Air Liquide SA · EURONEXT:AI
Air Liquide SA — Non-Deal Roadshow (June 2001)
46 slides from Air Liquide SA's roadshow presentation, June 2001
Slide 1: US Road Show Presentation June 2001
| AIR LIQUIDE . US ROAD SHOW Presentation June 2001
Slide 2: Air Liquide: Industrial and medical gases
Air Liquide: Industrial and medical gases ¢ A global provider of industrial and medical gases and related services ¢ Air Liquide provides its customers all over the world with new products, services and solutions ¢ Air Liquide has 125 subsidiaries in 60 countries and employs more than 30,000 people
Slide 3: Servicing all sectors of industry and healthcare
Servicing all sectors of industry and healthcare GLASS PULP & PAPER OTHERS SECONDARY METALS REFINING HEALTHCARE LABORATORIES A large spectrum of ELECTRONICS FOOD customers STEEL BASIC CHEMICALS FINE CHEMICALS 3
Slide 4: Diversified worldwide presence
Diversified worldwide presence 34% 28% 26% 23% 33% EUROPE 26% (Excluding France) FRANCE AMERICAS 15% 12% 1% 2% AFRICA ASIA - PACIFIC Share of 2000 total sales Share of 2000 total operating profit 4
Slide 5: 2000: Financial highlights
2000: Financial highlights ¢ Key figures (in million euros) 2000 2000/1999 Sales 8,099 +23.9% of which gas and services 6,598 +25.6% Net profits 652 +15.8% Cash flow 1,564 +19.6% EPS 7.22 € +16.1% ROCE (after tax) 10.5% from 9.6% Gearing ratio 40.4% from 46.1% ¢ A very good year =All sectors contrib
Slide 6: All sectors contributed to the growth
All sectors contributed to the growth Turnover 2000/99 Turnover 2001/00 In million euros 2000 ex forex Q1 2001 ex forex Large Industry 1,930 *+33.5% 608 *+40.2% Electronics 864 +32.9% 230 +32.2% Industrial Customers 2,883 +4.3% 740 +6.0% Healthcare 921 +16.1% 232 +6.3% Total Gas and Services** 6,598
Slide 7: Cash flow and capital expenditure
Cash flow and capital expenditure In million euros 1800 1600 1400 1,564 1200 1000 1,015 800 600 400 1993 1994* 1995 1996 1997 1998 1999 2000 2001 Cash flow Capital expenditure * 1994 includes the purchase of minority interests in SAF and SOAEO 7
Slide 8: Implementation of the growth model
Implementation of the growth model... ¢ …through the in-depth knowledge of the customers’ processes New applications Service offer with and market openings high technological value added Customer Production Molecule Equipment processes Air Liquide, partner with unique skills 8
Slide 9: Projected financial and operating information notice
*The following slides contain certain projected financial and operating information regarding Air Liquide S.A. This information has been prepared internally by Air Liquide's management and has not been reviewed by any independent party. While presented with specificity, the projected financial data
Slide 10: Large Industry
Large Industry ¢ Very strong opportunities linked to the environment = Less carbon, more hydrogen = Valuation of natural resources : oxygen = Energy ¢ A unique pool of skills ¢ Long-term contracts = Indexed prices, guaranteed minimum quantities = 18 contracts started in 1999 = 16 contracts started i
Slide 11: Large Industry
Large Industry ¢ Key figures 2000 : = % of group turnover : 23% = Operating margin 2000 : 26% = Capital employed : 3,000 million euros = ROCE** : 9% ¢ Objectives 2001-2003 : = Turnover* : +12-13 % = ROCE**: >11% * CAGR ** Calculated on the average tax rate of the segment 11
Slide 12: Electronics: A high growth market
Electronics : A high growth market Handheld Computing 35% Devices DVD Set-Top Player Box Internet 30% Smart Cards/ Game Consols CAGR 1997-2002 Yesterday SMART Kiosks Appliance- 25% Portable Phone Computing Automotive 20% Applications/GPS Multimedia Today PC 15% Net Advanced Desktop PCs Video Switchi
Slide 13: Electronics: Air Liquide sales by segment
Electronics Air Liquide sales by segment Sales in million euros + 52% (ex. forex = +33%) 864 900 800 + 10% (ex. forex = +1%) + 64% 700 569 600 513 + 43% 500 400 + 50% 300 200 100 0 1998 1999 2000 Equipments Liquid chemicals Gas and and installations and related services related services 13
Slide 14: Electronics
Electronics ¢ A high growth market (doubled in 2 years) in which Air Liquide is well positioned ¢ Air Liquide: an high technology offering = Constant technological renewal = Enlarged offering: products, services, e-business = Worldwide management of key accounts = 600 Air Liquide employees located w
