Regulatory News:
Air Liquide (Paris:AI):
Key Figures (in millions of
euros)
Q3 2024
2024/2023 as published
2024/2023
comparable(a)
Group Revenue
6,762
-0.7%
+3.3%
of which Gas & Services
6,445
-0.6%
+3.6%
of which Engineering &
Construction
110
+0.2%
-0.0%
of which Global Markets &
Technologies
207
-5.0%
-4.6%
(a) Change excluding the currency, energy
(natural gas and electricity) and significant scope impacts, see
reconciliation in the appendices.
Commenting on sales in the third quarter of 2024, François
Jackow, Chief Executive Officer of the Air Liquide Group,
stated:
“Air Liquide is continuing its trajectory and once again
delivered a solid quarter. In a difficult market
environment, our sales increased, demonstrating the
resilience of our business model. We continued to improve our
margin and our investment decisions reached a record level,
paving the way for long-term growth. Through the tangible solutions
we provide to our customers, our Group supports major
transformations, such as the energy transition and those
accelerated by digital technology and Artificial Intelligence,
which are key growth drivers.
At 6.8 billion euros in the third quarter of 2024, our
Group’s revenue was up +3.3%(1) on a comparable basis
(-0.7% as published, reflecting a negative currency impact and
lower energy prices, which variations are passed through to our
customers), an increase compared to the previous quarter (+3.1%).
Gas & Services, which represent 95% of Group revenue, were
up +3.6%(1) on a comparable basis: all activities are growing,
demonstrating the strength of our diversified business model.
Healthcare in particular increased sharply by +9%(1)
on a comparable basis. Geographically, the Americas and Asia
were particularly dynamic, with respective growth of
+8%(1) and +4%.
Air Liquide also continued to improve its performance.
The transformation plan announced in July has now entered the
execution phase across the entire Group, in particular
through the simplification of our organization. Group
efficiencies, up +10%, reached a record level of 353 million
euros at the end of September. We also continued the dynamic
management of our business portfolio, while adjusting our prices in
Industrial Merchant thanks to our ability to create value. All of
these actions contributed to the continued improvement of +100
basis points in the Group's operating margin excluding the
energy impact since the beginning of the year, outpacing our
ADVANCE plan, whose performance ambition was raised early in
the year.
Paving the way for future growth, our investment momentum is
particularly strong. Well diversified, our investment
backlog was still at the very high level of 4.2 billion euros
in this third quarter. Reaching a record level, investment
decisions amounted to 1.4 billion euros with major
projects in Large Industries and Electronics. 12-month
investment opportunities remained at a high level of more than 4
billion euros, driven by the transformations that the Group
accompanies, whether in the energy transition - for more
than 40% of them - or in the field of electronics and
semiconductors.
In 2024, Air Liquide is confident in its ability to further
increase its operating margin and to deliver recurring net profit
growth, at constant exchange rates(2)."
Highlights
Corporate
- As part of the simplification of the
Group organization to meet growing needs of the
market and increase its performance, an adjusted
governance was announced with changes effective September 1,
2024.
- The divestiture of Air Liquide’s
businesses in 12 countries in Africa was finalized on July
22, 2024, illustrating the Group’s strategy of regular review of
its business portfolio.
Industry and Energy Transition
- Investment of approximately 150
million US dollars to extend production capacities and the
pipeline network in the United States, as part of a contract with
LG Chem to supply oxygen to their battery plant for
electric vehicles in Tennessee.
- Investment of nearly 60 million euros
to acquire and operate an Air Separation Unit (ASU) in Yantai,
China under a long-term contract with Wanhua Chemical
Group.
- Investment of 100 million
euros, including a new Air Separation Unit in Bulgaria and
the modernization of four units in Germany, as part of the renewed
partnership with Aurubis AG, one of the largest copper
recycling groups in the world, to meet the demand for copper, a
crucial element in the energy transition.
- Air Liquide's innovative CO2
liquefaction technology, Cryocap™ LQ, was selected by
Stockholm Exergi, an energy supplier in Sweden, to contribute to
its bioenergy project.
Group revenue amounted to 6,762 million
euros in the 3rd quarter 2024 and posted growth of
+3,3% compared to the 3rd quarter 2023, demonstrating the
resilience of the portfolio of activities in a challenging
environment. Growth was up slightly sequentially compared to the
first two quarters of the year. The contribution of Argentina(3) to
comparable growth was +2.0%. The Group's published revenue
decreased slightly by -0.7%, impacted by unfavorable energy
(-0.9%) and currency (-3.1%) impacts. There was no significant
scope impact.
Gas & Services revenue in the 3rd quarter of 2024
reached 6,445 million euros, up by
+3.6% on a comparable basis (including a contribution
of +2.0% from Argentina).
All activities grew(4) in the 3rd quarter of 2024.
Revenue from Large Industries posted an increase of
+2.8%, supported by the start-up of two large units at the
beginning of the year and the strengthening of demand, particularly
in Chemicals in the United States. This growth was impacted by the
divestiture of a cogeneration unit in Europe in early January and
customers maintenance turnarounds. Development continued in the
Industrial Merchant business (+1.7%) in the 3rd
quarter 2024 with a solid price effect of +4.1%
offsetting slightly lower gas volumes and a marked decline in
Hardgoods sales in the United States. In Electronics
(+5.9%), all segments contributed to growth, with the
exception of Specialty Materials. In a difficult industrial
context, the Healthcare business (+9.2%) was the main
contributor to the growth in the 3rd quarter. It benefited from the
dynamic development of Home Healthcare and the increase in volumes
and prices of medical gases in an inflationary environment.
