Full year results Profitable Growth. Analysts Conference Call 09 March PDF Free Download

Full year results. Profitable Growth. Analysts Conference Call 09 March 2012

Disclaimer This presentation contains forward-looking statements about Linde AG ( Linde ) and their respective subsidiaries and businesses. These include, without limitation, those concerning the strategy of an integrated group, future growth potential of markets and products, profitability in specific areas, the future product portfolio, anti-trust risks, development of and competition in economies and markets of the group. These forward looking statements involve known and unknown risks, uncertainties and other factors, many of which are outside of Linde s control, are difficult to predict and may cause actual results to differ significantly from any future results expressed or implied in the forward-looking statements in this presentation. While Linde believes that the assumptions made and the expectations reflected in this presentation are reasonable, no assurance can be given that such assumptions or expectations will prove to have been correct and no guarantee of whatsoever nature is assumed in this respect. The uncertainties include, inter alia, the risk of a change in general economic conditions and government and regulatory actions. These known, unknown and uncertain factors are not exhaustive, and other factors, whether known, unknown or unpredictable, could cause the group s actual results or ratings to differ materially from those assumed hereinafter. Linde undertakes no obligation to update or revise the forward-looking statements in this presentation whether as a result of new information, future events or otherwise. 2

Agenda Part 1 1. Highlights and Divisional Performance 2. Strategic Focus: High Performance Organisation Growth Potential Mega-trends 3. 2012 Outlook Prof. Dr Wolfgang Reitzle Part 2 1. Operational Performance 2. Project Pipeline and Capex 3. Financial Performance Georg Denoke Appendix 3

Highlights Profitable Growth. Group sales and profit again on record levels Group sales increased by 7.1% and the operating profit grew at a faster pace by 9.7% Group operating margin has further improved by 60 bp to 23.3% Gases operating margin increased by 50 bp to 27.5% Adjusted* EPS increased by 11.9% to 7.71 Adjusted* ROCE is up by 50 bp to 13.0% Net debt down by 403 m to 5.094 bn Resilient business model and implementation of HPO initiatives drive profitable growth Solid contribution from Mature Markets and further increased share from Growth Markets Improvement of Gases operating margin in all operating segments supported by HPO Outlook Mid-term targets for 2014 confirmed *please see definitions on page 53 4

Group, sales by Divisions Continued growth in all areas in million, as reported Group 12,868 +7.1% 13,787 Gases Division Growth track continued in in all regions led by Asia/Pacific Gases 10,228 +8.1% 11,061 Growth in all product areas led by Tonnage and Bulk Engineering Division Order intake well balanced between Growth Markets and Mature Markets Order backlog remains on solid level Engineering 2,461 +2.8% 2,531 Other/ Cons. 179 195 5

Group, operating profit by Divisions Profitable Growth. - Group margin further improved in million, as reported Group 2,925 +9.7% 3,210 Gases Division Growth of operating profit* continued Operating margin further improved by 50 bp to 27.5% Gases 2,766 +9.9% 3,041 Engineering Division Operating margin of 12.0% on exceptional high level ahead of mid-term target of 8% Margin development driven by successful execution of individual projects Engineering Other/Cons. Op. margin 271-112 +12.2% 304-135 22.7% 23.3% 60 bp on reported basis *EBITDA incl. share of net income from associates and joint ventures 6

Gases Division, sales by product areas Balanced mix as basis for profitable growth in million, comparable* (consolidated) Healthcare 10,296 1,132 * +7.4% +5.0% 11,061 1,189 Solid growth in Healthcare The Mega-trend growth opportunities continue Acquisition will strengthen Homecare portfolio Tonnage 2,484 +8.5% 2,695 Continuous growth in Tonnage again above previous record level Increased contribution from Growth Markets in Bulk 2,472 +8.5% 2,683 Numerous important take-or-pay contract wins in Growth Markets Continuous contribution from project ramp-ups Positive performance of the merchant business Cylinder 4,208 +6.8% 4,494 Strong growth in Bulk supported by merchant LNG Recovery of late cyclical cylinder business in H1 *excluding currency, natural gas price and consolidation effect 7

