Air Liquide SA · EURONEXT:AI
Air Liquide SA — Q3 2011 Earnings Presentation
28 slides from Air Liquide SA's earnings presentation, December 2011
Slide 1: 2011 3rd quarter activity: Solid activity levels
2011 3rd quarter activity Solid activity levels Robust business development model December, 2011 2011 3rd quarter Solid activity levels Robust business development model Balanced mix of activities Geographical and applications diversity 2 Continued investment dynamic Net debt under control A
Slide 2: Q3 2011 Key figures
Q3 2011 Key figures Sales Q3 11/10 Q3 11/10 YTD 11/10 In €m Q3 11 as published comparable* comparable* Gas & Services 3,223 +5.9% +7.7% +9.5% Engineering and Construction 158 -15.3% -14.4% -21.9% Other Activities 216 +8.0% +8.9% +8.9% 3 Group Total 3,597 +4.9% +6.6% +7.7% * comparable: excluding for
Slide 3: Continued growth in Gas & Services and in all geographies
Continued growth in Gas & Services… G&S comparable growth* 2008 2009 2010 2011 12% +11.0% +11.3%+11.4% +10.7% +9.7% 10% +7.9% +8.3% 8% +7.7% 6% 4% 5 2% 0% -2% -4% -4.2% -4.6% -6% -5.1% -5.2% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2008 2009 2009 2009 2009 2010 2010 2010 2010 2011 2011 2011 * comparable:
Slide 4: Dynamism of developing economies
Dynamism of developing economies G&S comparable* sales growth (YTD 2011 / YTD 2010) +9% +6% +21% +2% +32% +9% 7 +16% Advanced Economies Developing Economies +6% +24% * comparable: excluding forex, natural gas and significant perimeter impacts Air Liquide, the world leader in gases for industry, heal
Slide 5: Good order intake in Engineering & Construction
Good order intake in Engineering & Construction Third party E&C sales E&C order intake In €m In €m YTD Year 300 574 1500 448 1250 203 200 185 186 177 1000 156 158 134 750 100 1105 500 9 800 706 250 437 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2008 2009 2010 2011 2010 2010 2010 2010 2011 2011 2011 Stabilization of t
Slide 6: Recent trends in our end markets; Steady operating performance
Recent trends in our end markets Large Industries - Steel - - Chemicals - - Refining - Industrial Merchant - Food - Craftsmen & - Auto & Fab - & Pharmacy - Distributors - Electronics - Flat screens - Integrated circuits - TFT/LCD - - Photovoltaic - 11 Healthcare - Home healthcare - - Medical gases -
Slide 7: Robust business development model
2011 3rd quarter Robust business development model Balanced mix of activities Geographical and applications diversity Continued investment dynamic Net debt under control Robust business models and balanced mix of activities Industrial Merchant Large Industries Diversified customers / application
Slide 8: Geographic expansion; Diverse applications portfolio
Geographic expansion Global presence Acceleration in developing countries YTD G&S sales 10 historic countries France 70 other Germany countries Spain 22% 30% Italy 22% Belgium 70% 19% Netherlands United-States 16% Canada 15% Japan 15 Australia YTD G&S sales growth 10 historic 70 other countries coun
Slide 9: Continued investment momentum; New project signing
Continued investment momentum… 12-month portfolio Investment Net capex* Start-ups** of opportunities decisions 48 In €bn In €bn In €bn 2.2 1.7 24 3.9 3.7 3.9 1.4 1.2 0,9 0,8 0,9 1.5 15 1.1 17 12 3,0 2,9 3,0 YTD YTD YTD YTD YTD YTD Dec-10 June-11 Sept-11 2009 2010 2011 2009 2010 2011 2009 2010 2011e
Slide 10: Sustained long-term investment returns; Strong balance sheet
Sustained long-term investment returns Operating income vs. capital employed* Base 100 Operating income 200 recurring 175 150 Capital employed 125 100 19 75 50 25 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 June 11 ** * Shareholders equity + minority interests + net debt, end of the period *
Slide 11: Access to new financing markets; Net debt under control
Access to new financing markets Issuance in RMB Investors by geography in September 2011 (for the 5-year tranche) €200m, 5 years Coupon: 3.00% Others Europe 3% + Hong Kong 12% €100m, 7 years 21 Coupon: 3.95% 52% 33% Singapore Air Liquide, the world leader in gases for industry, health and the enviro
Slide 12: 2011 Outlook
2011 Outlook * Q3 2011 Activity globally in line Steady operating performance Robust business development model 23 2011 objective confirmed Continued steady growth of net profit in 2011 * in a normal environment Air Liquide, the world leader in gases for industry, health and the environment December
Slide 13: Europe in Q3; Americas in Q3
Europe in Q3 Industrial Merchant 3% Strong growth in Central and Q3 Gas & Services sales: 24% 33% Eastern Europe €1,621m 40% Western Europe stable excluding internal transfers Pricing impact positive Q3 11/10 Comparable change: +4.3%* Large Industries Small decline in Metals -0.9% Indust
Slide 14: Asia-Pacific in Q3; 1st Half key figures
Asia-Pacific in Q3 Industrial Merchant 26% New liquid capacities in China Q3 Gas & Services sales: 38% €791m 4% First signs of recovery in Japan 32% Large Industries Numerous ramp-ups in China Q3 11/10 Comparable change: +12.5%* H2 volume increase in Industrial Merchant Singapore +7.1% Large