- In the Americas, Gas & Services revenue amounted to
2,562 million euros and all businesses contributed to the
strong growth of +8.2% (including the contribution of
Argentina for +5.1%). Large Industries (+11.6%) benefited from the
start-up of a major unit at the beginning of the year and the
strengthening of demand notably in the United States. The increase
in Industrial Merchant sales (+4.7%) was supported by a price
effect that remained high (+6.9%). Growth was dynamic in Healthcare
(+25.3%). In the Electronics business (+12.5%), sales of Carrier
Gases and of Equipment & Installation posted double-digit
growth.
- Revenue in Europe was down -1.5% in the 3rd
quarter of 2024 at 2,247 million euros. Revenue in Large
Industries (-3.6%) would be up slightly excluding the divestiture
of a cogeneration unit in the 1st quarter. In Industrial Merchant
(-2.3%), volumes contracted but the price effect improved
sequentially to -0.3%. The Healthcare business posted solid sales
growth (+3.0%), supported by the development of Home Healthcare and
medical gases.
- The Asia-Pacific region returned to growth
(+4.1%) in the 3rd quarter of 2024 with revenue of 1,340
million euros. Sales in Large Industries (+6.6%)
benefited in particular from the start-up of a large hydrogen unit
in China in March. Revenue in Industrial Merchant (-1.8%) was
impacted by the marked decline in helium sales in China, while
sales in the rest of Asia increased slightly. The dynamism of
Carrier Gases and Advanced Materials were the main contributors to
growth in Electronics (+6.8%).
- Revenue in the Middle East & Africa region increased
by +1.1% to 296 million euros in the 3rd quarter of
2024. It increased by +6.5% excluding the divestiture of businesses
in 12 African countries finalized in July.
Global Markets & Technologies posted a -4.6%
decrease in revenue on a comparable basis to 207 million
euros in the 3rd quarter of 2024. Excluding the divestiture of
the technological activities for the Aeronautics sector in the 1st
quarter, revenue from the business was stable compared to the 3rd
quarter of 2023.
Consolidated revenue from Engineering & Construction
amounted to 110 million euros in the 3rd quarter and
remained stable (-0.0%) compared to the 3rd quarter of 2023.
Consolidated revenue excludes internal projects, in particular for
Large Industries and Electronics, which are growing.
Industrial and financial investment decisions saw
a record level of 1.4 billion euros in the 3rd
quarter of 2024, thus exceeding 3.0 billion euros since the
beginning of the year. The investment backlog stood
at a very high level of 4.2 billion euros.
The additional contribution to sales of unit start-ups
and ramp-ups totaled 185 million euros at the end of the 3rd
quarter.
The portfolio of 12-month investment opportunities
remained at the very high level of 4.0 billion euros
at the end of September 2024 and the portfolio of opportunities at
more than 12 months is continuing to grow and has reached a very
high level.
The operating margin (OIR to revenue) in the nine first
months of the year posted a strong improvement of +100 basis
points excluding the energy impact(5), driven by the three
levers which are the efficiencies, price management and portfolio
optimization.
Efficiencies(6) totaled 120 million euros in the 3rd
quarter. They amounted to a record level of 353 million
euros in the first nine months of the year, up sharply by
+10.3% compared to the same period in 2023. They are well
ahead in respect of the annual target of 400 million euros. In an
inflationary environment, the Group continued its active price
management. Thus, the price impact in the Industrial
Merchant business stood at +4.1% in the 3rd
quarter 2024 and was in addition to the price increases of +18.0%
and +6.5% in the 3rd quarters of 2022 and 2023 respectively. During
the first nine months of the year, the Group continued its
active portfolio management with 14 acquisitions and 5
divestitures.
Cash flows from operating activities before changes in
working capital reached 1,581 million euros in
the 3rd quarter 2024, up +4.0% excluding current taxes and +2.4% as
published.
Net debt amounted to 9,615 million euros, a
decrease of 541 million euros compared to 10,156 million euros as
of June 30, 2024.
In terms of extra-financial performance, the Group
started up two Air Separation Units in China which were
electrified and which had previously consumed steam produced
by the customer from coal. This industrial transformation
reduces CO2 emissions (scope 2) by approximately 370,000 metric
tonnes per year. Air Liquide has also decided to invest in Air
Separation Units that will supply oxygen to customers producing
essential elements for the energy transition.
Analysis of 3rd quarter 2024 revenue
Unless otherwise stated, all variations in
revenue outlined below are on a comparable basis, excluding
currency, energy (natural gas and electricity) and significant
scope impacts.
