The technology company The Linde Group has continued to see positive trends in the 2014 financial year, achieving increases in both Group operating profit and Group revenue after adjusting for exchange rate effects.
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Operating cash flow exceeded the high figure achieved in 2013.
Linde achieved a 2.4 percent increase in Group revenue in the 2014 financial year to EUR 17.047 bn (2013: EUR 16.655 bn). Revenue trends were significantly affected by adverse exchange rate fluctuations, especially in the first nine months of the year.
After adjusting for the negative impact of currency fluctuations, equivalent to revenue of EUR 346 m, the increase in Group revenue for the 2014 financial year was 4.5 percent.
The exchange rate effects also had an unfavourable impact on Group operating profit. Linde achieved Group operating profit of EUR 3.920 bn, which was not quite as high as the prior-year figure of EUR 3.966 bn.
Without these distortions, which reduced earnings in the 2014 financial year by EUR 83 m, Linde would have achieved an increase in Group operating profit of 1.0 percent. The Group operating margin for 2014 was 23.0 percent (2013: 23.8 percent).
As far as the margin is concerned, it should be noted that, as expected, the Engineering Division contributed more to Group revenue in the 2014 financial year than in 2013. The engineering business has a lower margin than the Group’s gases operations.
Linde achieved earnings per share in the 2014 financial year of EUR 5.94 (2013: EUR 7.10). This figure was adversely affected by non-recurring items in the second half of 2014. Non-recurring items comprised mainly impairment losses in the Gases Division.
They also included costs in respect of additional efficiency improvement measures. Earnings per share before non-recurring items rose to EUR 7.13 (2013: EUR 7.10).
After adjusting for the payment of EUR 300 m made in 2014 to provide additional external funding for the pension plans in Germany, operating cash flow rose by 5.0 percent to EUR 3.301 bn (2013: EUR 3.144 bn).
Return on capital employed was 9.5 percent in 2014 (2013: 9.7 percent).
The decrease in ROCE was mainly due to the increase in capital employed at December 31, 2014 as a result of exchange rate effects. ■