Linde : recognises impairment losses and adjusts its growth targets to reflect the weakening in the economic outlook
October 30, 2014 at 01:43 am EDT
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Munich, 30 October 2014 - In the third quarter of 2014, Linde AG recognised impairment losses of EUR 229 m, which had an adverse impact on earnings for the nine months to 30 September 2014. The impairment losses were required due to changed conditions in some regions in the Gases Division.
Given these impairment losses, Linde will no longer be able to achieve the target it had set itself for the 2014 financial year of around 10 percent for return on capital employed (reported ROCE). The Group now expects to achieve a similar level of Group operating profit (EBIT before non-recurring items adjusted for the amortisation of intangible assets and the depreciation of tangible assets) in the 2014 financial year as in 2013, after adjusting for exchange rate effects. Until now, Linde had anticipated that it would achieve a moderate improvement in Group operating profit.
As a result of reduced growth expectations for the global economy, the Group has also adjusted its medium-term targets. Seen from today's standpoint, Linde expects to achieve Group operating profit of EUR 4.5 bn to EUR 4.7 bn and a reported ROCE of 11 percent to 12 percent in 2017, based on current exchange rates. Linde had originally set itself the target for 2016 of achieving Group operating profit of at least EUR 5 bn (equivalent to around EUR 4.6 bn at current exchange rates) and a reported ROCE of around 13 percent.
Linde plc is one of the world's leading engineering and industrial gas production groups. Net sales break down by activity as follows:
- production and sale of industrial gases (86.3%). Net sales break down by market between chemicals and energy (25%), manufacturing (19%), healthcare (16%), metals and mining (14%), food and beverage (10%), electronics (9%) and other (7%);
- surface engineering services (8.3%);
- other (5.4%).
Net sales are distributed geographically as follows: the United Kingdom (5.9%), the United States (31.6%), Germany (11%), China (7.9%), Australia (4.1%), Brazil (3.5%) and other (36%).
LINDE PLC 
