Air Liquide SA · EURONEXT:AI
Air Liquide SA — Q1 2014 Earnings Presentation
40 slides from Air Liquide SA's earnings presentation, Apr 24, 2014
Slide 1: 2014 Q1 activity: Confirmed growth in a more favorable environment
2014 Q1 activity Confirmed growth in a more favorable environment Paris, April 24, 2014 April 24, 2014 Q1 2014 revenue World leader in gases, technologies and services for Industry and Health
Slide 2: 2014 Q1 activity
2014 Q1 activity Paris, April 24, 2014 Fabienne Lecorvaisier l Chief Financial Officer Confirmed growth in a more favorable environment Focus on Electronics Selective investments 2 April 24, 2014 Q1 2014 revenue World leader in gases, technologies and services for Industry and Health
Slide 3: Growth highlights
Growth highlights Gas & GSI in Industrial Electronics Services developing Merchant recovery economies +5.7% +14.0% +4.4% +10.3% Q1 2014 Q1 2014 Q1 2014 Q1 2014 Sales growth, excluding currency, natural gas and significant M&A impacts. GSI: Gas & Services for Industries = Large Industries + Industria
Slide 4: Key figures
Key figures Q1 2013 Q1 2014 Q1 14/13 Q1 14/13 Sales in €m as published comparable (1) Gas & Services 3,406 3,416 +0.3% +5.7% Engineering & Technology 147 175 +19.4% Other Activities 145 143 -1.7% Group Total 3,698 3,734 +1.0% +6.2% (1) Sales growth, excluding currency, natural gas and significant M&
Slide 5: 92% of sales protected from monetary risk
92% of sales protected from monetary risk Q1 2014 G&S sales Strong currencies 83% EUR Related currencies USD 9% CAD CNY 8% Other JPY currencies GBP CHF FX impact limited to Matching cash flow and translation into Euro debt currencies 5 April 24, 2014 Q1 2014 revenue World leader in gases, technologi
Slide 6: Continued outperformance in a more favorable environment
Continued outperformance in a more favorable environment G&S comparable growth(1) 120 115 Air Liquide 110 World IP Index (2) Positive signs 105 in Euro zone Continuing growth 100 in the USA Improvement in Japan 95 2010 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2011 2012 2013 2014 Base 100 in 2010 (1) E
Slide 7: Steady growth…
Steady growth… G&S comparable growth(1) 8% 2012 2013 2014 7% 6% 5.7% 5% 4.6% 4.4% 4.0% 4.0% 3.9% 4% Average +3.5% Average +2.8% 3% 2% 1.6% 1.5% 0.9% 1% 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 (1) Excluding currency, natural gas and significant M&A impacts 7 April 24, 2014 Q1 2014 revenue World leader in gases
Slide 8: ...relying on stronger base business and robust start-ups
...relying on stronger base business and robust start-ups G&S quarterly growth analysis 7,0% 2012 2013 2014 7 5,0% start-ups in Q1 3,0% Base business Start-ups, 1,0% Ramp-ups, Site takeovers, Small acquisitions -1,0% Significant M&A -3,0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 8 April 24, 2014 Q1 2014 revenue W
Slide 9: Dynamic growth in Americas and Asia
Dynamic growth in Americas and Asia G&S comparable growth(1) Americas Asia-Pacific Middle-East & Africa 17% 16% 14% 12% 12% 11% 9% 8% 7% 5% 4% 3% 3% 2% 1% Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Strong LI accross the Chinese start-ups Instability in
Slide 10: Managing European markets
Managing European markets G&S comparable growth(1) in Europe 6% Healthcare 4% 2,2% Developing 1,5% Europe GSI 0,2% 0,1% -0,2% Advanced Europe GSI -2% Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Western industrial business slightly up excluding portfolio management and electricity impact (1) Excluding currency, na
Slide 11: Large Industries & Healthcare growing above 5%
Large Industries & Healthcare growing above 5% G&S comparable growth(1) Large Industries Sound Oxygen and Hydrogen volumes 6% 4 start-ups 5% Developing economies up 3% 3% 3% +18% 38% Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q1 Healthcare 2014 7% 7% 18% 5% 5% Robust growth despite 3% pressure on tariffs Develop
Slide 12: Industrial Merchant improving, Electronics recovering
Industrial Merchant improving, Electronics recovering G&S comparable growth(1) Industrial Merchant Pursued momentum in developing economies 4% 4% 4% 4% Strong quarter in Japan 36% 1% Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q1 10% 2014 9% Electronics 8% 4% Strong activity in the US and developing Asia Q1 13 Q2
Slide 13: Focus on executing projects
