Full Year 2018 Results Strong growth reinforced throughout the year - - PowerPoint PPT Presentation

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Full Year 2018 Results Strong growth reinforced throughout the year - - PowerPoint PPT Presentation

Jun 11, 2023 129 likes •638 views

Full Year 2018 Results Strong growth reinforced throughout the year and solid performance Paris, 14 February 2019 Agenda 1. Profitable, consistent and responsible growth 2. Strong growth reinforced throughout the year and solid performance

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SLIDE 1

Full Year 2018 Results

Strong growth reinforced throughout the year and solid performance

Paris, 14 February 2019

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SLIDE 2

Agenda

1. Profitable, consistent and responsible growth 2. Strong growth reinforced throughout the year and solid performance

  • Strengthening efficiency program
  • Dynamic business development

3. 2019 outlook

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health 2

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3

Profitable, consistent and responsible growth

Benoît Potier

Chairman & Chief Executive Officer

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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SLIDE 4

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

FY 2018 Highlights

4

+6.1% +60bps +30bps +22%

Strong sales growth in all markets and geographies ROCE ramping up Improved G&S Operational margin Record level of investment decisions

(1) Group comparable sales growth (2) Excluding energy impact (2) (1) (3) (3) Excluding FX impact and positive impact on 2017 net profit of non-cash one-off items

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SLIDE 5

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

High Sales Growth, Markets Well Oriented

5

Group Gas & Services Comparable sales growth

  • 1%

0% 1% 2% 3% 4% 5% 6% 7% H1 16 H2 16 H1 17 H2 17 H1 18 H2 18

Sales growth Markets

Chemicals Oil & gas Steel Metal Fab. Construction Energy Food & Pharma Integrated Circuit Outlook H1 19

         

IM LI EL

FY +6.1%

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SLIDE 6

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

FY 2018 – All Performance Indicators Further Improving

6

ROCE G&S OIR/sales

+30bps

Net profit Net debt

+4.2% <€836m>

69%

  • Excl. energy

Gearing

(1) (1) Compared to recurring 2017 net profit, excluding non cash non recurring items and taxes

8.0%

+8.7%

  • Excl. FX

8.3%

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7

Dividend Proposal, 1 Free Share for 10 in 2019

(1) Excluding non-cash non-recurring items & taxes (2) Historical data adjusted for attribution of free shares and for a factor 0.974 reflecting the value of the rights of the capital increase completed in October 2016 (3) Subject to approval at the combined shareholders’ meeting scheduled for 7 May 2019

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

Dividend Growth

0,0 0,4 0,8 1,2 1,6 2,0 2,4 2,8 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018

20 yrs CAGR

+8.8%

Dividend(2)

in € per share

€2.65

Net Profit

€2.1bn

(3)

As published

+ 4.2%

Compared to 2017 Recurring Net Profit(1)

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8

Record Level for Investment Decisions, >€3bn

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

  • Reinforcing presence

in key basins

  • Strategic positions

in growing markets

  • Opening innovative

new markets

~40%

2018 investment decisions

~40% ~20%

Large Industries Industrial Merchant Electronics Global Markets & Technologies

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9

2019 - Focus On NEOS Objectives

14 February 2019

  • Strategic investments to support growth
  • Strengthening efficiencies
  • Focus on ROCE

Profitable growth Consistent growth Responsible growth

  • Solid and resilient Business Model
  • Innovation and digital
  • Operational excellence
  • Climate objectives, 2015-2025
  • Reduce carbon intensity by 30%
  • Develop new low carbon solutions

for customers and ecosystems

A world leader in gases, technologies and services for Industry and Health FY 2018 Results

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10

Strong Growth Reinforced throughout the Year and Solid Performance

Fabienne Lecorvaisier

Executive Vice President & Chief Financial Officer

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Growth at the Top of NEOS Range

11 14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

Note: NEOS sales growth objective between +6% and +8% CAGR 2016-2020, including Airgas scope effect in 2017 contributing +2% to the CAGR (1) Comparable sales growth: excluding currency, energy and significant scope impacts

(1) (1)

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SLIDE 12

Positive Environment, Softening FX Headwind

World IP at High Level in 2018

12 14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

Neutral Forex Impact in Q4 2018(2)

Q4 2018

  • 0.1%

FY 2018

  • 3.6%

Higher Positive Energy impact(2) +2.4% +1.3%

Q4 2018 FY 2018

Industrial Production growth in % YTD 2018(1)

