* Change Q1 2016/Q1 2015 on a comparable basis: excluding currency, energy, and significant M&A impacts.
Commenting on the first quarter 2016, Benoît Potier, Chairman and CEO of Air Liquide, said:
“In the first quarter, growth was driven by dynamic sales in Electronics and the ramp-up of our production units in Large Industries. From a geographic perspective, growth was driven by Asia-Pacific, especially China. This quarter was also characterized by lower exchange rates and energy prices.
In Western Europe, industrial demand was moderate early in the year, while in North America sales continued to be affected by the slowdown in the oil & gas and metal fabrication sectors. Conversely, developing economies posted strong growth.
In addition, the Group continues to generate recurring efficiency gains, strengthen its competitiveness, and invest in its growth markets.
The Airgas acquisition is on track and in line with our expectations, with the preparatory work for integration allowing us to confirm synergies of more than $ 300 million, as announced last November. In addition, the transaction refinancing allows us today to envision a capital increase of between 3 and 3.5 billion euros. Lastly, acquisition timing might shorten, with possible completion by late Q2 2016.
Excluding the impact of Airgas acquisition and financing, and assuming a comparable environment, Air Liquide is confident in its ability to deliver another year of net profit growth in 2016.”
Q1 2016 Group revenue reached € 3,872 million, up +2.4% on a comparable basis and down -3.1% on a reported basis compared with Q1 2015. Sales in Gas & Services, which amounted to € 3,548 million, rose by +4.2% on a comparable basis and fell -1.8% on a reported basis. During this quarter, the unfavorable currency impact (-2.0% for Gas & Services), which was favorable in 2015, added to the negative impact of energy prices (-4.0% for Gas & Services).
The developing economies posted strong growth, with Gas & Services revenue up +14.1% on a comparable basis.
Overall, all Gas & Services sales grew on a comparable basis in the 1st quarter, except for Industrial Merchant, impacted by weak demand in certain industrial sectors. Therefore:
Engineering and Construction revenue, which reached € 124 million this quarter, was lower due to the impact of the slowdown in large projects linked to energy in a number of countries.
Global Markets & Technologies revenue totaled € 65 million, an increase of +11.1% on a comparable basis, driven by markets related to maritime and those related to the energy transition and space.
Efficiency gains amounted to € 63 million, in line with our forecasts for the year. Actions carried out on production sites as well as in supply chain and procurement management, contributed to the Group’s good operating performance.