Slide 15: Industrial Customers: A profitable and solid base
Industrial Customers A profitable and solid base ¢ Diversified customer base and locations Africa 3% Others Welding / cutting Asia Pacific 23% 35% 18% Europe Thermal treatment 45% 6% Laboratories 7% Metals 7% Chemicals Food processing Americas 9% 13% 34% ¢ A local organization close to customers ¢ C
Slide 16: Industrial Customers
Industrial Customers ¢ Key figures 2000: = % of group turnover : 43% = Operating margin 2000: 13% = Capital employed: 2,900 million euros = ROCE**: 11% ¢ Objectives 2001-2003: = Turnover*: +4-5% = ROCE**: >13% * CAGR ** Calculated on the average tax rate of the segment 16
Slide 17: Healthcare
Healthcare ¢ A market with sustained growth = Increased demand for Healthcare worldwide = Development of home care = Increased requirements for security and hygiene ¢ Air Liquide’s offer: an exclusive network of 5,000 dedicated healthcare professionals ¢ Key figures 2000: = % of group turnover: 11%
Slide 18: Efficiency Improvement Plan 2003
Efficiency Improvement Plan 2003 ¢ Objectives: 300 million euros in 3 years (2001-2003) è Measures put into place: • Standardization of information systems • Acceleration of European platforms • Repositioning of the Industrial Customers’ sector in the United States • Deeper integration of purchasing
Slide 19: Financial Objectives 2001-2003
Financial Objectives 2001-2003 ¢ Objectives* =Turnover: >10% per annum • with investments of 1,200 to 1,400 million euros per annum =Net earnings: close to +50% in 2003 =ROCE: 12% by 2002, and improved thereafter ¢ Financial objectives* =Increase of the 2000 dividend to 3 euros per share (+27%) • Pa
Slide 20: Consolidated sales 1st Quarter 2001
| AIR LIQUIDE . Consolidated sales 1st Quarter 2001 2 May 2001
Slide 21: Solid growth in 1st Quarter 2001
Solid growth in 1st Quarter 2001 ¢ Total sales: 2,145 M€ +17.2% =Change in perimeter: - 1.0% =Foreign exchange: +1.6% =Natural gas impact: +6.5% Ø Organic growth: +10.1% ¢ Gas and services sales: 1,810 M€ * +20.3% =Change in perimeter: +0.6% =Foreign exchange: +1.7% =Natural gas impact: +7.9% Ø Orga
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Slide 24: Geographical presence in 2000
Geographical presence in 2000 18% Large Industry Industrial Customers 51% Electronics The Gulf States and the Midwest represent 69% of total turnover in the United States 24
Slide 25: United States: Pipeline network
United States : Pipeline network Oxygen Pipeline Nitrogen Pipeline Hydrogen Pipeline Air Separation Plant Hydrogen Plant Cogeneration Plant Hydrogen/CO Plant 25
Slide 26: United States: Key figures for 2000
United States : Key figures for 2000 Total turnover: 1,827 million euros Growth 2000/99: +21% ex forex Weighting EBIT / Sales Large Industry 46% *20% Electronics 16% 8% Industrial Customers 37% 4% Healthcare 1% 8% Total 100% 11.6% * 27% ex natural gas and goodwill 26
Slide 27: Industrial Customers: Margin improvement plan
Industrial Customers: Margin improvement plan ¢ Exit of certain sectors, notably welding products, and repositioning into growth sectors ¢ Reconfiguration of the distribution network ➜ Restructuring program launched in November 2000 • Impact on sales: -130 million dollars • 700 to 800 people transfe
Slide 28: Gas and services sales 1st Quarter 2001
| AIR LIQUIDE . Gas and services sales 1st Quarter 2001 2 May 2001
Slide 29: Gas and services: Segment analysis
Gas and services: Segment analysis (excluding foreign exchange) ¢ Large Industry: (+40.2%) =Ramp up of new contracts =Strong natural gas impact in Q1 2001 (+28%) ¢ Electronics: (+32.2%) =Strong equipment invoicing in Japan and Taiwan ¢ Industrial customers: (+6%) =Structure impact close to neutral =
Slide 30: Gas and services: Analysis by region
Gas and services : Analysis by region (excluding foreign exchange) ¢ France: (+11.9%) =Growth of all segments =Homecare recorded double digit growth ¢ Europe: (+14%) =Ramp up of new contracts in Italy & Northern Europe =Acquisition of AGA’s assets in Austria ¢ Americas: (+27.1%) =Natural Gas impact
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Slide 32: Financial data
