Capitolo 6. APPENDICE
6.1. I report di Cheuvreux Credit Agricole Group
o ASML (9 febbraio 2012) o AXA (11 aprile 2012) o BASF (26 gennaio 2012) o BMW (30 gennaio 2012) o DAIMLER (4 settembre 2012)
o DEUTSCHE TELEKOM (2 maggio 2012) o ING GROUP (27 gennaio 2012) o NOKIA (23 aprile 2012) o VIVENDI (3 dicembre 2012) 6.2 I report di Societe Generale
o AIRLIQUIDE (11 settembre 2013) o ANHEUSER (25 novembre 2013) o BNP PARIBAS (4 giugno 2013) o ENGIE (9 agosto 2013) o ESSILOR (3 luglio 2013) 6.3 Specificazione Tabella 4 2012
Nuovi business o vecchi business più sostenibili
- DAIMLER (4 Aprile 2012 – Trefis)
- SAINT GOBAIN (19 Marzo 2012 – Liberum Capital)
- SCHNEIDER ELECTRIC (29 Febbraio 2012 – J.P. Morgan Cazenove) - SCHNEIDER ELECTRIC (23 Marzo 2012 – Societe Generale) Creazione di valore durevole
- AIR LIQUIDE (10 Febbraio 2012 – HSBC)
- AIR LIQUIDE (27 Marzo 2012 – J.P. Morgan Cazenove) - DAIMLER (16 Aprile 2012 – Trefis)
- DANONE (11 Giugno 2012 – Natixis) - VOLKSWAGEN (2 Ottobre 2012 – Natixis) Riduzione rischio ambientale
- CARREFOUR (Aprile 2012 – Canadean) - ENI (13 Febbraio 2012 – Natixis)
- IBERDROLA (29 Marzo 2012 – Societe Generale) - SIEMENS (18 Giugno 2012 – Kepler Research) - SIEMENS (10 Settembre 2012 – Credit Suisse) - TOTAL (5 Marzo 2012 – Natixis)
- TOTAL (30 Novembre 2012 – European Equity Research) - VINCI (1 Agosto 2012 – Raymond James)
- ANHEUSER BUSH INBEV (1 Giugno 2012 – Societe Generale) - BMW (20 Marzo 2012 – Barclays)
- SAFRAN (9 Luglio 2012 – ESN)
- UNIBAIL RODAMCO (25 Luglio 2012 – ESN) 2013
Nuovi business o vecchi business più sostenibili - BMW (22 ottobre 2013 – Redburn Europe Limited) - AIRBUS (18 gennaio – Morgan Stanley Research) - CARREFOUR (agosto 2013 – Canadean)
- CARREFOUR (settembre 2013 – Canadean) - ENGIE (8 aprile 2013 – ESN)
- PHILIPS (9 settembre 2013 – Kepler Chevreux) - SAINT GOBAIN (28 novembre 2013 – Natixis)
Creazione di valore durevole
- IBERDROLA (28 ottobre 2013 – Macquarie Research) - BASF (4 giugno 2013 – J.P.M Cazenove)
Riduzione rischio reputazione - AXA (27 giugno 2013 – ESN)
- BANCO SANTANDER (23 gennaio 2013 – Business Monitor International) - BMW (15 marzo 2013 – Warburg Research)
- DAIMLER (19 novembre 2013 – Morningstar Corporate Credit Research)
Riduzione rischio ambientale
- DAIMLER (29 luglio 2013 – Macquarie Equity Research) - DAIMLER (10 ottobre – Morgan Stanley Research) - ENI (23 maggio 2013 – Natixis)
- E.ON (9 settembre 2013 – HSBC Global Research)
- ENGIE (9 agosto 2013 – Societe Generale)
6.4 report esclusi dalla Tabella 4 2012
- SIEMENS (6 Febbraio 2012 – RBC Capital Markets) - TOTAL (2 Aprile 2012 – Morgan Stanley)
- NOKIA (24 Febbraio 2012 – Natixis)
2013
- ENI (European Equity Research)
6.5 report che considerano le normative
- E.ON (9 settembre 2013 – HSBC Global Research) - ENGIE (9 agosto 2013 – Societe Generale
Vedere paragrafo 6.5: report che considerano le normative
12 October 2012 FRANCE Air Liquide
Environmental, Social & Governance Issues
From industrial gas leadership to social stewardship in home healthcare diversification
HIGHLIGHTS
Air Liquide issued in October 2012 an innovative EUR 500m bond whose main sustainability characteristic is to focus investors' attention on the potential development of its Home Healthcare business while providing further transparency on that division.
