Linde avoids financial crisis with big net profit increase
AFP · 3 Nov 2008, 14:25
Published: 03 Nov 2008 14:25 GMT+01:00
Net profit rose to €177 million ($228 million) from the same period a year earlier, on sales that gained 2.3 percent to €3.14 billion, a company statement said.
Analysts polled by Dow Jones Newswires had forecast a lower net profit of €165 million, but higher sales of €3.23 billion for the Munich-based group which also builds industrial plants.
Linde has benefitted in particular from strong growth in emerging economies.
Core earnings exceeded expectations as well, gaining 6.5 percent to €652 million.
"The economic crisis has not yet had an impact on us," Linde chief executive Wolfgang Reitzle said in a statement. "We are still on track."
Many other German industrial groups have warned that profits will suffer from the international financial crisis and economic slowdown.
But Linde reaffirmed its 2008 outlook, and expected "the international gases business to remain a relatively stable and lucrative market for the rest of the year and in coming years."
"We confirm our outlook for the current financial year 2008 and expect sales growth and an above-average increase in earnings," the statement added.
In the nine months from January to end September, Linde's sales gained 11 percent after adjusting for foreign exchange fluctuations to €9.392 billion, while operating profit jumped by 12.9 percent to €1.91 billion.
Reitzle told a telephone news conference however that Linde's medium term target of an operating profit of more than €3 billion in 2010, had become "very ambitious in light of the current environment."
"Even a business like ours cannot remain immune to the adverse economic climate," the company statement said. But, it added, "our order books at the end of September are well-filled and we continue to expect orders to be processed on schedule."
Reitzle told the news conference that "there is practically no industry in the world that does not use gas in one form or another.
"Even in these troubled times, all industries do not collapse at the same time."
Shares in the industrial gas giant rose by 1.84 percent to €66.31 in midday trading on the Frankfurt stock exchange, while the DAX index had gained 0.54 percent overall.