(Reuters) – French industrial gases company Air Liquide on Tuesday beat analyst expectations for third-quarter sales, despite flagging slowing demand in Europe from customers in its Large Industries unit.
The group’s shares were up 4.2% by 0832 GMT, as JPMorgan in a note called the results “reassuring”.
Air Liquide, which supplies gases such as oxygen, nitrogen and hydrogen to factories and hospitals, posted sales of 8.25 billion euros ($8.15 billion) in the third quarter, up 8.3% from a year earlier, and beating the 8.11 billion average forecast from a company-provided consensus.
All three major segments recorded growth despite a “complex” macroeconomic environment of surging energy prices, the group said.
Its 12-month portfolio investment opportunities stood at over 3 billion euros at end-September, with 40% of the figure related to the energy transition. The group is hoping to benefit from its investments in green energy, notably hydrogen.
Air Liquide also confirmed its full-year guidance for an increase in operating margin and recurring net profit growth at constant exchange rates, “assuming no significant economic disruption”.
The company said revenue in Europe contracted by 0.2%, largely due to its Large Industries segment where revenue dropped by 27.5%, in a context of surging energy prices.
Air Liquide said Large Industries volumes dropped 6%, “impacted by a slowing demand from Steel and Chemical customers, notably in Germany and Benelux.”
The euro zone is likely entering a recession, with business activity contracting in October at its fastest pace in nearly two years, a business survey showed. Factories, many of which are Air Liquide customers, have been particularly hit as energy prices soar while supply chains are disrupted from the COVID-19 pandemic and an additional hit from Russia’s war in Ukraine.
Air Liquide announced a plan in September to withdraw from Russia, which accounts for less than 1% of its turnover, adding it had signed an agreement to shift its assets in the country to local management.
($1 = 1.0126 euros)
(Reporting by Olivier Sorgho; Editing by Josephine Mason, Kim Coghill and Mike Harrison)