Engineering Division, key figures Order intake well balanced Order intake increased by 3.5% to 2.235 bn Order backlog stays strong at 3.600 bn (year-end : 3.965 bn) Exceptional operating profit* margin in of 12.0% Operating profit margin in 2012 of at least 10% due to continuation of positive effects from successful execution of individual projects Order Intake by Region EMEA 32.4% Order Intake by Plant Type 25.7% Air Separation Plants Hydrogen/ Synthesis Gas Plants 18.9% Order Backlog by Plant Type Other 7.4% Olefin Plants 28.6% 21.5% Hydrogen/ Synthesis Gas Plants 3.6 bn 44.1% ASIA/PACIFIC 15.8% Olefin Plants 23.5% AMERICAS 23.4% 13.6% Natural Gas Plants Other Air Separation Plants 24.7% Natural Gas Plants 20.4% *EBITDA incl. share of net income from associates and joint ventures 8

HPO (High Performance Organisation) Covering the full value chain in all regions HPO is fully on track with savings additional savings of ~ 160 m Initiatives have been launched and rolled out in all relevant areas Contribution expected also in 2013 ff. Gross cost savings increased to 620 m Accumulated gross cost savings in million 650-800 160 ~35% Bulk Supply Chain 160 ~25% Cylinder Supply Chain 300 ~25% Procurement/Others ~15% SG&A 2009 2012 9

Mega-trends Leveraging growth with our Gas & Engineering set-up Growth Markets Energy/Environment Healthcare Leveraging Gases & Engineering business synergies 10

Mega-trend Growth Markets Industrial gases market vs. 2020 in bn Market leader in 4 out of 5 Growth Markets ~20 ~23 ~23 ~13 ~5 ~16 ~10 ~2 2.2 ~5 ~5 ~2 # 1 ~6 ~16 ~16 ~16 # 1 ~10 Growth Markets Mature Markets ~5 ~5 ~5 ~2 ~1 ~1 ~0.5 # 2 # 1 ~4 # 1 ~2 ~2 ~1 2020 2020 Source: Linde database, figures excl. Japan, equipment, healthcare and major impact out of future growth markets of the energy/environment sector 11

Mega-trend Growth Markets Strong investments in future growth Growth Markets exposure further increased Growth Market sales (% of Gases sales) Majority of Capex invested in Growth Markets Gases Capex 2007 in bn 36% 35% 1.5 1.3 1.4 32% 32% 34% 33% 1.1 0.6 0.8 1.0 0.6 0.7 0.6 29% 0.5 0.7 0.4 0.6 0.8 2007 2008 2009 2007 2008 2009 Excl. JVs Incl. JVs Mature Markets Growth Markets 12

Mega-trend Growth Markets Comprehensive strategy to capture growth potential in Asia Consolidates sales in Asia in m Major investment commitments in Greater China South & East Asia Pakistan #1 Bangladesh #1 India #1 Sri Lanka #1 Indonesia #1 Thailand Singapore 576 #1 #1 701 +22% Vietnam 975 861 China #1 Korea +13% Taiwan #1 Philippines Malaysia Construction of ASU in Map Ta Phut, Thailand (largest ASU) - Investment ~ 78 m, on-stream date 2013* Signed contract with PT Krakatau POSCO, Indonesia (largest ASU) - Investment ~ 80 m, on-stream date 2013* Second ASU in Giheung, Korea - Investment ~ 120 m for Samsung; largest investment in Korea Wu an, China (Q4/) - On-site supply contract with Hebei Puyang Iron and Steel Ltd. - Decaptivation of 7 ASUs with energy efficiency upgrade and construction of a new ASU: ~ 120 m capex, on stream date 2014* Jilin, China (Q4/) - On-site supply contract with Evonik Industries and Jilshen - Hydrogen plant (SMR): ~ 42 m capex, on stream date 2013/2014* Yantai, China (Q3/) - On-site supply contract with Wanhua Polyurethanes Co., Ltd. - Two large scale ASUs: ~ 130 m capex, on stream date 2013/2014* Chongqing, China (Q2/) - On-site supply contracts with CCPHC and BASF - Large scale HYCO plant: ~ 200 m capex, on stream date 2014* Chongqing, China: - On-site supply contract with Sinopec, on stream date Q2/ * to be expected 13

