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PRESS RELEASE: First six months of 2010: Linde continues upward trend and expects operating profit to exceed record year 2008

Linde AG /
First six months of 2010: Linde continues upward trend and expects operating
profit to exceed record year 2008
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  * Group sales up 11.5 percent to EUR 6.104 bn
  * 26.4 percent growth in Group operating profit* to EUR 1.396 bn outpaces
    increase in sales
  * Significant improvement in Group operating margin of 270 basis points to
    22.9 percent
  * Increase in earnings per share to EUR 2.63 (2009: EUR 1.47)
  * Group outlook for 2010 reaffirmed:
    Growth in sales expected, with operating profit increasing at a faster rate
    than sales
    Group operating profit expected to exceed record year 2008 

Munich, 2 August 2010 - Capitalising on the general economic upturn, the
technology group The Linde Group has continued the positive trend seen in the
first quarter into Q2. In the first half of 2010, the Group achieved significant
growth in sales and operating profit. "The upward trend is continuing. In the
course of the second quarter, we have increasingly seen a rise in demand
worldwide," said Professor Dr Wolfgang Reitzle, Chief Executive Officer of Linde
AG. "Once again we have improved our profitability and we look with confidence
to the months ahead. We reaffirm our objective, which is to reach a higher level
of Group sales and Group operating profit in the 2010 financial year than in
2009. We are well on the way to achieving a faster rate of growth in Group
operating profit than in Group sales and exceeding the Group operating profit of
record year 2008." 

In the six months to 30 June 2010, Group sales rose 11.5 percent to EUR 6.104 bn
(2009: EUR 5.476 bn). After adjusting for exchange rate effects, the increase in
sales was 5.8 percent. Linde achieved a 26.4 percent improvement in Group
operating profit* to EUR 1.396 bn (2009: EUR 1.104 bn). The growth in operating
profit again outpaced the increase in sales. The Group operating margin was
22.9 percent, 270 basis points above the figure for the prior-year period of
20.2 percent. If an adjustment is made for the one-off restructuring costs of
EUR 67 m recognised in 2009, the rise in the operating margin is 150 basis
points. This positive performance is also evidence of the successful and
rigorous implementation of HPO (High Performance Organisation), Linde's
integrated concept for sustainable process optimisation and increased
productivity. 

Earnings before taxes on income (EBT) reached EUR 646 m, a significant 77.0
percent improvement on the figure for the six months to 30 June 2009 of EUR 365
m. Earnings after tax rose in the first half of the year by 76.3 percent to EUR
483 m (2009: EUR 274 m). Earnings attributable to Linde AG shareholders were EUR
445 m (2009: EUR 248 m). Earnings per share improved as a result by 78.9 percent
to EUR 2.63 (2009: EUR 1.47). On an adjusted basis, i.e. after adjusting for the
effect of the purchase price allocation in the course of the BOC acquisition,
earnings per share stood at EUR 3.15 (2009: EUR 2.06). 

Gases Division
The market recovery in the international gases industry gathered pace in the
second quarter of 2010 as a result of the improvement in the general economic
situation. Linde benefited from this positive trend, given the Group's global
footprint and strong position in emerging markets in particular. 

Linde achieved a 13.4 percent increase in sales in the Gases Division in the
first half of 2010 to EUR 4.931 bn (2009: EUR 4.350 bn). On a comparable basis,
i.e. after adjusting for exchange rate effects, changes in the price of natural
gas and changes to Group structure, sales rose by 5.6 percent. Business trends
from quarter to quarter confirm that the recovery in the general economy is
stabilising. After achieving growth of 3.9 percent on a comparable basis in the
first quarter of 2010, Linde's gases business saw a 7.1 percent increase in
sales in the second quarter of 2010. 

Operating profit rose by 17.5 percent in the six months to 30 June 2010 to EUR
1.337 bn (2009: EUR 1.138 bn). The operating margin in the Gases Division
improved as a result by 90 basis points to 27.1 percent (2009: 26.2 percent).
This increase in profitability is mainly due to the positive impact of HPO. 

The business trends in the operating segments of the Gases Division reflect
regional variations in the pace of economic recovery. In the second quarter of
2010, the highest growth rates were to be seen in Asia, especially in the
Greater China region. In the more mature markets, such as the United States and
Western Europe, demand also continued to rise. However, the upturn here is
proceeding still at a relatively modest pace. 

