2013 H1 Consistent Performance Capturing growth opportunities Cliquez pour modifier le style des sous-titres du masque Paris, Benoît Potier Chairman and CEO Fabienne Lecorvaisier Chief Financial Officer
2013 H1 Performance Paris, Benoît Potier Chairman and CEO Consistent performance Capturing growth opportunities 5% + underlying trend confirmed Operating margin maintained Strong Cash flow 2
Stronger Q2 Group sales growth Excl. Currency and Natural Gas H1 2013 + 3.0 % Q1 2013 Q2 2013 + 0.2 % + 5.8 % OIR/sales margin H1 2012 16.5 % H1 2013 16.6 % 3
Consistent performance In bn 8 6 Group sales 6.5. 7.1 7.5 7.6 In bn 1,5 Operating Cash flow (3) 1.4 1.5 1.3 1.3 4 2 +3% (1) 1,0 0,5 +6% 0 H1 10 H1 11 H1 12 H1 13 0,0 H1 10 H1 11 H1 12 H1 13 In m 4 300 200 100 Group Efficiencies 280 270 284 2013 Objective 250 M 138 0 0 2010 2011 2012 2013 H1 10 H1 11 H1 12 H1 13 (1) Excluding currency and natural gas impacts. (2) Industrial and financial investments, including transactions with minority shareholders, net of divestitures. (3) from operations, before WCR. H1 In bn 1,2 1 0,8 0,6 0,4 0,2 Net Capex (2) 0.8 0.8 1.0 1.1 +9%
Strong Cash flow financing capex Net cash flow from operations (1) Net capex (2) 3000 In m 2500 2000 Average cash flow Average capex 25% 1500 1000 500 0 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 H1 2013 (1) After changes in WCR (2) Industrial and financial, including transaction with minority shareholders, net of divestitures 5
Investments focused in growth markets Home Healthcare New Capacities Fracking Beverage Refining Metals 1.5 bn in H1 2013 H 2 energy Chemicals Hygiene H 2 energy Innovation Home Healthcare Metals Chemicals New Capacities Home Healthcare H 2 energy Chemicals Logistics Carrier gases Food Large industries Industrial Merchant Healthcare Electronics E&T 6
Capturing growth opportunities Industrial Merchant Deploying offer in all growing regions Large Industries Developing energy conversion through technologies Beverage Gasification Electronics Building strong positions Healthcare Extending our Home Healthcare offer Advanced materials Home infusion 7
Favorable outlook for Industrial Production in Q4 2013 (1) Industrial production index expected for Q4 2013. Source: Consenus Economics Inc, June 2013. 8
2013 H1 Performance Paris, Fabienne Lecorvaisier Chief Financial Officer Consistent performance Capturing growth opportunities 5% + underlying trend confirmed Operating margin maintained Strong Cash flow 9
2013 H1 Performance Activity Operating performance 10
5% + underlying growth trend confirmed in Q2 Sales in m H1 2013 H1 13/12 as published H1 13/12 excl. currency and natural gas Q1 13/12 underlying trend Q2 13/12 excl. currency and natural gas Gas & Services 6,885 +0.7% +3.5% +4.9% +5.6% Engineering & Technology 372 +1.8% Other Activities 304-7.8% Group Total 7,561 +0.4% +3.0% +5.8% 11
Activity level progressing Quarterly G&S activity indicator (1) Base 100, average 2008 2010 2011 2012 2013 120 115 110 105 100 95 90 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 (1) Revenue (excluding currency and natural gas), adjusted for the number of days per month. 12
Sales for Industries improving in Advanced economies G&S for Industries (GSI) sales growth (1) (Q2 2013/ Q2 2012) + 9% growth +8% 0% +27% +5% +15% -3% 27% of GSI in Q2 2013 +11% Advanced economies Developing economies +1% +9% (1) G&S for Industries sales excluding healthcare sales. Comparable growth excluding the impact of currency, natural gas and significant scope. 13
