Air Liquide reports ‘very strong’ 2022 first half results

Following on from an exceptionally strong 2021, Air Liquide has highlighted several areas of success from its first half of 2022, including a major leadership change, the launch of its ADVANCE strategic plan for sustainability, and the role it has played in the scaling up of renewable hydrogen production.

The company also mobilised to support victims of the war in Ukraine through its Air Liquide Foundation, received validation by the Science Based Targets initiative (SBTi) of the company target to reduce scope 1 & 2 CO2 emissions by 2035, and signed various deals involving carbon capture. 

Reporting its half year results today (28^th July), the company also revealed a ‘very strong performance’ financially, with an increase in sales and operating margin, in addition to a push for sustainable development related initiatives, a sharp increase in revenue and growth across all activities including Gas & Services, Engineering & Construction, and Global Markets & Technologies. 

For the first half of 2022, Group revenue totalled $14.3bn, up 31% compared with the previous year reflecting the global increase in energy prices. 

Engineering & Construction consolidated revenue increased by 29% relative to the previous year, totalling $223.6m, with order intake totalling $532.4m, in line with the high level recorded in the first half of 2021. 

Global Markets & Technologies were up by 13.8%, totalling $390.7m in the first half of the year, boosted by strong moment in the biogas business and the spike in energy price. Gas & Services revenue amounted to $13.7bn, representing an increase of 7.2% on a comparable basis. 

Commenting on the results, François Jackow, Chairman and CEO, Air Liquide, said, “The Group delivered a very strong performance during the first half of 2022. This is even more remarkable considering the particularly complex macroeconomic and geopolitical context.” 

“Given the strong performance in the first half of 2022, combined with a more resilient business model and a clear strategic plan, as well as committed teams, whose dedication I commend, we are entering the second half of the year.” 

Sectors 

In the first half of the year, Healthcare sales increased by 2.2%, led by proximity care in the US and Home Healthcare in Latin America, despite a decline in medical oxygen sales for the treatment of Covid-19.

Large Industries revenue was down by 1.4% overall, though showed sustained growth in the Americas. 

This contributed to the high sales growth in the Industrial Merchant sector, which reached a high of 22.9%, offsetting the 7.4% decline in Large Industries sales. 

Electronics sales increased by 15.5%, boosted by a ‘strong contribution’ from all business segments.

Engineering & Construction growth totalled $223.5m, representing strong comparable growth of 29%. 

Global Markets & Technologies sales totalled $390.5m, a growth of 29% compared to the previous year. 

Geographies 

Gas & Services revenue in the Americas totalled $5bn in the first half of 2022, showing a 9.2% increase, with Large Industries in the region up by 5.3%, driven by solid demand and the start-up of new units. 

Healthcare revenue was up 2.2%, led by proximity care in the US and Home Healthcare in Latin America, despite a decline in medical oxygen sales for the treatment of Covid-19. 

Electronics contributed 8.2% to the overall growth of the region. 

Revenue in Europe was up 6.4%, reaching $5.4bn, the strong growth contrasted across the business lines in a context of exceptionally high energy prices and the war in Ukraine. 

Industrial Merchant growth was driven by record price increases, reaching a high of 22.9%, offsetting the 7.4% decline in Large Industries sales. 

Healthcare sales were up by 3.3%, driven by the momentum in Home Healthcare. 

Sales in Asia-Pacific were up 5.5%, totalling $2.7bn, driven by ‘particularly dynamic’ growth in the Electronics business (15.8%). 

Other business lines were impacted by Covid-19 related lockdowns in China during the second quarter of the year, with Large Industries sales remaining stable (down by 0.2%) in the first half, whereas Industrial Merchant sales were up by 2.5%. 

Revenue in the Middle East and Africa totalled $417m, representing a slight increase (up by 0.9%). In South Africa volumes increased sharply due to the integration of the 16 Sasol air separation units whose sales were recognised as part of the significant scope impact, and hence excluded from comparable growth. 

Jackow added, “In Gas & Services, all geographies improved, driven mainly by Industrial Merchant and Electronics, which enjoyed strong growth particularly in Asia. In Industrial Merchant, value creation and dynamic price management allowed the Group to transfer the increase in costs, while in Large Industries, the increase in energy prices in contractually passed on to customers.” 

“In this context, the Group’s operating margin improved again significantly by +50 basis points, excluding the energy impact. The Group also continues taking efficiency measures, notably through targeted industrial investments.” 

“Recurring net profit reached $1.6bn, an increase of 20.4% excluding the currency impact. Cash flow remained high at 23.5% of sales.” 

“Net profit (Group share) was $1.3bn, an increase as published of 5.3% despite a non-recurring provision on our assets in Russia.” 

“In 2022, assuming no significant economic disruption, Air Liquide is confident in its ability to further increase its operating margin and to deliver recurring net profit growth at constant exchange rates.”