+4.0% +3.0%

U.S. World

+4.5% +1.2%

Developing Economies Euro zone

(1) End of Nov. 2018, except U.S. end of Dec. 2018 (2) On Group sales

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13

Q4 - Strong Growth Drivers Across Geographies and WBLs

Comparable G&S sales growth

ASIA INDUSTRIAL MERCHANT AMERICAS HEALTHCARE

+5%

+9%

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

+13%

DEVELOPING ECONOMIES

+6%

ELECTRONICS

+5%

LARGE INDUSTRIES

+3% +18%

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14

Base Business Operating at Highest Level

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

G&S Quarterly Sales Growth Analysis

(1) Comparable growth based on 2016 adjusted sales

+29% +31% +14%

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SLIDE 15

Q4 – Strong Momentum in Americas, Solid Europe

AMERICAS

FY 2018

€7,982m

EUROPE

FY 2018

€7,111m

Dynamic activity in all WBLs

  • LI: high H2, start-ups in air gases
  • IM: high growth with increased pricing; most markets

well-oriented, very strong Metal Fabrication

  • Dynamic HC in the U.S. and South America
  • EL: high Advanced Materials, buoyant E&I
  • LI: HyCO turnarounds, start-up in Turkey
  • IM: growth in all countries; high bulk and

cylinders; stronger pricing

  • HC: HHC driving growth especially

diabetes in Nordics

High IM and HC

G&S Comparable Sales Growth

15 14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Q4 – Very Dynamic Asia, Major Start-Up in South Africa

IM boosted by China, buoyant EL

  • LI: 3 start-ups including Fujian but major

H2 turnaround in Singapore

  • IM: China driving growth with high cylinder

volumes, softer pricing; dynamic SEA

  • EL: buoyant activity with double-digit growth

in CG and AM, very dynamic E&I

Full impact of major start-up in LI

  • LI: Sasol start-up in South Africa in Dec. 17
  • IM: high growth in Egypt and India
  • HC: major contribution from acquisition in

Saudi Arabia

ASIA-PACIFIC

FY 2018

€4,359m

MIDDLE-EAST & AFRICA

FY 2018

€655m

G&S Comparable Sales Growth

16 14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

FY 18 : +15.5%

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Q4 – Strong IM, Solid LI

LARGE INDUSTRIES

FY 2018

€5,685m

INDUSTRIAL MERCHANT

FY 2018

€9,181m

Robust growth, several start-ups

  • 5 SUs, contribution only

end of Q4

  • Strong H2 in Americas
  • HyCO turnarounds in Europe

and Asia

Favorable environment with price hikes

All end markets positive Very strong fabrication market Strong bulk, cylinders catching up Increased pricing at +3.3%

G&S Comparable Sales Growth

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

FY 18 : +4.5%

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Q4 – Steady HC Growth, Buoyant EL

Very solid organic activity

  • Double-digit growth in HHC,

low level of bolt-on acquisitions

  • Solid business model
  • High Medical Gases in Americas

driven by Proximity Care

Record sales growth

  • Strong demand from

IC market

  • Very high growth of

CG and AM

  • Very dynamic E&I

HEALTHCARE

FY 2018

ELECTRONICS

FY 2018

€1,755m €3,486m

G&S Comparable Sales Growth

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Continued Recovery in E&C, High Growth in GM&T

19 14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

E&C - Strong Improvement

Sales FY 2018*

+31%

Order Intake FY 2018

+11% GM&T - Strong Sales and Order Intake +30% +31%

Sales FY 2018* Order Intake FY 2018

€807m €460m €430m €474m

* Comparable sales growth

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Improved OIR Margin in line with NEOS

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

Note: Group FY 18 OIR Margin as published at 16.4%

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$300m Airgas Synergies Fully Delivered Beginning 2019

14 February 2019

$290m

  • Costs

~$230m

  • Revenue ~$60m
  • $300m synergies expected in Q1 2019, one year ahead initial target
  • Airgas fully integrated
  • From 2019, future Airgas contribution to the efficiency program

Cumulated synergies End of 2018

FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Efficiencies Outpaced NEOS Target of €300m per Year

€351m

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

FY 2018 Efficiencies NEOS Cumulated Efficiencies as defined in initial target

2020 2019 2018 2017

>€1,200m >€900m

€674m

as of 31/12/2018

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Strengthened Efficiency Program Starting in 2019

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

100 200 300 400 Initial target New target

  • 50% Airgas

efficiencies

  • 50%
  • Organization

agility – Mutualization

  • Leverage on

digital

>€300m

>€400m

Annual target Cumulated NEOS forecast in 2020

Update

>€1.2bn

>€1.5bn

Update

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Net Profit Recurring Excluding Currency +8.7%

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

(1) Excluding non-cash one-off items in 2017 net profit

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Significant Debt and Gearing Reduction

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

CASH FLOW

+10.9%

(1) Including acquisitions, transactions with minority shareholders, net of divestitures. (2) Including share purchases and capital increases.

