Linde GmbH
Linde AG: January to June 2017: Linde continues to increase revenue and earnings
DGAP-News: Linde AG / Key word(s): Half Year Results/Quarterly / Interim Statement Press release
– Group revenue increases to EUR 8.653 bn (up 4.7 percent; – Group operating profit[1] rises to EUR 2.123 bn (up 4.3 percent; up 2.4 percent after adjusting for exchange rate effects) – Group outlook for 2017 confirmed
The Linde Group: Positive contributions from EMEA and Asia/Pacific have an impact on revenue and earnings trends During the financial year, Linde is continuing to implement long-term efficiency improvement measures across the Group through its Focus and LIFT programmes. By the end of 2017, the LIFT programme is expected to have incurred total costs of around EUR 400 m, which will be classified as special items. Of this total, EUR 116 m was recognised for the whole of the 2016 financial year and a further amount of EUR 134 m has been recognised in the first half of 2017. Also disclosed as special items are costs of around EUR 27 m which relate to the planned merger with Praxair. The total figure for special items in the first half of 2017 was therefore EUR 161 m (2016: EUR 39 m). In the first six months of 2017, Linde’s earnings per share from continuing operations before special items was EUR 3.81 (2016: EUR 3.53). Earnings per share from continuing operations was EUR 3.17 (2016: EUR 3.37). Due to the planned sale of Gist in 2017, the contribution to revenue and earnings from this division has been disclosed as discontinued operations. Operating cash flow was EUR 1.317 bn, which was 17.9 percent below the figure for the first half of 2016 of EUR 1.604 bn. This was mainly as a result of the lower figure for advance payments received from plant construction customers and a higher figure for income taxes paid than in the prior-year period. In the EMEA segment (Europe, Middle East, Africa), the Group generated revenue of EUR 2.947 bn in the first six months of 2017, which was 3.0 percent higher than the figure achieved in the first half of 2016 of EUR 2.861 bn. On a comparable basis, revenue rose by 2.9 percent. Operating profit was EUR 924 m, which was similar to the figure for the first half of 2016 of EUR 928 m. The operating margin fell to 31.4 percent (2016: 32.4 percent). However, the 2016 figures included income from changes to pension plans and profits on disposal of non-current assets totalling EUR 39 m. Positive trends were to be seen in the EMEA segment in almost all product areas. In the on-site business, where the Group supplies gases on site to major customers, Linde was able to achieve revenue growth in Northern Europe and Middle East & Eastern Europe as a result of plant start-ups. In the liquefied gases and cylinder gas product areas, revenue increased in virtually all regions. Linde generated revenue in the Asia/Pacific segment in the six months to 30 June 2017 of EUR 2.172 bn, which was 9.9 percent above the figure for the first six months of 2016 of EUR 1.976 bn. On a comparable basis, revenue increased by 5.3 percent. At EUR 615 m, operating profit was 19.9 percent above the figure for the prior-year period of EUR 513 m, giving an operating margin of 28.3 percent (2016: 26.0 percent). It should be noted that there was a one-off effect from the sale of assets of EUR 70 m, which had a positive impact on the operating margin. In the Asia/Pacific segment, positive trends were to be seen in all product areas. Solid volume and revenue increases were achieved in particular in the liquefied gases and on-site product areas. In the Americas segment, revenue decreased by 1.3 percent in the first half of 2017 to EUR 2.545 bn (2016: EUR 2.578 bn). After adjusting for exchange rate effects and changes in the natural gas price, revenue fell by 6.2 percent. When compared with the prior-year period, operating profit dropped by 3.8 percent to EUR 627 m (2016: EUR 652 m). The operating margin was 24.6 percent (2016: 25.3 percent). The lower margin in 2017 was also due to higher natural gas prices. Revenue and earnings trends in this segment were affected by a number of factors working in different directions. Positive trends were once again to be seen in the on-site business and the liquefied gases business in North America. In the Healthcare business in North America, on the other hand, the impact of the price reductions in 2016 as a result of government tenders continues to be keenly felt. As expected, the Group’s sale of two Lincare subsidiaries in the third quarter of 2016 also had an adverse impact on revenue. Conditions in the individual countries in South America, especially in Brazil and Venezuela, did not improve in the first half of 2017. The economic situation in the region is characterised by high inflation and low growth rates. Trends in the product areas in South America were positive. However, the growth achieved is from a relatively low base in the prior-year period. Engineering Division: Margin in line with expectations Despite continuing high levels of competition and the persistently low price of oil and the resulting slack demand in plant construction, there was an increase in order intake in the six months to 30 June 2017 to EUR 1.170 bn (2016: EUR 718 m). The order backlog in the