REVENUE
Revenue (in millions of euros)
Q3 2023
Q3 2024
2024/2023 published
change
2024/2023 comparable
change
Gas & Services
6,483
6,445
-0.6%
+3.6%
Engineering & Construction
110
110
+0.2%
-0.0%
Global Markets & Technologies
218
207
-5.0%
-4.6%
TOTAL REVENUE
6,811
6,762
-0.7%
+3.3%
Revenue by Quarter (in millions of
euros)
Q1 2024
Q2 2024
Q3 2024
Gas & Services
6,358
6,438
6,445
Engineering & Construction
92
105
110
Global Markets & Technologies
200
186
207
TOTAL REVENUE
6,650
6,729
6,762
2024/2023 Group published
change
-7.3%
-1.2%
-0.7%
2024/2023 Group comparable
change
+2.1%
+3.1%
+3.3%
2024/2023 Gas & Services comparable
change
+2.0%
+3.4%
+3.6%
Group
Group revenue amounted to 6,762 million
euros in the 3rd quarter 2024 and posted growth of
+3,3% compared to the 3rd quarter 2023, demonstrating the
resilience of the portfolio of activities in a challenging
environment. Growth was up slightly sequentially compared to the
first two quarters of the year. The contribution of Argentina(7) to
comparable growth was +2.0%. Global Markets &
Technologies sales were down by -4.6% due in particular
to the divestiture of the technological activities for the
Aeronautics sector. Revenue from Engineering &
Construction with third-party customers was stable
(-0.0%), while project activity for the Group grew.
The Group's published revenue decreased slightly by
-0.7%, impacted by unfavorable energy (-0.9%) and currency
(-3.1%) impacts. There was no significant scope impact.
Gas & Services
Gas & Services revenue in the 3rd quarter of 2024
reached 6,445 million euros, up by
+3.6% on a comparable basis (including a contribution
of +2.0% from Argentina).
All businesses grew in the 3rd quarter of 2024. Revenue
from Large Industries posted an increase of +2.8%,
supported by the start-up of two large units at the beginning of
the year and the strengthening of demand, particularly in Chemicals
in the United States. This growth was impacted by the divestiture
of a cogeneration unit in Europe in early January and customer
maintenance turnarounds. Development continued in the Industrial
Merchant business (+1.7%) in the 3rd quarter 2024 with a
solid price effect of +4.1% offsetting slightly lower
gas volumes and a marked decline in Hardgoods sales in the United
States. In Electronics (+5.9%), all segments
contributed to growth, with the exception of Specialty Materials.
In a difficult industrial context, the Healthcare business
(+9.2%) was the main contributor to the growth in the 3rd
quarter. It benefited from the dynamic development of Home
Healthcare and the increase in volumes and prices of medical gases
in an inflationary environment.
Published revenue for Gas & Services was down
-0.6% in the 3rd quarter of 2024, penalized by unfavorable
currency (-3.3%) and energy (-0.9%) impacts. There was no
significant scope impact in the 3rd quarter of 2024.
Revenue by geography and business
line (in millions of euros)
Q3 2023
Q3 2024
2024/2023 published
change
2024/2023 comparable
change
Americas
2,556
2,562
+0.2%
+8.2%
Europe
2,331
2,247
-3.6%
-1.5%
Asia Pacific
1,313
1,340
+2.1%
+4.1%
Middle East & Africa
283
296
+4.6%
+1.1%
GAS & SERVICES REVENUE
6,483
6,445
-0.6%
+3.6%
Large Industries
1,882
1,818
-3.4%
+2.8%
Industrial Merchant
2,988
2,945
-1.4%
+1.7%
Healthcare
1,013
1,054
+4.0%
+9.2%
Electronics
600
628
+4.7%
+5.9%
Americas
In the Americas, Gas & Services revenue amounted to 2,562
million euros and all activities contributed to the strong
growth of +8.2% (including the contribution of Argentina for
+5.1%). Large Industries (+11.6%) benefited from the start-up of a
major unit at the beginning of the year and the strengthening of
demand notably in the United States. The increase in Industrial
Merchant sales (+4.7%) was supported by a price effect that
remained high (+6.9%). Growth was dynamic in Healthcare (+25.3%).
In the Electronics business (+12.5%), sales of Carrier Gases and of
Equipment & Installation posted double-digit growth.
- Revenue from Large Industries posted strong growth of
+11.6% in the 3rd quarter of 2024 despite customer
turnarounds. The start-up of a major unit at the beginning of the
year and the strengthening of demand from Chemicals customers were
the main contributors to the sharp increase in air gas sales in the
United States. In North America, the sale of electricity from
cogeneration units and of hydrogen also increased. In Latin
America, hydrogen volumes were down due to the nationalization of a
production unit in Mexico at the end of 2023.
- Sales in the Industrial Merchant business posted an
increase of +4.7% in the 3rd quarter. The price
effect (+6.9%) remained high. It benefited from proactive
price campaigns, particularly in the United States (50% of the
+6.9% increase in the 3rd quarter) in the 1st semester and in
Argentina to counter hyperinflation (40% of the increase). Gas
volumes remained resilient, while Hardgoods posted a marked
decline. Growth in industrial markets was still mainly driven by
prices, but volumes increased in the Technology, Research,
Chemicals and Food sectors.
- In the Healthcare business, sales rose by +25.3%
in the 3rd quarter of 2024, driven by the strong increase in prices
in the United States (+5.3%) and in Argentina in a context of
hyperinflation. Sales growth outside Argentina was significantly
higher than that of the 2nd quarter of 2024. In the United States,
the volumes of medical gases increased, particularly in Proximity
care. In Latin America, the number of patients in Home Healthcare
as well as the volumes of medical gases increased
significantly.