Mega-trend Energy/Environment LeadIng joint capabilities & access to Energy/Environment sector Engineering Division Mega-projects Proven technology and project execution Gases Division Proven long-term operations track record Technology Know-How Energy: Environment: LNG (Merchant/Floating), EOR/EGR, Coal-to-X, Gas-to-X, Bio-to-X, Geothermal OxyFuel, Post-combustion CO2-capture and handling, H2-fueling Efficiency & Applications: Higher energy efficiency of plants, REBOX oxy-fuel, WASTOX Long-term Customer Relations Competitive Products and Services Plant Sales for captive customer Commodity Customers with focus on price/energy efficiency (TCO) and reliability 14

Mega-trend Energy/Environment Importance of new technologies & industrial gases applications Global energy consumption* Energy/Environment annual market revenue estimates* 700 Renewables 500 Nuclear Coal 300 Natural Gas 100 Petroleum Liquids 2015 2020 2030 Source: U.S. Energy Information Administration 80-140 bn 14-19 bn 5-7 bn CLEAN COAL CO2 HANDLING H2 FUELING RENEWABLES (e.g. BIOMASS GASIFICATION, PHOTOVOLTAIC) CO2 emission reduction Fossil resources remain dominant energy source Fossil resources becoming scarce CO2-emissions steadily increasing Importance of renewable energy increasing but still limited reach * in quadrillion British Thermal Units (equals around 10 27 Joules) LNG EOR (N2 / NRU / CO2) 2015 2020 2030 Increasing energy consumption & CO2 emission Annual market revenue in the respective year Pilot projects and small volumes *Assuming 100% Build Own Operate and excluding sale of equipment and plants (Please find assumptions for estimates on page 49) 15

Mega-trend Energy/Environment Opportunities in shale gas business: Example US Natural gas processing plant Active major shale gas fields in the USA Expected development of US shale gas production in the next decade (in Bcf) Barnett Fayetteville Woodford Haynesville Marcellus 2.0 4.5 4.5 5.5 Bcf = billion cubic feet Source: EIA, Oil and Gas Field Maps ; Linde database; Navigant 8.0 Engineering Total order intake since > 400 m Opportunities within the field of shale gas: Natural gas processing plants: driven by the necessity of gas treatment for pipeline and bulk use Small-mid-scale LNG plants: driven by increasing demand for merchant LNG Ethane cracker: feasible for gas fields without petrochemical clusters Gases Potential leverage of our operation experience into the area of shale gas Based on shale gas new chemical clusters develop with the need for industrial gases supply 16

Mega-trend Healthcare Market environment and drivers Market environment Increasing and ageing population Increasing wealth in Growth Markets Healthcare budget pressure and regulation Drivers of development New and innovative pharmaceutical gases and services Quality and optimum care for patients Value creation by cost-effective and reliable products and services Regional expansion Relevant Healthcare markets vs. 2020 in bn ~1.8 ~5.7 ~5.8 ~8.1 ~3.9 ~5.8 2.2 ~2.2 ~1.0 2020 2020 Mature Markets Growth Markets Source: Linde database, figures incl. gas therapies and intermediate care 17