Healthcare strong increase in all regions Healthcare sales growth (1) (Q2 2013/Q2 2012) +16% growth (1) +18% +10% +9% +24% 20% of G&S in Q2 2013 Healthcare presence (1) Growth excluding currency impacts. 14
Higher Q2 G&S sales growth H1 sales Comparable growth (1) Total G&S 6,885m 2.0% 4.0% Europe 3,547m 2.2% 1.2% LI maintenance Healthcare pricing Home Healthcare IM stabilization LI in Eastern Europe Americas 1,590m 3.9% 8.4% Volumes in Brazil Fracking O 2 in Canada HyCO volumes Asia Pacific 1,562m 2.2% 0.2% Low Japan IP Electronics still low Ramp-ups + IM volumes in China E&I picking up ME & Africa 186m +16.3% +16.5% Volume growth Solid South Africa Q2 2013 H1 2013 (1) Excluding the impact of currency, natural gas and significant scope. 15
Healthy business mix G&S comparable growth (1) Industrial Merchant Large Industries +7% +8% +4% +2% +1% +2% +1% +4% 38% 36% +3% +4% (2) +3% +5% Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Electronics +2% -6% -4% -11% -12% -12% Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 8% H1 2013 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 +6% Healthcare +2% +5% +14% +12% +16% Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 (1) Excluding the impact of currency, natural gas and significant scope. (2) Q1 2013 also excluding the impact of 2012 customer settlements. 18% LVL + Gasmedi 16
Sound Q2 activity in Engineering & Technology E&T order intake (1) Third party E&T sales 1,942 964 785 372 In m 750 718 In m 300 500 250 417 251 556 448 516 200 100 178 188 167 252 147 225 +20% 0 Q1 Q2 Q3 Q4 Q1 Q2 2012 2013 0 Q1 Q2 Q3 Q4 Q1 Q2 2012 2013 (1) Including advanced Business & Technologies order intake. 17
2013 H1 Performance Activity Operating performance 18
Robust margin level In m H1 2012 (1) H1 2013 Change 13 vs 12 Revenue 7,533 7,561 +0.4% Purchases (3,010) (2,960) -1.7% Personnel expenses (1,340) (1,374) +2.5% Other net income and expenses (1,337) (1,351) +1.1% Operating profit before depreciation 1,846 1,876 +1.7% Depreciation and amortization (601) (620) +3.3% Operating Income Recurring (OIR) 1,245 1,256 +0.9% OIR margin OIR margin excl. natural gas effect 16.5% 16.6% 16.5% flat (1) Restated for the effects of the IAS19 «Employee benefits» revision. 19
G&S margin supported by strong efficiency gains G&S OIR margin in m 1 400 18.7% +133 18.7% 1 300 1,277 +2 0 +23 +81 <68> 1,291 1 200 G&S <75> G&S 1 100 1 0000 OIR H1 2012 Volume mix Energy effect Cost increase Price excl. energy Efficiencies Forex and Others OIR H1 2013 OIR = Operating Income Recurring 20
Significant non recurring expenses In m H1 2012 (1) H1 2013 Change 13 vs 12 Revenue Operating Income Recurring Other non-recurring operating income & expenses 7,533 1,245 10 7,561 1,256 (41) +0.4% (2) +0.9% Operating Income 1,255 1,215-3.1% Net financial costs and other net financial expenses (163) (157) Income taxes (289) (284) Tax rate 26.4% 26.9% Share of profit of associates 14 9 Minority interests (33) (31) Net profit (Group share) 784 752-4.0% Earnings per share (in ) 2.52 2.43-3.6% (1) Restated for the effects of the IAS19 «Employee benefits» revision. (2) + 3.0% excluding currency and natural gas impacts 21
Strong cash flow performance Net debt In m <932> +85 <6,837> <6,103> + 1,501 +6% <1,081> +734 Gearing ratio <307> 58% Gearing ratio 60% (3) Net Debt Dec 31, 2012 Cash flow WCR + others Net Investments (1) Dividends net of capital increases (2) Forex Net Debt, June 30, 2013 22 (1) Industrial and financial, including transactions with minority shareholders, net of divestitures (2) Incl. share purchases 117m (3) Adjusted for the seasonal dividend effect.
