The Linde Group has revealed an adjustment to its medium-term targets for 2017, tempering its expectations for Return on Capital Employed (ROCE).

The announcement was made pursuant to Section 15 of the German Securities Trading Act (WpHG).

It saw Linde inform that from today´s perspective it will not achieve the target for 2017 of ROCE of 11-12%, and now expects ROCE to be between 9-10%.

Further, the targeted group operating profit for 2017 of €4.5bn to €4.7bn ($4.7-4.9bn) is also not achievable, it said, and is actually expected to come in between €4.2bn to €4.5bn ($4.4-4.7bn).

The main reasons for the adjustments are substantially changed overall conditions compared to October 2014, Linde explained, when the targets were defined. On the one hand, the growth rates of industrial production relevant for the industrial gases business have been significantly reduced. On the other hand, the state-controlled price reductions in the US healthcare market in 2016 and 2017 are expected to be stronger than originally assumed.

Moreover, Linde’s Engineering Division will contribute less to group operating profit than originally planned – largely due to an expected lower order intake as a result of the medium-term low oil price and related investment hesitancy among customers.

Revised 2017 targets are based on current exchange rates, the company added.