Mega-trend Healthcare From medical gas provider to solutions & service provider Cost ease to Healthcare budgets Development of new therapies and applications Gas Therapies Intermediate Care Pulmonary hypertension & cardio-thoracic surgery Oxygen & Heliox therapies Pain relief Homecare Patient centered care Home oxygen therapies Ventilation services Sleep therapies Other service REMEO: treatment and care of chronic patients with mechanical ventilation needs Hospital Care Bulk supply and technical assistance Logistics and installation Customer Service Hospital & medical gas services Integrated service provider 18

Mega-trend Healthcare Homecare: growth through innovation and regional expansion Linde Homecare sales by operating segments EMEA AMERICAS 78% 18% 4% ASIA/ PACIFIC Home Oxygen Therapy Sleep Therapy Ventilation Services Chronic respiratory diseases, patients need oxygen (COPD, Asthma) Products: LOX, GOX and Concentrators Obstructive Sleep Apnea, patients need positive air pressure during sleep Products: Positive Airway Pressure Devices, Masks Advanced respiratory diseases patients need mechanical ventilation support Products: Mechanical Ventilators, Equipment Synergies: sales & marketing, logistics, integrated patient management, care center, adherence programme, technology development 19

Outlook Profitable Growth. 2012 Group Gases Engineering Growth in sales and operating profit vs. Confirmation of HPO-programme: 650-800 m of gross cost savings in 2009-2012 Sales increase vs. Continuous improvement of productivity Sales at the same level as in Operating margin of at least 10% 2014 Group Gases Operating profit of at least 4 bn Adjusted* ROCE of 14% or above Average capex/sales ratio 13% plus Revenue increase above market growth Further increase in productivity *please see definitions on page 54 20

Group Financial key indicators again on record levels Profitable growth for our shareholders adjusted EPS up by 11.9% adjusted ROCE further improved by 50 bp 5.46 4.58 Adjusted* EPS Adjusted* ROCE Operating Cash Flow in m, as reported 6.89 6.89 4.58 7.71 12.5% 13.0% 2,142 2,422 2,426 10.4% 2009 2009 2009 *please see definitions on page 53 22

Gases Division, Q4 sales by product areas Q4 development above market average in million, comparable* (consolidated) Healthcare 2,645 +5.5% 2,791 * Continued growth in Healthcare 294 +5.1% 309 New tender wins Tonnage 647 +5.1% 680 Sound growth in Tonnage Scheduled maintenance shut downs Less start-ups than in previous quarters Bulk 644 +7.2% 690 Positive performance of the merchant business Positive contribution from pricing initiatives Solid volume growth in Bulk, despite base effect Cylinder 1,060 +4.9% 1,112 Seasonal lower CO2-sales Q4 Q4 *excluding currency, natural gas price and consolidation effect 23

Gases Division, product areas Comparable* year-on-year growth in percent Healthcare Tonnage 5.5 5.8 5.7 1.5 2.7 3.7 4.0 6.5 5.8 5.0 4.2 5.1 11.1 10.3 13.3 10.0 5.1 12.1 10.7 6.5 5.1-4.4-6.5-1.7 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Bulk 2009 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Cylinder 2009 0.5 5.2 9.9 5.1 6.3 7.3 8.4 11.4 7.2 0.0 3.2 4.8 5.3 7.5 8.4 6.4 4.9-6.9-11.1-7.9-5.5-12.2-9.1-9.1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2009 *excluding currency, natural gas price and consolidation effect Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2009 24

Gases Division, sales by operating segment Growth in all regions led by Asia/Pacific and Americas Mature Markets Growth Markets 65% 35% in million 5,330 EMEA +6.4% 5,672 Asia/Pacific Americas 2,692 +14.3% 3,076 2,279 +4.6% 2,384 +5.7%* +9.2%* +9.1%* Solid growth in all regions Growth driven by cylinder and bulk business in Continental Europe Growth in Asian regions led by China and India Bulk continued solid growth trend in all regions Healthcare growth supports double digit growth in South America Highest growth rates in North America in Tonnage *excluding currency, natural gas price and consolidation effect 25

