an increase in demand for medical liquid oxygen to fight Covid-19 and
benefited from a recovery in proximity care. In Latin America, the
Healthcare teams remain highly committed to the fight against Covid-19
with sales to hospitals up markedly, in particular in Argentina and
Brazil. The number of patients treated at home was also up.
-- Electronics revenue was up +6.6%, with very high Equipment & Installation
sales during the quarter.
Americas Air Liquide announced a long-term supply agreement with Eastman
Chemical Company to provide additional gaseous oxygen, nitrogen and syngas
supporting Eastman's growth in Longview, Texas. Air Liquide will invest more
than 160 million U.S. dollars to modernise existing assets and build a new Air
Separation Unit (ASU) and Partial Oxidation Unit (POX).
Revenue in Europe totaled 1,615 million euros over the 3(rd) quarter, posting growth of +0.5%. Industrial activities saw a significant recovery across the region, although volumes remained below pre-public health crisis levels. Large Industries sales (-3.4%) grew sequentially compared with the 2(nd) quarter of 2020. In Industrial Merchant (-4.8%, of which -1.9% from minor divestments), cylinder gas sales returned to a level similar to the 3(rd) quarter of 2019. Healthcare revenue was up +9.5% during the 3(rd) quarter, driven by sales of ventilators at cost price, that remained exceptionally high due to the pandemic.
-- During the 3rd quarter, Large Industries sales were down -3.4% but grew
sequentially compared with the 2nd quarter, which marked the peak of the
public health crisis. Demand for air gases remained weak in the Steel
sector. Volumes improved slightly quicker for Chemicals customers than
for Refineries which have adjusted their production in response to weaker
demand for transportation fuel. Air gases sales were up over the quarter
in Russia and Turkey.
-- Industrial Merchant revenue was down -4.8%, of which a -1.9% minor scope
impact, due to the balance of small disposals and bolt-on acquisitions
carried out as part of the portfolio management program. Cylinder gas
sales improved and returned to a level similar to the 3rd quarter of 2019
notably thanks to the restart of construction activities. The recovery
was slower for liquid gas sales, particularly in Germany. Revenue growth
was strong in the eastern part of Europe, in particular in Turkey, Russia
and Poland. Pricing impacts remained solid at +1.7%, marking an increase
compared with the 2nd quarter (+1.4%).
-- Healthcare revenue was up +9.5% during the 3rd quarter. Ventilators sales,
at cost price, were once again particularly high, due to the pandemic.
Medical gases sales remained high. Home Healthcare saw a return to more
dynamic growth following the slowdown in new homecare installations
during the 2nd quarter, at the peak of the pandemic. This was notably
driven by an increase in the number of patients treated at home for
diabetes in Germany, France, Spain and Portugal, as well as the
contribution from new bolt-on acquisitions.
Europe Air Liquide announced an investment of 125 million euros in July to
build the first world-scale Air Separation Unit (ASU) for oxygen production
with an energy storage system that helps facilitate more renewable energy on
the electricity grid due to its grid stabilizing capability. This highly
efficient plant, with circa 10% less electricity consumption, will have a
production capacity of 2,200 tons of oxygen per day, and will be built in Port
of Moerdijk in the Netherlands. This project illustrates Air Liquide's
strategy to grow in strategic industrial basins, and the Group's ability to
design and implement innovative solutions contributing to the energy
transition, in line with its Climate Objectives. Air Liquide and KGHM Polska
Mied , one of the largest producers of copper and silver in the world, have
signed a new long-term contract for the supply of oxygen and nitrogen at the G
ogów site in Poland. Air Liquide will invest around 40 million euros in
the construction of a state-of-the-art Air Separation Unit (ASU) which offers
high levels of energy efficiency and reliability. In addition, the extended
liquid argon production will support growth of the Industrial Merchant
business in Poland.
Revenue in Asia-Pacific reached 1,101 million euros, up +1.6%. In China, momentum was strong across all industrial business lines growing at +7.6%. The recovery was slower in the rest of the region, impacted by the public health crisis. Large Industries (+3.0%) was driven by demand in China and the ramp-up of a unit in South Korea. Industrial Merchant (-4.0%) was still sluggish, but recovered compared with the 2(nd) quarter. Electronics (+6.3%) remained very strong with growth exceeding +10% excluding Equipment & Installation sales.
