Air Liquide Reports 4.8% Comparable Revenue Growth in First Half

The Tip Desk · June 30, 2014 · 2 min read

The industrial gas company increased its operating margin to 16.7% through cost efficiencies despite currency headwinds.

Air Liquide reported a comparable revenue increase of 4.8% for the first half of 2014. Published revenue fell 0.7% to 7,505.5 million euros from 7,561.5 million euros in the first half of 2013. The company said the published decline was impacted by a negative currency effect of -4.2% and a natural gas effect of -0.1%.

Operating performance improved as the company implemented efficiency plans totaling 152 million euros. Current operating result before depreciation and amortization was 1,872 million euros, a published decrease of 0.2%. After depreciation and amortization of 618 million euros, the current operating result reached 1,254 million euros. The operating margin rose 10 basis points to 16.7%.

Regional results for the Gas and Services segment showed divergent trajectories. In Europe, current operating result was 665 million euros, a decrease of 0.7%. The company said the operating margin in Europe, excluding the natural gas effect, rose 60 basis points. In the Americas, current operating result fell 4.7% to 327 million euros. The company attributed this to a strong currency effect and increased transport costs in the United States during winter weather. In Asia-Pacific, current operating result rose 12.7% to 275 million euros.

Net income attributable to the Group was 755.2 million euros, a published increase of 0.4%. Net income per share remained at 2.20 euros.

Financial structure shifted as net debt reached 6,797.2 million euros on June 30, 2014. This represented an increase of 735.3 million euros compared to December 31, 2013. The company said this increase reflected the usual seasonality associated with the payment of the 2013 dividend. The net debt to equity ratio was 57% when adjusted for the dividend seasonality.

To manage its debt and fund development, the company issued 750 million euros in bonds during the first half of 2014. These included a 500 million euro public bond issue with a 1.875% coupon. This specific issuance was used to refinance a 535 million euro bond that matured in June 2014.

Investment activity remained active with gross investment payments reaching 1,081 million euros. Net investment payments were 943 million euros. The company said it maintains a high level of investment opportunities at 3.4 billion euros. Current investments under execution are 2.6 billion euros, which the company said will generate future annual sales of 1.2 billion euros once fully operational.