Air Liquide Sa · EURONEXT:AI
Air Liquide Sa — Q3 2018 Earnings Presentation
36 slides from Air Liquide Sa's earnings presentation, Oct 24, 2018
Slide 1: Q3 2018 Activity
Q3 2018 Activity Continued Strong Growth Dynamic Business Development Paris, 24 October 2018
Slide 2: 2018 Q3 Activity
2018 Q3 Activity Fabienne Lecorvaisier Executive Vice President & Chief Financial Officer 2 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 3: Highlights
Highlights Group comparable sales growth +6.0% in Q3 Top of NEOS expected range High G&S, improvement in E&C and strong GM&T Efficiencies and synergies delivered High signings and thriving business opportunities Note: NEOS sales growth objective between +4% and +6% CAGR 2016-2020 and betwe
Slide 4: Growth at the Top of NEOS Range
Growth at the Top of NEOS Range Note: NEOS sales growth objective between +4% and +6% CAGR 2016-2020 and between +6% and +8% including Airgas scope effect in 2017 4 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 5: Favorable Environment, Softening FX Headwind
Favorable Environment, Softening FX Headwind World IP Remaining at High Level Softer Negative Forex Impact(1) Industrial Production Year on Year in % (3-month rolling average) -1.2% ~-4% Estimated Q3 2018 FY 2018 Higher Positive Energy impact +2.3% ~+1% Estimated Q3 2018 FY 2018 (1) On Group sales 5
Slide 6: Strong Global Growth Across All WBLs in Q3
Strong Global Growth Across All WBLs in Q3 +11% INDUSTRIAL MERCHANT +4% +6% LARGE INDUSTRIES +5% +5 % HEALTHCARE +6 % ELECTRONICS +9 % AMERICAS DEVELOPING ASIA ECONOMIES Comparable G&S sales growth 6 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry a
Slide 7: Base Business Operating at Highest Level
Base Business Operating at Highest Level G&S Quarterly Growth Analysis +14% +31% +29% (1) Comparable growth based on 2016 adjusted sales 7 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 8: Q3 – High Growth in Americas, Solid Europe
Q3 – High Growth in Americas, Solid Europe AMERICAS EUROPE Q3 2018 Q3 2018 €2,017m €1,779m G&S Comparable Sales Growth Strong LI growth and very robust IM Solid growth across all WBLs • LI: high demand, OCI start-up • LI: high H2 volumes in Oil & Gas, • IM: broad-based growth in all markets, strong
Slide 9: Q3 – Strong Asia, Major RU in South Africa
Q3 – Strong Asia, Major RU in South Africa MIDDLE-EAST AS I A - P AC I F I C & AF R I C A Q3 2018 Q3 2018 €1,099m €171m G&S Comparable Sales Growth Very dynamic IM and continued buoyant EL Positive impact of major RU • LI: lower ramp-ups contribution in China, • LI: Sasol start-up in South Africa in
Slide 10: Q3 – Better Pricing in IM, High Demand in LI
Q3 – Better Pricing in IM, High Demand in LI INDUSTRIAL L AR G E M E R C H AN T I N D U S TR I E S Q3 2018 Q3 2018 €2,312m €1,454m G&S Comparable Sales Growth Pursued trends in all geographies Americas driving growth in Q3 • 6th quarter of growth >+15% in China • High volumes of air gases and H2 in
Slide 11: Q3 – Robust HC, Buoyant EL
Q3 – Robust HC, Buoyant EL H E AL T H C AR E E L E C TR O N I C S Q3 2018 Q3 2018 €862m €438m G&S Comparable Sales Growth Sustained organic activity Above 15% growth in Asia • Strong growth in Home Healthcare • Very high demand from IC market • High Medical Gases in U.S. • Strong growth of Carrier G
Slide 12: Continued Recovery in E&C, GM&T Supported by Innovation
Continued Recovery in E&C, GM&T Supported by Innovation E&C - Progressive Improvement GM&T - Strong Sales and Order Intake €285m +33% €313m +27% Sales YTD 18 Sales YTD 18 €656m +30% €328m +70% Order Intake YTD 18 Order Intake YTD 18 12 24 October 2018 Q3 2018 Activity The world leader in gases, tech
Slide 13: Efficiencies Above NEOS Target
Efficiencies Above NEOS Target YTD 2018 Efficiencies NEOS Cumulated Efficiencies >€1,200m 2020 >€900m 2019 €254m >€600m 2018 €577m Target YTD 2017 13 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 14: Total Airgas Synergies Moved Earlier to Beginning of 2019
Total Airgas Synergies Moved Earlier to Beginning of 2019 Initial target(1) 215m Latest update >300m >300m Early 2019 US$ 2019 273m Q3 18 >235m 2018 215m Costs ~US$222m 2017 >175m Revenue ~US$51m 2017 45m 45m 2016 2016 (1) Defined in 2016 In US$ In US$ 14 24 October 2018 Q3 2018 Activity The wor
Slide 15: Very Solid Cash Flow, Net Debt Below €14bn
Very Solid Cash Flow, Net Debt Below €14bn YTD 2018 figures Cash Flow on Sales(1) Net CAPEX Net Debt 19.5% €1.7bn €13.9bn • >€3bn(1) • 10.7% of sales • 78% Gearing(2) (1) Operating Cash Flow before change in Working Capital Requirements, as of 30 September 2018 (2) Adjusted for dividend seasonality
Slide 16: 2018 Q3 Focus Investments and Business Opportunities
2018 Q3 Focus Investments and Business Opportunities Mike Graff Executive Vice President & Americas Hub 16 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 17: High Level of Signings