Gases Division, operating profit by operating segment Profitable Growth continued in Mature Markets Growth Markets 68% 32% in million 1,513 28.4% EMEA +8.0% 1,634 28.8% Asia/Pacific 754 +15.6% 28.0% 872 28.3% Americas 499 535 +7.2% 21.9% 22.4% Continuous implementation of HPO supports margin development in all regions Positive margin track record in EMEA continued Despite investments in future structural growth in Asia the margin exceeds level of 26

Gases Division, Split of Capex Growth Markets Capex increased to above 50 percent Split Capex by operating segments in million 1,439 +8.5% 1,326 Growth Markets Split Capex by markets 616 +1.8% 627 EMEA 54% 46% 54% 46% 492 +19.3% 587 Asia/Pacific 218 +3.2% 225 Americas Mature Markets 27

Gases Division, project pipeline Good basis for sustainable growth 4.1 bn investments between 2009-2013 (thereof 0.6 bn in JVs @ share) Project amount for 2012 and 2013 further increased by around 200 m 2014 project amount already at around 550 m Around 70% of total project-capex allocated to Growth Markets Amount of project opportunities remains with 4.3 bn on a high level Project amount by on-stream date (incl. JVs) in m ~800 ~800 ~750 50 ~650 ~500 150 ~550 700 2009 2012 2013 2014 (Projects > 10 m) 28

Gases, Capex Development Capex Sales Ratio 2007-15% Capex/Sales Ratio 12% 11% 13% 13% ~1,800 average -2014 13% plus* 1,451 1,326 1,439 1,062 1,029 Capex in million 2007 2008 2009 2012 Data 2007- @ actual average fx rates at the end of the respective year * plus: additional potential for mega-projects 29

Group, solid financial position Sound financial strategy Net debt ( m) Net debt/ebitda 12,815 5 4.8 9,933 4 6,427 6,423 6,119 5,497 5,094 3 2 2.7 2.5 2.6 1.9 1.6 1 30/09/ 2006 2006 2007 2008 2009 0 2006 2007 2008 2009 Credit Ratings Standard&Poor s: A-/A-2 with stable outlook (27/10/*) Moody s: A3/P-2 with stable outlook (12/10/*) * Date of latest rating report 30

Group, solid financial position Net debt reduction of 403 million in million 1,254 5,497 2,426 757 12 5,094 Net debt 31/12/ Cash flow from investment activities excl. inv. in liquidity reserve Operating cash flow Net interest Dividends Other FX & Fair Value Accounting 31

Group, solid financial position Early refinancing of existing financial debt Continuous efforts to extend the Group s maturity profile ~ 360 m partial bond buyback and issuance of 600 m notes due in 2021 Issuance of 750 m senior notes due in 2018 More than 80% of total financial debt is due beyond 2012 Approx. 56% of total financial debt has a longer maturity than 5 years Financial debt, by instrument 19% 2% 2% 7% 10% 1% Balanced mix of various financing instruments Strong focus on long-term bond financing Strategic funding in EUR, GBP, USD and AUD Financial debt, by maturity (in m) 4,344 3 67% 72% Other Bonds 1,277 132 349 796 2,147 224 1,923 2,880 1,461 Subordinated Bonds (*callable in 2013/2016) Commercial Paper Bank Loans < 1 year 1-5 years > 5 years 32

Group, Pensions Performance and key figures Net obligation Performance of major pension plans in million 01/01/ DBO 4,971 Plan asset 4,467 Net obligation 504 United Kingdom Germany Service costs Net financing Actuarial losses/gains Contributions/payments 88 253 335 213 254 153 13 88-1 182 200 12.3% 11.6% 14.6% 12.8% Other -33-19 -14 31/12/ 5,401 4,842 Pension plan assets portfolio structure 559 6.0% 5.0% 12% 57% 25% 1% 5% 12% 64% 1% 3% 20% expected actual 2009 - avg. expected actual 2009 - avg. Fixed-intrest securities Equities Others Insurance Property 33