Slide 15: Gas & Services margin in H1 2011; Change in debt
Gas & Services margin maintained in H1 2011 G&S operating margin 19.2 % 19.2 % * +123 <13> M€ 1,206 1 200 + 96 0 + 32 1,091 <122> + 31 1 100 1 000 29 900 800 0 OIR OIR S1 09 Effet volume Growth Effet Energie Energy Augmentation Cost Pricing Prix hors Efficacités Efficiency _ Change / Currency S1 10
Slide 16: 2015 objectives: Large Industries market drivers
Appendices Remin de r 2015 objectives Large Industries 2010-2015 Market Drivers Growth in Outsourcing 35% of O2 production today 20% of H2 production today New capacities in developing markets 80% of expected market growth Renovation in advanced markets Green technologies 32 Over the Fence Gas
Slide 17: Engineering & Construction; Industrial Merchant market drivers
Engineering & Construction Business Model Markets Advanced Proprietary Orders in Hand (H1 2011) Technologies Air Gases, HyCO Fuels € 4.1 bn Gasification Renewable Refining/Chemicals 4% Biofuels Alternative Air Gases 10% 50% Amplified by Lurgi acquisition Traditional Competitiveness 14% 3
Slide 18: Health and Electronics 2010-2015 market drivers
Health 2010-2015 Market Drivers Demography / Epidemiology / Economic development Fast Ageing Populations Expected Market Over 60s to triple by 2050 Growth 2 billion by 2050 Rising Chronic Diseases +6% CAGR COPD, 3rd cause of death by 2030 35 Diabetes: 300 million patients +12% in Developing
Slide 19: 2015 objectives; Growth drivers confirmed
2015 objectives Sales growth Efficiency +8 to +10% > € 200 m In a normal environment Per year on average 37 ROCE Engagement in 12 - 13% Responsibility objectives Range in the period Air Liquide, the world leader in gases for industry, health and the environment December, 2011 Growth drivers confirme
Slide 20: Grow sales of +8 to 10%; Invest in all geographies
Grow sales of +8 to 10% 1-2 015 201 While Global Market Grows + 7 to +8%, Air Liquide Growth +8 to +10%* Industrial Merchant Large Industries +6 to 9% +9 to 11% 39 40% 34% Electronics 10% 16% Healthcare +8 to 10% +7 to 11% Air Liquide 2010 revenue CAGR (compound annual growth rate) estimates for Air
Slide 21: Generate >€200m efficiencies; Achieve ROCE 12-13%
Generate > €200m operational efficiencies / year Reorganizations A sustainable component of our management and general expenses Procurement Industrial & Supply Chain globalization Efficiencies in M€ Efficiency 335 300 3C* 280 Operational efficiencies 230 over € 200 M per year on average 41 200 180 1
Slide 22: Appendices: Air Liquide background
Achieve ROCE in the 12% to 13% range New project returns Time to production Improved Capital Efficiency Design to cost Reduced capital Intensity Standard plants Network & Basin Asset mutualization Better use 43 of assets WCR optimization Cash & Debt management Global Cash management Air Liquide, the
Slide 23: Air Liquide, the world leader in gases; global presence
Air Liquide, The world leader in gases for: Group 2010 sales: €13.5 bn Gas & Services Industry 88% Health 45 Other Engineering & activities Construction 6% 6% The Environment 2010 Net profit: €1.4bn 2010 ROCE: 12.1% Air Liquide, the world leader in gases for industry, health and the environment Dece
Slide 24: Air Liquide, leader of the industry; balanced portfolio
Air Liquide, leader of the industry 2010 Revenues (€bn) 2010 G&S Market share Air Liquide 22% Air Liquide 11.9 Others 10.2 34% Linde 47 Praxair 7.2 Linde 19% Air Products 6.5 Air Products 12% Praxair 13% Gas and Services Other activities Fiscal year 2010. Source: Companies Source: Air Liquide estima
Slide 25: Strongest innovation organization; Business Line margins
The strongest innovation organization 49 Innovation budget in % of sales 2,0% 1.7% 6 R&D centers 1,5% 1.3% 7 E&C centers* 1,0% 0.9% 0.8% 9 Technical centers 0,5% 0,0% AL AP Linde Px * technical development only Source: Air Liquide estimates Air Liquide, the world leader in gases for industry, health
Slide 26: Cost / Price / Efficiency equation; Sustainable development
The “Cost / Price / Efficiency” equation G&S OIR margin 19.4%* +77 in €m 19.6% 2,281 2 200 19% FX, +163 others 17.7% +250+ XX <189> 2 000 +58 <14> +298 Volume 1,994 effect Cost Price Efficiencies 1,949 FX, <284> increase others excl. 1 800 91% energy <137> +110 51 Volume 1 600 effect Efficiencies Pr
Slide 27: Investment cycle of a Large Industries contract
Investment cycle of a Large Industries contract Opportunities under Signature Construction Commissioning and revenue discussion 12-month Investment Capex Start-ups Ramp-ups Portfolio decisions Investment amount 100 100 100 Revenue amount * 53 50 50 50 50 40 30 2008 2008 2009 2009 2009 2010 2010 2011
Slide 28: For further information, please contact
For further information, please contact: Investor Relations Virginia Jeanson + 33 (0)1 40 62 57 37 Annie Fournier + 33 (0)1 40 62 57 18 Bastien Maurice + 33 (0)1 40 62 59 38 www.airliquide.com Corporate headquarters: 75, Quai d’Orsay L’Air Liquide S.A. 75321 Paris Cedex 07 Corporation for the