On the 6th July 2016, at its Capital Markets Day, Air Liquide announced the implementation of a customer-centric, profitable growth strategy ‘NEOS’, for the period 2016-2020.

Executive leadership teams from its headquarters in Paris, along with hubs in Houston, Frankfurt, Shanghai and Dubai will work together to roll out Air Liquide’s four-year NEOS scheme.

The Tier One corporation identified the energy and environment transition, changes in healthcare, and digitisation as the three major trends for sources of growth throughout the organisation in the coming years.

Energy and environmental transition opportunities

It is clear that, through NEOS, Air Liquide is placing more focus on the environmental impact of company operations. One example of this is the aspiration to promote clean transport solutions to help reduce the environmental footprint.

Furthermore, Air Liquide is looking to offer more efficient energy solutions. This should help customers in a number of ways, such as improving competitiveness and reducing their respective environmental footprints. As well as external opportunities, Air Liquide will strive to implement these solutions within the group’s activities, to ensure group efficiency gains.

Healthcare opportunities

Another key strategy of NEOS is the renewed focus on the healthcare end-use sector. Air Liquide plans to develop a number of new products and services for healthcare professionals and patients, growing revenues generated from this segment.

Digitisation opportunities

Air Liquide has also stated that a number of digitalisation opportunities could be implemented across the group. This, the company states, will lead to more efficient and competitive initiatives; citing the plant of the future, increased reliability and predictive analysis.

The company will also develop new products and services which enhance the customer experience. This should, in turn, gain more customer loyalty and help Air Liquide attract new customers.

Source: Air Liquide


With the NEOS programme in place, Air Liquide is aiming for revenue compound annual growth rate (CAGR) over the 2016-2020 period of 6% to 8%.

The Tier One corporation intends to generate substantial recurrent efficiency gains of more than €300m on average per year, in addition to synergies related to Airgas, for a total amount above $300m.

Meanwhile, the company is targeting a return on capital employed (ROCE) in excess of 10% after 5 to 6 years. Lastly, Air Liquide hopes to maintain its Standard & Poor’s Financial Services LLC (S&P) ‘A’ range rating.

As for responsibility, which lies at the heart of its ambition alongside performance, the group will reinforce its actions aimed at improving the air quality for better environment and health.

Air Liquide’s Chairman and CEO, Benoit Potier, stated, “Our ambition is to lead our industry, deliver long-term performance and contribute to sustainability. With strong fundamentals and a disciplined model of development and management, the group is well positioned to perform in various economic environments and leverage the underlying trends, i.e., the energy and environment transition, changes in the world of healthcare, and digitisation.”

US boost

The company’s $13.4bn takeover of Airgas boosted Air Liquide’s Gas & Services sales in the US by 30%. The deal, officially confirmed in May 2016, comfortably created the biggest industrial gas group in the world, as well as establishing Air Liquide as the largest player in the North American market.

2016 Annual Results

Air Liquide posted strong financial results in 2016, the first full year results released by the company since the NEOS strategy was introduced. Following a renewed focus of its Gas & Services sales, revenue in this segment rose by 17.5%, totalling €17.3bn. On a comparable basis, Gas & Services revenue grew by 2.7%.

The company also generated recurrent efficiency gains of €315m ($333m) during the year, hitting its target of more than €300m ($318m) per year, as outlined by the NEOS plan.

During the year, Air Liquide’s debt-to-ratio exceeded forecasts and was lowered to 90% at the end of the year and its return on capital employed after tax (ROCE) stood at 7.8%. The group’s target, set as part of its NEOS programme, is to reach ROCE above 10% again in the next five to six years.

Discussing these results, Potier, was optimistic about Air Liquide’s future prospects and stated that, “with the integration of Airgas and the launch of the NEOS programme for the period of 2016-2020, Air Liquide is implementing its transformation, which combines targeted investments, digital development, and innovations to fuel growth in the coming years.”

“Assuming a comparable environment, Air Liquide is confident in its ability to deliver net profit growth in 2017,” he added.

Business plan series

This is the second in a series of articles that gets behind some of the business plans and accounting measures of the major industrial gas companies, and the industry itself.