- Electronics saw an increase of +12.5% in revenue
in the 3rd quarter of 2024. Carrier Gas sales posted double-digit
growth, supported by the start-up of a nitrogen generator and
higher helium volumes. Equipment and Installation sales remained
very high, while Materials sales were still down.
Americas
- Air Liquide will invest around 150 million US dollars to
expand its production capacity and pipeline network in Clarksville,
in Tennessee, United States, in the context of a new
long-term contract with LG Chem. The new air
separation unit will supply oxygen to LG Chem's battery
materials production site and will also have significant
liquefaction capacity to support the development of the
Industrial Merchant business in Tennessee and Kentucky.
Europe
Revenue in Europe was down -1.5% in the 3rd quarter of
2024 at 2,247 million euros. Sales in Large Industries
(-3.6%) would be up slightly excluding the divestiture of a
cogeneration unit in the 1st quarter. In Industrial Merchant
(-2.3%), volumes contracted but the price effect improved
sequentially to -0.3%. The Healthcare business posted solid sales
growth (+3.0%), supported by the development of Home Healthcare and
medical gases.
- In the 3rd quarter of 2024, revenue in Large Industries
was down -3.6%. Excluding the divestiture of a cogeneration
unit in the 1st quarter (impact of approximately -5.5%), it would
have been up slightly. Hydrogen volumes for Refining and Chemicals
rose slightly. Air gas sales to Steel customers remained stable
overall at a low level.
- Sales in the Industrial Merchant business declined by
-2.3% following growth of +6.5% in the 3rd quarter of 2023.
The price effect improved sequentially at -0.3%. The
decline in the price of bulk gas (indexed to energy prices for an
estimated decrease of -5.7%) was offset by proactive actions to
increase prices (for +5.4%), supported by innovation and quality of
customer service. Volumes remained down but the trend improved
compared to the previous quarter. Volumes were resilient in the
Construction, Food and Water Treatment sectors.
- In the Healthcare business, sales increased by
+3.0% in the 3rd quarter. Home Healthcare continued its
growth, with a sharp increase in the number of patients cared for,
particularly for sleep apnea and diabetes. Growth in sales of
medical gases remained solid, supported by a balanced contribution
from volumes and prices in line with inflation.
Europe
- Air Liquide will invest approximately 100 million euros
to supply Aurubis AG, a leading global provider of non-ferrous
metals and one of the largest copper recyclers worldwide, in
Bulgaria and in Germany. This investment will cover a new Air
Separation Unit (ASU) in Bulgaria which will replace older
units to produce larger oxygen and nitrogen volume. In Germany,
Air Liquide will modernize four existing units on the Aurubis site.
These units will provide large volumes of oxygen and nitrogen
for Aurubis' growing production of copper and other metals and
will support the development of the Industrial Merchant
markets in these two regions.
Asia-Pacific
The Asia-Pacific region returned to growth (+4.1%) in the
3rd quarter of 2024 with revenue of 1,340 million
euros. Sales in Large Industries (+6.6%) benefited in
particular from the start-up of a large hydrogen unit in China in
March. Revenue in Industrial Merchant (-1.8%) was impacted by the
marked decline in helium sales in China, while sales in the rest of
Asia increased slightly. The dynamism of Carrier Gases and Advanced
Materials were the main contributors to growth in Electronics
(+6.8%).
- Revenue in Large Industries saw a sharp rise of
+6.6%. Sales benefited from the start-up of a large hydrogen
production unit in China in March and fewer customer shutdowns than
in previous quarters.
- In Industrial Merchant, revenue was down -1.8%.
The price effect, impacted by the decline in helium prices,
particularly in China, remained slightly negative (-0.7%)
but improved sequentially. In China, volumes of gas in cylinders
were up sharply, also supported by recent acquisitions. In the rest
of Asia, sales increased slightly, helped by higher volumes and a
positive price effect. Volumes were up in Secondary Electronics,
Manufacturing and Food.
- Revenue in Electronics increased by +6.8%
compared to a relatively low basis of comparison in the 3rd quarter
of 2023. All business segments, with the exception of Specialty
Materials, contributed to this growth. The start-up of several
production units since the beginning of the year contributed to the
strong increase in Carrier Gas sales. Revenue in Advanced Materials
saw double-digit growth, while sales in Equipment &
Installation were at a high level.
Asia-Pacific
- Air Liquide has decided to invest close to 60 million
euros to take over and operate an Air Separation
Unit (ASU) within the context of a long-term contract
with Wanhua Chemical Group (Wanhua), a global leading
supplier of chemical innovative products, in the city of Yantai,
China. In this context, Air Liquide will also build, own and
operate a new liquid argon production unit on this ASU -
built by Air Liquide Engineering & Construction - to serve
Industrial Merchant markets in Yantai and the wider province of
Shandong. This long-term contract, the first signed by the Group
with Wanhua, will allow Air Liquide to start supplying
industrial and medical gases in the city of Yantai and to
reinforce its presence in the region of Shandong.
Middle East and Africa
Revenue in the Middle East & Africa region increased by
+1.1% to 296 million euros in the 3rd quarter of
2024. It increased by +6.5% excluding the divestiture of businesses
in 12 African countries finalized in July. Large Industries
benefited from resilient activity in the region. In the 4th quarter
of 2024, a major customer in Saudi Arabia scheduled an extended
shutdown for maintenance. Industrial Merchant revenue was down due
to the divestiture of businesses in 12 African countries at the end
of July 2024. Excluding this divestiture, activity posted dynamic
growth, supported by the increase in prices (+6.7%).
