Linde has set itself the target of becoming the leading integrated gases and engineering company in the world. This means becoming the leading company not only in terms of its key financial figures, such as revenue and operating profit, but also in terms of its reputation in the market and with customers and all other stakeholders. Linde sees its role as providing its customers with high-quality products and services and offering sustainable value added, as well as serving those customers in the best way possible. In order to achieve this, it is constantly enhancing its proximity to customers, also by opening Application Centres. Linde also aims to create a unique selling point by offering innovative products and services, as well as showing in-depth knowledge of the customer’s industry. Linde’s growth is based on innovations that serve customers and help to boost productivity on the customer’s side. Linde is committed to behaving responsibly towards people and the environment and to conserving natural resources.
Measurable medium-term targets
Linde will continue to pursue a corporate strategy of sustainable earnings-based growth. Linde underpins its claim of being the leading gases and engineering company in the world with measurable targets.
Linde’s financial targets are summarised below:
Please see definitions of key figures in our Annual Report 2015 on page 46
*Dependent on economic development
**Dependent on economic development and based on forward exchange rates from time of communication in November 2015
Linde has also set itself a number of further targets. These targets focus in particular on further improvements in the area of safety and environmental protection and in the area of personnel development. Priorities are production-related safety and transport safety, increasing energy efficiency and reducing emissions, and diversity in the workforce.
Please find more information on non-financial target in our Corporate Resposibility Report.
Sustainable earnings-based growth
The strategy of the Group is geared towards sustainable, earnings-based growth. Using its integrated business model as a base, Linde is always working to achieve improvements in the Group’s performance and focusing on the expansion of the Group’s business activities. The resilience of the integrated business model has been proven in the past and offers numerous opportunities that the Company will continue to exploit in the future, too. The company wants to continue to strengthen its core business and to take best advantage of the synergies between its engineering business and gases business. The Group is committed to further expanding its strong customer focus and cooperating closely with its customers on a long-term basis, developing innovative gases applications which are tailor-made for its customers’ requirements and offer customers added value.
Linde is also keen to benefit disproportionately from the following growth areas:
Especially in China, Linde has a leading market position. The Group became involved here at an early stage, installing technologies which were relevant to those markets, thus gaining a competitive advantage. Linde intends to exploit these advantages and to stabilise and expand its revenue over the coming years.
With well in excess of one million healthcare customers worldwide, Linde is a leading gases companies in this field. Linde is leveraging the international platform to expand its respiratory therapies and clinical care services in a targeted manner. The Group has defined its strategy in the Healthcare segment as tapping into synergy effects, making further improvements to its sales and cost structures, increasing the patient density in existing markets and successfully launching new services such as telehealth services.
Another element of Linde’s strategy is to ensure that it benefits from long-term growth drivers in the global healthcare sector. The market is characterised by a growing, ageing population, an increase in chronic diseases such as asthma and COPD (chronic obstructive pulmonary disease), and a greater emphasis on patient care in settings other than hospitals. Rising prosperity especially in Asia is also generating ever-growing demand for healthcare.
High Performance Organisation
Linde continues to refine its processes on the basis of its HPO (High Performance Organisation) programme, a holistic concept designed to achieve sustainable efficiency gains.
The Group began to apply this programme in 2008 and is continuing to implement the measures defined therein. These activities are linked to measurable targets. Linde is seeking to achieve reductions in gross costs of EUR 750 m to EUR 900 m in the four-year period from 2013 to 2016. The Group sees potential above all in the supply chain for the cylinder gas and liquefied gases business as well as in the areas of procurement and IT. Linde intends to further develop the organisation of procurement in order to continue to achieve a lasting positive impact on costs and cash flow in future, and laid a key foundation stone in this respect in the year under review with a global procurement organisation. The focus is on both the spending and the process side of things. In addition to making structural changes, the Group will also continue to work on optimising its supplier portfolio and product range in order to reduce costs. The aim of these projects is to implement the structures which will ensure that procedures continue to be effective in future. Important factors in this context are cooperation across functional and organisational boundaries, standardisation and optimised processes. Moreover, Linde is implementing pricing initiatives to counteract rising costs in the volatile markets for energy and raw materials.
Sustainability is a vital component of the Group’s strategy. Linde combines long-term economic value added with environmental and social responsibility.
Linde wants to apply the fundamental principle of sustainability to an even greater extent to drive its business operations. The Group is constantly analysing how its products help its customers develop more sustainable processes: e.g. through increased energy efficiency or reduced emissions.