L'Air Liquide (AI) Q2 2024 earnings summary

Executive summary

• Delivered resilient H1 2024 performance with 2.6% comparable sales growth, strong margin improvement, and continued execution of the ADVANCE strategic plan, focusing on structural transformation and sustainability.

• Major project wins and investments in energy transition, decarbonization, and electronics, including the ExxonMobil hydrogen project, Micron partnership, and D'Artagnan CO2 capture project.

• Launched organizational simplification and governance changes to enhance agility, efficiency, and decision-making.

• Record investment pipeline, with over €4bn in 12-month opportunities, more than 40% linked to energy transition.

• Portfolio optimization through divestitures and bolt-on acquisitions, including exit from 12 African countries.

Financial highlights

• Group revenue for H1 2024: €13,379m (-4.3% as published, +2.6% comparable); Gas & Services: €12,796m (+2.6% comparable); Engineering & Construction up 9.9–10%.

• Operating income recurring (OIR) rose 4.9% as published (+10.6% comparable), with OIR margin up 100bps to 19.4%; Gas & Services OIR margin at 21.2% (+110bps excl. energy).

• Recurring net profit: €1,681m (+3.3% as published, +16% excluding FX and Argentina); EPS: €2.92 (-2.3% as published).

• Cash flow from operations before working capital: €3,155m (23.6–24% of sales); net debt at €10.2bn, net debt-to-equity ratio at 35.2%.

• Recurring ROCE improved to 10.7% (+50bps year-over-year).

Outlook and guidance

• Confident in delivering 2024 performance targets, with further operating margin and recurring net profit growth at constant exchange rates.

• Enhanced 2025 ADVANCE objectives, including doubling initial margin improvement ambition.

• Investment backlog remains high at €4.1bn, with robust pipeline in energy transition and semiconductors.

• Positive pricing outlook and continued efficiency gains expected for the remainder of 2024.