L'Air Liquide S.A. Annual Report 2022

Plain-text annual report

2 0 2 2 A N N U A L R E P O R T Advancing Access the digital version 02 _ C O N T E N T S A world of challenges p. 04 Advancing with confidence p. 10 Advancing to meet the world’s challenges p. 26 Advancing with you p. 56 Cover: Taken by Air Liquide on the occasion of Génération Hydrogène, the cover photo represents hydrogen mobility on its way to the future. Twenty-two hydrogen cars drive down Avenue Foch in Paris, forming the H2 symbol to represent hydrogen. A W O R L D O F C H A L L E N G E S _ 0 3 What does it mean to advance? At Air Liquide, a group deﬁned by future-oriented thinking, advancing means inventing the future by responding to the challenges facing society and seeing them as opportunities instead of roadblocks. It means tackling climate change, contributing to the transformation of healthcare systems, accelerating key markets of the future, supporting industry progress and continually renewing our commitment to develop concrete solutions that have a real impact. And most of all, it means delivering long-term, sustainable performance for all our stakeholders. ALRA022_GB_01_int_bat.indd 3 30/03/2023 13:44 04 _ A W O R L D O F C H A L L E N G E S “The cement industry is a strategic one, and the essential work of decarbonizing it is already underway. We can reach this goal. At EQIOM, we aim to make our Lumbres plant in northern France the first carbon- neutral cement plant in Europe by 2028. This means rethinking production methods and integrating new technologies that will enable us to meet our CO2 emissions reduction targets.” Pierre Bultez Public Policy Manager at EQIOM ALRA022_GB_01_int_bat4.indd 4 07/04/2023 11:51 A I R L I Q U I D E 2 0 2 2 _ 05 Dr Stefan Larsson Chairman and Co-Founder of the International Consortium for Health Outcomes Measurement (ICHOM) “The aim of anyone working in healthcare should be to improve patient outcomes. Patient-reported data allow us to build replicable care models that continually improve outcomes while reducing total costs, helping tackle healthcare challenges and bringing value to providers, professionals and, most of all, patients.” ALRA022_GB_01_int_bat.indd 5 30/03/2023 13:44 06 _ A W O R L D O F C H A L L E N G E S “Employees today expect companies to help them reach their full professional potential, but also to leave them time and energy for their personal lives. To do so, I employ three management principles. First, I communicate proactively and with transparency about intentions and challenges. Second, I empower and encourage team members to make their own decisions, while also opening doors for underrepresented groups. And finally, I prioritize speed and simplicity to enact change as quickly as possible.” Taki Nkhumeleni Large Industries & Industrial Merchant (LIM) Program Director for Europe Industries at Air Liquide ALRA022_GB_01_int_bat2.indd 6 05/04/2023 15:19 A I R L I Q U I D E 2 0 2 2 _ 07 Olivier Mareuse Executive Vice President, Director of Asset Management and of Saving Funds at Caisse des Dépôts, member of the Executive Committee of Caisse des Dépôts “As the leading public institutional investor in France, Caisse des Dépôts places long-term shareholding at the heart of its investment strategy. We closely examine the individual challenges facing each company and business sector, using financial and extra-financial performance criteria (environment, social, governance). Our aim is to support companies in their sustainable growth strategies by encouraging them to adopt the best ESG standards and practices.” ALRA022_GB_01_int_bat2.indd 7 05/04/2023 15:19 08 _ W O R L D O F C H A L L E N G E S “The European Union faced many geopolitical and economic upheavals in 2022 including hydrocarbon supply difficulties and rising energy prices. This situation has provoked an accelerated shift in both energy usage and production methods by encouraging the adoption of low-carbon technologies. It has also triggered a historic surge in public policy. This momentum is happening on a global scale. In the United States for example, the Inflation Reduction Act (1) is encouraging companies to invest in green energy.” (1) The U.S. Inﬂation Reduction Act, in place since January 1, 2023, aims to curb inﬂation by reducing the deﬁcit, while meeting the challenges of climate change and strengthening the social security system. Marc-Antoine Eyl-Mazzega Director of the Energy & Climate Center at the French Institute for International Relations (Institut français des relations internationales - IFRI) ALRA022_GB_01_int_bat2.indd 8 05/04/2023 15:19 A I R L I Q U I D E 2 0 2 2 _ 09 Luana Cattan Chemical engineering Master’s student at University of Campinas in São Paulo, Brazil “Corporate social responsibility will be the most important criterion in the job I choose when I am ready to join the workforce. I need to feel comfortable with my work, so joining a company with a strong sustainability agenda will be a requirement. I believe major industrial companies have a responsibility to develop realistic solutions for a climate-neutral future and to start implementing them.” ALRA022_GB_01_int_bat2.indd 9 05/04/2023 15:19 10 _ A D V A N C I N G W I T H C O N F I D E N C E Advancing with confidence ALRA022_GB_01_int_bat4.indd 10 07/04/2023 09:56 A I R L I Q U I D E 2 0 2 2 _ 11 Advancing with conﬁdence is advancing together with our stakeholders toward a sustainable future. It is a conviction that has led us to put sustainable development at the heart of our growth model. It is a mindset and an ambition embodied by everyone in the Group and those within our ecosystem. Editorial by Benoît Potier, Chairman of the Board of Directors (p. 12) Interview with François Jackow, Chief Executive Ofﬁcer (p. 1(cid:26)) Governance (p. 18) Business Model (p. 22) Performance (p. 2(cid:22)) ALRA022_GB_01_int_bat4.indd 11 07/04/2023 09:57 12 _ A D V A N C I N G W I T H C O N F I D E N C E Believing in the future and, more than ever, inventing it Benoît Potier, Chair man of Air Liquide’s Board of Directors We have reached a particular moment in the history of the world, with geopolitical tensions as well as energy and climate challenges becoming primary concerns. This context of uncertainty is a rallying call to action, with new energy approaches now available to address the common need for moderation, sovereignty and decarbonization. With the requisite tools in hand, Air Liquide is proposing innovative solutions and inventing a sustainable future. I am therefore conﬁdent in our future. Since its creation, our Group has demonstrated its ability to take action regardless of the situation, with the past three years being the most recent proof of this. Our conﬁdence is driven by our capacity to anticipate and design the solutions of the future, and we continuously invest in new technologies to support the industrial, electronics and healthcare sectors in their journey toward progress. My conﬁdence in the future is also founded on our capacity to adapt. Our strength lies in our ability to respond to global transformations and constantly expand our activities with solutions for our customers, all while addressing the major issues that impact society as a whole. Finally, I am a fervent believer in the power of the collective, which has always been a cornerstone of our business model. Together with our employees, alongside our customers and our partners, and with the support of our shareholders, we have shown resilience and agility in initiating the transition toward a low-carbon society. But for future generations, we must pick up the pace. Our contribution to shared progress gives very strong signiﬁcance to our individual and collective action. It is both what motivates us and what helps us advance. ALRA022_GB_01_int_bat2.indd 12 05/04/2023 15:20 A I R L I Q U I D E 2 0 2 2 _ 13 Champion of climate solutions Interview with François Jackow, Chief Executive Of ficer of Air Liquide “The planet is in a state of emergency, and as of now we have the capacity to provide concrete solutions to the major challenges of decarbonizing industry.” 2022 was a pivotal year with the launch of the new ADVANCE strategic plan. What can you tell us about the Group’s performance? That it is very solid! In 2022, we achieved another year of proﬁtable growth despite a complex and changing environment. Our reported sales reached 29.9 billion euros, up +7%, (1) and recurring net income grew by +17%. (2) All our businesses – Gas & Services, Engineering & Construction and Global Markets & Technologies – are up signiﬁcantly. Within Gas & Services, all our geographies are growing, in particular the Americas and Asia Paciﬁc. (1) on a comparable basis (2) at constant exchange rates ALRA022_GB_01_int_bat2.indd 13 05/04/2023 15:20 14 _ A D V A N C I N G W I T H C O N F I D E N C E Focusing on markets of the future In addition to revenue growth, we have further improved our operating margin thanks to signiﬁcant efﬁciency gains and the dynamic management of our business portfolio. Moreover, in the context of rising energy prices, the Group has demonstrated its ability to create value, enabling it to adjust prices for customers. The quality of these results illustrates both the resilience of our business model and the mobilization and responsiveness of our teams, who have done a remarkable job in adapting to a volatile environment. I would like to take this opportunity to thank them. I would also like to add that our investment momentum, which is the guarantee of our future growth, has accelerated, particularly in regard to hydrogen and the transition to a low-carbon society. Indeed, our investments have reached a record level of nearly 4 billion euros. Finally, in terms of extra-ﬁnancial aspects, our CO2 emissions (3) have remained stable for the second year in a row. This supports our goal of achieving carbon neutrality by 2050. These results show that ADVANCE, our strategic plan combining our ﬁnancial and extra-ﬁnancial trajectory for 2025, is already bearing fruit. On the basis of this performance, we look forward to 2023 with conﬁdence. “Our ADVANCE strategic plan was designed to provide innovative solutions to challenges that are here to stay. The current context has acted as an accelerator, strengthening our resolve to move forward with a clear goal: pursuing our global performance trajectory.” The energy crisis, inﬂation, conﬂict in Europe… economic and geopolitical instability seems to be taking hold. Will this have an impact on Air Liquide’s strategic road map? Without a doubt, 2022 was deﬁned by a range of geopolitical, energy and climate-related crises, which have obviously had an impact on our customers, our activities and society as a whole. This complex year conﬁrmed more than ever the relevance of our road map, as our ADVANCE strategic plan was designed to provide innovative solutions to challenges that are here to stay. The current context has acted as an accelerator, strengthening our resolve to move forward with a clear goal: pursuing our global performance trajectory by combining ﬁnancial and extra- ﬁnancial performance. This ambition is based on an extremely solid foundation built on the Group’s proven resilience; the robustness of our business model through the diversity of our business lines and geographical footprint; and of course our teams, who demonstrated yet again this year their ability to respond to challenges. And, with ADVANCE, we are now positioned at the heart of the energy transition and are focused on the markets of the future, such as hydrogen mobility, electronics, healthcare and high technologies. All this provides Air Liquide with unprecedented