The group shares with its peer LINDE the same growth strategy in the Healthcare (homecare) area which represent less than 10% of the group revenues with EBITDA-margins ~28% at least in-line with industrial gases segment margins. Risks, in the segment, are tariff reduction, potential decline of public subsidies as well as increased liability risk while broadening the geographic footprint, although the latter appears to be been well managed so far.
We see limited risk arising from the extension of the carbon regulation in Europe to hydrogen production sites, estimating that costs will be limited to a small single digit m USD but no cheap option for significant emissions cuts.
The group energy efficiency target for 2015 may be too ambitious in our view since it strives to achieve a less committing reduction during the recent years but Air Liquide is however back on a positive trend with regards to energy management at its main business lines.
Green businesses in clean energy or fuels represent in our view up to 30% of the group sales and a EUR 500m capex plan in 2012 but the emergence of powerful new competitors from emerging regions (China) is a threat.
Limited track record on ethics' failures but within the perspective of accelerated growth developments in Mexico, Russia and other emerging markets we highlight the lack of a strong and publicly declared policy to further mitigate the significant risks the company faces.
Note the so-called group Efficiency program is targeting an annual gross cost savings of >EUR200m p.a. that might include some selective restructuring measures. However, we lack figures on the potential labour impact.
The group has a track record in issuing innovative ESG bonds… in 2006 Air Liquide issued so-called Breton bonds (a form of poison pill) to make a takeover bid more difficult. Since that date CEO and chairman roles have been combined, leading to some reservations about the potential for concentration of power at the top of the company, despite a majority of independent board members.
CORPORATE GOVERNANCE DETAILS
1. Does the company have a combined chair/CEO? Yes
2. Percent Independent Directors 83%
3. Does the company disclose its corporate governance policies or guidelines? Yes
4. Do all executive board members own shares after excluding options held? ND
5. Is the company currently under investigation for accounting irregularities? No
6. Do all common or ordinary equity shares have one-share, one-vote, with no restrictions? Yes
7. Do shareholders have a right to convene an EGM with 10% or less of the shares requesting one? Yes
8. Do shareowners have a right to act in concert through written communication? No
9. Potential Dilution from Stock Options Outstanding + Not Yet Granted Under Old or New Plans 1.6%
10. Is there a single shareholder or shareholder group which controls a majority of the voting power of the No
company?
11. Has the company adopted a shareholder rights plan ("poison pill")? yes 6.1 I report di Cheuvreux Credit Agricole Group
12 October 2012 FRANCE Air Liquide
12. Disclosure on CEO remuneration details (amount detailed if disclosed) EUR 2.69m
Source: GMI , Cheuvreux
CORPORATE GOVERNANCE ANALYSIS
Since 2006 the roles of chairman and CEO have been combined at the top of the company and held by Benoit Potier. However, while we have reservations about the potential for concentration of power at the top of the company. We generally consider the board to be majority independent and we do not believe the Chairman & CEO or any other outside shareholder has an undue influence over the board.
Remuneration disclosure includes individual components such as salary, bonus and benefits for key executives. The capital is entirely free float, of which 37% belongs to individual shareholders and about 50% institutional investors. We remind that the group issued in 2003 so-called Breton bonds (a form of poison pill) in 2006 to make a takeover bid more difficult. There is no evidence of a poison pill that could be used to diminish the rights of minority shareholder in the event of a change in control. We note that in previous years the board sought approval from shareholders for authority to issue warrants that could be issued into shares (with a discounted price) thereby inflating the purchase price. However, this authority was not sought at the last AGM held in 2012.
