- Margin Expansion: Gas & Services operating margin improved by 130 bps, excluding energy pass-through, achieving a record level.
- Investment Momentum: Investment backlog surged to €4.9 billion (+15% YoY), with a 12-month portfolio of €4.6 billion.
- Decarbonization Progress: CO2 emissions fell 13% from 2020 baseline, and carbon intensity dropped 46% over 10 years.
- Dividend Increase: Proposed dividend hike to €3.70/share (12% increase), alongside a 1-for-10 free share offer in 2026.
- Margin Ambitions Extended: 2026-2027 margin improvement target raised to +100 bps annually, with cumulative +560 bps since 2022.
Investment Backlog and Decarbonization Efforts
The company's investment backlog reached a record high of nearly €5 billion, up 15% from last year, and the investment portfolio of 12-month opportunities was at a record high of €4.6 billion. Air Liquide achieved significant milestones in decarbonization, with CO2 emissions now 13% below the 2020 baseline and a 46% reduction in carbon intensity over 10 years.
Strategic Plan and Margin Improvement
The ADVANCE strategic plan successfully delivered on its objectives, including growth, returns, and decarbonization. Air Liquide reiterated its objective of delivering an additional 100 basis points of margin improvement in 2026 and has raised and extended its margin ambition through 2027, implying an additional 100 basis points of improvement.
Valuation and Dividend
With a P/E Ratio of 28.66 and an EV/EBITDA of 13.84, the market appears to be pricing in a certain level of growth and profitability. Air Liquide's dividend yield stands at 1.89%, and the company has announced a dividend increase to €3.70 per share, representing a 12% increase. The company's ROIC stands at 9.05%, indicating a relatively efficient use of capital.
Outlook and Sector Trends
Air Liquide assumes a soft growth trend for 2026, with potential positive signals from electronics, large industry, and some subsegments in the U.S. industrial activity. The energy transition is still a long-term trend, and electronics projects are gaining importance, with 40% of the backlog now dedicated to electronics. The company's helium business remains strong, despite a global supply surplus.
Transformation Program and Future Plans
The company's transformation program, launched in mid-2024, aims to structurally enhance profitability. Air Liquide is focused on return on capital employed and is selective in choosing projects where it has a competitive advantage. The company is transforming its footprint to be more profitable in the long term, with investments of over €3 billion in Europe over the past three years.