Financial data 1999 2000 Exchange rates(1) (in euros) USD 0.94 1.08 Yen (1,000) 8.24 10.05 Amortization of goodwill (in million euros) 28.5 33.0 Capitalized financial charges (in million euros)27.6 13.2 Tax rate (%) - Air Liquide method 34.6% 30.9% Current income taxes + Deferred income taxes Earnin
Slide 33: Statement of consolidated earnings (1/2)
Statement of consolidated earnings(1/2) 1999/98 2000/99 2000/99 In million euros 1999 2000 ex.forex % % Sales 6,538 +7.4% 8,099 +23.9% +15.6% Sales Gases and Services 5,254 +10.2% 6,598 +25.6% +16.5% Cost of products sold, operating expenses and innovation costs 4,955 +5.8% 6,206 +25.3% +16.5% Depre
Slide 34: Statement of consolidated earnings (2/2)
Statement of consolidated earnings(2/2) 1999/98 2000/99 2000/99 1999 2000 ex.forex In million euros % % Operating income 935 +10.4% 1,116 +19.4% +13.5% Financial results (90) (147) Companies by the equity method 39 46 Other income 28 (4) Earning before income taxes 912 +10.3% 1,011 +10.9% +5.9% Inco
Slide 35: Net financial charges
Net financial charges Contributing elements to the increase in financial charges In million euros 13 Capitalized 18 13 interest 10 42 14 57 Capitalized interest 28 90 147 Exchange Volume of Interest 1999 rate debt rate 2000 35
Slide 36: Other income and expenses
Other income and expenses In million euros 1999 2000 Gains on disposals 31 49 Miscellaneous income and charges (3) (18) Exceptional provisions - Customer risk (35) - Write-off information systems Total other income and expenses 28 (4) 36
Slide 37: Income taxes
Income taxes 1999 2000 Average group tax rate 34.6% 30.9% Change 2000/1999 of which: > Fiscal savings > Reduction of the tax rate in France > Other impacts 37
Slide 38: 2000 consolidated results by area
2000 consolidated results by area 2000 2000 In million euros 1999 2000 ex.forex % Sales France 1,628 1,874 15.1 15.1 Europe excluding France 1,938 2,216 14.3 13.9 Americas 1,937 2,688 38.8 20.6 Asia Pacific 933 1,217 30.5 11.6 Africa 103 104 2.8 0.0 Total 6,538 8,099 23.9 15.6 Operating income Franc
Slide 39: Consolidated balance sheet
Consolidated balance sheet In million euros LIABILITIES & ASSETS 31/12 31/12 STOCKHOLDERS' 31/12 31/12 1999 2000 EQUITY 1999 2000 Net assets 7,499 7,664 Stockholders' equity 4,927 5,286 in which net goodwill 728 744 Minority interests 344 358 Provisions and deferred Others long-term assets 542 591 i
Slide 40: Statement of changes in financial position (1/2)
Statement of changes in financial position (1/2) In million euros 1999 2000 Net earnings 100% 610 713 Depreciation and amortization 648 777 Deferred income taxes 98 69 Increase (decrease) on provisions (42) 15 Impact of equity in earnings (6) (10) Cash flow 1,308 1,564 40
Slide 41: Statement of changes in financial position (2/2)
Statement of changes in financial position (2/2) In million euros 1999 2000 Funds provided by operations 1,308 1,564 Distributions (256) (287) Acquisition of fixed assets (1,438) (1,015) Change in working capital (48) (95) Others 4 190 Net before financing (430) 357 Increase in share capital 32 4 Pu
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Slide 43: Long term contracts: acceleration of ROCE
Long term contracts: acceleration of ROCE 1 2 5 10 Investments 100 INV : 100 Capital employed, depreciation 15 years 100 95.3 79.3 40.0 R/I : 14 % Operating income / investment - 10.0 14.0 14.0 IRR : 12 % Net earnings - 6.2 8.7 8.7 ROCE - 7% 11% 19% ROCE 35 30 25 20 15 10 IRR = 12% 5 0 1 2 3 4 5 6 7
Slide 44: 16 large contracts commissioned in 2000
16 large contracts commissioned in 2000 1st half 2000 2nd half 2000 6 new plants 10 new plants Belg. Charleroi (O2 ) Sue. Boliden (O2 ) U.S.A. BASF II (O2 ) U.S.A. Lukens Steel (O2 ) Bulg. Union Minière (O2 ) All. Norddeutsche (O2 ) U.S.A Puget Sound (O2 ) Arg. Siderar (O2 ) Can. Ispat/Sidbec (O2 )
Slide 45: Strong growth of services
Strong growth of services 2000/1999 In million euros 1999 2000 % Healthcare 344 455 32% Industry 258 322 25% Energy solution 224 449 100% Total services 826 1 226 48% % of Gas and services sales 16% 18.6% 45
Slide 46: Strong accelerated growth of earnings
Strong accelerated growth of earnings In million euros 652 700 +15.8% 600 500 400 300 200 100 0 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 46