Linde confident for Praxair merger after strong Q1

German industrial gases group Linde confirmed its objectives for 2018 Wednesday after a strong first quarter, as it eyes a jumbo tie-up with US rival Praxair in the second half.

Profit attributable to shareholders from continuing operations increased 23.5 percent year-on-year, to 384 million euros ($469 million) between January and March, Linde said in a statement.

Operating, or underlying profit increased 12.1 percent, to 1.1 billion euros, while revenues fell 7.8 percent to just over 4.0 billion.

Chief executive Aldo Belloni said “efficiency measures” were behind the increased profits despite falling revenues, also pointing to “continued portfolio optimisation and good macroeconomic conditions.”

Linde, which makes ready-to-use industrial plants as well as supplying gases, said unfavourable exchange rates and changes to its accounting rules were the main reasons for the fall in revenue.

Meanwhile, the group spent 122 million euros in the first quarter on restructuring in anticipation of the Praxair tie-up.

If approved by competition authorities including the European Commission, the merger — which both firms see set for completion in the second half of the year — would create the world’s biggest industrial gases supplier, overtaking France’s Air Liquide.

In its present shape, Linde stuck to its 2018 targets for an increase in revenue of up to 4.0 percent year-on-year, with operating profits adding up to 5.0 percent.

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