Group Financial Result and Tax Rate Financial Result (in million) Tax Rate 385 329 280 291 22.9% 22.1% 23.9% 23.2% 2008 2009 2008 2009 34

Group, dividends Proposed dividend increased by 13.6% to 2.50 +13.6% 2.50 2.20 +22.2% +5.9% 1.80 stable 1.80 +13.3% 1.70 Change in Operating Profit 1.50 +18.1%* +5.4% -6.7% +22.6% +9.7% 2006 2007 2008 2009 * Comparable change: prior year figures including twelve months of BOC 35

Summary Profitable Growth. New record levels achieved in Group sales and profit on record levels Group operating margin and Gases operating margin further improved Net debt reduced to a net debt/ebitda ratio of 1.6x Resilient business model and competitive set-up for sustainable profitable growth More than a third of revenues from Growth Markets Focus on Mega-trends Healthcare and Energy/Environment Leveraging business synergies of Gases & Engineering Sustainable cash flow generation and further optimised long-term financing Capex/Sales ratio 13% plus Resilience of business model further optimised Implementation of High Performance Organisation on track 36

Group, FY Key P&L items in million in % Sales 12,868 13,787 7.1 Operating Profit 2,925 3,210 9.7 Margin 22.7% 23.3% +60 bp EBIT before PPA depreciation 1,933 2,152 11.3 PPA depreciation -254-242 -5.0 EBIT 1,679 1,910 13.8 Financial Results -280-291 3.9 Taxes -335-375 11.9 Net income 1,064 1,244 16.9 Net income Part of shareholders Linde AG 1,005 1,174 16.8 EPS in 5.94 6.88 15.8 Adjusted EPS in 6.89 7.71 11.9 38

Group, Q4 Key P&L items in million Q4/ Q4/ in % Sales 3,463 3,578 3.3 Operating Profit 780 847 8.6 Margin 22.5% 23.7% +120 bp EBIT before PPA depreciation 509 572 12.4 PPA depreciation -63-61 -3.2 EBIT 446 511 14.6 Financial Results -50-76 52.0 Taxes -80-94 17.5 Net income 316 341 7.9 Net income Part of shareholders Linde AG 307 318 3.6 EPS in 1.81 1.86 2.8 Adjusted EPS in 2.01 2.03 1.0 39

Group, FY Cash Flow Statement in million Q1 11 Q2 11 Q3 11* Q4 11* * Operating profit 761 798 804 847 3,210 2,925 Change in Working Capital -180 6 60 39-75 84 Other changes -141-267 -142-159 -709-587 Operating Cash Flow 440 537 722 727 2,426 2,422 Investments in tangibles/intangibles -237-310 -346-452 -1,345-1,192 Acquisitions/Financial investments -13-1 -41-23 -78-68 Other 43 33 40 53 169 195 Investment Cash Flow -207-278 -347-422 -1,254-1,065 Free Cash Flow before Financing 233 259 375 305 1,172 1,357 Interests and swaps -45-114 -123-56 -338-298 Dividends and other changes -2-385 -7-11 -405-280 Net debt increase (+)/decrease (-) -186 240-245 -238-429 -779 * excluding investments in securities of 600 m in Q3 and 1,052 m in Q4 40

Group Free Cash Flow before Financing ( vs. ) in million Investing CF Operating CF Free CF vs. Q1-207 -191 440 397 233 206 13.1% Q2-278 -245 537 505 259 260-0.4% Q3-347* -227 722 631 375 404-7.2% Q4-422* -402 727 889 305 487-37.4% Total -1,254* -1,065 2,426 2,422 1,172 1,357-13.6% * excluding investments in securities of 600 m in Q3 and 1,052 m in Q4 41