In Healthcare, the rise in medical gas volumes in South Africa and
the development of diabetes treatment in Saudi Arabia were the main
contributors to revenue growth.
Middle East and Africa
- Air Liquide finalized on July 22nd, 2024,
the sale to Adenia Partners Ltd of the Group’s activities in
twelve countries(a) in Africa, representing an annual
revenue of approximately 60 million euros.
- This transaction illustrates Air Liquide’s strategy to
regularly review its portfolio of activities.
- With approximately 1,600 employees in the region and 700
million euros invested in the last three years, Air Liquide
remains a major industrial and medical gases player in Africa,
where it continues to pursue development opportunities,
particularly in the fields of energy transition, hydrogen and
healthcare.
(a) Benin, Burkina Faso, Cameroon, Congo,
Côte d'Ivoire, Gabon, Ghana, Madagascar, Mali, Democratic Republic
of Congo, Senegal and Togo.
Global Markets & Technologies
Global Markets & Technologies posted a -4.6% decrease
in revenue on a comparable basis to 207 million euros in the
3rd quarter of 2024. Excluding the divestiture of the technological
activities for the Aeronautics sector in the 1st quarter, revenue
from the business was stable compared to the 3rd quarter of 2023.
Sales of rare gases were particularly high in the 3rd quarter.
Biomethane volumes were stable in Europe and benefited from the
start-up of a unit in the United States. Sales of hydrogen for
mobility were down compared to the exceptionally high sales in the
3rd quarter of 2023.
Order intake for Group projects and third-party customers
amounted to 157 million euros in the 3rd quarter. They
included Turbo-Brayton LNG reliquefaction units, special systems
for the Electronics industry and for the purification of rare
gases, as well as biogas processing equipment.
Engineering & Construction
Consolidated revenue from Engineering & Construction
amounted to 110 million euros in the 3rd quarter and
remained stable (-0.0%) compared to the 3rd quarter of 2023.
Consolidated revenue excludes internal projects, in particular for
Large Industries and Electronics, which are growing.
Order intake amounted to 505 million euros in the
3rd quarter. This mainly involved Air Separation Units for the
Group and third-party customers. It also included cryogenic
equipment and studies for projects related to the energy
transition. Group orders represent a large majority of new
projects.
Engineering & Construction
- Air Liquide's innovative large scale
CO2 liquefaction technology, Cryocap™ LQ, has been selected by
Stockholm Exergi, Stockholm’s energy company, to contribute
to its Bio-Energy Carbon Capture & Storage (BECCS) project.
This new technology is an important additional brick in Air
Liquide’s portfolio of proprietary technologies that paves the
way to developing large-scale Carbon Capture & Storage (CCS)
value chains.
Investment Cycle
INVESTMENT DECISIONS AND INVESTMENT BACKLOG
Industrial and financial investment decisions saw
a record level of 1.4 billion euros in the 3rd
quarter of 2024, thus exceeding 3.0 billion euros since the
beginning of the year.
Industrial investment decisions reached 1,213
million euros, close to the all-time high of 1,273
million euros in the 3rd quarter of 2023.
- Industrial investment decisions were particularly high in
Asia this quarter. In particular, the Group completed the
acquisition of an ASU in Yantai (China) as part of a long-term
contract with Wanhua Chemical Group, at an investment of 60 million
euros, which also included a new argon production facility for
local customers. In addition, Air Liquide decided to invest in new
carrier gas units to serve customers in the Electronics business in
China and in a new Advanced Materials production center in South
Korea. Lastly, the Group signed several contracts to build and
operate six nitrogen generators for an Industrial Merchant customer
in Taiwan.
- In the Americas, investment decisions included a new ASU
that will supply oxygen to the LG Chem battery materials production
site in Clarksville (United States), for an amount of approximately
150 million US dollars. This unit will also have a significant
liquefaction capacity to support the development of the Industrial
Merchant business in Tennessee and Kentucky. Furthermore,
investment decisions included a new Specialty Materials production
unit to serve Electronics customers in the United States.
- The main investment decision in Europe concerned the
replacement of two Air Separation Units (ASUs) in Bulgaria by a
modern larger capacity ASU to serve Aurubis. This project completes
the modernization of four production units in Germany that began in
the 1st quarter and thus brings the investments decided in 2024 as
part of the renewal of contracts with Aurubis to 100 million
euros.
- To be noted that investment decisions to generate
efficiencies represented approximately 10% of total
industrial investment decisions in the 3rd quarter of 2024.
Financial investment decisions totaled 162
million euros in the 3rd quarter, compared with 30 million
euros in the 3rd quarter of 2023. In Industrial Merchant,
these included a major acquisition in China, two acquisitions in
the United States and one in Italy. They will contribute to growth
and strengthen the density of the Group’s local presence. Financial
decisions also included the acquisition of a biogas producer in
Sweden for the Global Markets & Technologies
business.
The investment backlog stood at a very
high level of 4.2 billion euros. The breakdown is well
balanced between Large Industries projects located in all regions
and those in Electronics, mainly in Asia and Americas.