positioning in terms of the current global upheavals, and an excellent opportunity to propel the Group into the future. (3) In metric tons of CO2 equivalent from Scopes 1 and 2 on a “market basis,” restated to take into account for a full year from 2020 and each year thereafter, emissions from assets, which correspond to changes in scope (both upwards and downwards) and which have a signiﬁcant impact on CO2 emissions. ALRA022_GB_01_int_bat.indd 14 30/03/2023 13:44 A I R L I Q U I D E 2 0 2 2 _ 15 regulation and, of course, support from investors and consumer adherence. This means developing new usages in sectors such as steel and road transportation. We have established several partnerships to collectively support the opening of these new markets. Additionally, it means increasing our low- carbon and renewable hydrogen production capacities. To do so, we intend to invest a minimum of €8 billion in the low-carbon hydrogen value chain by 2035. One example is the Group’s largest renewable hydrogen production unit in Normandy, France, which is under construction and will be commissioned in 2025. We have also signed long-term contracts with industrial players in Europe to supply them with low-carbon hydrogen. In the United States, the Inﬂation Reduction Act (4) will also create several opportunities. Driven by this unprecedented global momentum, we aim to triple sales, from €2 billion to €6 billion by 2035. “It is necessary to build an entire ecosystem around this technology. To do so, political strategies need to promote the development of new decarbonized usages, common regulation and, of course, support from investors.” Visiting the Air Liquide industrial site in Hamilton, Ontario, in Canada. Amid all these challenges, you have made the climate crisis and decarbonization a priority. Indeed. My aim is to make Air Liquide the champion of climate solutions. This is an urgent priority for the planet, and for us all. At Air Liquide, we are already able to provide tangible solutions to the major challenges of decarbonizing industrial activities. Moreover, our solutions apply to both our own activities and those of our customers. Our expertise and our thorough understanding of their needs mean we can help our customers meet their climate commitments. For example, we are developing large-scale hydrogen technologies for industry and mobility, and I am proud to say that we have been pioneers in this ﬁeld. We are also established in CO2 capture, biomethane and oxycombustion, all areas that are in growing demand. We therefore offer a wide range of technologies based on our key molecules. This is something our customers appreciate, as shown by our recent strategic partnerships with cement manufacturer EQIOM, reﬁner Eni and aircraft manufacturer Airbus. You have mentioned hydrogen as a solution for the future. What are the challenges involved with accelerating growth in this ﬁeld? The subject is no longer a matter of debate. Hydrogen has a major role to play in the decarbonization of industry and heavy transport. Its potential is huge, but we have many collective challenges to tackle before it can fully contribute to the energy transition. Industrial players will clearly contribute, but it is necessary to build an entire ecosystem around this technology. To do so, political strategies need to promote the development of new decarbonized usages, common ALRA022_GB_01_int_bat2.indd 15 05/04/2023 15:20 16 _ A D V A N C I N G W I T H C O N F I D E N C E and innovative solutions, we aim to improve the quality of life of patients at the best cost for the healthcare system. You have been leading the Group since June 2022. How do you see the rest of the year? With energy and determination. And also with a great deal of composure, owing to my conﬁdence in the unwavering commitment of our teams, regardless of what the future may hold. Since my appointment, I regularly meet with our teams, and every time I do, I am impressed with their proactive approach in a context that frankly had the potential to be unsettling. From one side of the globe to the other, I have seen the same commitment to satisfying our customers, the same desire to advance, innovate and create an impact. This is a great source of pride for me as a leader, and I am deeply grateful to them. The coming months will without a doubt be complex and full of surprises. But we are ready and determined to meet the needs and expectations expressed by our customers and patients, and to invent a more sustainable future together. Discussing with a researcher at the Shanghai Innovation Campus. “I went to meet the teams, and I saw everywhere the same desire to satisfy our customers, the same drive to move forward and create impact.” (4) The U.S. Inﬂation Reduction Act, in place since January 1, 2023, aims to curb inﬂation by reducing the deﬁcit, while meeting the challenges of climate change and strengthening the social security system. (5) A megafab is a very large capacity electronic chip production unit. In addition to decarbonization, what are the other principal growth drivers for Air Liquide? Air Liquide’s major strength has always been its dynamic and diversiﬁed business portfolio, which is rich in potential sources of growth. I would like to mention two. First is electronics, where Air Liquide is currently a leading supplier of ultra-high purity gases and advanced molecules. A real revolution is taking place in this sector. The semiconductors market is growing rapidly, driven by the rapid development of artiﬁcial intelligence and connected objects, as well as by an increased need for North American and European sovereignty. This is evidenced by the establishment of several “megafab” (5) projects. We are currently reinforcing our leadership position in these geographic areas. Our second major source of growth is of course healthcare, and in particular home healthcare. This sector is continuing to evolve, after having demonstrated its central role during the public health crisis. Our Group is making a contribution. Both at hospital and at home, our activity is committed to a transformation toward value-added offers for patients and healthcare professionals. By offering personalized support ALRA022_GB_01_int_bat2.indd 16 05/04/2023 15:20 A I R L I Q U I D E 2 0 2 2 _ 17 Unlocking progress via technology Thanks to its capacity for innovation and its technological expertise, the Group is contributing to the development of ﬁve markets of the future: hydrogen mobility, electronics, healthcare, industrial merchant and high technologies. — ~€8 billion will be invested in the low-carbon hydrogen value chain by 2035 Acting for all As a civic-minded company, Air Liquide strives to ensure that everything it does is in the interests of its employees, customers, patients, shareholders and partners, and, beyond that, of society as a whole. — 35% of engineers and managers will be women by 2025 Providing 100% of our employees with common basis of care coverage by 2025 Delivering strong global performance The Group is rising up to an ambitious challenge: continuing its growth dynamic and improving proﬁtability all while meeting its commitments to reduce CO2 emissions and invest in the markets of the future. — +5 to 6% average annual sales growth (1) >10% ROCE from 2023 Start reducing CO2 emissions by 2025 Decarbonizing the planet The Group is affirming its leading role in the decarbonization of industry and the dawn of a low-carbon society in which hydrogen has a key role to play. The Group is committed to decarbonizing its own operations while helping customers to do the same. Air Liquide plans to reach carbon neutrality by 2050, with an intermediate step of beginning to reduce its CO2 emissions around 2025. — -33% CO2 emissions by 2035 (2) ~50% of industrial investment decisions will be devoted to the energy transition (3) (1) Compound annual growth rate (CAGR) of sales, on a comparable basis, over the period 2021-2025. (2) In tons of CO2 equivalent, adjusted to include, from 2020 and for each subsequent year, the full year’s emissions of assets acquired and integrated after 2020, scopes 1 and 2. Scope 2 emissions are calculated from purchased supplies (a market-based method): the Group uses the method recommended by the GHG Protocol. (3) Industrial investment decisions for projects over €5 million. A strategy guided by ADVANCE, our 2025 plan The Group is pursuing its ADVANCE plan, placing sustainable development at the heart of its strategy and positioning itself on the path to global performance that combines financial and extra-financial performance. ALRA022_GB_01_int_bat.indd 17 30/03/2023 13:44 18 _ A D V A N C I N G W I T H C O N F I D E N C E Board of Directors As of December 31, 2022 March 22, 2022, monitoring its implementation and choosing and executing the new unbundled governance structure. As of June 1, 2022, Benoît Potier is Chairman of the Board of Directors, and François Jackow is Chief Executive Officer. The work of the Board of Directors also included a review of the situation brought about by the geopolitical and macroeconomic context, in particular the conﬂict in Ukraine and actions to take into account the interests of Group employees and stakeholders. The Board also monitored the active pursuit of industrial investment decisions, in particular those related to the energy transition in line with the environmental objectives announced by the Group; oversaw the development of the Group’s hydrogen activities; and decided to distribute one free share for every ten existing shares to Shareholders in June 2022. The Board of Directors is composed of 12 members: 10 who are appointed at the Annual General Meeting and two who represent Air Liquide employees. The Board of Directors brings together a diverse range of proﬁles. Four nationalities are represented (American, British, French and German) and 50% of elected members are women. Experience in ﬁelds including industry, services, research and innovation, healthcare, chemicals and construction are represented on the Board. Directors bring transversal ﬁnance, corporate social responsibility and digital skills, as well as their leadership vision of major international groups. The Board of Directors determines Air Liquide’s strategy and ensures its implementation, taking into consideration the social and environmental challenges of its activities. Accordingly, it examines and approves the Group’s major strategic priorities, including multi- year strategy linked to corporate social responsibility. In 2022, the Board of Directors notably focused on reviewing the new ADVANCE strategic plan, which includes the Group’s Sustainable Development objectives, presented during Capital Market Day on Benoît Potier Chairman of the Board Born in 1957 – French Geneviève Berger Independent Director Member of the Environment and Society Committee Born in 1955 – French ALRA022_GB_01_int_bat.indd 18 30/03/2023 13:44 A I R L I Q U I D E 2 0 2 2 _ 19 Kim Ann Mink Independent Director Member of the Remuneration Committee Born in 1959 – American Aiman Ezzat Independent Director Member of the Audit and Accounts Committee Born in 1961 – French Fatima Tighlaline Director representing the employees Member of the Remuneration Committee Born in 1979 – French François Jackow Chief Executive Officer and Director Born in 1969 - French Philippe Dubrulle Director representing the employees Member of the Environment and Society Committee Born in 1972 – French Siân Herbert-Jones Independent Director Chairwoman of the Audit and Accounts Committee Born in 1960 – British Bertrand Dumazy Independent Director Member of the Appointments and Governance Committee Born in 1971 – French Xavier Huillard Independent Director Lead Director Chairman of the Appointments and Governance Committee and of the Remuneration Committee Born in 1954 – French Anette Bronder(1) Independent Director Member of the Audit and Accounts Committee Born in 1967 – German Annette Winkler Independent Director Chairwoman of the Environment and Society Committee Member of the Appointments and Governance Committee Born in 1959 – German (1) The Board of Directors took note of the resignation of Mrs Anette Bronder with effect from January 3, 2023, due to her wish to take up an executive position within an auditing ﬁrm, which is incompatible with the continuation of her term of office as Director of L’Air Liquide S.A. The Board met on February 15, 2023, and decided to appoint Mrs Monica de Virgiliis as Director for the remaining term of office of Mrs Anette Bronder, i.e., until the Annual General Meeting of 2024. Mrs Monica de Virgiliis has been qualiﬁed as independent by the Board of Directors. ALRA022_GB_01_int_bat.indd 19 30/03/2023 13:44 20 _ A D V A N C I N G W I T H C O N F I D E N C E Executive Committee As of January 1, 2023 The Executive Committee coordinates Air Liquide’s various programs and activities. It implements the strategy defined by the Board of Directors and oversees operations, the management of transformation projects and business development. It also carries out strategic reviews and monitors the Group's safety and operational performance. François Jackow Chief Executive Officer Born in 1969 - French François Abrial Senior Vice President in charge of the Asia Pacific hub. Born in 1962 – French Ronnie Chalmers Vice President in charge of the Africa / Middle East / India hub. Born in 1968 - British Marcelo Fioranelli Chief Executive Officer of Airgas. Born in 1968 – Brazilian Matthieu Giard Vice President supervising Hydrogen activities and the Industrial Merchant world business line. Born in 1974 – French Michael J. Graff Executive Vice President supervising the Americas hub. He is also in charge of the Electronics world business line and the Engineering and Construction activity. Born in 1955 – American Fabienne Lecorvaisier Executive Vice President in charge of Sustainable Development, Public and International Affairs, Societal Programs and the Air Liquide Foundation. She is also in charge of the General Secretariat. Born in 1962 – French ALRA022_GB_01_int_bat2.indd 20 05/04/2023 15:20 A I R L I Q U I D E 2 0 2 2 _ 21 Armelle Levieux Vice President, Group Human Resources. Born in 1973 – French Émilie Mouren-Renouard Vice President in charge of Innovation, Digital & IT, and Intellectual Property, as well as the Global Markets & Technologies activity. Born in 1979 – French Jérôme Pelletan Chief Financial Officer Born in 1970 – French François Jackow Jean-Marc de Royere Senior Vice President in charge of Development Aid. He is also Chairman of the Air Liquide Fondation. Born in 1965 – French Diana Schillag Vice President in charge of Healthcare activities in Europe and the Healthcare world business line. She also supervises the Procurement and the Efficiency Programs. Born in 1971 – German François Venet Senior Vice President in charge of Strategy. He also supervises the Large Industries world business line. Born in 1962 – French Pascal Vinet Senior Vice President in charge of the Europe Industries and Africa / Middle East / India hubs. He also supervises the Safety and Industrial Systems function. Born in 1962 – French In 2022, faced with the conﬂict in Ukraine, the Executive Committee came together to take appropriate action to protect employees in Ukraine, support refugees and monitor operations in Russia, which ultimately led to the decision to transfer, in a responsible and orderly manner, its activities in Russia to the local management team in the form of an MBO. (1) In addition, the Executive Committee closely followed major global upheavals (the energy crisis in Europe, high levels of inﬂation, the ﬁght against climate change in particular in Europe and the United States, etc.) to adapt how it carried out its operations. ability to cope with crises. It has worked on implementing this program across its regions and activities, all while continuing to apply the Group’s Sustainable Development objectives. (1) Management buy out: the purchase of a company by its managers. On a strategic level, in March 2022, in an uncertain global context, the Executive Committee launched ADVANCE, the new strategic program for 2025, conﬁrming its conﬁdence in the Group’s ALRA022_GB_01_int_bat2.indd 21 05/04/2023 15:20 22 _ A D V A N C I N G W I T H C O N F I D E N C E A unique model Air Liquide draws its strength from the resilience of its model, the diversity of its businesses and regions, and its capacity to innovate in almost all sectors of the economy. These are solid pillars on which the Group relies to pursue its long-term growth dynamic and contribute to a more sustainable world. Long-term vision and sustainable growth strategy Large Industries Industrial gases in large quantities in the framework of long-term partnerships 67,100 committed employees in 73 countries Extensive scientific and technical expertise in industrial gases (oxygen, nitrogen, hydrogen, etc.) >3.9M customers and patients 3,600 employees contributing to innovation A wide range of customers and applications Air Liquide, a world leader in gases, technologies and services for industry and health 6 Innovation and Technologies Campuses Long-term customer contracts indexed to energy prices ~14,000 patents Major ability to innovate Industrial Merchant Industrial gases in small and medium quantities, application technologies, small equipment and related services serving a wide range of customers Electronics Ultra-pure gases in large quantities and development of new molecules Healthcare Medical gases, products and services to support patients and customers at home and in the hospital Global Markets & Technologies Molecules, equipment and services to support the energy transition and deep tech (1) markets >600 production units worldwide Management and optimization of gas production and distribution chain Engineering & Construction Plants and equipment for industrial gas production (1) Disruptive technologies based on scientific breakthroughs that can fundamentally change design and production methods. ALRA022_GB_01_int_bati.indd 22 ALRA022_GB_01_int_bati.indd 22 13/04/2023 10:55 13/04/2023 10:55 A I R L I Q U I D E 2 0 2 2 _ 23 Performance indicators 2022 A regular long-term performance Key ﬁnancial ﬁgures Evolution of Group revenue over 30 years (in millions of euros) 29,934 15,326 4,562 7,900 1992 2002 2012 2022 +6.5% average annual growth (1) Evolution of adjusted net earnings per share over 30 years (in euros) 5.28 0.74 1.47 3.37 1992 2002 2012 2022 +6.8% average annual growth (1) Evolution of adjusted dividend (2) per share over 30 years (in euros) 2.95 1.65 0.26 0.67 1992 2002 2012 2022 +8.4% average annual growth (1) Revenue €29,934M +7%(3) Net proﬁt (Group share) €2,759M +7.3% Recurring net proﬁt (4) (Group share) €3,162M +17.3% Operational margin 16.2% +70 pbs(5) Efficiency gains €378M Gearing 41.8% Investment decisions ~€4bn (1) Calculated according to prevailing rules over 30 years. (2) Adjusted for the 2-for-1 share split in 2007, for free shares attributions and for the capital increase completed in October 2016. (3) On a comparable basis (excluding currency, energy effects and excluding signiﬁcant scope). (4) Excluding exceptional and signiﬁcant operations not impacting operating income recurring, at constant exchange rates. (5) Operating Income Recurring on Sales excluding energy passthrough impact. ALRA022_GB_01_int_bat.indd 23 30/03/2023 13:45 24 _ A D V A N C I N G W I T H C O N F I D E N C E 2022 Group revenue (in millions of euros) 2022 Gas & Services revenue by activity (in millions of euros) 2022 Gas & Services revenue by geography (in millions of euros) 887 (3%) Global Markets & Technologies 474 (2%) Engineering & Construction 2,558 (9%) Electronics 10,525 (37%) Large Industries 5,608 (20%) Asia Pacific 3,923 (14%) Healthcare 895 (3%) Middle East & Africa 10,680 (37%) Americas 28,573 (95%) Gas & Services 11,567 (40%) Industrial Merchant 11,390 (40%) Europe Groupe revenue €29,934M Innovation (2022 ﬁgures) Group Shareholders (as of December 31, 2022) €308M of innovation expenses including €100M dedicated to climate solutions 350 new patents ﬁled 400 innovation partnerships with academics, industrial partners and start-ups 65% institutional Shareholders 35% individual Shareholders €2.95 dividend per share to be proposed at the Annual General Meeting on May 3, 2023 ~750,000 individual Shareholders, including 123,000 direct registered Shareholders and 181,000 intermediary registered Shareholders ALRA022_GB_01_int_bat2.indd 24 05/04/2023 15:20 A I R L I Q U I D E 2 0 2 2 _ 25 2022 environmental, social and governance (ESG) indicators Air Liquide’s ambition is to contribute to a more sustainable world. The Group’s growth model is now based on the principle of global performance that combines economic growth and sustainable development. In 2022, supported by the announcement of ADVANCE, Air Liquide has made significant progress and confirmed the Group’s alignment with its short-term and medium-term ESG objectives. Act For a low-carbon society In line with the Paris Agreement, the Group aims to achieve carbon neutrality by 2050: • In 2022, the Group’s CO2 emissions from scopes 1 and 2 amounted to 39 million metric tons of CO2 equivalent. • CO2 emissions in absolute terms decreased in 2022 by 0.3% compared to the 2020 baseline. (1) They have remained stable for the second consecutive year in a strong business growth context. • This result is in line with the ADVANCE plan’s objective of reaching an inﬂection point in 2025 before embarking on a trajectory of lower CO2 emissions in absolute terms. For health By improving the quality of life of patients with chronic diseases in advanced economies, and by facilitating access to medical oxygen in low- and middle- income countries. 1.9M patients were cared for at home by Air Liquide in 2022, including: 49% who are following a personalized care pathway, which amounts to 910,000 patients. 1.8M people in low- and middle- income countries now have improved access to medical oxygen. As a trusted partner By engaging with employees and building best-in-class governance practices. 31.5% of engineers and professionals in 2022 were women. Air Liquide is aiming for 35% of engineers and professionals to be women by 2025. 42% of employees beneﬁted from the common basis of care coverage in 2022, with a target of 100% coverage by 2025. 