Latin American Business Report

OVERALL RESULTS 

Favored by the strong growth of the world economy, record high commodity prices, and healthy internal consumption, industrial gas company sales in Latin America grew at double digit rates in the first nine months of 2008. The financial crisis that began with the US sub-prime credit crunch, however, began to impact commodity prices worldwide in the second half of ’08 and resulted in full-blown recession in most developed countries by the end of the year. Markets in Latin America slowed with the recession, but did not decline as fast as other regional markets.

Praxair, the largest industrial gas company in the region, reported sales in South America of $1,501 million for the first nine months of 2008, a 29.9 percent growth over the previous year. Sales were driven by strong internal demand and high Industrial Production growth in on-site, merchant, and packaged gases segments. Favorable currency effects included in this figure contributed 15.6 percent. In the rest of South America, Praxair reported that sales grew more than 20 percent, excluding favorable currency effects. Operating profit was $302 for the first nine months of 2008, 33.6 percent better than in the same period of 2007. Praxair also reported that sales in their Mexican operations were up 22 percent over the previous year. Sales in Mexico were boosted by the new nitrogen Enhanced Oil Recovery (EOR) project start-up in that country as well as strong demand in general.

_{Favorable currency effects included in this figure contributed 15.6 percent. In the rest of South America, Praxair reported that sales grew more than 20 percent, excluding favorable currency effects.”}

Linde, which no longer reports its South American sales separately from its North American number, indicated that sales in the region were growing strongly.

Air Liquide reported that their Industrial Merchant business in the Americas was up 11.9 percent, with strong growth in South America, and that Healthcare sales increased 10.4 percent in the Americas, with strong demand and pricing in South America and the US.