Airgas acquisition boosts Air Liquide’s results

February 15, 2017 | Francinia Protti-Alvarez

Air Liquide's net profit for the full year 2016 amounted to €1.84 billion ($1.95 billion), up 5% year-over-year (YOY). Recurring operating income reached €3.02 billion, up 12% YOY but 2% below consensus estimates.  Revenue for the full year grew 14.6% YOY, to €18.13 billion, reflecting the inclusion of sales by Airgas since 23 May 2016. The group has not disclosed net profit for the full year, or operating income for the fourth quarter.

"With the acquisition of Airgas, the group has taken a major step forward in its geographic expansion and the extension of its markets. Its performance in 2016, which includes Airgas for a portion of the year, is solid with an increase in revenue, net profit, and net earnings per share, despite unfavorable currency and energy effects," says Benoit Potier, chairman and CEO of Air Liquide. Assuming a comparable environment, the company expects to deliver net profit growth in 2017.

Air Liquide's revenue totaled €5.16 billion in the fourth quarter, up 27.8% YOY. Sales in the Americas more than doubled YOY, to just over €2 billion, in large part due to completion of the Airgas deal in October last year. Growth in the APAC and European regions was modest in comparison at 2.4% and 3.2% YOY, respectively. However, revenue in the Middle East and Africa shrank just over 12% YOY. Fourth-quarter sales in the Middle East were penalized by a scheduled customer maintenance turnaround that lasted four weeks. The health-care business continued to grow in the region, the company says.

Air Liquide’s gas and services segment remained the largest revenue stream, contributing €4.93 billion, up 30.8% YOY. The segment benefited from the consolidation of Airgas sales since May despite negative currency effects and an adverse energy impact, Air Liquide says. Worldwide markets and technology also grew 19.5% YOY, to €111 million, with significant sales in the space, maritime, and biogas sectors, the company says. However, the engineering and construction segment’s sales dropped 34% YOY, on a slowdown in major energy-related projects and a low number of new projects in a still difficult environment, Air Liquide says.