START-UPS
The main start-ups in the 3rd quarter of 2024 included the
electrification of two Air Separation Units in Large
Industries in China, which will allow CO2 emissions (scope
2) to be reduced by approximately 370,000 metric tons per year.
They also included the start-up of a carrier gas production
unit for an Electronics customer in the United States
and a liquefied biomethane unit for the Global Markets &
Technologies business.
The additional contribution to sales of unit start-ups
and ramp-ups totaled 185 million euros at the end of the 3rd
quarter. In 2024, it is expected to be between 230 and
250 million euros. In 2025, it is forecasted to be above 250
million euros.
INVESTMENT OPPORTUNITIES
The portfolio of 12-month investment opportunities
remained at the very high level of 4.0 billion euros
at the end of September 2024, up sharply compared to 3.4 billion
euros at the end of September 2023. Energy transition
projects represent more than 40% of the portfolio. Their
development is very dynamic in Europe and America, supported by the
Inflation Reduction Act and illustrated by the major project
announced in the 2nd quarter for ExxonMobil in Baytown, Texas
(United States). In Electronics, opportunities are now
spread between Asia, Europe and the United States and are bolstered
by incentive programs (Chips Acts).
The portfolio of opportunities at more than 12
months is continuing to grow and has reached a very high
level. It includes in particular significant projects in energy
transition and the Electronics sector.
Operating Performance
FINANCIAL PERFORMANCE
The operating margin (OIR to revenue) in the nine first
months of the year posted a strong improvement of +100 basis
points excluding the energy impact(8), driven by the three
levers which are the efficiencies, price management and portfolio
optimization.
Efficiencies(9) totaled 120 million euros in the 3rd
quarter. They amounted to a record level of 353 million
euros in the first nine months of the year, up sharply by
+10.3% compared to the same period in 2023. They are well
ahead in respect of the annual target of 400 million euros. The
Group's transformation programs accelerated and included the
rollout of digital tools to support operations, the optimization of
the logistics chain (particularly in North America) and the
reorganization of the Home Healthcare businesses in France.
Efficiencies related to purchasing, which make up more than
a quarter of the total, were increasing. In addition, the
cross-functional program of continuous improvement,
comprising in particular more than a thousand industrial efficiency
projects, actively supported the achievement of more than a third
of efficiencies.
In an inflationary environment, the Group continued its active
price management. Thus, the price impact in the
Industrial Merchant business stood at
+4.1% in the 3rd quarter 2024 and was in addition to the
price increases of +18.0% and +6.5% in the 3rd quarters of 2022 and
2023 respectively.
During the first nine months of the year, the Group continued
its active portfolio management with 14 acquisitions and
5 divestitures. In the 3rd quarter 2024, these were mainly
Industrial Merchant acquisitions, including a significant size
acquisition in China, two in the United States and one in Italy. A
biogas producer in Sweden has also been integrated in the Global
Markets & Technologies business. Furthermore, the divestiture
of the Group’s businesses in 12 African countries, representing an
annual revenue of approximately 60 million euros, was completed in
July. Lastly, in Healthcare, a small business unrelated to the
Group’s core business was disposed of during the 3rd quarter.
Cash flows from operating activities before changes in
working capital reached 1,581 million euros in
the 3rd quarter 2024, up +4.0% excluding current taxes and +2.4% as
published. It notably ensures the payment of industrial
investments, which totaled 928 million euros.
Net debt amounted to 9,615 million euros, a
decrease of 541 million euros compared to 10,156 million euros as
of June 30, 2024.
EXTRA-FINANCIAL PERFORMANCE
During the 3rd quarter of 2024, the Group started up two Air
Separation Units in China which were electrified and which
had previously consumed steam produced by the customer from coal.
This industrial transformation reduces CO2 emissions (scope 2)
by approximately 370,000 metric tonnes per year.
Air Liquide has also decided to invest in Air Separation Units
that will supply oxygen to customers producing battery materials
(LG Chem in the United States) and copper (Aurubis in Bulgaria),
essential elements for the energy transition.
Outlook
Air Liquide is continuing its trajectory and once again
delivered a solid quarter. In a difficult market
environment, our sales increased, demonstrating the
resilience of our business model. We continued to improve our
margin and our investment decisions reached a record level,
paving the way for long-term growth. Through the tangible solutions
we provide to our customers, our Group supports major
transformations, such as the energy transition and those
accelerated by digital technology and Artificial Intelligence,
which are key growth drivers.
Air Liquide also continued to improve its performance.
The transformation plan announced in July has now entered the
execution phase across the entire Group, in particular
through the simplification of our organization. Group
efficiencies, up +10%, reached a record level of 353 million
euros at the end of September. We also continued the dynamic
management of our portfolio of activities, while adjusting our
prices in Industrial Merchant thanks to our ability to create
value. All of these actions contributed to the continued
improvement of +100 basis points in the Group's operating
margin excluding the energy impact since the beginning of the
year, outpacing our ADVANCE plan, whose performance ambition
was raised early in the year.
Paving the way for future growth, our investment momentum is
particularly strong. Well diversified, our investment
backlog was still at the very high level of 4.2 billion euros
in this third quarter. Reaching a record level, investment
decisions amounted to 1.4 billion euros with major
projects in Large Industries and Electronics. 12-month
investment opportunities remained at a high level of more than 4
billion euros, driven by the transformations that the Group
accompanies, whether in the Energy Transition - for more
than 40% of them - or in the field of Electronics.