0.9 The lost-time accident frequency (2) rate of Air Liquide employees and temporary workers decreased to 0.9 at the end of 2022, compared to 1.1 at the end of 2021. (1) In tons of CO2-equivalent of scopes 1 and 2, on a “market-based" methodology, restated to take into account over a full year from 2020 and each subsequent year, the emissions of the assets which correspond to changes in scope (upwards and downwards) and which have a signiﬁcant impact on CO2 emissions. Scope 2 emissions calculated from the speciﬁc supplies (market-based): the Group hence adopted the methodology recommended by the GHG Protocol. (2) With work stoppages per million hours worked. ALRA022_GB_01_int_bat2.indd 25 05/04/2023 15:20 26 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S Advancing to meet the world’s challenges ALRA022_GB_01_int_bat2.indd 26 05/04/2023 15:20 A I R L I Q U I D E 2 0 2 2 _ 27 Advancing to meet challenges that the world is facing means making innovation the driving force of our business strategy. It is leveraging our expertise to address the challenges of today and anticipate those of tomorrow. It is bringing to life the cutting-edge technology that will accelerate the key markets of the future. And it is embracing a leading role in developing solutions that matter for society. Decarbonizing industry and mobility (p. 28) Unlocking progress through innovation (p. 44) ALRA022_GB_01_int_bat2.indd 27 05/04/2023 15:21 28 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S Decarbonizing industry and mobility Air Liquide has at its disposal a comprehensive portfolio of technological solutions and services to support the decarbonization of industry and mobility worldwide. This spans from the production and supply of low-carbon industrial gases to CO 2 management and the optimization and transformation of industrial processes. ALRA022_GB_01_int_bat.indd 28 30/03/2023 13:45 A I R L I Q U I D E 2 0 2 2 _ 29 Reducing CO2emissions at the world’s largest oxygen plant Your Guides: [ Jens Juckel ], Senior Process and Efficiency Expert, Air Liquide, [ Lizelle Meyer ], Operations Excellence Manager, Air Liquide, [ Cyril Sebei ], Mechanical Area Manager, Air Liquide, [ Simon Baloyi ], Sasol Executive Vice President, Energy Operations and Technology Secunda, South Africa "I n a way, these units are coming back home,” s a y s J e n s J u c k e l , gesturing toward a line of seven rectangular towers rising from a mesh of ground-level piping. But, of course, these air separation units (ASU) located in Secunda, in South Africa’s Mpumalanga Province, aren’t going anywhere. As we head east across the expansive site to loo(cid:78) at another ro(cid:90), (cid:45)ens, (cid:54)enior Process and (cid:40)(cid:389)ciency (cid:40)(cid:91)(cid:83)ert at Air Liquide Lar(cid:74)e (cid:44)ndustries (cid:54)outh Africa, e(cid:91)(cid:83)lains(cid:29) (cid:354)Air Liquide (cid:90)as co(cid:80)(cid:80)issioned (cid:69)y (cid:54)asol to (cid:69)uild these A(cid:54)(cid:56)s in (cid:20)(cid:28)(cid:26)(cid:28)(cid:17)(cid:355) Here, (cid:54)outh Africa’s largest energy and chemical producer operates a two-mile-wide site that boasts the world’s highest oxygen production capacity. The oxygen produced on-site is mainly used to produce synthesis fuel and chemicals. Following a 480 million euro deal in summer 2021, the oxygen plant is now owned by Air Liquide(cid:17) (cid:354)(cid:58)e (cid:90)ill (cid:69)e o(cid:83)eratin(cid:74) all (cid:20)(cid:25) A(cid:54)(cid:56)s for the next 15 years, in addition to the unit we already o(cid:83)erate today,(cid:355) says (cid:45)ens, (cid:354)and since we built them, it feels like we are coming full circle.” The deal is a key step in the long- term relationship that the Group has had (cid:90)ith (cid:54)asol for the (cid:83)ast (cid:23)(cid:19) years(cid:17) (cid:49)ot only is Air Liquide o(cid:83)eratin(cid:74) the (cid:90)hole oxygen production plant, but it is also modernizing the units. In addition to bringing benefits in terms of safety, reliability and efficiency, the solution provided by Air Liquide (cid:90)ill hel(cid:83) reduce the a(cid:80)ount of CO2 e(cid:80)itted durin(cid:74) o(cid:91)y(cid:74)en (cid:83)roduction(cid:17) (cid:354)(cid:58)e are ai(cid:80)in(cid:74) to cut e(cid:80)issions of the acquired assets in (cid:54)ecunda (cid:69)y (cid:22)(cid:19)(cid:8) to (cid:23)(cid:19)(cid:8) (cid:69)y (cid:21)(cid:19)(cid:22)(cid:20),(cid:355) ALRA022_GB_01_int_bat4.indd 29 07/04/2023 11:52 “Air Liquide has brought us global expertise. It’s been very positive for the atmosphere.” [ Cyril Sebei ] “In both senses of the term!” [ Jens Juckel ] 30 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S explains Jens. “The most obvious option is to use renewable energy.” Indeed, Air Liquide and Sasol have signed power purchase agreements for the long-term supply of 480 MW of renewable energy. Ultimately, the goal is to procure a total capacity of 900 MW of renewable-generated power for the site. Other key contributions to reducing CO2 emissions include improvements in process efficiency and the introduction of a new operating philosophy for the acquired assets. “We have identiﬁed and started work on a number of efficiency projects from which we are already seeing significant savings,” says Jens. And then there are what he calls “the quick wins”: running existing units more efficiently. At the eastern set of ASUs, Operations Excellence Manager Lizelle Meyer talks us through them. “Under Sasol, safety and reliability were para- mount, as they are to Air Liquide. But we now have a third primary focus as well: energy efficiency, which we are pursuing through advanced process control optimization strategies.” “We apply digitalization to make maintenance more effective.” [ Lizelle Meyer ] ALRA022_GB_01_int_bat2.indd 30 05/04/2023 15:21 A I R L I Q U I D E 2 0 2 2 _ 31 “The partnership between Air Liquide and Sasol is anchored in open, honest and transparent collaboration.” [ Simon Baloyi ] Air Liquide is also working with identify and the Sasol teams to execute further opportunities for site decarbonization. According to Simon Baloyi, Sasol Executive Vice President, Energy Operations and Technology, the shared ambition to decarbonize operations in Secunda is what makes the partnership with Air Liquide successful. “By improving the energy efficiency of our operations and assets, we will reduce steam usage, which will directly result in less carbon dioxide emissions.” “Then there is increased reliability and safety, which has a direct impact on efficiency. Air Liquide uses digitalization to make maintenance more effective,” explains Lizelle, introducing us to Cyril Sebei, Mechanical Area Manager, who is responsible for a maintenance team. “With our extensive cold boxes maintenance program, for example,” explains the engineer, “we are not only ensuring safety, but increasing efficiency.” “Air Liquide has brought a new operational strategy to the acquired Secunda assets,” Cyril continues. “We now work with Sasol to forecast demand and reduce c apacity whenever possible.” He gestures over to the hulking Sasol cooling towers. “For some employees, the acquisition was worrying at ﬁrst. As it turned out, though, Air Liquide has brought global expertise in industrial gases. It’s been very positive for the atmosphere.” Adds Jens with a chuckle: “In both senses of the term!” ALRA022_GB_01_int_bat2.indd 31 05/04/2023 15:21 32 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S Delivering the world’s glass with less gas Your Guides: [ Alessandro Pallotti ], Key Account and Business Development Manager at Air Liquide Italy, [ Benjamin Coiffier ], On-Site Innovation Program Manager, Industrial Merchant activity at Air Liquide, [ Andrea Cendron ], Technical Director at Verallia Italy Pescia, Italy E ntering the meeting room at the Verallia g l a s s p l a n t i n Pescia, Italy, the ﬁrst thing one notices is all the bottles of water in the middle of the table. Luckily, we don’t have to wait long until our host, Andrea Cendron, Technical Director at Verallia Italy, gestures toward them: “Please, help yourselves,” he says, adding with a chuckle, “We’re not running short.” That’s certainly true: with 34 plants producing more than 16 billion glass containers every year, Verallia is the world’s third largest manufacturer of bottles and jars for beverages and foodstuffs. And after the tour – especially the brief stop by the furnace – we’re thirsty. “Glass is made by melting a mixture of silica, contained in sand, or indeed recycled glass – and this requires temperatures of around 1,500°C,” Andrea explains. By way of comparison, gold melts at just over 1,000°C; lead is already liquid at 300°C. “Our produc- tion process is highly energy intensive, so our main challenge is to lower our carbon emissions. “This is where Air Liquide can help,” says Alessandro Pallotti, Key Account and Business Development Manager at Air Liquide Italy. “In late 2021, Verallia announced ambitious sustainability objectives, and we were able to respond with a proposal specifically tailored to the glass market. Here in Pescia, we will be combining our new next-generation, on-site oxygen production unit, which will be 10% more energy efficient than the previous generation, with our HeatOxTM technology, ALRA022_GB_01_int_bat2.indd 32 05/04/2023 15:21 A I R L I Q U I D E 2 0 2 2 _ 33 “Our new- generation on-site oxygen production unit is more efficient than current systems. It lowers both energy consumption and related carbon emissions.” [ Benjamin Coiffier ] “Then, there is HeatOxTM, our proprietary technology that harnesses the high-temperature fumes emitted by the furnace to preheat the natural gas and oxygen fed into it. They must be at about 500°C on entering the furnace. Thanks to heat recovery, less energy is needed to bring them up to temperature,” Alessandro further explains. According to Andrea, these technologies are real game changers: “By introducing pure oxygen as an which will recover wasted heat from furnaces to save up to 20% of the en- ergy needed for the glass melting process. The result: an 18% reduction in CO2 emissions. The solution will also deliver an up to 90% reduction in nitric oxide emissions, which in high concentrations can be harmful to health.” His colleague, Benjamin Coiffier, On-Site Innovation Program Manager at Air Liquide Industrial Merchant activity, explains the details. “Let’s start with oxygen: furnaces are heated by burning natural gas with air. If pure oxygen is used instead of air (this is called oxycombustion), then nitrogen and nitric oxide emissions are removed from the process and efficiency is higher.” He continues, “Now, separating oxygen from air also requires energy, but our new on-site oxygen production units are more efficient than current systems, which lowers both our energy consumption and related carbon emissions; they also produce purer oxygen, further reducing nitric oxide emissions.” ALRA022_GB_01_int_bat2.indd 33 05/04/2023 15:21 34 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S “We will be combining our new-generation, on-site oxygen production unit with our HeatOxTM heat recovery system to deliver energy savings of up to 20%.” [ Alessandro Pallotti ] oxidizer in our production process, and using HeatOxTM to recover the flue gas heat, we will vastly improve our performance regarding specific emissions compared to a conventional furnace.” Air Liquide’s twin oxy- combustion and heat recuperator solution into service in Pescia at the beginning of January 2024, and preparations a r e a l r e a d y w e l l u n d e r w a y. is scheduled to go “For us as glass producers, long-term planning and continuity of supply are absolutely essential,” explains Andrea. “Once we commission a new furnace, it will be in continuous operation – day and night – for its entire service life, which is around 15 years. If we ever had to switch it off, recommissioning would be difficult.” “Here, our new-generation, on-site oxygen production unit offers another ALRA022_GB_01_int_bat2.indd 34 05/04/2023 15:21 A I R L I Q U I D E 2 0 2 2 _ 35 “We know that Air Liquide is a trusted partner with whom we can explore future solutions to our challenge of reducing our emissions.” [ Andrea Cendron ] is only the beginning. In Brazil, too, the Group is working with Verallia to upgrade its furnaces. As an important step toward making glass manufacturing carbon neutral, Air Liquide has completed preliminary tests with another partner to replace natural gas with hydrogen. “But before we start talking about H2,” Andrea jokes, “can I offer anyone some more H2O?” advantage,” says Benjamin. “Our unique cryogenic