Focus on executing projects E&T order intake(1) Third party E&T sales 1,905 803 In €m In €m 750 750 667 516 500 448 500 274 267 225 247 250 250 147 184 175 0 0 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 2013 2014 2013 2014 Mainly third party activity Regular progress of projects in Q1 2014 under execution (1) Gr
Slide 14: Q1 2014 wrap-up
Q1 2014 wrap-up Group Sales Cost & Investments Comparable growth (1) Q1 Efficiency gains +6.2% € 69m Operating Cash flow (2) More favorable environment € 484m Improving base business Start-ups and ramp-ups Net Industrial Capex € 471m (1) Excluding currency, natural gas and significant M&A impacts. (
Slide 15: Focus on Electronics: Enhanced strategic profile
Focus on Electronics Enhanced strategic profile Paris, April 24, 2014 Pierre Dufour l Senior Executive Vice-President 8% of G&S Revenues April 24, 2014 Q1 2014 revenue World leader in gases, technologies and services for Industry and Health
Slide 16: EL: Managing business mix to reduce cyclicality
EL: Managing business mix to reduce cyclicality % EL Sales Market Sensitivity to 2003 2013 Driver Industry Cycles Carrier Gases 28% 42% New Investments Low msi wafers(2) Specialty Gases 43% 19% m2 FPD High Advanced Electronics 5% New nodes Medium Materials(1) Equipment & 19% 18% New High Installatio
Slide 17: EL: Increasing value through innovation
EL: Increasing value through innovation Value Air Liquide 2003-2013 Improvement drivers -30% kWh per m3 Carrier Gases Energy efficiency produced Proprietary Advanced Electronics Specialty Gases materials molecules: now 5% of sales High tech Gross Margin x2 Equipment & through portfolio Installations
Slide 18: EL: Advanced Electronic Materials designed with customers
EL: Advanced Electronic Materials designed with customers A designer molecule (10 in production) Responding to specific requirements (100 molecules in pipeline) Built with leading customers and tool makers (16 US, 8 Japan, 6 Korea, 5 Europe) Protected by 250 patents Sales x5 In the last 6 years offe
Slide 19: EL: Creating a more resilient, profitable business
EL: Creating a more resilient, profitable business Air Liquide Electronics sales 9% In m€ Sales CAGR 1 500 >14% Operating margin in 1 200 2013 900 600 Margin <9% 300 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 19 April 24, 2014 Q1 2014 revenu
Slide 20: In less than 20 years, Air Liquide Electronics has become...
In less than 20 years, Air Liquide Electronics has become... A growing business Less sensitive to industry cycles A technological partner closer to its customers More profitable A recognized leader 20 April 24, 2014 Q1 2014 revenue World leader in gases, technologies and services for Industry and He
Slide 21: Selective investments
Selective investments Paris, April 24, 2014 Fabienne Lecorvaisier l Chief Financial Officer Q1 2014 Investment opportunities (1) Investment decisions (1) € 3.6 bn € 300 m Industrials Innovation (1) See definitions in appendix 21 April 24, 2014 Q1 2014 revenue World leader in gases, technologies and
Slide 22: Strong investment backlog
Strong investment backlog Q1 2014 Investment backlog Decisions Start-ups € 2.7bn € 2.5bn € 2.3bn € 2.1bn ~ €1.2bn Sales in hand after full ramp-up Dec 2011 Dec 2012 Dec 2013 Decisions Start-ups Investment backlog March 2014 See definitions in appendix 22 April 24, 2014 Q1 2014 revenue World leader i
Slide 23: Selective investments consistent with growth ambition
Selective investments consistent with growth ambition Past decisions(1) Trends In €M 3000 Financial Target 2500 Progress 2014 EL, HC steadily guidance 2000 Load existing IM capacities 1500 LI Return to average 1000 500 MSE Maintain 0 2008 2009 2010 2011 2012 2013 MSE Growth LI Growth IM Growth Other
Slide 24: 2014 Outlook
2014 Outlook Q1 2014 ■ Confirmed growth in a more favorable environment ■ Selective investments 2014 objective Barring a degradation of the environment, Air Liquide is confident in its ability to deliver another year of net profit growth in 2014 24 April 24, 2014 Q1 2014 revenue World leader in gase
Slide 25: April 24, 2014 Q1 2014 revenue World leader in gases, technologies and services for
25 April 24, 2014 Q1 2014 revenue World leader in gases, technologies and services for Industry and Health
Slide 26: Appendix
Appendix 26 April 24, 2014 Q1 2014 revenue World leader in gases, technologies and services for Industry and Health
Slide 27: 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 replacements or