High Level of Signings Increased Investment Decisions(1) 14 projects above €20m signed YTD €1.9bn Americas Asia 4 7 1,9 3 Europe Number of projects 1,7 • Very high success rate in AL existing LI basins – ~€200m in Gulf Coast – ~€80m in Benelux new investments – ~€100m in Korea • Leading positions in
Slide 18: Increased Backlog
Increased Backlog Decisions Start-ups €2.3bn €2.4bn €2.1bn €2.1bn in €bn € 1.0bn Dec 2015 Dec 2016 Dec 2017 Decisions Start-ups Sept. 2018 Yearly Sales Backlog(1) after full Ramp-ups (1) See definitions in appendix 18 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and servi
Slide 19: Update on Start-Ups
Update on Start-Ups Major start-ups 2018 2019 2017 Q1 Q2 Q3 Q4 Q1 Q2 Sasol OCI Takeover Electronics Chinese Yanchang Pemex Project Electronics RSA U.S. Europe Projects Project China Mexico Middle- Projects Asia East Asia Fujian Shenyuan Sales growth contribution China (1) €192m ~€250m YTD Sept.18 FY
Slide 20: Thriving Bidding Activity
Thriving Bidding Activity Increasing Investment Opportunities(1) 12-month portfolio +20% compared to Q3 17, €bn back to Q4 2015 level 2,8 €2.6bn Balanced risk 2,6 >€100m €50m - €100m 2,4 €20m - €50m 2,2 <€20m 2 Q4 17 Q1 18 Q2 18 Q3 18 Number of projects (1) See definitions in appendix 20 24 Octo
Slide 21: Portfolio Well Aligned with Market Trends
Portfolio Well Aligned with Market Trends 12-month portfolio of opportunities(1) GM&T, HC, LI Chemicals €2.6bn others Middle-East €2.1bn & Africa Electronics Americas >40% €2.6bn Industrial Asia Merchant Europe LI Other LI Oil & Gas LI Metals Q3 17 Q3 18 Increased Asia and Middle-East >50% in Chemic
Slide 22: 2018 Outlook
2018 Outlook Continued strong growth “Assuming a comparable Q3 with Group sales up +6%(1) environment, Air Liquide is 2018 2018 confident in its ability to deliver Performance well on track net profit growth in 2018, Thriving business calculated at constant opportunities exchange rate and excl
Slide 23: Q3 2018 Appendix
Q3 2018 Appendix 23 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 24: Q3 2018 G&S Revenue Breakdown by Region
Q3 2018 G&S Revenue Breakdown by Region EUROPE €1.8bn ASIA- AMERICAS PACIFIC €2.0bn €1.1bn €5,066m Industrial Merchant Large Industries Healthcare Electronics 24 24 28 July 2017 October 2018 H1 2018 Q3 2017 Activity Results The world The worldleader leaderiningases, gases,technologies technologies a
Slide 25: Americas
Americas Q3 Gas & Services Sales: €2,017m INDUSTRIAL MERCHANT LARGE INDUSTRIES HEALTHCARE ELECTRONICS • Broad-based growth, particularly in • High volume growth • Strong Medical Gases in • High E&I sales manufacturing, metal fabrication and for O2 and H2 the U.S. construction in the U.S. • OCI start
Slide 26: Europe
Europe Q3 Gas & Services Sales: €1,779m INDUSTRIAL MERCHANT LARGE INDUSTRIES HEALTHCARE • Sustained growth, especially in France, • Increase in H2 volumes for Oil & Gas • Very robust organic growth Germany and Italy • Strong growth in Eastern Europe • Strong HHC, especially in Scandinavia, with • Dy
Slide 27: Asia-Pacific
Asia-Pacific Q3 Gas & Services Sales: €1,099m INDUSTRIAL MERCHANT LARGE INDUSTRIES ELECTRONICS • Buoyant China (>+15%), • Several customer turnarounds in China • Continued buoyant growth strong volume increase in and Singapore • >+10% growth in Carrier Gases cylinders • Less contribution from RU in
Slide 28: Progressive Improvement in E&C, Dynamic GM&T
Progressive Improvement in E&C, Dynamic GM&T Sales and Order intake(1) – in €m E&C GM&T 200 200 (2) 100 100 0 0 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18 Sales Order intake Sales Order intake (1) Group and third-party order intake 28 24 October 2018 Q3 2018
Slide 29: Industrial Merchant Pricing
Industrial Merchant Pricing 29 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 30: Impact of Currency and Energy on G&S Revenue
Impact of Currency and Energy on G&S Revenue Refer to appendix for definitions 30 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 31: Revenue Analysis by Quarter and by Business Line
Revenue Analysis by Quarter and by Business Line 31 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 32: Revenue Analysis by Quarter and by Geography
Revenue Analysis by Quarter and by Geography 32 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 33: G&S Revenue Growth by Quarter and by Impact
G&S Revenue Growth by Quarter and by Impact 33 24 October 2018 Q3 2018 Activity The world leader in gases, technologies and services for Industry and Health
Slide 34: 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 35: Regular and Sustained Performance
Regular and Sustained Performance 21 000 Revenue (in €m) +6.0% EPS(1) (in €) +7.5% 18 000 C AG R C AG R 5,0 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 19
Slide 36: 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 Muriel Légeron + 33 (0)1 40 6