Net debt discipline Net debt to equity ratio (as reported) Average cost of net debt 80% 70% 60% 50% 40% 2008 2009 2010 2011 2012 2013 5,5% 5,3% 5,0% 4,8% 4,5% 4,3% 4,0% Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun 2008 2009 2010 2011 2012 2013 As of June 30 As of Dec 31 23
High investment decisions at 1.5 bn 12-month portfolio Investment of opportunities decisions (1) Net capex (1) Start-ups (2) In bn In bn In bn 50 e 4.2 4.1 4.0 3.8 24 1.5 1.4 1.4 2.7 2.7 2.5 1.3 2.5 0.4 0.8 1.0 1.2 1.5 0.8 0.8 0.8 1.0 1.1 15 16 17 9 H1 H1 H1 H1 H1 H1 H1 H1 H1 H1 Dec- 11 Jun- 12 Dec- 12 Jun- 13 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 2014 H1 2013 65% 46 % 51% 78 % Developing Economies Advanced Economies Acquisitions (1) industrial and financial investments, including transactions with minorities, net of divestitures (2) Industrial investments > 10m 24
2013 Outlook maintained H1 2013 Investments focused on growing markets Consistent performance Realignment plans engaged 2013 objective Barring a degradation of the environment, Air Liquide is confident in its ability to deliver another year of net profit growth in 2013 25
H1 2013 Appendix 26
Impact of currency and natural gas on G&S revenue Currency In m Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 /USD +18 +54 +56 +20 (3) (10) /CAD +4 +11 +16 +11 (2) (5) /JP +21 +37 +30 (3) (40) (55) Others +27 +48 +57 +33 (20) (27) Total currency impact +70 +150 +160 +61 (65) (97) Average rate Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 In m /USD 1.31 1.28 1.25 1.30 1.32 1.31 /CAD 1.31 1.29 1.24 1.29 1.33 1.34 /JP 104.0 102.6 98.4 105.3 121.9 129.0 Natural Gas Natural Gas Impact +22 0 (9) +4 (21) (8) 27
Consolidated P&L In m H1 2012 (1) H1 2013 Revenue 7,533 7,561 Cost of goods (5,687) (5,685) Operating income recurring before depreciation 1,846 1,876 Depreciation and amortization expenses (601) (620) Operating income Recurring 1,245 1,256 Net non-recurring operating income 10 (41) Operating income 1,255 1,215 Net finance costs & other net financial expenses (163) (157) Income taxes (289) (284) Share of profit of associates 14 9 Profit for the period 817 783 - Minority interest 33 31 - Net profit (Group share) 784 752 Basic earnings per share (in ) 2.52 2.43 (1) Restated for the effects of the IAS19 «Employee benefits» revision. 28
Consolidated Balance Sheet In m ASSETS 31/12/12 (a) 30/06/13 Goodwill Fixed assets Other non-current assets* 5,133 13,511 1,084 5,127 13,715 1,050 EQUITY AND LIABILITIES 31/12/12 (a) 30/06/13 Shareholders equity Minority interests 10,191 233 9,998 234 Total equity 10,424 10,232 Total non-current assets 19,728 19,892 Inventories & work in-progress 776 812 Trade receivables & other current assets 3,320 3,483 Cash and cash equivalents* 1,187 1,063 Provisions & deferred tax liabilities Non-current borrowings Other non-current liabilities* Total equity and non current liabilities 3,379 5,789 281 19,873 3,290 6,534 242 20,298 Total current assets 5,283 5,358 Total assets 25,011 25,250 Provisions Trade payables & other current liabilities Current borrowings* 243 3,398 1,497 224 3,381 1,347 31/12/12 (a) 30/06/13 Net debt 6,103 6,837 Net debt ratio 58.5% 66.8% Total equity and liabilities 25,011 25,250 (a) Restated for IAS 19 revision * including fair value of derivatives 29
Cash Flow statement In m H1 H1 2012 (1) 2013 Funds provided by operations 1,413 1,501 Changes in Working Capital Other items (270) (5) (266) (41) Net cash from operating activities 1,138 1,194 Purchase of PPE* and intangible assets Purchase of financial assets Proceeds from sale of PPE*, intangible and financial assets (958) (59) 32 (982) (109) 10 Net cash in investing activities (985) (1,081) Distribution (760) (854) Increase in capital stock Purchase of treasury shares Transactions with minority shareholders Exchange rate and consolidation scope effect 17 (112) (6) (55) 39 (117) (0) 85 Change in net indebtedness (763) (734) (1) Restated for the effects of the IAS19 «Employee benefits» revision. * property, plant and equipments 30
Comparable growth above last year average G&S comparable growth (1) 2010 2011 2012 2013 12% 10% 8% +10.7% +11.0%+11.3% +11.4% +9.7% +8.3% +7.7% 6% 4% 2% 0% +4.0% +1.9% +0.9% +1.6% +4.6% +4.0% +1.5% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 (2) (1) Excluding the impacts of currency, natural gas and significant scope. 2010 and 2011 growth rates are not revised for the integration of Seppic into the G&S activity. (2) Q1 2013 also adjusted for the impact of 2012 customer settlements. 31
Steady contribution from growth initiatives G&S quarterly growth analysis 7,0% 5,0% 3,0% 1,0% Base business Start-ups, Ramp-ups, Site takeovers, Small acquisitions Significant perimeter -1,0% -3,0% Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q1 2013 excluding the impact of 2012 customer settlements. 32
Revenue analysis by quarter (1) Sales in m Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q2 13/12 as published Q2 13/12 comparable (1) Europe 1,747 1,724 1,728 1,827 1,769 1,778 +3.1% +2.2% Americas 772 746 793 797 766 824 +10.5% +8.4% Asia-Pacific 840 835 873 868 780 782-6.3% +2.2% Middle-East & Africa 84 89 96 93 91 95 +6.4% +16.3% Gas & Services 3,443 3,394 3,490 3,585 3,406 3,479 +2.5% +4.0% Engineering & Technology 178 188 167 252 147 225 +19.9% +21.0% Other Activities 158 172 146 153 145 159-7.6% -6.7% Group Total 3,779 3,754 3,803 3,990 3,698 3,863 +2.9% +4.3% 33 (1) Excluding the impact of currency, natural gas and significant scope.
