First six months of 2009: The Linde Group strengthens operating margin in difficult market environment
In the course of the global economic crisis, Group sales fell by 12.5 percent in the first half of 2009 to 5.476 billion euro, compared with the record figure achieved in the first half of 2008 of 6.256 billion euro. Group operating profit for the six months to 30 June 2009 was 1.104 billion euro, 12.2 percent below the prior year figure of 1.258 billion euro. Taking into account restructuring costs arising from the accelerated implementation of the High Performance Organisation (HPO) programme, the fall in Group operating profit for Linde was only 6.9 percent. With HPO, the integrated programme for process optimisation and increased productivity, the Group is seeking to achieve cost savings of between 650 million euro and 800 million euro in the financial years from 2009 to 2012 and to continue to improve its competitiveness irrespective of the economic situation.
Earnings before taxes on income (EBT) were 365 million euro, a decline of 179 million euro (-32.9 percent) compared to the first half of 2008 (544 million euro). After deducting restructuring costs of 67 million euro and the gains on disposal of businesses of 59 million euro achieved in the first half of 2008 this decline was only 53 million euro (-10.9 percent).
Earnings after tax at 30 June 2009 were 274 million euro (2008: 402 million euro). After taking minority interests into account, earnings attributable to Linde AG shareholders were 248 million euro (2008: 375 million euro), giving earnings per share (EPS) of 1.47 euro (2008: 2.24 euro). Account should be taken here too, when comparing the figures for the first six months of 2009 and 2008, of the one-off restructuring costs charged in 2009 and the gains on the disposal of businesses recognised in 2008. On an adjusted basis, i.e. after adjusting for the effect of the purchase price allocation in the course of the BOC acquisition and the profits on disposal achieved in the prior year, earnings per share in the first half of 2009 stood at 2.06 euro (2008: 2.72 euro). The restructuring costs recognised in the first half of 2009 have not been adjusted for in this calculation. Cash flow from operating activities in the first six months of the year was 841 million euro, a figure which was higher than that for the first six months of 2008 of 816 million euro, despite the fall in earnings. This increase was mainly due to improvements in working capital management, according to the company.
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