Engineering Division at 30 June 2017 remained solid at EUR 4.223 bn (31 December 2016: EUR 4.386 bn). Outlook To coincide with the publication of the interim report, a webcast for analysts will take place today at 2 p.m. German time in English with Dr Sven Schneider, CFO of Linde AG. Journalists will have the opportunity to watch the webcast by following this link: In the 2016 financial year, The Linde Group generated revenue of EUR 16.948 bn, making it one of the leading gases and engineering companies in the world, with approximately 60,000 employees working in more than 100 countries worldwide. The strategy of The Linde Group is geared towards long-term profitable growth and focuses on the expansion of its international business, with forward-looking products and services. Linde acts responsibly towards its shareholders, business partners, employees, society and the environment in every one of its business areas, regions and locations across the globe. The company is committed to technologies and products that unite the goals of customer value and sustainable development. For more information, see The Linde Group online at www.linde.com
In connection with the proposed business combination between Praxair, Inc. (“Praxair”) and Linde AG (“Linde”), Linde plc (“New Holdco”) has filed a Registration Statement on Form S-4 (which Registration Statement has not yet been declared effective) with the U.S. Securities and Exchange Commission (“SEC”) that includes (1) a proxy statement of Praxair that also constitutes a prospectus for New Holdco and (2) an offering prospectus of New Holdco to be used in connection with New Holdco’s offer to acquire Linde shares held by U.S. holders. Once the Registration Statement is declared effective by the SEC, Praxair will mail the proxy statement/prospectus to its stockholders in connection with the vote to approve the merger of Praxair and an indirect wholly-owned subsidiary of New Holdco, and New Holdco will distribute the offering prospectus to Linde shareholders in the United States in connection with New Holdco’s offer to acquire all of the outstanding shares of Linde. New Holdco has also filed an offer document with the German Federal Financial Supervisory Authority (Bundesanstalt fuer Finanzdienstleistungsaufsicht) (“BaFin”) which has not yet been approved for publication by BaFin. The consummation of the proposed business combination is subject to regulatory approvals and other customary closing conditions. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND THE OFFER DOCUMENT REGARDING THE PROPOSED BUSINESS COMBINATION TRANSACTION AND PROPOSED OFFER BECAUSE THEY CONTAIN IMPORTANT INFORMATION. You may obtain a free copy of the proxy statement/prospectus and other related documents filed by Praxair, Linde and New Holdco with the SEC on the SEC’s Web site at www.sec.gov. The proxy statement/prospectus and other documents relating thereto may also be obtained for free by accessing Praxair’s Web site at www.praxair.com. Following approval of its publication by the BaFin, the offer document will be made available for free at New Holdco’s Web site at www.lindepraxairmerger.com. Furthermore, the offer document is expected to be made available at BaFin’s Web site for free at www.bafin.de. This document is neither an offer to purchase nor a solicitation of an offer to sell shares of New Holdco, Praxair or Linde. The final terms and further provisions regarding the public offer will be disclosed in the offer document after the publication has been approved by the BaFin and in documents that will be filed with the SEC. No money, securities or other consideration is being solicited, and, if sent in response to the information contained herein, will not be accepted. The information contained herein should not be considered as a recommendation that any person should subscribe for or purchase any securities. No offering of securities shall be made except by means of a prospectus meeting the requirements of the U.S. Securities Act of 1933, as amended, and applicable European and German regulations. The distribution of this document may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein come should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. Subject to the exceptions described in the offer document and to any exceptions potentially granted by the respective regulatory authorities, no offering of securities will be made directly or indirectly in any jurisdiction where to do so would be a violation of the respective national laws. Participants in Solicitation Forward-looking Statements Contact: Person making the notification: Dr Frank Herkenhoff, Head of External Communications
28.07.2017 Dissemination of a Corporate News, transmitted by DGAP – a service of EQS Group AG. |
Language: | English |
Company: | Linde AG |
Klosterhofstraße 1 | |
80331 München | |
Germany | |
Phone: | +49.89.35757-01 |
Fax: | +49.89.35757-1075 |
E-mail: | frank.herkenhoff@linde.com |
Internet: | www.linde.de |
ISIN: | DE0006483001 |
WKN: | 648300 |
Indices: | DAX |
Listed: | Regulated Market in Berlin, Dusseldorf, Frankfurt (Prime Standard), Hamburg, Munich, Stuttgart; Regulated Unofficial Market in Hanover, Tradegate Exchange; SIX |
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