First quarter 2015: Revenue up by +7% Solid operational performance

Commenting on the first quarter 2015, Benoît Potier, Chairman and CEO of Air Liquide, said:

“Growth this quarter was driven by the dynamism of Healthcare and Electronics, and by developing economies, especially China where sales rose by nearly +20% on a comparable basis.

Industrial demand was moderate at the start of the year. In North America, the slowdown in the oil services industry, combined with temporary plant turnarounds of several customers, had a short-term impact on our Large Industries activities, while in Western Europe, the manufacturing sector continues to improve in several countries. Globally, the Group’s revenue growth outpaced that of its market, against a backdrop of falling energy prices and favorable exchange rates.

Operational performance remains solid; the Group continues to generate efficiency gains and is also reinforcing its growth initiatives.

Growth in the next few years will be supported by the recent major new contract signings, the investment backlog of € 2.6 billion, and the innovations and technologies currently under development.

Assuming a comparable economic environment, Air Liquide is confident in its ability to deliver another year of net profit growth in 2015.”

Q1 2015 Group revenue reached € 3,993 million, up +7.0% on a reported basis and up +3.0% on a comparable basis¹ versus the 1^st quarter of 2014. Sales in Gas & Services, which amounted to € 3,632 million, rose by +6.3% on a reported basis and by +2.6% on a comparable basis. The positive currency effect (+7.3%) was partly offset by a negative energy impact (-3.6%), which was particularly evident in Large Industries.

On a comparable basis, Gas & Services revenue in developing economies progressed by +9.4% while all Gas & Services business lines reported revenue growth in the 1^st quarter 2015:

• Healthcare revenue, up significantly at +6.8%, benefited from increased demand for home healthcare services and from higher hygiene and specialty ingredient sales. Growth was also supported by several acquisitions in Europe and in Canada. The Healthcare business progressed in advanced and developing economies alike.
• Revenue growth in Electronics was a robust +14.4%, a progression in line with 2014 that attests to the sector’s positive momentum. Sales grew in all of our product lines. In advanced materials, which includes the ALOHA™ range and the Voltaix offer, revenue grew by +49.0%. Sales were particularly vigorous in China, in Taiwan, in Japan, and in the United States.

In industry, the results were more contrasted.

• In Large Industries, revenue was virtually unchanged (+0.2%) due to temporary plant turnarounds of several customers in North America and Western Europe. However, a gradual recovery in volumes began in late March in North America. This quarter also saw the ramp-up of new production units in both China and South America, while demand for air gases remained sustained in Asia.
• In Industrial Merchant, where revenue was up a slight +0.3%, the situation remains one of contrast with volumes still low, especially in cylinders, but with positive pricing of +1.1%. Improvement is visible in bulk sales in Europe, while in North America oil services volumes are down. In Asia-Pacific, the Australian market is still difficult, whereas volume growth remains strong in Southeast Asia and in China.

Engineering and Technology revenue rose by +16.4% on a comparable basis, reflecting the progress made on projects underway for third-party customers.

Efficiency gains reached € 62 million, in line with the annual target of more than € 250 million. The initiatives, mainly in the area of procurement, logistics, and energy efficiency, combined with ongoing efforts to align Group structures, contributed to the good operational performance.

 
¹ adjusted for currency, energy (natural gas and electricity) and significant M&A impacts ↩