Group, solid financial position Liquidity reserve again further strengthened 2.5 bn committed revolving credit facility Arranged in May with 25 national and international banks Maturing in 2015 No financial covenants Fully undrawn More than 2.6 bn cash and securities 3,897 in million (31/12/) 2,500 1,674 1,000-1,277 Short-term financial debt Cash and cash equivalents Current securities and strategic liquidity reserve of 600 m Revolving credit facility Liquidity reserve 42

Division Gases, sales bridge FY sales increased by 7.4% on comparable basis in million +7.4% 11,061 +0.3% -0.2% +0.6% 10,228 FY Consolidation Currency Natural Gas Price/Volume FY 43

Gases Division Joint ventures in million Proportionate Sales* (not incl. in the Group top-line) Share of Net Income (contribution to operating profit) +13.8% +4.2% 398 453 85 89 * Adjusted for local accounted joint ventures 44

Engineering Division, key figures Order intake up by 3.5% in million Order Intake in million Sales +3.5% +2.8% 2,159 2,235 2,461 2,531 in million Operating Profit* +12.3% Operating Margin +100 bp 271 304 11.0% 12.0% *EBITDA incl. share of net income from associates and joint ventures 45

Engineering Division FY order intake by plant type and region Order Intake by Plant Type Order Intake by Region 28.3% Air Separation 25.7% Plants 57.2% EMEA 32.4% Hydrogen/ 16.2% Synthesis Gas 21.5% Plants 28.5% Olefin Plants 15.8% ASIA/PACIFIC 44.1% 16.7% Natural Gas Plants 23.4% 10.3% Other 13.6% 27.2% 15.6% AMERICAS 23.5% 46

Engineering Division Solid and diversified order backlog Order backlog by plant type (31/12/) Other: 7.4% (: 4.6%) Synthesis Gas Plants: 18.9% (: 14.7%) Olefin Plants: 28.6% (: 43.5%) Air Separation Plants: 24.7% (: 24.7%) Natural Gas Plants: 20.4% (: 12.5%) 47

Mega-trend Energy/Environment Current and future growth markets for Gases & Engineering Better use of fossil resources: Existing growth markets Renewable energy: Developing growth markets Clean energy: Future growth markets Liquified Natural Gas (LNG) Statoil plant, Hammerfest, Floating LNG Photovoltaic Signed Gases contracts for 6 GWp of nominal capacity OxyFuel Vattenfall Pilot Project, Schwarze Pumpe, Germany Gas-To-Liquid (GTL) xxx CO 2 scrubbing Coal-to-Gas Pearl GTL project, Qatar Shell GTL LTd RECTISOL CO 2 wash, used at Hammerfest LNG plant ASUs and Rectisol for coal gasifications in China Bio to Liquids Biomass- Conversion Geothermal Waste Management JV plant started up in 2009 Choren/Sun Fuel Pilot Project, Germany Turbines for geothermal project in France Post-comb. CO 2 capture CO 2 handling RWE/BASF Pilot Project, Niederaussem, Germany Recycling CO 2 (OCAP, Nld) CO 2 SINK, Ketzin, Germany Statoil LNG plant, Norway Coal liquefaction Tonnage contract with Bayer/SCCC 1 in China Automotive Hydrogen H 2 Mobility Initiative launched with key industrial partners Enhanced Oil& Gas Recovery Pemex Cantarell project, Mexico Adnoc Joint Venture, Abu Dhabi Refinery Hydrogen Tonnage contracts with Shell, EMAP, Chevron, CITGO, Higher efficiency in energy use: Sustained growth in traditional end markets REBOX oxy-fuel (steel), WASTOX (aluminium), Oxygen burner (glass), Water Treatment, 1 Shanghai Cooking & Chemical Corporation Business model Linde: Engineering Gas Supply Maturity of business: Existing business Pilot on-going 48

