office «Further expand the model "Accelerate innovation Medical = Medicalization Gases : . = Geographical expansion
Slide 56: Proven Growth Model
Proven Growth Model 2800 - : countries 2600 - 2400 - 2200 - 2000 ~ 1 3 M 1800 - +7.0% sates CAGR* patients at home 1600 -| constant OIR/Sales — 1400 - (00. 7,500 1000 hospitals & clinics 2010 2011 2012 2013 2014 2015 finoarsDAY \ A 2015) (*) Excluding Anios perimeter effect nm" LIQUIDE se }
Slide 57: Further Expanding the Air Liquide Healthcare Activity
Further Expanding the Air Liquide Healthcare Activity GEOGRAPHIC EXPANSION INNOVATION Health expenditure per capita = \F Extend to new — pathologies : Ed New offers 1 ota -' [Syne * < Pa T- O50°0, . Digital& New =P FE, Technologies Ee Source: World Bank Data
Slide 58: Healthcare NEOS Objectives
Healthcare NEOS Objectives +6% to +8% CAGR sales* Selective bolt-on acquisitions Tariff compensated by efficiencies (asrapyay) b 201.5) *Including Airgas scope effect in 2017 contributing +1% to the CAGR
Slide 59: II. World Business Lines: Electronics
Il. World Business Lines 4. Electronics
Slide 60: Electronics
Electronics Continue premium value creation AIR LIQUIDE co)
Slide 61: Electronics Strategy
Electronics Strategy « Portfolio focused on added value products « Strong positions with major customers Proprietary molecules developed with customers Leverage on leadership position in key countries including China Reduce exposure to cycles mn LIQUIDE 61 }
Slide 62: Pursue Premium Value Creation
Pursue Premium Value Creation 300 5 (Base 100 in 2005) 250 5 200 | 150 | 100 + 7 T T 7 T T T 7 1 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2005 O-OIR OSales 2015 wCarriergases mESG mAdvanced materials mServices mE& a" s0U88 e
Slide 63: Leverage Strong Footprint in Asia
Leverage Strong Footprint in Asia (eats DAY\ s 20.1.5) Well-positioned for future growth WORLD LEADING MARKET SHARE* the #2 player # 1 % market share 2005 CHINA A STRONG LEADING POSITION 2015 * Excluding Equipment & Installation and Chemicals
Slide 64: Electronics NEOS Objectives
Electronics NEOS Objectives +7 to +9% excluding downturns Upgraded product mix (roartsDAY) Increased cash generation pa uou0e cs }
Slide 65: II. World Business Lines: Global Markets & Technologies
Il. World Business Lines 5. Global Markets & Technologies
Slide 66: Global Markets & Technologies
Global Markets & Technologies Shaping new businesses
Slide 67: Global Markets & Technologies Strategy
Global Markets & Technologies Strategy * Develop innovative «Further develop extreme technologies cryogenics and aerospace = Open new markets ona =» Accompany energy transition global scale with new value chains: H, energy, biomethane, clean transportation
Slide 68: From Biogas Purification to Clean Energy
From Biogas Purification to Clean Energy —Eaaa Household waste Bio digester Rea —)>- : Usable eal In teaial Biogas CH, Agricultural (Biomethane) lad] waste canoe. tom ’ - P al Fac . ~~ Purification Sludge | Bio Technology - IP Branding Feedstock Ecosystems Asset management ‘i customer Digital Market
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Slide 70: A New Group
A New Group Creative Ongen “ a
Slide 71: NEOS Strategy: a Customer-centric Transformation
NEOS Strategy: a Customer-centric Transformation | Growth and cash Customer reach and competitiveness i B a Expansion Premium value = New businesses fnvous DAY) 2018) a LIQUIDE @
Slide 72: Relying on a New Balanced Mix
Relying on a New Balanced Mix Mu 2020 Gas & Services Sales Geography Mix Asia-Pacific Middle-East & Africa Activity Mix Large Industries Europe Industrial Healthcare Merchant Americas Electronics DAY’ b 201.5) AIR LIQUIDE 72)
Slide 73: Leveraging on Digital
Leveraging on Digital ile New ways of working Managing assets and optimizing production & logistics Customer reach through e-commerce a" s0U88 ©
Slide 74: Engaging the Whole Organization
Engaging the Whole Organization organization ‘ . | aes 68,000 Cannecting employees ema. o @ 8 20 clusters ©
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Slide 77: Assumptions, NEOS Financial Objectives over 2016-2020
Assumptions, NEOS Financial Objectives over 2016-2020 MAIN CURRENCIES OTHER DATA Local currency for 1€ = |P worldwide: +2.8% CAGR » USD 1:12 «Inflation: ~+2% CAGR = CNY 7.43 oo. «Marginal impact on sales of the JPY 127.55 energy price variation over the " CAD 1.56 period | (ines DAY)
Slide 78: pa ee [ape
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Slide 79: Benoit Potier
Benoit Potier Chairman and Chief Executive Officer Air Liquide Group Chairman of the ERT (European Roundtable of Industrialists) A graduate of CentraleSupélec (Ecole Centrale Paris), Benoit Potier joined Air Liquide in 1981 as a Research and Development engineer. He held different positions in the G
Slide 80: Pierre Dufour
Pierre Dufour Senior Executive Vice President Air Liquide Group Pierre Dufour joined Air Liquide in 1997 as Vice President of Worldwide Engineering before his promotion to Group Industrial Director in 1998, overseeing the technical aspects of Group operations worldwide. In 2000, he was appointed Cha
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