12 October 2012 FRANCE Air Liquide
E&S ISSUES FOR THE CHEMICALS SECTOR
1 Carbon Impact & Footprint and Climate Change Strategy
Analysis for Air Liquide
Air Liquide's operations emitted 20.5 mtCO2e in 2011, mostly due to direct CO2 emissions from hydrogen production (5.2mtCO2e) and cogeneration (4.7mtCO2e) units and indirect emissions related to the large amounts of electricity consumed in air separation units (~10mtCO2e)
Limited risk arising from the extension of the carbon regulation in Europe to hydrogen production sites, in our view : AL's cogeneration units in Europe have already been regulated under the EU ETS and the scheme will start
covering all AL's hydrogen production units in Europe from 2013 onwards. We see limited risk for CO2 costs to arise as hydrogen production has been deemed eligible by the regulator for receiving 100% free CO2 right up to a benchmark level set at 8.85 tCO2 / t of hydrogen. Although several technicalities prevent from comparing directly the two figures, AL states that the carbon content of a sample of its European hydrogen production units is at 8.71 tCO2 / t. The technical limit for the CO2-intensity of a hydrogen production unit using steam methane reforming (SMR) process was estimated by Praxair at 8.3 tCO2 / t . Ca. 11% of AL's direct emissions are located in California where a CO2 cap & trade system will be launched in 2013. We estimate that costs will be limited to a small single digit m USD.
No cheap option for significant emissions cuts
AL has set itself the objective to improve by at least 2% between 2011 and 2015 the energy efficiency of each of its activities : air separation units, hydrogen units, and product deliveries.
Between 2007 and 2011 the improvement was respectively of 1%, 1.5% and 2.9%. These objectives might look little ambitious but th emargin for improvement is relatively limited if we consider that most of AL's emissions come from process emissions (chemical reaction
AL's hydrogen production sites use steam methane reforming processes. This technology is more cost competitive than electrolysis and is now used for 95% of hydrogen production globally. Switching to electrolysis process could prove more carbon-intensive, unless the electricity is sourced from low-carbon power producers. A study led by Praxair showed that a large unit using electrolyser is 3x+ CO2-inetnsive than SMR units.
Carbon capture & storage technology can be applied to hydrogen production units but would require a CO2 price of USD40-50/t to incentivise investments, according to Praxair. Applications are likely to remain limited to demo projects hence on the mid term (e.g. RD Shell's Quest project in Alberta).
Overall, we believe 2011 confirmed that AL is back on a positive trend with regards to energy management at its main business lines, after the negative impact seen in 2008-09 due to the economic slowdown forcing suboptimal utilisation rates at its air separation units.
PS : note that REACH is a limited issue in industrial gaz compared with other Chemicals; less than 6% of Air Liquide business is exposed to this EU regulation.
12 October 2012 FRANCE Air Liquide
2 Product Stewardship and commitment to Green technologies.
Analysis for Air Liquide
We estimate that the group generates 30% of revenues in so called 'Green Sales.
The company's products enhance industrial efficiency (energy efficiency) through gas usage optimisation and process optimisation. Company also is a supplier to the solar industry (gas supplier to solar panel and thin film manufacturers). In Solar the group is a leader with 50% market share in crystalline and 40% in thinfilm technology.
In the current context of growing concern about environmental issues, clean energy technologies are a real growth driver for industrial gas players. Gases such as oxygen or hydrogen can be used with coal or natural gas to produce clean energy or fuels, and to reduce greenhouse gases emission. The capture and storage of CO2 offer new opportunities. Energy and environment are an important growth driver for all industrial gas players. According to Air Liquide's assumptions, this market is expected to be EUR30bn by 2020. The green technologies on which AL is working are CCS (O2 for clean conversion), energy efficiency, solar cells (use of silane & specialty gases differentiation), the 2nd and 3rd generation of biofuels through its subsidiary Lurgi (H2 and O2 for hydroprocessing, pyrolysis and gasification), hydrogen energy (H2 prod from renewables, fuel cell vehicles), hydrocracking and desulphurization in a refinery, fossil clean power production.
