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2016 Annual General Meeting

May 12, 2016
Paris, Palais des Congrès

Air Liquide held its Annual General Meeting on May 12, 2016 at the Palais des Congrès, Paris (France).

Replies to questions asked prior to the AGM


Questions from Mr Roger Keraudy and Mr Bernard Benoist:

Could you consider offering shareholders the possibility to reinvest the amount of their dividends in shares? Why do you refuse the conversion of the dividends paid directly into shares?

Our company does not offer the option of payment of a dividend in shares, as the costs of implementation and complexity of such an operation are very significant. 

Question from Mr Bernard Benoist: 

I benefit from free shares every 2 years, nothing this year? Why?

2016 is a major year for Air Liquide, both due to the exceptional nature of the Airgas acquisition and to the decision to carry out an increase in capital in cash with preferential subscription rights, the last operation of such kind having been carried out thirty years ago at the time of the acquisition of the Big Three company in the United States.

For all that, free share issues are part of our shareholder strategy, and have been for many years. We remain very attached to a policy of regular distribution of free shares for the future.


Question from Mr Sebastien Groyer (from the company Equinomy):

Is the lack of customer representation on the Board deliberate?

The composition of the Board is aimed at reflecting the interests of all the shareholders. In the choice of directors proposed to the Annual Shareholders’ Meeting, preference is given to skills in the sectors in which the Group is active (energy/oil/chemicals, automotive, healthcare/research/pharmaceuticals, services/retail industry). These sectors are in particular those of our customers.

Question from Mr Hubert Benac:

As Air Liquide has an oil expert in the person of Mr Thierry Desmarest on its Board of Directors, what will the appointment of Mr Brian Gilvary contribute?

It is true that strong expertise in the chemical/refining and energy industries on the Board is important in light of Air Liquide’s activities in this sector. Once Thierry Desmarest’s term of office has expired due to application of the rules on the age limit, Brian Gilvary will continue to bring expertise to the Board in this field.

Questions from Mr Patrice Seurin:

The European Commission proposed on April 12 a directive requiring multinationals to publish their accounting data county-by-country on their website. Will we be able to have these economic data county-by-country for financial year 2016?

We are in the process of analyzing the Commission’s proposal. The potential application date is not known at this stage, as this is a proposal for amendment of a directive. The date on which the Group will publish this information will depend on the date of final adoption of the European directive and its transposition into national laws. 

What is the purpose of the creation of the European Clusters and Hub? Would it have an influence on publication of the economic data required by the European Commission?

In 2013, Air Liquide changed its global organization to a base in Paris and 3 hubs in Houston, Frankfurt, and Shanghai. Dubai became the 4th hub in 2016. 

The aim is to increase proximity with customers and markets to better anticipate needs, accelerate decision-making processes and augment Air Liquide’s ability to attract new talents locally. The clusters make it possible to group together the necessary skills to be shared with the countries that compose them. This organization does not have any influence on the legal obligations relating to the group’s publications, whatever they may be.

In 2015, the total number of stock options decreased and the total number of performance shares increased. What is the reason for this change in allocation? 

For long-term remuneration, a decision was made, in the grants, to give preference to performance shares over stock options, in accordance with French market practice. At a practically equivalent cost, this tool, which is less dilutive, benefits from more favorable taxation. 

Business activities

Question from Mr Régis Faye:

Could you please give us more details on the Engineering & Construction project in Canada which shows a loss of €124 million? What are the reasons for such losses and should further losses be expected in the next few years?

The project concerned is a particularly complex, large-scale E&C project in Canada. The difficulties encountered were essentially with regard to the Construction aspects. An agreement entered into with the customer at the end of 2015 relieves Air Liquide from the rest of the construction work, and the residual liabilities in the event of a performance failure are capped.

Question from Mr Daniel Joseph-Dailly:

Can you specify what are the amounts (or projects) that may be engaged by Air Liquide with the State of Israel or partners in this same State, in comparison with those that are described in Saudi Arabia?

In Israel, the local industry players efficiently satisfy the local market. The Group’s outward sales towards customers in the State of Israel are therefore modest and amounted to approximately €8 million in 2015.

Saudi Arabia has important petrochemical basins such as Jubail or Yanbu, which enable the Group to make significant investments; the situations therefore differ greatly. 


Question from Mr Jean-Baptiste Perrier:

Doesn’t Air Liquide have sophisticated hedging instruments to handle the impact of foreign exchange rates on financial performance?

A distinction should be made between 2 types of exposure to foreign exchange risk:

  • Foreign exchange risk with regard to transactions in a currency different to that of the entity concerned: Air Liquide hedges this risk systematically using a range of standard hedging instruments (currency futures, swaps, currency options)
  • The translation exchange risk (also known as the consolidation or conversion risk) due to the fact that the financial data of foreign subsidiaries denominated in several different currencies have to be counter-valued in Euro. Air Liquide reduces this risk by entering into debt in the currency in which the cash flows are expected and through diversification of the currencies resulting from its presence in over 80 countries

Question from Mr Hubert Benac:

The drafting of resolutions 23 to 25 is impossible to understand for an average individual shareholder. How will the issue prices for non-preferential shares be set?

These resolutions will make it possible, if necessary, to complete the arrangements for financing of the Airgas acquisition with an issue of complex marketable securities such as, for example, an issue of bonds convertible into shares for an amount limited to 5% of the capital. The issue price is determined according to the type of instrument chosen.