system is more reliable than pressure-swing absorption. It's also more compact.” Alessandro nods: “And just in case there are any teething difficulties, we have contingency plans to deliver oxygen by truck. Continuity of supply is guaranteed at Air Liquide.” “We have built up strong working relationships at all levels,” says Andrea, “and we know that Air Liquide is a trusted partner with whom we can explore future solutions to our challenge of reducing our emissions.” Air Liquide’s support of Verallia’s sustainability goals in Italy ALRA022_GB_01_int_bat2.indd 35 05/04/2023 15:21 36 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S Building the future of renewable hydrogen in Normand’Hy "T i s w h e r e h i s A i r L i q u i d e ’ s e l e c t r o l y z e r w i l l be built,” indicates Rahim Salemkour, Project Director. “It is scheduled to be commissioned in 2025 and will be the largest in the world.” We are in Port-Jérôme, a small town in a region of Normandy, France, that is known for its industrial prowess. In front of us, construction is underway at the site that will soon be home to the Group’s new renewable hydrogen production unit. “Air Liquide Normand’Hy is a large-scale electrolyzer with an initial capacity of 200 megawatts,” Rahim explains. This is equivalent to the average annual electricity consumption of more than 235,000 French households. “We will be able to produce up to 28,000 tons of hydrogen per year here through water electrolysis, which is a production process that uses electricity to ‘break’ purified water molecules in order to separate the hydrogen from the oxygen.” Air Liquide Normand’Hy is the corner- stone of a project aimed at decarbonizing this industrial basin, which Air Liquide is implementing alongside other major industrial players in the region. The strong level of interest in the project means it has also garnered the backing of the French government as part of an Important Project of Common European Interest.(1) “To enable this kind of large-scale production of renewable hydrogen,” states Rahim, “the Group has entered a (1) Project selected among the 35 PIIEC “Hy2Use” projects. Your Guides: [ Rahim Salemkour ], Project Director, Air Liquide, [ Mathieu Cavélius ], Business Developer, Air Liquide, [ Liliane Herculano ], Project Manager, Air Liquide Port-Jérôme, France ALRA022_GB_01_int_bat2.indd 36 05/04/2023 15:21 A I R L I Q U I D E 2 0 2 2 _ 37 Developing a new generation of electrolyzers with Siemens Energy Air Liquide and Siemens Energy have embarked on a joint venture in the large-scale production of renewable hydrogen electrolyzers. The combined expertise of the two leading companies in their field will enable a sustainable hydrogen ecosystem to emerge in Europe. joint venture with Siemens Energy to develop large-capacity electrolyzers. This will allow us to pool our technology and expertise in proton-exchange membrane (PEM) electrolysis.” This Franco-German partnership is crucial for the development of a European hydrogen sector, which Air Liquide is spearheading. Air Liquide has chosen to install this new electrolyzer in Port-Jérôme because it is a strategic location for the Group. “We have had a presence here since the 1970s and have rolled out many technologies in the region,” explains Mathieu Cavélius, Development Engineer. Over time, the Group has cemented its presence by developing a pipeline network and forging long-standing partnerships with major refiners in the region who use hydrogen to remove sulfur from fuel. “It was clear that we would continue to roll out new technologies here,” explains Mathieu. Indeed, Port-Jérôme is already home to the largest steam methane reforming hydrogen production unit (2) operated by Air Liquide in France, just a few kilometers from the Normand’Hy site. Here, in 2015, the Group installed its Cryocap™ technology, which uses cryogenics to capture up to 98% of (2) Method separating the atoms that make up methane (CH4). Using steam, hydrogen and carbon dioxide are obtained. This is the most widely used and most economical method of producing hydrogen to date, but it does emit CO2 which can be captured and utilized through various applications thanks to CryocapTM technology. ALRA022_GB_01_int_bat2.indd 37 05/04/2023 15:21 “Normand’Hy’s major asset is its ability to produce competitive and carbon- free hydrogen on a large scale from renewable energy.” [ Rahim Salemkour ] 38 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S footprint of industrial players can be reduced,” said Mathieu. This hydrogen will also be used to decarbonize heavy transport, starting with heavy goods and industrial vehicles, followed by buses and commercial vehicles in the region. Not only will the Air Liquide Normand’Hy site produce renewable hydrogen, the project as a whole has an environmental approach. Liliane Herculano, a Project Manager who deals with regulatory aspects, explained: “Due to its size, the project the CO2 emitted during hydrogen production – a world first. Thanks to Cryocap™, Air Liquide has created new opportunities for capturing and reducing the carbon emissions of its own sites, as well as those of its customers. “Today, we are seeing great progress being made with the construction of this vast electrolyzer,” Rahim says. The main challenge lies in sourcing the electricity that powers it. “The electricity used will come from wind turbines and photovoltaic solar farms located near the site. This is what we mean when we talk about renewable hydrogen. There will be no CO2 emissions produced during the production process,” said Rahim. As a result, up to 250,000 tons of CO2 emissions per year will be prevented, the equivalent of the emissions of a French city with 25,000 inhabitants. (3) D o w n s t r e a m , A i r L i q u i d e Normand’Hy will be connected to the regional industrial ecosystem. This will allow the hydrogen to be distributed directly to industries in the area. “We will continue to collaborate with refining, petrochemical and chemical companies that require hydrogen for their production. Today, with the climate challenges we are facing, it is a matter of gradually replacing the hydrogen we already supply with renewable hydrogen. This way, the carbon ALRA022_GB_01_int_bat2.indd 38 05/04/2023 15:22 A I R L I Q U I D E 2 0 2 2 _ 39 “This pioneering project is a unique opportunity for industrial players in this area of Normandy, as well as for mobility – it will be a milestone.” [ Mathieu Cavélius ] has been subjected to an environmental assessment. With the help of an environmental engineer, we carried out a year-long fauna and flora impact study, which represents a complete life cycle.” This allowed Air Liquide to adapt the project in terms of its design, construction and operation. “As a simple example, we decided to excavate the site between September and October 2022, as this is a time of year when animals are neither hibernating nor in their breeding period,” explained Liliane. Air Liquide has worked to preserve the environment and support the entire area surrounding the Normand’Hy site. This project will contribute to the economic development of the region and build up a unique expertise in hydrogen production. The Group is already committed to developing this expertise through the H2 Academy, a higher education training initiative that teaches younger generations in the area about new career paths within the hydrogen industry. Air Liquide’s objective is to accelerate the development of renewable and low-carbon hydrogen on a global scale. To achieve this, it has decided to invest at least 8 billion euros in this area by 2035. The Normand’Hy project is this ambition brought to life! (3) In 2019, the Carbone 4 consulting ﬁrm estimated the average emissions per person and per year in France to be nearly 10 tons of CO2 equivalent. ALRA022_GB_01_int_bat2.indd 39 05/04/2023 15:22 40 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S And also Up to 98% of CO2 emissions emitted by a hydrogen production unit captured thanks to CryocapTM. Toward carbon neutrality: CCS, a promising solution then recovered for other industrial uses. This unique capture process will also be integrated into Air Liquide’s low-carbon and renewable hydrogen production unit in Grandpuits, France, which is under construction as part of a long-term contact with TotalEnergies. The Group is present across the CCS value chain, from CO2 capture to its transport to sequestration sites. It is deploying large-scale projects in France, Belgium and the Netherlands. Meanwhile, a joint venture with Sogestran, called OCEOS, is enabling Air Liquide to participate in maritime transport of carbon to meet the needs of future CCS projects in Europe. How can large volumes of CO2 emitted by industrial players be captured in the short term? Carbon capture and storage (CCS) is currently one of the most viable and efficient solutions. Air Liquide has been developing CO2 management solutions for 15 years now, with a notable example being its Cryocap™ system. In Normandy, France, this solution is already in use at the Group’s Port-Jérôme hydrogen production facility, where it uses cryogenics to capture up to 98% of emitted CO2. The liquefied CO2 is ALRA022_GB_01_int_bat2.indd 40 05/04/2023 15:22 Accelerating hydrogen development in the U.S. Hydrogen mobility is growing in the U.S. To meet the increasing demand, Air Liquide opened its largest liquid hydrogen production facility in 2022, in North Las Vegas, Nevada. The facility and the associated logistics infrastructure mark a 250 million dollar investment by the Group in the national hydrogen market. The plant has a production capacity of 30 tons of liquid hydrogen per day, which is enough to fuel up to 40,000 hydrogen vehicles. It will serve customers looking for low-carbon solutions, notably those in the mobility market in California. A I R L I Q U I D E 2 0 2 2 _ 41 Biomethane: for a sustainable energy mix Air Liquide is committed to the development of biomethane, a key energy source to decarbonize transport and industry and accelerate the energy transition as part of a circular economy approach. The Group is positioned as a partner of choice for industrial players, farmers and local authorities thanks to its presence along the entire biomethane value chain: from biomass sourcing, to the production of biogas and its purification into biomethane, to final transportation to customers. With production facilities in France, Norway, Sweden, the United Kingdom and recently Italy, the Group is expanding its business on a global scale. In the United States, Air Liquide is currently building its largest biomethane production plant to date, in Rockford, Illinois. And in China, where biomethane has major potential, the Group launched its first production plant at the end of 2022. 