Clean Energy market estimation 2020 & 2030 top down Market size in bn 2015 2020 2030 Assumptions for 2030 Clean Coal --- --- 20 40 Triple-digit number of 1 GW Carbon Capture (1.5 Gt/a CO 2 at EUR25-40/t) CO 2 networks small 1 15 25 Installation of significant pipeline network and corresponding compression (1.5 Gt/a handling fee CO 2 at EUR 10-15/t) H 2 fueling small 1 10 15 EOR/EGR* 1.5 4-5 18 35 LNG 3-4 6-10 11 23 Renewables 1 2 Range 5-7 14-19 18-140 3 Installation of a significant fuel station infrastructure Corresponding annual H 2 consumption of some bn tons p.a. Single to double digit number of large N 2 EOR/NRU projects Double digit number of large CO 2 EOR projects including industrial CO 2 capture and pipeline (overlapping w/ccs) Based on penetration rate of LNG replacing existing fuels Merchant LNG projects based on geographical set up and existing infrastructure Floating LNG projects Includes mainly gases used for manufacturing of photovoltaic cells * Assuming 100% Build Own Operate and excluding sale of equipment and plants. General assumptions: Market numbers are directional only and w/o inflation or currency Oil price development at 80-100 USD/bll Outsourced gases market only (excl. captive market or equipment sales) 49

Group Reconciliation of Capital Employed 31/12/ 31/12/ in million Key Financial Figures As reported Non-GAAP adjustment Key Financial Figures Effects Equity incl. minority interest 10,572 12,144-649 11,495 PPA and disposal effects Plus: financial debt 6,673 7,768 7,768 Plus: liabilities from financial lease 49 46 46 Less: receivables from financial lease 392 352 352 Less: Cash, cash equivalents and securities 1,176 2,674 2,674 Plus: Net pension obligations 552 611 611 Capital employed 16,278 17,543-649 16,894 Average Capital employed 15,451 17,305 16,586 Return on Capital Employed (ROCE) 12.5% 11.0% 13.0% 50

Group Reconciliation of EPS 31/12/ 31/12/ in million Key Financial Figures As reported Non-GAAP adjustment Key Financial Figures Effects EBIT before special items 1,933 1,910 242 2,512 PPA Taxes on income -427-375 -101-476 deferred taxes on PPA Earnings after taxes and minority interest 1,167 1,174 141 1,315 EPS (in ) 6.89 6.88 7.71 Weighted average no. of shares (in million) 169.3 170.6 170.6 51

Group PPA Expected Depreciation & Amortisation Development of depreciation and amortisation (in million) Impact in : 242 million Expected range 2012 2013 2022 > 175 225 > 190-210 < 125 PPA Depreciation Planning (in m) 400 300 200 100 2006 2008 2012 2014 2016 2018 2020 2022 2024 0 52

Group, Definition of financial key figures Operating Profit adjusted ROCE Return Return EBITDA (incl. IFRIC 4 adjustment) excl. finance costs for pensions excl. special items incl. share of net income from associates and joint ventures Operating profit - depreciation / amortisation excl. depreciation/amortization from purchase price allocation adjusted EPS Average Capital Employed Return equity (incl. minorities) + financial debt + liabilities from financial leases + net pension obligations - cash, cash equivalents and securities - receivables from financial leases earnings after tax and minority interests + depreciation/amortization from purchase price allocation +/- special items Shares average outstanding shares 53

Investor Relations Contact Phone: +49 89 357 57 1321 email: investorrelations@linde.com Internet: www.linde.com Financial Calendar Interim Report January to March: 4 May 2012 Annual General Meeting: 4 May 2012 Interim Report January to June: 27 July 2012 Interim Report January to September: 29 October 2012 54

Full year results Profitable Growth. Analysts Conference Call 09 March 2012