L'Air Liquide Ord

Good morning, ladies and gentlemen, and welcome to the Air Liquide Q1 2024 Revenue Conference Call. All participants are currently in listen mode only until we conduct a question and answer session and instructions will be given at that time. I will now hand over to the Air Liquide team. Please begin your meeting and I will be standing by.

Well, thank you. Good morning, everyone. This is Aude Rodriguez, Head of Investor Relations. Thank you very much for attending the call today. François Jacob and Jérôme Pelleton will present the first quarter of the new. For the Q&A session, they will be joined by Pascal Vinet, Executive VP overseeing the Europe Industries and the Africa Middle East Hubs, the Industrial Merchant Activity and Group Safety. Marcello Furanelli, Group VP, CEO of Airgas is on the phone with us from the US. In the agenda, our next announcement is on July 26th for our half year 2024 results. Let me now hand you over to François.

Thank you, Aude, and good morning, everyone. It is my pleasure to be with you today to share the highlights of the first quarter of 2024. In a few words, we delivered a strong operational performance, which put us on the right track to deliver our 2024 guidance and 2025 objectives. Market demand was globally a mixed bag. As you will see with Jerome, no strong negatives, but no clear positive catalyst yet in line with our anticipation. Our sales growth was resilient this quarter at plus 2%, which is a solid number given the context and the high comparison basis with plus 7% in Q1 last year. The actions we are taking are bearing fruits. IM pricing kept increasing at plus 4% in Q1, coming on top of a plus 13% in Q1 2023, which is a clear increase. strong performance in a context of energy cost sharp decrease and slowdown of inflation. The momentum on efficiencies is very positive with a plus 22% growth compared to Q1 last year. At 112 million euros, it marks a strong start of the year with a clear contribution to the margin. Another sign of good momentum is the cash flow growing at plus 6% showing strong leverage when sales are increasing by plus 2%. And finally, the backlog, which remains at a very high level, above €4 billion. This is a great indicator of future growth when the projects currently under construction will start up. So again, a very solid quarter, as expected in terms of top line, and showing clear signs that we are on the right track to deliver our commitments in terms of performance for the year and beyond. How did we manage it? I am now on slide four. We continue our steady commitment to take proactive actions as the current uncertainty leads markets to take a wait and see approach. No need for me to come back on the characteristic of the current economic or geopolitical context that you know very well. Most importantly, We are on track because we follow a clear, disciplined, and structured action plan. First, we build on a resilient business model, well balanced by geographies and activities serving all economic sectors, long-term contracts, take-off pays, indexation. A good illustration of the role of our balanced portfolio is our healthcare activity, posting plus 8% growth this quarter in this macroeconomic context. Second, pricing management and further value creation through innovation, in IM in particular, but also across all business lines. Jerome will detail our strong performance on pricing shortly. Third, cost savings, looking systematically at ways to do things better and more effectively, leveraging a new culture of continuous improvement, but also, and this is the fourth point, structural efficiencies. One recent example is the launch of a single ERP in Europe, replacing 10 systems. It's too early to see the full benefits of such a massive project, which has been prepared for the last two years and handles more than 4.5 million invoices per year in 20 countries. We know that benefits for such projects will ramp up continuously in the next two to three years. Fifth, portfolio management. And, for example, you have seen our recent press release on the sales of our activities in 12 African countries, but also selected Bolton acquisitions. This action plan gives us full confidence to deliver on our performance commitment. It also positions us very well for the future. Looking ahead on slide five, we see that despite several unit startups this quarter, the backlog remains at a high level above 4 billion euros. Let's note that this backlog is well diversified with more than 80 projects which dilutes the overall risk. And it is also well balanced among activities, sectors, and geographies. Regarding business development, our portfolio remains very active in all regions of the world. To conclude, Thanks to our agility, discipline, and execution plan, we delivered a very solid first quarter despite an uncertain environment. Q1 confirms that we are on the right track. We have confidence, confidence in our ability to deliver on our commitments in terms of performance and growth for 2024, as well as on our enhanced advanced objectives of doubling the initial margin improvement ambition by 2025. Thank you very much for your attention. I will now ask Jérôme to present the details of our financial performance in Q1.