Revenue analysis by quarter (2) Sales in m Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q2 13/12 as published Q2 13/12 comparable (1) Large Industries 1,262 1,204 1,253 1,296 1,225 1,236 +2.7% +4.8% Industrial Merchant 1,281 1,283 1,322 1,307 1,254 1,284 +0.1% +3.8% Healthcare 598 599 607 678 659 685 +14.4% +6.8% Electronics 302 308 308 304 268 274-11.0% -4.0% Gas & Services 3,443 3,394 3,490 3,585 3,406 3,479 +2.5% +4.0% Engineering & Technology 178 188 167 252 147 225 +19.9% +21.0% Other Activities 158 172 146 153 145 159-7.6% -6.7% Group Total 3,779 3,754 3,803 3,990 3,698 3,863 +2.9% +4.3% (1) Excluding the impact of currency, natural gas and significant scope. 34
G&S Revenue growth by quarter (2) Growth as published Natural Gas Currency Significant scope Comparable growth (1) Q1 2012 +6.3% +0.7% +2.2% -0.6% +4.0% 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% +1.5% (2) Q2 2013 +2.5% -0.2% -2.9% +1.6% +4.0% (1) Excluding the impact of currency, natural gas and significant scope. (2) Q1 2013 also excluding the impact of 2012 customer settlements. 35
H1 2013 G&S revenue growth in m +2.0% comparable (1) 7000 6,837 +134 <29> <163> +105 6,885 6500 6000 +0.7% published growth 5500 5000 4500 0 H1 2012 Comparable growth (1) Natural gas Currency Scope H1 2013 (1) Excluding forex, natural gas and significant scope impacts 36
H1 2013 Revenue breakdown by region Europe 23% Americas Gas & Services H1 Revenue 6,885m 51% 3% 23% Asia-Pacific Middle-East and Africa Europe: 3.5bn Americas: 1.6bn Asia-Pacific: 1.6bn 30% 2% 31% 11% 6% 47% 5% 23% 37% 37% 36% 35% Industrial Merchant Large Industries Healthcare Electronics 37
Europe in Q2 Q2 Gas & Services sales: 1,778m Industrial Merchant Stabilization in Western Europe Acquisitions in Russia and UK Positive pricing Healthcare Electronics 31% 2% 36% 31% Industrial Merchant Large Industries Large Industries Start-up in Russia Reduced Electricity prices Turnarounds in Northern Europe Healthcare Solid Home Healthcare demand Acquisitions contributing Tariff reductions (1) Excluding impact of currency, natural gas and significant scope (2) Excluding impact of natural gas Q2 13/12 Comparable change (1) : + 2.2 % +2.0% +0.8% Large Industries +5.7% Industrial Merchant Healthcare 0% 3% 5% 8% 10% In m H1 2013 Publ. growth Comp. growth (1) Sales 3,546 +2.2% +1.2% OIR 669 +7.8% + 17.8% incl. LVL + Gasmedi OIR/Sales 18.9% +100bps +60bps (2) 38
Americas in Q2 Q2 Gas & Services sales: 824m Industrial Merchant Sustained activity in Canada Volume growth in Argentina and Mexico Slight slow down in Brazil Large Industries HyCO solid growth across North America Start-up in Mexico Healthcare South America new contract, volume growth and pricing Electronics High E&I comparison base Healthcare Q2 13/12 Comparable change (1) : +8.4% Industrial Merchant 6% 11% 37% Large Industries Large Industries Healthcare Electronics 46% +6.7% Industrial Merchant +9.7% -13.5% Electronics -14% -9% -4% 1% 6% 11% 16% In m H1 2013 Publ. growth Comp. growth (1) Sales 1,591 +4.8% +3.9% OIR 343-3.3% +16.8% (1) Excluding impact of currency, natural gas and significant scope (2) Excluding impact of natural gas OIR/Sales 21.6% -180bps -90bps (2) 39