In 2024, Air Liquide is confident in its ability to further
increase its operating margin and to deliver recurring net profit
growth, at constant exchange rates(10).
Appendices - Performance indicators
Performance indicators used by the Group that are not directly
defined in the financial statements have been prepared in
accordance with the AMF position 2015-12 about alternative
performance measures.
The performance indicators are the following:
- Currency, energy and significant scope impacts
- Comparable sales change
- Efficiencies
DEFINITION OF CURRENCY, ENERGY AND SIGNIFICANT SCOPE
IMPACTS
Since industrial and medical gases are rarely exported, the
impact of currency fluctuations on activity levels and results is
limited to euro translation impacts with respect to the financial
statements of subsidiaries located outside the euro zone. The
currency effect is calculated based on the aggregates for the
period converted at the exchange rate for the previous period.
In addition, the Group passes on variations in the cost of
energy (electricity and natural gas) to its customers via indexed
invoicing integrated into their medium and long-term contracts.
This indexing can lead to significant variations in sales (mainly
in the Large Industries Business Line) from one period to another
depending on fluctuations in prices on the energy market.
An energy impact is calculated based on the sales of each
of the main subsidiaries in Large Industries. Their consolidation
allows the determination of the energy impact for the Group as a
whole. The foreign exchange rate used is the average annual
exchange rate for the year N-1. Thus, at the subsidiary level, the
following formula provides the energy impact, calculated for
natural gas and electricity respectively:
Energy impact = Share of sales indexed to energy year (N-1) x
(Average energy price in year (N) - Average energy price in year
(N-1))
This indexation effect of electricity and natural gas does not
impact the operating income recurring.
The significant scope effect corresponds to the impact on
sales of all acquisitions or disposals of a significant size for
the Group. These changes in scope of consolidation are
determined:
- for acquisitions during the period, by deducting from the
aggregates for the period the contribution of the acquisition,
- for acquisitions during the previous period, by deducting from
the aggregates for the period the contribution of the acquisition
between January 1 of the current period and the anniversary date of
the acquisition,
- for disposals during the period, by deducting from the
aggregates for the previous period the contribution of the disposed
entity as of the anniversary date of the disposal,
- for disposals during the previous period, by deducting from the
aggregates for the previous period the contribution of the disposed
entity.
COMPARABLE SALES CHANGE
Comparable change for sales excludes the currency, energy and
significant scope impacts described above.
(in millions of euros)
Q3 2024
Q3 2024/2023 Published
Growth
Currency impact
Natural gas impact
Electricity impact
Significant scope
impact
Q3 2024/2023 Comparable
Growth
Revenue
Group
6,762
-0.7%
(212)
(28)
(32)
0
+3.3%
Impacts in %
-3.1%
-0.4%
-0.5%
-%
Gas & Services
6,445
-0.6%
(211)
(28)
(32)
0
+3.6%
Impacts in %
-3.3%
-0.4%
-0.5%
-%
(in millions of euros)
YTD 2024
YTD 2024/2023 Published
Growth
Currency impact
Natural gas impact
Electricity impact
Significant scope
impact
YTD 2024/2023 Comparable
Growth
Revenue
Group
20,140
-3.1%
(682)
(392)
(165)
-
+2.8%
Impacts in %
-3.3%
-1.8%
-0.8%
-%
Gas & Services
19,241
-3.3%
(679)
(392)
(165)
-
+3.0%
Impacts in %
-3.5%
-1.9%
-0.9%
-%
EFFICIENCIES
Efficiencies represent a sustainable cost reduction
resulting from an action plan on a specific project. Efficiencies
are identified and managed on a per project basis. Each project is
followed by a team composed in alignment with the nature of the
project (purchasing, operations, human resources...).
Year to date revenue
BY GEOGRAPHY
Revenue (in millions of euros)
YTD 2023
YTD 2024
YTD Published
change
YTD Comparable
change
Americas
7,715
7,737
+0.3%
+8.0%
Europe
7,306
6,722
-8.0%
-1.4%
Asia Pacific
4,076
3,933
-3.5%
+0.8%
Middle East & Africa
791
849
+7.3%
+4.9%
GAS & SERVICES REVENUE
19,888
19,241
-3.3%
+3.0%
Engineering & Construction
290
306
+5.9%
+6.2%
Global Markets & Technologies
613
593
-3.3%
-3.0%
GROUP REVENUE
20,791
20,140
-3.1%
+2.8%
BY BUSINESS LINE
Revenue (in millions of euros)
YTD 2023
YTD 2024
YTD Published
change
YTD Comparable
change
Large Industries
5,942
5,275
-11.2%
+1.6%
Industrial Merchant
9,038
8,944
-1.0%
+1.9%
Healthcare
3,047
3,175
+4.2%
+9.1%
Electronics
1,861
1,847
-0.8%
+2.1%
GAS & SERVICES REVENUE
19,888
19,241
-3.3%
+3.0%
Complementary geographic and segment information
CONTRIBUTION OF THE ARGENTINA TO THE COMPARABLE
GROWTH
Contribution of the Argentina to the
comparable growth of revenue in Q3 (in %)
Total
Large Industries
Industrial Merchant
Healthcare
Electronics
Americas
+5.1%
+6.1%
+3.3%
+18.1%
-
Gas & Services
+2.0%
+1.3%
+1.9%
+4.8%
-
Group
+2.0%
Argentina’s contribution is calculated as the difference between
the amounts consolidated at Group level and the same amounts
consolidated excluding Argentina’s data. The same method applies to
the Gas & Services activity.
