Air Liquide Profit Rises on Europe, Emerging Market Growth

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  • Gas producer aims for further growth in 2016 excluding Airgas
  • Share price fall as much as 4%, most in more than 2 months

Air Liquide SA, the French industrial gas maker buying U.S. competitor Airgas Inc., reported a rise in 2015 profit that met analyst estimates and said it’s aiming to achieve further net income growth in 2016.

Recurring operating income rose 9.8 percent to 2.9 billion euros ($3.2 billion) amid a recovery in Europe and growth in emerging markets, the Paris-based company said in a statement Tuesday. Net income climbed 5.5 percent, while the company proposed a dividend of 2.60 euros per share, up 2 percent from last year.

The shares declined as much as 4.5 percent, the most since Dec. 1, and traded 4.4 percent lower at 92.23 euros as of 10:57 a.m. in Paris. That extended the fall for this calendar year to 11 percent, valuing the company at 32 billion euros.

The guidance for 2016 is “not particularly demanding,” analysts at Bernstein wrote in a note to clients, while Baader Helvea said the dividend was below expectations.

Air Liquide agreed in November to acquire Airgas for an enterprise value of $13.4 billion in a bid to expand in the U.S. market and leapfrog competitors Linde AG, Air Products & Chemicals Inc. and Praxair Inc. to the top spot in North America. The purchase will be financed with a capital increase of as much as 4 billion euros, the French company has said. Like Linde, Air Liquide has been adding plants in the U.S., China and the Middle East to process gases used in chemicals, refining and electronics, while also expanding in medical gases and health-care services.

“The group achieved a solid performance, delivering once again an increase in revenue, operating margin and net profit, in the context of slower global growth in 2015,” Chief Executive Officer Benoit Potier said in the statement. Regulatory approval for the purchase of Airgas is being sought.

“Europe benefited from the good development in healthcare and an improvement in certain industrial sectors in the second half of the year,” Air Liquide said in the statement. North American business was “marked by a slowdown in sectors related to oil and gas production and metal fabrication” while growth in China continued.