Asia in Q2 Q2 Gas & Services sales: 782m Electronics 23% Industrial Merchant Healthcare 5% 37% Industrial Merchant Japan still weak 35% High single digit growth in China Large Industries Large Industries Ramp-ups in China Lower HyCO demand Electronics Growth outside Japan E&I sales in China, Taiwan and Japan ESG pricing pressure (1) Excluding impact of currency, natural gas and significant scope (2) Excluding impact of natural gas Q2 13/12 Comparable change (1) : +2.2% Large Industries +0.4% +0.1% -2% 2% In m H1 2013 Industrial Merchant Electronics Publ. growth Comp. growth (1) Sales 1,562-6.7% +0.2% OIR 244-7.9% OIR/Sales 15.6% -20bps -40bps (2) +4.7% 40
Industrial Merchant pricing Q2 2013 H1 2013 Europe +0.5% +0.5% Americas +3.5% +4.0% Asia-Pacific +1.1% +1.1% Middle-East and Africa +6.4% +8.0% Total Industrial Merchant +2.0% +1.8% 41
Engineering & Technology In m H1 2012 H1 2013 Consolidated revenues 365 372 OIR (1) margin 9.1% 8.9% Total order intake (2) 1,135 964 Total orders-in-hand (2) 4,549 4,919 Total Orders-in-hands breakdown at June 30, 2013 ASU HyCO Traditional energy Alternative energy Renewable energy 3% 11% 10% 9% 45% ab&t 22% (1) Includes financial income generated by customers advances. (2) Includes ab&t activity (Advanced Business & Technologies) 42
Operating margin natural gas effect Group, in m H1 2012 H1 2013 Revenue 7,533 7,561 Incl. Natural gas effect (29) Operating income recurring 1,244 1,256 Operating margin 16.5% 16.6% Operating margin excluding natural gas 16.5% Gas and services, in m H1 2012 H1 2013 Revenue 6,837 6,885 Incl. Natural gas effect (29) Operating income recurring 1,277 1,291 Operating margin 18.7% 18.7% Operating margin excluding natural gas 18.7% 43
Operating margin (OIR/Revenue) H1 10 H2 10 2010 2010 Group 16.6% 16.8% 16.7% Gas & Services 19.2% 19.2% 19.2% 2011 Group Gas & Services H1 11 H2 11 2011 16.7% 16.6% 16.7% 19.0% 18.8% 18.9% H1 12 H2 12 2012 2012 Group 16.5% 16.9% 16.7% Gas & Services 18.7% 19.0% 18.8% H1 2013 Group as published 16.6% Excl. Nat gas 16.5% Gas & Services 18.7% 18.7% 44
Gas & Services capex by geography G&S FY 2012 Investments (1) 2.8bn G&S H1 2013 Investments (1) 1.1bn Middle East - Africa Middle East - Africa Asia-Pacific Americas 20% 19% 8% 53% Europe Asia-Pacific 10% 26% 25% 39% Europe Americas (1) Industrial and financial investments, including transactions with minority shareholders 45
For further information, please contact: Investor Relations Virginia Jeanson + 33 (0)1 40 62 57 37 Annie Fournier + 33 (0)1 40 62 57 18 Bastien Maurice + 33 (0)1 40 62 59 38 Communications Anne Bardot + 33 (0)1 40 62 50 93 Corinne Estrade-Bordry + 33 (0)1 40 62 51 31 www.airliquide.com Follow us on Twitter @AirLiquideGroup L Air Liquide S.A. Corporation for the study and application of processes developed by Georges Claude with registered capital of 1,717,546,374.50 euros Corporate headquarters: 75, Quai d Orsay 75321 Paris Cedex 07 Tel : +33 (0)1 40 62 55 55 RCS Paris 552 096 281 46