22 biomethane production plants worldwide with production capacity of 1.6 TWh per year, equivalent to the average gas consumption of approximately 333,000 people. +25% increase in capacity over the past 3 years. ALRA022_GB_01_int_bat2.indd 41 05/04/2023 15:22 42 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S Taking to the skies, powered by hydrogen To help the aviation sector achieve carbon neutrality by 2050, Air Liquide has partnered with Groupe ADP (Aéroports de Paris) to create a joint venture that will provide airports with the engineering and services needed for the transition to hydrogen. As Airbus aims to operate the ﬁrst hydrogen- powered commercial aircraft by 2035, airports need to start reconsidering their infrastructure today. In particular, they must look at how liquid hydrogen will be supplied and how it can also serve other ground mobility usages, notably heavy-duty transport or ground support. Tomor row ALRA022_GB_01_int_bat4.indd 42 07/04/2023 10:31 Tomor row A I R L I Q U I D E 2 0 2 2 _ 43 Toward low-carbon shipping With more than 500 million metric tons of goods transported inland in the European Union, (1) shipping companies are looking for solutions to decarbonize their logistic chain. In this context, Air Liquide and Future Proof Shipping (FPS), a provider of zero- emission shipping solutions, have signed a long-term contract for the supply of hydrogen to FPS’s inland barge, the Maas, which transports containers in the Benelux region. This supply will allow the substitution of hydrogen for the conventional fuel used in the shipping industry, thus reducing the sector's environmental footprint. The hydrogen will be delivered in specially designed multi-modal hydrogen storage suited for inland barges. The overall solution will avoid nearly 2,000 metric tons of CO2 emissions per year for the first ship concerned. Due to its replicability potential for other ships (and other heavy-duty mobility usages), the project is a milestone on the path to the decarbonization of inland waterways. (1) Eurostat ALRA022_GB_01_int_bat4.indd 43 11/04/2023 13:31 44 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S Unlocking progress through innovation Innovation and technology are major forces of Air Liquide and have always enabled it to play a pioneering role. It is thanks to these strengths that the Group is contributing to the development of key sectors for the future. This includes electronics, where its molecules are used in the manufacture of semiconductors, and healthcare, where its solutions contribute to improving patient's quality of life. ALRA022_GB_01_int_bat.indd 44 30/03/2023 13:46 A I R L I Q U I D E 2 0 2 2 _ 45 Advanced materials for sustainable electronics Your Guides: [ Jenny Tan ], Frontend Global Materials Operations Director, Micron, [ Jiro Yokota ], Technology Program Manager, Advanced Materials, Air Liquide, [ Dylan Low ], Strategic Business Unit Director, Air Liquide Singapore, [ Helena Seiver ], Vice President, Strategic Account Management for Micron, Air Liquide Singapore "W h e n p e o p l e h e a r ‘advanced materials,’” says Jir o Yokota, “they often think that we are dealing with simple, plug-and-play solutions: ‘Just exchange material A for material B to save X amount of money in production,’” says the Technology Program Manager at Air Liquide Advanced Materials. “But what we do is far more complex – and requires a closer relationship with the customer and a thorough understanding of their production processes.” We have come to one of Air Liquide’s longest-standing customers, Micron, to get a feel for what Jiro means. For 30 years now, Air Liquide has been supplying the US-based provider of memory storage solutions with the ultra-pure gases required in microchip production. During this time, the electronics industry had expanded rapidly as computers and then smartphones became standard consumer goods, while at the same time cars and household appliances acquired more complex electronic components capable of faster performance and more processing power. All while reducing financial costs and environmental footprint. ALRA022_GB_01_int_bat2.indd 45 05/04/2023 15:22 46 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S “Our enScribe™ products are designed to reduce the global warming potential typically associated with most contemporary gases used in etch processes.” [ Jiro Yokota ] We are here in Singapore at the Air Liquide Advanced Materials center built for Micron. Located on the western shore of the island state, a couple of miles away from its gleaming center, the facility is an ultra-modern production plant – “the first of its kind,” explains Dylan Low of Air Liquide Singapore. He picks us up at the gates along- side Helena Seiver, Vice President, Stra- tegic Account Management for Micron at Air Liquide, and while we don protec- tive goggles, helmets and overalls for our tour of the plant cleanrooms, she explains her role as “providing one Air Liquide ser- vice to one Micron.” This means ensuring that Air Liquide deploys its international reach to support its partner as it, too, expands globally. In this case, the Group opened one of its largest electronics advanced materials production facilities alongside Micron in Singapore. This strategy of regionalizing supply chains makes them more robust and responsive. With covid-19 lockdowns in place during the construction of Air Liquide’s Advanced Materials center in Singapore, the importance of regional synergies became even more salient. About the partnership with Air Liquide, Jenny Tan, Frontend Global Materials Operations Director at Micron, comments, “Micron and Air Liquide have been successfully collaborating for the last 30 years on various projects that have contributed to Micron’s production efficiency, supply chain resiliency and sustainability efforts. We are excited to continue our long partnership with Air Liquide in the years to come.” ALRA022_GB_01_int_bat2.indd 46 05/04/2023 15:23 “We are excited to continue our long partnership with Air Liquide in the years to come.” [ Jenny Tan ] by some customers has already helped reduce the industry's overall emissions by almost 1%.” “Also,” he adds, “each chip that leaves a fab has the potential to further reduce emissions down the line – by making a computer or even a car more efficient.” Advanced materials indeed! Jiro takes this as his cue to talk us through how Air Liquide’s enScribe™ etching molecules help the company’s electronics customers make marked emissions reductions in their manufacturing processes. “Our materials replace high global warming potential etching gases, which have more potent greenhouse gas emissions than carbon dioxide,” he says. “As such, whenever a customer adopts one of these molecules, it has the potential to reduce the entire sector’s emissions. The use of just one of these molecules A I R L I Q U I D E 2 0 2 2 _ 47 “For 30 years, Air Liquide and Micron have grown together. The Singapore Advanced Materials Center, their most recent joint achievement, is the first production plant of its kind.” [ Dylan Low ] [ Helena Seiver ] ALRA022_GB_01_int_bat3.indd 47 06/04/2023 14:54 48 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S Toward personalized care at home Your Guides: [ Federica Bellingeri ], Patient Empowerment and Centricity Manager, Air Liquide Healthcare, [ David Rudilla ], Director of Patient Quality of Life, Air Liquide Healthcare, [ Carlos Garcia Diaz ], Oxygen technician, VitalAire Spain Madrid, Spain David Rudilla, Air Liquide Healthcare’s Director of Patient Quality of Life and a psychologist, is on-site with us today. He is part of a multidisciplinary team of nurses, technicians, doctors and pharmacists who help patients like Margaret cope with living with a range of chronic conditions. “I am passionate about placing human dignity and quality of life at the center of the support teams provide,” he enthuses. “As we are on the ground l i f e " M y h a s changed,” says Margaret Watty, a lively, independent-minded woman who is living with chronic obstructive pulmonary disease, a condition that results in severe breathing difﬁculty. Her gratefulness is palpable as we sit together in the warm, sunny living room of her Madrid apartment. “Before, I couldn’t go out – I could hardly walk.” After two bouts with covid-19, she now requires oxygen therapy 24 hours a day. ALRA022_GB_01_int_bat4.indd 48 07/04/2023 09:58 A I R L I Q U I D E 2 0 2 2 _ 49 interacting with patients throughout their care, we have a global view that takes into account more than just clinical data.” This proximity allows a more comprehensive understanding of each person’s needs, which in turn enables the development of innovative solutions to help them. Carlos Garcia Diaz, Margaret’s VitalAire oxygen technician, is also joining us today. He visits Margaret regularly and the two have developed a close bond. He is always on the lookout for ways to improve her quality of life, and he recently brought her a new oxygen concentrator that better fits her needs. “Originally I had a bigger machine, but Carlos found me this smaller one,” says Margaret with a smile. “I’ll be able to put it in a backpack, so I can be more mobile.” Carlos nods in agreement. “She has to be constantly connected to the machine,” he explains. “These long tubes can be a real impediment when she moves around. But the portable machine allows her to leave her home and be more independent.” Because every patient experi- ences their illness differently, person- alized care plans are more effective “It makes a huge difference to me to know that the people delivering my follow-up understand my situation.” [ Margaret Watty ] ALRA022_GB_01_int_bat2.indd 49 05/04/2023 15:23 50 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S 0 14 _ R E P O R T A G E _ H Y D R O G È N E V E R T “My goal is to try to ensure the therapy interferes as little as possible with the patient’s daily life.” [ Carlos Garcia Diaz ] tells us. “Payers understand that personalized care plans allow for better targeting of resources and efforts.” David agrees: “The approach improves patient outcomes at the best cost for healthcare systems, which are under unprecedented strain due to rising life expectancy, chronic diseases and treatment costs,” he says. To improve treatment adherence and lon(cid:74)(cid:16)ter(cid:80) quality of life, feed(cid:69)ac(cid:78) f ro m pat i e nts o n t h e i r n e e d s , expectations and treatment experience is vital. And even their lifestyle enters into the equation(cid:17) (cid:354)Patient adherence to therapy is vital, but patients are often dealing with chronic conditions at home,” David points out. “Therapy outcomes rely not only on clinical indicators, but on the barriers or inconveniences of treatment being minimized as much as possible.” than a one-size-fits-all approach. A combination of human presence, dig- ital platforms and data analysis allows Air Liquide Healthcare tea(cid:80)s to (cid:69)uild a personal profile for every patient and continuously adapt it as the patient’s situation evolves. “It makes a huge dif- ference to know that if I call I can speak to Carlos, and not a machine telling me press 1 if I need this, press 2 if I need that,” says Margaret. To learn more about the impor- tance of value-based healthcare models, we jump in a car with David and head to his office to meet with Federic a Bellingeri, Patient E m p o w e r m e n t a n d C e n t r i c i t y (cid:48)ana(cid:74)er for Air Liquide Healthcare in the Netherlands. “Value-based healthcare is increasingly gaining traction in the health sector,” she ALRA022_GB_01_int_bat4.indd 50 07/04/2023 09:59 A I R L I Q U I D E 2 0 2 2 _ 51 “Therapy outcomes rely not only on clinical indicators, but on the barriers or inconveniences of treatment being minimized as much as possible.” [ David Rudilla ] The future of healthcare has to be an ecosystem that puts the patient at the center. Air Liquide Healthcare teams collaborate closely with stakeholders to find ways to advance this goal. “Some payers have adopted an outcome-driven model, with payment linked to therapy adherence or to patient satisfaction, and to innovation that improves patient outcomes,” says Federica. For David, Air Liquide Healthcare is contributing to the development of a virtuous circle: “Doctors benefit from the information we provide. Hospitals that entrust us with their patients’ care at home get better outcomes at the right cost. Patients are empowered because their voices are heard. We receive feedback that