GEARING

80%

GEARING

69%

Net Debt 31 Dec. 2017 Net Debt 31 Dec. 2018

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Delivering NEOS ROCE Objective

14 February 2019

6% 8% 10%

  • Dec. 15
  • Dec. 16

adjusted

  • Dec. 17
  • Dec. 18

2021/22 2021/2022 NEOS

  • bjective

>10%

Airgas acquisition

10.3% 6.9%

ROCE – After tax

(1) Excluding positive impact on 2017 net profit of non-cash one-off items

7.7%(1) 8.0%

as published

8.3% excl. FX +60bps

FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Dynamic Business Development

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Very High Decisions & Increasing Opportunities

Investment Opportunities(1)

12-month portfolio

2018 Investment Decisions(1) 2018 Start-up/Ramp-up Sales Growth Contribution

€270m €2.6bn

  • Selectivity in thriving

bidding activity

  • Medium-size opportunities
  • Record level
  • Very high in LI, EL and GM&T
  • 1/3 of decisions in the U.S.
  • 17 start-ups

(1) See definitions in appendix

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

€3.1bn

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Strong Backlog

(1) See definitions in appendix

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

Dec 2015 Dec 2016 Dec 2017 Decisions Start-ups Dec 2018

Start-ups Decisions

Yearly Sales Backlog(1) after full Ramp-ups

€2.3bn €2.1bn €2.1bn €2.2bn € 0.9bn

in €bn

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30 14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

Start-Ups Outlook for 2019

Major start-ups Sales growth contribution €270m

>€300m

FY 2019 FY 2018

Note: TO = Take Over

LI TO

China

Fujian Shenyuan

China

Pemex TO

Mexico

2018 2019

Q1 Q2 Q3 Q4

Yanchang

China

LI Projects

Middle- East

EL Projects

Asia

EL Projects

Asia

Steel Projects

Europe

LI Project

Argentina

EL Projects

Asia

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2019 Outlook

  • Profitable, consistent and

responsible growth

  • Solid performance with

continued margin improvement and strong cash flow

  • Dynamic business

development 2019

2018

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

“Assuming a comparable environment, Air Liquide is confident in its ability to deliver net profit growth in 2019, calculated at constant exchange rate.”

  • Continue to focus on

growth and operational excellence

  • Strengthening efficiency

program

  • Continue to seize strategic
  • pportunities
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FY 2018

Appendix

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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FY 2018 G&S Revenue Breakdown by Region

AMERICAS

€8.0bn

EUROPE

€7.1bn

ASIA- PACIFIC

€4.4bn

Large Industries Electronics Healthcare Industrial Merchant

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

€20,107m

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Americas

Q4 Gas & Services Sales: €2,091m

INDUSTRIAL MERCHANT LARGE INDUSTRIES HEALTHCARE ELECTRONICS

  • Very solid activity for all products:

bulk, cylinders and hardgoods

  • Very strong pricing +4.2%
  • Well-oriented end-markets,

particularly Manufacturing, Metal Fabrication and Construction in the U.S.

  • Strong volumes of hydrogen

in the U.S. and high cogen in Canada

  • Ramp-ups in Argentina and

the U.S.

  • Limited customer turnarounds
  • Solid growth in the U.S. and

Canada for medical gases

  • Limited contribution from

bolt-on acquisitions

  • Strong momentum in

medical gases and HHC in Brazil

  • Double-digit sales growth

in Advanced and Specialty Materials

  • Buoyant E&I sales

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

(1) Excluding energy impact

(1)

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Europe

Q4 Gas & Services Sales: €1,868m

INDUSTRIAL MERCHANT LARGE INDUSTRIES HEALTHCARE

  • High number of customer

turnarounds in HyCO

  • Softer volumes from steel

customers

  • Start-up in Turkey
  • Growth in all countries
  • ~+1 working day
  • All markets positive; high

