Air Liquide more optimistic on Europe; sees no mid-term impact from U.S. hydrogen pause

By Olivier Cherfan

Feb 20 (Reuters) - French industrial gases group Air Liquide AIRP.PA said on Friday it sees a gradual improvement in Europe and said U.S. President Donald Trump's move to cancel billions in federal clean‑energy funding will not affect its mid‑term activity.

"There are probably a few more reasons to be optimistic than a year ago, because we're seeing some early stirrings in certain industries," CEO François Jackow told reporters.

Air Liquide, which supplies gases including oxygen, nitrogen and hydrogen to factories and hospitals, confirmed its 2026 target of a 100-basis-point increase in operating profit margin and said it expects a similar rise in 2027, bringing the cumulative improvement to 560 basis points over 2022–2027 after previously providing targets only through 2026.

Industrial gases continue to look relatively resilient compared with the broader European chemicals sector, as the European Union's chemical competitiveness remains under pressure from weak demand and high energy costs.

"There is no impact on our medium-term activity, but overall these projects are on pause, with a few exceptions we're still working on," CEO François Jackow said on the U.S. clean-energy grant cancellations.

Air Liquide reported slightly higher than expected recurring operating income of 5.58 billion euros ($6.56 billion) for 2025, while analysts polled by Vara Research were expecting 5.56 billion euros on average. That translated to an operating margin of 20.7%.

Shares in the company rose 3.5% by 1101 GMT, as J.P. Morgan analysts called the update reassuring and Jefferies highlighted a higher than expected annual dividend.

Rival Linde's annual results still reflected soft volumes in the EMEA region, underscoring the European weakness.

Air Liquide said it would propose a dividend of 3.70 euros per share, up 12.1% from a year ago.

($1 = 0.8508 euros)