makes our solutions more effective. And, ultimately, society benefits from a more sustainable healthcare system.” “My life has returned to almost normal,” says Margaret. And that is the most meaningful outcome of all. “We’re creating synergies with stakeholders to ensure that the ultimate treatment goal is the one most meaningful to the patient.” [ Federica Bellingeri ] ALRA022_GB_01_int_bat.indd 51 30/03/2023 13:46 52 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S And also ALTEC, cutting edge engineering at Airgas In 2022, Airgas, Air Liquide's American subsidiary, opened the new ALTEC(1) center, which brings its engineering teams together to innovate, create and accelerate solutions for their customers. The 42,000 square feet facility includes cutting-edge laboratories dedicated to industries spanning from food, metals and glass to welding and automation. This new center facilitates the sharing of resources, ideas and expertise in a customized space, providing synergies that greatly amplify Airgas's ability to provide tailor- made solutions to customers. (1) Air Liquide Technology Center. Photoshoot planned at Altec, Airgas ALRA022_GB_01_int_bat2.indd 52 05/04/2023 15:23 A I R L I Q U I D E 2 0 2 2 _ 53 Data and AI working for the energy transition The energy transition is impossible without technology, and artificial intelligence (AI) is playing a decisive role. For Air Liquide, AI is a strong lever of value creation and efficiency, fully in line with its innovation strategy for a sustainable performance. Every day, billions of data are collected from the Group’s 500 plants, 20 million gas cylinders and 9,900 trucks. Analyzing this data allows a detailed and global understanding of industrial assets and, ultimately, monitoring optimization. For example, the teams have implemented AI solutions that reinforce the reliability of production units, which are controlled by remote centers, and that optimize their energy consumption, thus reducing their environmental impact. 20 million kilometers avoided thanks to AI Another axis for decarbonizing operations is logistics. In 2020, the Group deployed a program to digitize its liquid gas supply chain, based on AI. This will allow Air Liquide to better anticipate its customers’ needs and determine optimal routes, thus limiting the number of kilometers traveled by delivery trucks. The goal is a 10% reduction per year until 2025. Making factories more ﬂexible with AI Contributing to a low-carbon society requires using renewable energy to power industrial and urban areas. However, their intermittence poses a major challenge. Air Liquide has thus launched an ambitious research program with the École des Mines ParisTech into how to use AI to address this challenge. Among other things, the program focuses on the flexibility of industrial units, which is essential for integrating renewable energy into the grid, and on the development of algorithms to optimize plant production. ALRA022_GB_01_int_bat.indd 53 30/03/2023 13:46 54 _ A D V A N C I N G T O M E E T T H E W O R L D ’ S C H A L L E N G E S Tomor row To the Moon As an expert in extreme cryogenics and a supplier of key molecules, Air Liquide is a major partner in sustainable space exploration. Its cutting- edge technologies are an essential building block for establishing the ﬁrst prolonged human presence on the Moon. In particular, they will enable the refueling of space vehicles via stations in orbit, and the use and production of hydrogen in situ from lunar resources. The Group is already meeting these challenges with its partners in the sector, notably the ESA and NASA, to whom it supplied high-pressure nitrogen for the launch of the Artemis 1 mission to the Moon. ALRA022_GB_01_int_bat4.indd 54 07/04/2023 09:59 A I R L I Q U I D E 2 0 2 2 _ 55 When CO2 is recycled into textiles Start-up Fairbrics is using CO2 emitted by industry to replace polyester made with fossil fuels. Founded in 2019, this green chemistry start-up has developed an innovative process that turns captured CO2 into textile ﬁbers. It serves as a concrete example of how the circular economy can contribute to decarbonization. During the two years that it spent at Accelair, Air Liquide’s deep tech start-up accelerator, Fairbrics developed its technology thanks to the laboratories at its disposal and the technical and safety expertise of the Group’s R&D teams. Thanks to this support, Fairbrics was able to launch and raise nearly €10 million in 2020 and 2021 to transition to an industrial scale. In 2022, following a second round of ﬁnancing of more than €20 million, the start-up announced the construction of a pilot plant in Antwerp that will produce 1,000 T-shirts per day from the CO2 emissions of factories in the industrial zone. Tomor row ALRA022_GB_01_int_bat4.indd 55 07/04/2023 10:00 56 _ A D V A N C I N G W I T H Y O U Advancing with you ALRA022_GB_01_int_bat4.indd 56 07/04/2023 10:00 A I R L I Q U I D E 2 0 2 2 _ 57 Advancing with you is recognizing the journey toward a sustainable future as a joint endeavor requiring collaboration throughout our entire ecosystem. It is forging meaningful connections with employees, customers, patients, shareholders and all other stakeholders. It means acting for all in the pursuit of a more sustainable, just and equitable world. With our employees (p. 58) With our customers (p. 59) With patients (p. 60) With communities (p. 61) With our shareholders (p. 62) ALRA022_GB_01_int_bat4.indd 57 07/04/2023 10:01 58 _ A D V A N C I N G W I T H Y O U Leading by example Lori Kuiper, Orbital, Heating and Pipe Product Manager, Red-D-Arc, part of Airgas, Air Liquide’s U.S. subsidiary Being a woman in a traditionally male profession is not always easy, but welding engineer Lori Kuiper was raised to believe you can be anything you want to be. Today, she is determined to pass on this message by inspiring women to forge their path in the industry that she loves. How did your career as a woman welder start? When I was 24, I applied for an apprenticeship program at General Motors that had reserved three places for women. On my first day, I ended up in a dark, smoky foundry with overhead cranes on tracks carrying buckets of molten metal – and I wondered what I had gotten myself into! My career has evolved a lot since then, but I wouldn’t be here at Airgas today if that original opportunity for women hadn’t been created – proof that when a company does something with intent, it pays off. You are very committed to encouraging women in the industry. Do you have examples of initiatives to share with us? There are a lot of fantastic grassroots initiatives such as Weld Like a Girl™ and Women Who Weld®. (1) Internally at Air Liquide, Women in TCL (2) supports employees to advance in their field. This program recognizes employees for their technical knowledge and scientific expertise, offering them a flexible and structured career path. We are also involved in educational outreach, and we provide welding equipment and training to help teachers and students learn new and advanced skills in the field. That might seem basic, but not being able to find personal protective equipment that fits correctly is a huge barrier to learning to weld. What would you say to a woman thinking about an engineering career at Air Liquide? I would tell them that it’s a place where their voice will be heard and where different points of view are valued. But most importantly, I would say don’t let other people put limitations on you or hold you back from your path. (1) Weld Like a Girl™ is an empowerment project for girls and women, using welding and creativity to boost self-esteem and whole-person wellness. Women Who Weld® is a nonproﬁt organization that teaches women how to weld and ﬁnd employment in the welding industry. (2) Technical Community Leaders. ALRA022_GB_01_int_bat.indd 58 30/03/2023 13:46 As Chief Procurement Officer at leading specialty polymer manufacturer Covestro, Thomas Römer oversees all global procurement activities and works closely with suppliers to find ways to reduce the company’s carbon footprint. Why did you choose Air Liquide as a supplier? Industrial gases like hydrogen and carbon monoxide serve as the basis for all of our end products: they are "backbone" materials. The choice of suppliers is indeed critical, and we were won over not only by the price, but also by Air Liquide’s reliability, which is of the utmost importance to us. We also really appreciate the key account concept. This means we have one main contact at Air Liquide for day-to-day operations and project development, which simplifies everything and accelerates decision-making. He always works to understand what we as the customer need and then find a solution for us. And if needed, he is capable of mobilizing a task force to solve technical issues. In light of Covestro’s climate neutrality goals, what is Air Liquide doing to help you achieve them? Cost and availability have always been key purchase criteria for us, and our CO2 footprint is now another, as we want to achieve net-zero emissions (1) by 2035. With Air Liquide, we are looking into the possibility of using biogenic carbon dioxide (2) for production processes, and low-carbon hydrogen and A I R L I Q U I D E 2 0 2 2 _ 59 ammonia for heating. We’re also interested in Air Liquide’s work on water electrolysis. What are the challenges that Covestro faces on its way to carbon neutrality? Making our industry carbon neutral is critical, but today no chemical company can instantly become 100% defossilized. So, we have to find the most promising solutions to help reduce the CO2 emissions of production units all while meeting our customers’ needs in terms of competitive solutions. Air Liquide helps us by adapting offerings and processes to the situation, such as the recent investment in Shanghai for low-carbon hydrogen production, which benefits from green financing. (1) Scope 1 and Scope 2 (2) Biogenic carbon dioxide is carbon dioxide that is produced as a by-product of the decomposition of organic materials. Thomas Römer Chief Procurement Of ficer at Covestro A joint approach to reducing CO2 emissions ALRA022_GB_01_int_bat.indd 59 30/03/2023 13:46 60 _ A D V A N C I N G W I T H Y O U Committed to improving the lives of people with diabetes, Air Liquide has partnered with the International Diabetes Federation (IDF) Europe to engage stakeholders in developing a patient- centered care ecosystem and inspire policy change that will transform the future of people living with diabetes. IDF Europe aims to advocate on all levels for those with diabetes. How do you do this? A big part of our work is to raise visibility and awareness about diabetes, which currently affects more than 32 million Europeans. We do this through information campaigns as well as advocating for policy change at the national and European levels. In November 2022, we celebrated a major achievement when a new resolution on the prevention, management and better care of diabetes was adopted by the European Parliament. We worked together with Air Liquide Healthcare teams, people living with diabetes and other diabetes stakeholders on a campaign that engaged policymakers to get this resolution passed, highlighting what you can achieve if you have strong political will and science working together. What should the future of diabetes care look like? Care needs to shift from being disease-focused to person- focused. Patient empowerment is critical to helping people self- manage their condition. Thanks to companies like Air Liquide Healthcare, recent years have seen huge advancements in using unique combinations of human support, digital tools and devices to provide