Slide 28: Growth in Q1 2014 G&S revenue
Growth in Q1 2014 G&S revenue in €m 3750 +194 +24 <161> 3500 +0.7% <47> 3,406 3,416 -4.7% -1.4% 3250 +0.3% 3000 published growth 2750 +5.7% comparable growth (1) 2500 2250 0 Q1 2013 Comparable (1) Natural gas Currency Significant M&A Q1 2014 growth (1) Excluding currency, natural gas and significant
Slide 29: Impact of currency and natural gas on G&S revenue
Impact of currency and natural gas on G&S revenue Currency In €m Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 €/USD (3) (10) (30) (26) (22) €/CAD (2) (5) (16) (17) (25) €/JP¥ (40) (55) (74) (65) (35) Others (20) (27) (82) (77) (87) Total currency impact (65) (97) (202) (185) (169) Average rate Q1 13 Q2 13 Q3 13 Q4
Slide 30: Revenue analysis by quarter (1)
Revenue analysis by quarter (1) Sales in €m Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q1 14/13 Q1 14/13 comparable(1) Europe 1,769 1,778 1,745 1,766 1,701 - 3.8% - 0.2% Americas 766 824 813 822 814 + 6.2% + 11.6% Asia-Pacific 780 782 796 826 816 + 4.6% + 13.5% Middle-East 91 95 90 94 85 - 6.9% + 2.9% & Africa G
Slide 31: Revenue analysis by quarter (2)
Revenue analysis by quarter (2) Sales in €m Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q1 14/13 Q1 14/13 comparable(1) Large Industries 1,225 1,236 1,218 1,261 1,285 + 4.9% + 6.2% Industrial Merchant 1,254 1,284 1,274 1,269 1,229 - 2.0% +4.4% Healthcare 659 685 667 678 626 - 5.0% + 5.3% Electronics 268 274 285 3
Slide 32: G&S Revenue growth by quarter (3)
G&S Revenue growth by quarter (3) Growth as Natural Currency Significant Comparable published Gas scope growth(1) Q2 2012 +4.9% +0.0% +4.6% -0.6% + 0.9% Q3 2012 +6.5% -0.3% +4.9% +0.3% + 1.6% Q4 2012 +8.2% +0.2% +1.8% +1.6% + 4.6% Q1 2013 -1.1% -0.6% -1.9% +1.4% + 0.0% Q2 2013 +2.5% -0.2% -2.9% +1.6
Slide 33: Q1 2014 Revenue breakdown by region
Q1 2014 Revenue breakdown by region Gas & Services 24% Americas Europe Q1 Revenue € 3,416M 50% 24% Asia-Pacific 2% Middle-East & Africa Europe: € 1,701M Americas: € 814M Asia: € 816M 2% 8% 9% 21% 30% 31% 34% 44% 5% 39% 37% 40% Industrial Merchant Large Industries Healthcare Electronics 33 April 24,
Slide 34: Europe in Q1
Europe in Q1 ■ Industrial Merchant Continued growth in developing Q1 Gas & Services sales: € 1,701m Europe Electronics Slightly negative pricing linked to 2% reduced costs Healthcare 30% Industrial Merchant 31% ■ Large Industries Strong Oxygen for Steel Large Industries 37% HyCO volumes Cogen dispos
Slide 35: Americas in Q1
Americas in Q1 ■ Industrial Merchant Positive pricing, especially in South Q1 Gas & Services sales: € 814M America Electronics High Liquid volumes Healthcare 8% 9% Industrial Merchant ■ Large Industries 44% Strong HyCO volumes Lower O2 volumes in Canada 39% (Steel) Large Industries Natural Gas price
Slide 36: Asia-Pacific in Q1
Asia-Pacific in Q1 ■ Industrial Merchant Q1 Gas & Services sales: € 816M China continued growth Electronics Helium sales growth 21% Japan solid growth 34% Industrial Merchant Healthcare 5% ■ Large Industries Start-ups in China Large Industries 40% HyCO and Oxygen volumes Q1 14/13 Comparable change (
Slide 37: Industrial Merchant pricing
Industrial Merchant pricing Q1 2014 FY 2013 -0,2% Europe 0,5% 4,4% Americas 3,6% 0% Asia-Pacific 1,1% 5,2% Middle-East and Africa 4,6% 1,5% Total Industrial Merchant 1,8% 37 April 24, 2014 Q1 2014 revenue World leader in gases, technologies and services for Industry and Health
Slide 38: Q1 2014 wrap-up
In €M Q1 2014 wrap-up G&S sales In €Bn Efficiency gains In €M 3.4 69 4 80 3 60 2 40 1 20 0 0 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Capex (1) In €M Operating Cash flow (2) In €M 500 484 600 499 500 400 400 300 300 200 200 100 100 0 0 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2011 Q
Slide 39: Regular and sustained performance
Regular and sustained performance Revenue (in €m) EPS (1) (in €) 15 000 6 +6.1% CAGR over 30 years(3) +8.4% CAGR over 30 years(3) 12 500 5 10 000 4 7 500 3 5 000 2 2 500 1 0 0 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 1983 1985 1987 1989 1991 1993 1995 1997 1999
Slide 40: www.airliquide.com
For further information, please contact: Investor Relations Communications Virginia Jeanson + 33 (0)1 40 62 57 37 Anne Bardot + 33 (0)1 40 62 50 93 Annie Fournier + 33 (0)1 40 62 57 18 Anette Rey + 33 (0)1 40 62 51 31 Jérôme Zaman + 33 (0)1 40 62 59 38 www.airliquide.com Follow us on Twitter @AirLiq