EUROPE, MIDDLE EAST AND AFRICA
Q3 revenue (in millions of
euros)
As published growth
Q3 comparable growth (in
%)
Total
Large Industries
Industrial Merchant
Healthcare
Electronics
Europe
2,247
-3.6%
-1.5%
-3.6%
-2.3%
+3.0%
N.C.
Middle East and Africa
296
+4.6%
+1.1%
N.C.
N.C.
N.C.
-
Europe + Middle East and Africa
2,543
-2.7%
-1.2%
-2.2%
-3.1%
+3.4%
N.C.
N.C.: Not communicated.
Air Liquide will start reporting the Gas & Services
performance of the Middle East and Africa region (also including
India) with Europe from Q4 2024.
Sales and investments key figures summary
The following tables gather data already available in
this report. They complement the key figures indicated in
the table on the first page.
Sales
Q3 2024 split of revenue and comparable
growth in %
Total
Large Industries
Industrial Merchant
Electronics
Healthcare
Americas
100%
14%
70%
5%
11%
+8.2%
+11.6%
+4.7%
+12.5%
+25.3%
Europe
100%
34%
32%
2%
32%
-1.5%
-3.6%
-2.3%
N.C.
+3.0%
Asia Pacific
100%
34%
28%
34%
4%
+4.1%
+6.6%
-1.8%
+6.8%
N.C.
Middle-East and Africa
100%
N.C.
N.C.
N.C.
N.C.
+1.1%
Gas & Services
100%
28%
46%
10%
16%
+3.6%
+2.8%
+1.7%
+5.9%
+9.2%
Engineering & Construction
-0.0%
Global Markets & Technologies
-4.6%
GROUP TOTAL
+3.3%
N.C.: Not communicated.
Investments
(in billion euros)
Q3 2024
12-month portfolio of investment
opportunities(a)
4.0
Investment decisions on the period
1.4
Investment backlog(a)
4.2
Additional contribution to revenue of unit
start-ups and ramp-ups(b) (in million euros)
185
(a) At the end of the reporting
period.
(b) Cumulated from the beginning of the
calendar year until the end of the reporting period.
Definitions:
Portfolio of 12-month investment opportunities (at end of the
period):
- Investment opportunities under consideration by the Group for
decision within 12 months;
- Industrial projects with investment value above 5 million
euros for Large Industries and above 3 million euros for other
business lines;
- Includes asset replacements or efficiency projects. Excludes
maintenance and safety.
Investment backlog (at end of the period):
- Cumulated industrial investment value of projects decided but
not yet started;
- Industrial projects with value above 10 million euros,
including asset replacements, excluding maintenance, efficiency and
safety projects.
Decisions (of the period):
- Cumulated value of industrial and financial investment
decisions;
- Industrial, growth and non-growth projects including asset
replacements, efficiency, maintenance and safety;
- Financial decisions (acquisitions).
The slideshow that accompanies this release
is available as of 7:20 a.m. (Paris time) at
www.airliquide.com
Throughout the year, follow Air Liquide
on LinkedIn.
Air Liquide is a world leader in gases, technologies and services
for industry and healthcare. Present in 60 countries with 66,300
employees, the Group serves more than 4 million customers and
patients. Oxygen, nitrogen and hydrogen are essential small
molecules for life, matter and energy. They embody Air Liquide’s
scientific territory and have been at the core of the Group’s
activities since its creation in 1902. Taking action today
while preparing the future is at the heart of Air Liquide’s
strategy. With ADVANCE, its strategic plan for 2025, Air Liquide is
targeting a global performance, combining financial and
extra-financial dimensions. Positioned on new markets, the Group
benefits from major assets such as its business model combining
resilience and strength, its ability to innovate and its
technological expertise. The Group develops solutions contributing
to climate and the energy transition—particularly with hydrogen—and
takes action to progress in areas of healthcare, digital and high
technologies.
Air Liquide’s revenue amounted to more than 27.5 billion euros in
2023. Air Liquide is listed on the Euronext Paris stock exchange
(compartment A) and belongs to the CAC 40, CAC 40 ESG, EURO STOXX
50, FTSE4Good and DJSI Europe indexes. ______________________
1See appendix for impact of Argentina.
2Operating margin excluding energy
passthrough impact. Recurring net profit excluding exceptional and
significant transactions that have no impact on the operating
income recurring.
3See impact of Argentina in Appendix.
4Unless otherwise stated, all variations
in revenue outlined below are on a comparable basis, excluding
currency, energy (natural gas and electricity) and significant
scope impacts.
5No impact from Argentina.
6See definition in appendix.
7See impact of Argentina in Appendix.
8No impact from Argentina.
9See definition in appendix.
10Operating margin excluding energy
passthrough impact. Recurring net profit excluding exceptional and
significant transactions that have no impact on the operating
income recurring.
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Investor Relations IRTeam@airliquide.com +33 1 40 62 51
50
Media Relations media@airliquide.com +33 1 40 62 58
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UPCOMING EVENTS 2024 Full Year results: February 21,
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