In the Western Europe operating segment, Linde achieved sales growth of 7.0
percent in the first half of 2010 to EUR 1.979 bn (2009: EUR 1.849 bn). On a
comparable basis, the increase in sales was 4.0 percent. Operating profit rose
significantly as a result of process and cost optimisation measures by 13.0
percent to EUR 572 m (2009: EUR 506 m). This had the effect of improving the
operating margin in this region by 150 basis points to 28.9 percent (2009: 27.4
percent). 

In the Americas operating segment, Linde achieved sales in the first six months
of 2010 of EUR 1.095 bn, an increase of 10.3 percent when compared with the
figure for the prior-year period of EUR 993 m. On a comparable basis, sales rose
7.2 percent. Operating profit was up 18.1 percent, from EUR 210 m in the first
half of 2009 to EUR 248 m in the first half of 2010. The operating margin was
22.6 percent, significantly higher than the figure for the prior-year period of
21.1 percent. Here, the positive impact of numerous cost reduction and
productivity improvement measures more than offset the adverse pass-through
effect of higher natural gas prices. 

Powered by the structural growth dynamic of the emerging markets, Linde achieved
a significant increase in sales in the Asia & Eastern Europe operating segment
in the six months to 30 June 2010 of 21.6 percent to EUR 1.066 bn (2009: EUR
877 m). On a comparable basis, sales rose 12.7 percent. Operating profit also
improved considerably, by 21.4 percent to EUR 323 m (2009: EUR 266 m). The
operating margin remained steady, reaching the same high level as in the first
half of 2009 of 30.3 percent. To ensure that this strong profitability is
maintained, Linde is continuing the rigorous implementation of its ongoing
process and cost optimisation measures. 

In the South Pacific & Africa operating segment, Linde achieved sales in the
first six months of 2010 of EUR 833 m. This is an increase of 25.1 percent
compared with the figure for the first half of 2009 of EUR 666 m. The positive
impact of the exchange rates for the Australian dollar and the South African
rand should be taken into account here. On a comparable basis, sales were at the
same level as for the prior-year period. Operating profit, which was also
boosted by exchange rate effects, rose 24.4 percent to EUR 194 m (2009: EUR 156
m). The operating margin achieved was 23.3 percent (2009: 23.4 percent). 

Business performance in the individual product areas confirms the upward trend
in the Gases Division. In the first half of 2010, sales in the on-site business,
where Linde supplies industrial gases from plants situated directly on the
customer's site, increased on a comparable basis by 11.8 percent to EUR 1.182 bn
(2009: EUR 1.057 bn). In its bulk business, Linde achieved a 7.6 percent rise in
sales on a comparable basis to EUR 1.203 bn (2009: EUR 1.118 bn). The cylinder
gases business recovered during the second quarter. Linde was able to increase
sales in this product area in the six months to 30 June 2010 on a comparable
basis by 1.7 percent to EUR 1.999 bn (2009: EUR 1.966 bn). The Healthcare or
medical gases product area continued its steady progress in the first six months
of 2010, achieving 3.2 percent growth in sales on a comparable basis to EUR 547
m (2009: EUR 530 m). 

Gases Division - Outlook
Linde's original target for the gases business still applies. The Group wants to
outperform the market and continue to increase productivity. In its on-site
business, Linde has a well-filled project pipeline, which will make a
particularly significant contribution in the 2010 financial year to sales and
earnings growth targets. The liquefied and cylinder gases business should
benefit from the forecast general economic recovery. In the Healthcare product
area, Linde expects to continue to deliver steady growth. 

Against this background and given its good business performance in the first six
months of the year, Linde continues to assume that it will achieve an increase
in sales and earnings in the Gases Division in the full year 2010. The Group
still expects to exceed the record operating profit of EUR 2.417 bn achieved in
2008. 

Engineering Division
The market environment in the international plant construction business was
characterised in the first six months of 2010 by a slight increase in demand. In
the four major product segments (olefin plants, natural gas plants, air
separation plants, hydrogen and synthesis gas plants), there are growing signs
of a revival in capital spending. Against this background, the Engineering
Division achieved an order intake of EUR 962 m in the first half of 2010 (2009:
EUR 1.299 bn), winning a number of small and medium-sized projects. In contrast,
the high figure for the prior-year period was mainly the result of one major
contract in Abu Dhabi worth USD 1.075 bn. 

Sales in the Engineering Division in the six months to 30 June 2010 were EUR
1.095 bn, almost the same as the figure for the prior-year period of EUR 1.113

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