the right support for each patient, with the objective of improving both health outcomes and quality of life. Personalized care plans are really an investment that could prevent long-term complications. Are things moving in the right direction? I’m optimistic, as stakeholders are starting to see the importance of smoother, personalized care pathways. Our shared goal is to reduce the burden of living with the disease. Elisabeth Dupont Regional Manager Europe at the Inter national Diabetes Federation Elevating the voices of patients ALRA022_GB_01_int_bat2.indd 60 05/04/2023 15:24 A I R L I Q U I D E 2 0 2 2 _ 61 When the conflict in Ukraine started in February 2022, Internationaler Bund Polska, a social action organization, which provides a variety of reintegration services, rapidly mobilized to help the influx of refugees arriving in Poland. A local Air Liquide employee contacted the NGO to see what could be done to help. Consequently, Air Liquide supported the charity’s project with employee volunteering and a grant from the Fondation Air Liquide. What was the situation like for your organization when the conﬂict in Ukraine started? We are a small, local organization helping people in difficulty. When the conflict started, the international NGOs didn’t arrive immediately, so in a very short time and on a major scale we had to organize ways to help those fleeing. We had 2,500 people show up to our center. Two days later, we opened the first warehouse to distribute material aid. And during the most intense period, we had 10 locations open in Krakow. How did you manage? And how did Air Liquide get involved? We opened a huge warehouse, which at one point had 300 volunteers from 24 countries working there. In the midst of all this, Paweł Świątkowski, an Air Liquide Maria Wojtacha Director of the Fundacja Inter nationaler Bund Polska Joining forces to help communities engineer, came to my office and asked, “What do you need?” At the time we critically lacked women’s underwear and hygiene products, and he told me, “OK, we’ll take care of it.” What is the most important way companies can help? We helped 174,000 Ukrainian refugees in 2022, and it was invaluable to have a partner that listened over the long term and adjusted the type of support given as our needs changed. They also gave employees time off to work with us(1) – one day all our warehouse volunteers were from Air Liquide! What truly makes the difference is everyone coming together – individuals, businesses, other NGOs – to offer help. (1) Employee volunteering that took place in the framework of Citizen at Work. By 2025, this Air Liquide program will offer all Group employees the possibility to support, during work hours and on a voluntary basis, their local communities by participating in initiatives organized or identiﬁed by their entity. ALRA022_GB_01_int_bat2.indd 61 05/04/2023 15:24 62 _ A D V A N C I N G W I T H Y O U Investing is a social commitment Virginie I. an Air Liquide individual Shareholder (1) since last year, founder of the association Coup de Pouce (A Helping Hand) and an active philanthropist. A proponent of impact investing, (2) Virginie I. helps major investors choose investments that generate a positive social and environmental impact in addition to financial performance. This criteria led her to invest in Air Liquide. Why did you choose to invest in Air Liquide? Impact investing in companies like Air Liquide gives purpose to my investments. In addition to the ﬁnancial return, which allows me to conduct an after-school project in the Haut-Katanga Province of the Democratic Republic of the Congo, my Air Liquide shares are a way for me to support a company that is aligned with my beliefs. They are also an opportunity to contribute to the development of solutions that are beneﬁcial to society and that meet daily needs, from transport and energy to healthcare and more. In your opinion, what are Air Liquide’s strengths? Air Liquide may be an international Group, but it values close relationships and favors direct contact with its Shareholders. I have great conﬁdence in Air Liquide’s long- term vision, in part due to the stability of its strategy. How do you get involved as a Shareholder? Air Liquide provides many services and tools to Shareholders that are invaluable for answering our questions and helping us to feel involved in the Group. I follow Air Liquide’s news closely via the Shareholder Newsletter, which I read regularly, and via the website. I also get involved in events such as Génération Hydrogène, which explained hydrogen usages and its future potential. This involvement is essential to helping me understand the full extent of my investment. (1) Direct registered shareholders hold a securities account directly with Air Liquide, without going through a ﬁnancial institution. (2) Impact investments are investments made in companies, organizations and funds that aim to generate a positive social and environmental impact in addition to a ﬁnancial return. ALRA022_GB_01_int_bat2.indd 62 05/04/2023 15:24 A I R L I Q U I D E 2 0 2 2 _ 63 Paris Innovation Campus ALRA022_GB_01_int_bat2.indd 63 05/04/2023 15:24 64 _ A P P E N D I X Consolidated income statement (summarized) AS OF DECEMBER 31, 2022 (in millions of euros) Revenue Operating costs Operating proﬁt before depreciation Depreciation and amortization Operating income recurring Other non-recurring operating income & expenses Operating income Net financial costs and other net financial expenses Income taxes Share of proﬁt of associates PROFIT FOR THE PERIOD - Minority interests - Net proﬁt (Group share) Basic earnings per share (in €) 2021 23,335 -17,002 6,333 -2,173 4,160 -150 4,010 -408 -915 5 2,692 120 2,572 4.94 2022 29,934 -22,606 7,328 -2,466 4,862 -571 4,291 -386 -1,002 1 2,904 145 2,759 5.28 Recurring net proﬁt (Group share) 2,572 3,162 ALRA022_GB_01_int_bat.indd 64 30/03/2023 13:47 A I R L I Q U I D E 2 0 2 2 _ 65 Consolidated Balance Sheet (summarized) AS OF DECEMBER 31, 2022 Assets (in millions of euros) 12/31/2021 12/31/2022 Goodwill Fixed assets Other non-current assets* Total non-current assets Inventories & work in-progress Trade receivables & other current assets Cash and cash equivalents* Total current assets Assets held for sale TOTAL ASSETS 13,992 23,984 1,216 39,192 1,585 3,611 2,311 7,507 84 14,587 25,458 1,234 41,280 1,961 4,216 2,019 8,196 42 46,783 49,518 Equity and Liabilities (in millions of euros) 12/31/2021 12/31/2022 Shareholders’ equity Minority interests Total equity Provisions & Deferred tax liabilities Non-current borrowings Non-current lease liabilities Other non-current liabilities* Total equity and non-current liabilities Provisions Trade payables & other current liabilities Current lease liabilities Current borrowings* Total current liabilities Liabilities held for sale 21,462 537 21,999 4,419 10,506 1,033 382 38,339 309 5,614 228 2,256 8,407 37 23,736 836 24,572 4,457 10,169 1,052 372 40,622 282 6,258 228 2,113 8,881 15 TOTAL EQUITY AND LIABILITIES 46,783 49,518 * Including fair value of derivatives ALRA022_GB_01_int_bat.indd 65 30/03/2023 13:47 66 _ A P P E N D I X Consolidated cash ﬂow statement (summarized) AS OF DECEMBER 31, 2022 (in milions of euros) Funds provided by operations Changes in working capital Other cash items Net cash from operating activities Purchases of property, plant and equipment, and intangible assets Purchases of ﬁnancial assets and the impact of changes in scope Proceeds from sale of subsidiaries, property, plant and equipment, and intangible and financial assets Net cash in investing activities Distribution Increase in capital stock Purchase of treasury shares Transactions with minority shareholders Change in borrowings and lease liabilities (including net interests) Impact of exchange rate changes and net debt of newly consolidated companies and others Change in net cash and cash equivalents NET CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 2021 5,292 377 -98 5,571 -2,917 -660 225 -3,352 -1,418 175 -40 -37 -497 17 420 2,139 2022 6,255 -397 -48 5,810 -3,273 -136 167 -3,242 -1,487 38 -192 -4 -1,136 -165 -378 1,761 ALRA022_GB_01_int_bat2.indd 66 05/04/2023 15:24 02 _ C O N T E N T S A world of challenges p. 04 Advancing with conﬁdence p. 10 Advancing to meet the world’s challenges p. 26 Advancing with you p. 56 A I R L I Q U I D E .C O M See our annual publications on our website: Annual Report, Sustainability Report, Universal Registration Document, Shareholder’s Guide. YO U T U B E L I N K E D I N T W I T T E R I N STAG R A M @AirLiquideGroup linkedin.com/company/airliquide @AirLiquideGroup @air_liquide_group Air Liquide's Normand'Hy electrolyzer project on page 36 is supported by: Complimentary copy. Published by the Communications department of the Air Liquide Group, 75 quai d’Orsay, 75007 Paris, France Publication Director: François Jackow. Editor: Domitille Faﬁn. Date of publication and legal deposit: April 2023. ISSN: 2803-6220. Photo credits: in order of appearance, p. 1: Isegoria/Havas Events, p. 4: Wachirawit Jenlohakit/Getty Images, p.5: Adrien Daste – All rights reserved, p. 6: Adrien Daste – Air Liquide, p. 7: Alexander Spatari/Getty Images – Frédérique Plas/Caisse des Dépôts, p. 8: krisanapong detraphiphat/Getty Images – All rights reserved, p. 9: Hiroshi Watanabe/Getty Images – Gabo Morales/CAPA Pictures, p. 10-11: Ippei Naoi/Getty Images, p. 12: Antoine Doyen, p. 13-16: Mourad Mokrani – Colin Rowe – Zhao Wei, p. 18-19: Antoine Doyen – Julien Lutt / CAPA Pictures – Carlos Crespo / CAPA Pictures – Laurent Attias/Edenred, p. 20-21: Franck Juery – Terry Halsey – Mourad Mokrani – Habibullah Qureshi Mujeebullah Qureshi, p. 26-27: AJ_Watt/Getty Images, p. 29-31: Erik Forster/CAPA Pictures – Sasol, p. 32-35: Elio Carchidi/CAPA Pictures, p. 36-39: Carlos Ayesta/CAPA Pictures, p. 40-41: Adrien Daste – Gauge Theory Creative – kontrast-fotodesign/Getty Images, p. 42-43: Colin Anderson Productions/Getty Images – Mrz producer/ Shutterstock, p. 45-47: Adrien Daste – Xavier Keutch/CAPA Pictures – Jennifer Altman/CAPA Pictures, p. 48-51: Jacobo Medrano/CAPA Pictures, p. 52-53: Mystic Image Productions – Adrien Daste, p. 54-55: Anton Petrus/Getty Images – Kryssia Campos/Getty Images, p. 56-57: Mourad Mokrani, p. 58: Alicia's Photography, p. 59: Egbert Trogemann/CAPA Pictures, p. 60: Antonin Weber/CAPA Pictures, p. 61: Raphael Olivier/CAPA Pictures, p. 62: Thomas Laisné/La Company, p. 63: Adrien Daste. Design and production: (ref.: ALRA022) Printers: Imprimerie Snel. This document is printed on FSC-certiﬁed paper sourced from sustainably managed forests by an Imprim’Vert-certiﬁed printer. L’Air Liquide - S.A. company established for the study and application of processes developed by Georges Claude with issued capital of 2,878,976,490.50 euros. Cover: Taken by Air Liquide on the occasion of Génération Hydrogène, the cover photo represents hydrogen mobility on its way to the future. Twenty-two hydrogen cars drive down Avenue Foch in Paris, forming the H2 symbol to represent hydrogen. ALRA022_GB_00_couv_bat2.indd 2-4 05/04/2023 15:15 Air Liquide is a world leader in gases, technologies and services for industry and health Present in 73 countries and counting 67,100 employees, Air Liquide serves over 3.9 million customers and patients. Oxygen, nitrogen and hydrogen are essential small molecules for life, matter and energy. They embody Air Liquide’s scientiﬁc territory and have been at the core of the company’s activities since its creation in 1902. 2 0 2 2 A N N U A L R E P O R T Advancing ALRA022_GB_00_couv_bat3.indd 1,3 07/04/2023 09:41 Access the digital version

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