Industryweek 6172 Air Liquide Reports Profit Rise

Air Liquide Posts Profit Increase, Projects More of Same

Feb. 18, 2014
The group, which provides vital inputs for many industrial processes such as oxygen for steelmaking, said it intends to raise net profits further this year, despite the strength of the euro.

PARIS -- French industrial gas group Air Liquide (IW 1000/223) surprised with a 5.5% net profit rise last year, and said today it would raise the dividend payout to shareholders.

The group, which provides vital inputs for many industrial processes such as oxygen for steelmaking, said it intends to raise net profits further this year, despite the strength of the euro.

Net profit in 2013 amounted to 1.64 billion euros ($2.26 billion), slightly better than a consensus forecast by analysts polled by Dow Jones newswires. They had foreseen about 1.62 billion euros.

Operating profit surged by 16.9%, and the group said it had beaten its own targets for cutting costs.

The company describes itself as a world leader in supplying gases, technologies and services for the industrial and health sectors.

Deputy finance director Maelys Castella said, "We have achieved a very good improvement in our operating performance, thanks mainly to our efficiency plans which set a new record, since they totaled 303 million euros, far above our target of 250 million euros."

The group said it had achieved its annual targets despite a mixed context. Sales slipped by 0.7% to 15.23 billion euros, slightly short of the analysts' consensus view of 15.35 billion euros.

Castella said that the euro had risen strongly against other currencies last year and that currency factors had reduced sales by 3.8 percentage points.

Analysts had been concerned that the group might undershoot its targets because of the strength of the euro.

CEO Benoit Potier told a press conference that the currency factor could work both ways.

However, "it would be good for the European economy if the euro were readjusted downwards," he said.

Improvement in U.S., China

"The progress the group made in 2013 reflects the return to a more supportive economic climate during the year and an increase in the pace of growth in the United States and China," Potier said in a results statement.

He said that "investment decisions totalling 2.7 billion euros, the conclusion of new contracts, and the commissioning of 23 production units will contribute to our growth in the years to come."

He added that subject to any downturn, "Air Liquide is confident in its ability to deliver another year of net profit growth in 2014."

The board recommended a 2.0% increase in the dividend to 2.55 euros per share, and to distribute one free share for 10 shares held, a reward which the group makes every two years "when we achieve good results," Castella said.

In December, the group had updated its forecast for growth of sales from 2011 to 2015, to 5% to 7% per year excluding currency factors.

The price of shares in the group was showing a fall of 1.62% to 97.72 euros in afternoon trading.

Net debt fell to 6.06 billion euros at the end of 2013, from 6.1 billion euros at the end of 2012.

Copyright Agence France-Presse, 2014

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