Manufacturing and Craftsmen

  • Strengthened pricing at +2.6%
  • Very strong HHC, particularly in

Air Liquide’s largest markets: sleep apnea and diabetes

  • Limited bolt-on acquisitions
  • Increased number of patients,

especially in Northern Europe

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

(1)

(1) Excluding energy impact

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Asia-Pacific

Q4 Gas & Services Sales: €1,153m

INDUSTRIAL MERCHANT LARGE INDUSTRIES ELECTRONICS

  • 3 SUs in China
  • H2 customer turnarounds
  • Double-digit growth in China :

very strong volumes in cylinders ; high demand for small on-site generators ; softer pricing

  • Slight decrease in Japan
  • High Fabrication and Craftsmen markets
  • Double-digit growth in Carrier Gases

and Advanced Materials in all countries

  • Multiple Ramp-ups
  • Buoyant E&I sales

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

(1) (1)

(1) Excluding energy impact

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Industrial Merchant Pricing

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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SLIDE 38

Progressive Improvement in E&C, Dynamic GM&T

38

Sales and Order intake(1) – in €m

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

100 200 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Sales Order intake 100 200 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Sales Order intake (1) Group and third-party order intake

E&C GM&T

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Consolidated P&L

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Operating Margin (OIR/Revenue)

G&S FY 2018 operating margin excluding energy improved +30bps compared to FY 2017

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Consolidated Balance Sheet Simplified - In €m

* Including fair value of derivatives 14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Cash Flow Statement

* PPE: Property, plant and equipment

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Impact of Currency and Energy on G&S Revenue

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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44

Revenue Analysis by Quarter and by Business Line

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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45

Revenue Analysis by Quarter and by Geography

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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46

G&S Revenue Growth by Quarter and by Impact

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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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 replacements or efficiency projects. Excludes maintenance and safety.

  • Investment backlog at end of the period

– Cumulated industrial investment value of projects decided but not yet started. – Industrial projects with value > €10m, including asset replacements or efficiency projects, excluding maintenance and safety.

  • Sales backlog

– Cumulated expected sales per year generated by the current investment backlog after full ramp-up.

  • Decisions of the period

– Cumulated value of industrial and financial investment decisions. – Industrial, growth and non-growth projects including asset replacements, efficiency, maintenance and safety. – Financial decisions (acquisitions).

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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Financing Structure

As of December 31, 2018

(1)Others: finance leases and put options granted to minority shareholders

14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

< 1 year > 5 years Between 1 and 5 years

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SLIDE 49

0,0 0,5 1,0 1,5 2,0 2,5 3,0 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 0,0 1,0 2,0 3,0 4,0 5,0 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018

Regular and Sustained Performance - 2018

4 000 8 000 12 000 16 000 20 000 24 000 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 1 000 2 000 3 000 4 000 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018

Revenue (in €m) EPS(1) (in €) Cashflow (in €m)

(1) Adjusted for the 2-for-1 share split in 2007, for attributions of free shares and for a factor of 0.974 reflecting the value of the rights of the capital increase completed in October 2016. (2) Calculated according to prevailing accounting rules over 30 years.

Dividend(1) (in € per share)

CAGR

  • ver 30 years(2)

+5.8%

CAGR

  • ver 30 years(2)

+6.9%

CAGR

  • ver 30 years(2)

+6.5%

CAGR

  • ver 30 years(2)

+8.3%

49 14 February 2019 FY 2018 Results A world leader in gases, technologies and services for Industry and Health

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50

For further information, please contact:

Investor Relations Aude Rodriguez  + 33 (0)1 40 62 57 08 Louis Laffont  + 33 (0)1 40 62 57 18 Ludmilla Binet  + 33 (0)1 40 62 57 37 Muriel Légeron  + 33 (0)1 40 62 50 18 Jérôme Zaman  + 33 (0)1 40 62 59 38 Joseph Marczely  + 1 610 263 8277 Communication Alexandra Rocca  + 33 (0)1 40 62 50 93 Annie Fournier  + 33 (0)1 40 62 51 31

www.airliquide.com Follow us on Twitter @AirLiquideGroup

L’Air Liquide S.A. Corporation for the study and application of processes developed by Georges Claude with registered capital of 2,361,264,235 euros Corporate Headquarters: 75, Quai d’Orsay 75321 Paris Cedex 07 Tel : +33 (0)1 40 62 55 55 RCS Paris 552 096 281

A world leader in gases, technologies and services for Industry and Health 14 February 2019 FY 2018 Results