-- Large Industries sales were up +3.0% over the quarter. These were driven
by the takeover of an Air Separation Unit and a strong increase in oxygen
volumes for Steel and Chemicals in China, coupled with the ramp-up of a
hydrogen unit in South Korea. The recovery was slower in the rest of the
region, notably in South East Asia and Japan, where volumes remained
-- Industrial Merchant revenue was down -4.0%, but grew sequentially
compared with the 2nd quarter. Activity in China improved markedly at
+8.3%, driven notably by the Manufacturing, Construction, Glass, Retail
and Craftsmen, and Research markets. Business remained sluggish across
the rest of the zone, held back by the public health crisis, in
particular in Japan and Singapore, but nonetheless improved compared with
the 2nd quarter. Pricing impacts in the region were marginally negative
at -0.5%, with helium prices stabilizing during the 3rd quarter.
-- Electronics sales were up markedly (+6.3%) during the 3rd quarter and
improved by +10.3% excluding Equipment & Installations. This growth was
driven by Advanced Materials and Carrier Gases, notably with the supply
ramp-up of Advanced Materials in South Korea and of Carrier Gases in
China, Taiwan and Japan.
Asia-Pacific Air Liquide China will invest around 60 million euros to build an
Air Separation Unit (ASU) in the Lingang Economic District, Tianjin Port Free
Trade Zone. Air Liquide has been supplying industrial gases to this major
Chinese industrial basin for more than 25 years. The investment is secured by
a new long term supply agreement with a major customer. This facility will
also incorporate a dedicated capacity to supply liquid and packaged gases to
Industrial Merchant's customers as well as hospitals requiring high-purity
medical gases. It is planned to be operational in 2022. Air Liquide China
operates seven ASUs in Tianjin, as well as a multi-sourced pipeline network
that delivers oxygen, nitrogen and hydrogen to adjacent customers.
Middle East and Africa
Middle East and Africa revenue stood at 145 million euros, stable (+0.0%) compared with the 3(rd) quarter of 2019. In Industrial Merchant, Middle East and India improved clearly compared with the 2(nd) quarter, with the recovery more contrasted in Africa. Large Industries sales were up slightly compared with the 3(rd) quarter of 2019, notably in South Africa and Saudi Arabia. Healthcare, which continues to be committed to the fight against COVID-19, posted strong growth across the region.
Engineering & Construction
Consolidated Engineering & Construction revenue reached 60 million euros in the 3(rd) quarter, with sales to third-party customers remaining sluggish due to the public health crisis. These sales were down -24% compared with the 3(rd) quarter of 2019, with resources mainly allocated to internal Large Industries and Electronics projects. The decline in total sales was more modest at -19%.
Order intake has improved since the end of the summer and reached 428 million euros, of which more than half was in Asia. This mainly related to Air Separation Units and ultra-pure nitrogen production units, with orders for the Group slightly exceeding those for third-party customers.
Global Markets & Technologies
Global Markets & Technologies revenue was 143 million euros and saw a return to very dynamic growth momentum of +11.4%, as production capacity was no longer restricted by the public health crisis. Equipment sales were up markedly, in particular membrane purification systems. The biogas business remained strong, in particular in Europe where biomethane sales for transport were up, and in the United States.
Order intake for Group projects and third-party customers reached a record level of 485 million euros, a significant increase of +34% over 2019 following the signature of several major contracts during the 1(st) half of the year. These notably included major contracts for helium cryogenic refrigerators and Turbo-Brayton LNG reliquefaction units.
Global Markets & Technologies Air Liquide has acquired 80% of the capital of
the French company Cryoconcept, which specialises in dilution refrigeration --
a technology allowing to reach very low temperatures. This transaction enables
Air Liquide to strengthen its expertise in the field of extreme cryogenics, or
close to absolute zero, to propose a broader offer and accelerate the
development of Cryoconcept's activities.
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