Outlook

Group

Economists are expecting stronger growth in the global economy in 2015 than was achieved in 2014. The international forecasting institute The Economist Intelligence Unit Ltd. (EIU) is currently predicting growth in global gross domestic product (GDP) for 2015 of 2.9 percent, the same figure as it was predicting at 31 December 2014. Actual GDP growth in 2014 was 2.5 percent. The EIU is forecasting an increase in global industrial production (IP) in 2015 of 2.8 percent, compared with the actual increase in 2014 of 2.6 percent.

The high level of sovereign debt in major economies is expected to continue to have the greatest impact on macroeconomic trends. Other factors which might adversely affect the global economy are currency fluctuations, high unemployment in many industrialised countries and the uncertain political situation in some regions of the world.

Linde assumes that it will be able to continue to deliver a relatively steady business performance and confirms its outlook for the current year. Depending on economic trends and exchange rate movements, Linde expects to achieve Group revenue of between EUR 18.2 bn and EUR 19.0 bn in the 2015 financial year. It anticipates that it will achieve an increase in Group operating profit (after adjusting for non-recurring items) in 2015 to between EUR 4.1 bn and EUR 4.3 bn. The non-recurring items relate to costs recognised for structural and organisational measures designed to enhance efficiency.

Linde is seeking to achieve a return on capital employed (ROCE) of between 9 percent and 10 percent in the 2015 financial year.

If the economy were to see stronger growth this year, especially in the growth regions, than is being forecast at the date of completion of this report, this might result in the performance indicators described above turning out better than Linde is currently expecting.

N. B.: The Group’s medium-term targets continue to apply. A detailed description of these targets is given in the section of the Financial Report 2014 entitled Targets and strategy of the Linde Group.

Outlook – Gases Division

Recent economic forecasts indicate that the global economy will grow at a slightly faster pace in 2015 than was the case in 2014. However, considering the geopolitical crises in some areas of the world, Linde expects parts of the gases market to be volatile. The Group remains committed to its target in the gases business of outperforming the market and continuing to increase productivity.

Linde’s on-site project pipeline will make a contribution to revenue and earnings in the 2015 financial year and an even more significant contribution to revenue and earnings in subsequent years. The Group is forecasting that its liquefied gases and cylinder gas product areas will perform in line with macroeconomic trends. In the Healthcare product area, stable business trends are expected.

Depending on sector-specific trends and exchange rate movements, Linde is seeking to achieve the following targets in the Gases Division in the 2015 financial year: revenue of between EUR 14.9 bn and EUR 15.4 bn and operating profit of between EUR 4.05 bn and EUR 4.25 bn. The margins which are achieved in 2015 in the EMEA, Asia/Pacific and Americas segments are expected to be around the same as those actually achieved in 2014.

Outlook – Engineering Division

It is anticipated that the market environment in the international large-scale plant construction business will be much more volatile in 2015 than in previous years. Nevertheless, the Group is well-positioned in the olefin plant, natural gas plant, air separation plant and hydrogen and synthesis gas plant product areas and also has a high order backlog.

Linde assumes that it will be able to generate revenue in the Engineering Division in the 2015 financial year of between EUR 3.0 bn and EUR 3.3 bn, with an operating margin of around 8 percent.