The Green tech Competitors of Air Liquide are : Linde, Praxair, Air Products, Airgas, Yingde Gases, Messer
3 Business Ethics is a stronger driver than ever in impacting both company reputations and valuations
Analysis for Air Liquide
Limited track record on Ethics' failures
Though Air Liquide faced allegations (together with over 90 other companies) through to 2005 in the Iraq UN Oil for Food programme for a subsidiary which signed contracts in 2001 , no prosecutions were brought and the company rigorously denied the claims.
But still limited implementation of ethical procedures and no zero tolerance policy.
The company whistle blowing system is both internal and does not allow for anonymity, which can compromise the willingness of employees and other stakeholders to utilise it - we would red flag this as a potential limitation in implementing a strong set of Business Ethics systems for a company as geographically diversified as Air Liquide in this sector. Further information would be welcomed on how the Code of Ethics is integrated into subsidiaries (where corruption risk is generally greater) , as Air Liquide has been acquisitive. The company declared that at the end of 2010, 71% of the Group's employees belonged to subsidiaries that have a local Code of conduct.
Air Liquide states there has been an anti-corruption training program since 2010 - which is a strong step forward. It is aimed at sales and purchasing teams as well as managers, and is being gradually rolled out throughout the Group - further statistics on its uptake would help us to assess it how embedded it is in company operations.
In 2012 the company highlighted new contracts in Mexico, and new production units in Russia, expansion in South Africa, robust growth in the Middle East- Africa region and chemicals investments (Hydrogen) in China - these are all pointers of corruption exposure geographically. In this light we would welcome a publicly declared policy against facilitation payments to further mitigate the significant risks the company faces.
12 October 2012 FRANCE Air Liquide
4 Social Stewardship & Engagement in Healthcare Business
Analysis for Air Liquide
Developing Home Healthcare services.
Air Liquide has become a major provider of oxygen, respiratory and other chronic therapy services to patients in their home. Homecare is a preferred growth segment in Healthcare, which is less affected by budget cuts compared to Hospitalcare. The group shares with its peer LINDE the same growth strategy in the Healthcare (homecare) area and both are looking to broaden the geographic footprint. LINDE being more exposed to the US carries more liability risk
(prosecution and legal cost, class actions…) in our view.
In our view the Home Healthcare strategic development fits well AI's profitable growth strategy (organic growth & selective bolt-on acquisitions) and further strengthens the company's leading position in the Healthcare area. Homecare is widely seen as a stable growth market within Healthcare and EBITDA-margins ~28% are at least in-line with AI's industrial gases segment margins.
Recent acquisitions
Gasmedi earnings margins are indeed above Air Liquide's Group average. Based on the indicated EV of EUR330m the deal multiple based on EV/EBITDA is around 7x, which does not look too expensive for this kind of acquisition (Lincare 9.6x). By increasing global patient density, Gasmedi's management know-how, global purchasing and Air Liquide's innovation skills, there will be costs and sales synergies from this deal, which will be more than offsetting the usual pricing pressure in the Healthcare market.
The ranking in the Spanish Homecare market pre acquisition was Linde #1, Praxair #2, Gasmedi #3 and Air Liquide #4, which explains why it was not possible to acquire number 1 and 2. This deal made Air Liquide #1 in this market segment in Spain.
The acquisition of the French homecare business of LVL Médical, which accounted for revenues of EUR104m and an EBITDA of EUR29m (EBITDA-margin 28%) in FY-11. The enterprise value of the target was set at EUR316m which was in our view a reasonable deal, fitting to AI's profitable growth strategy.
ASML (9 febbraio 2012)
Environmental, Social & Governance Issues
The need to advance lithography technology provides both energy efficiency and financial opportunities
„ HIGHLIGHTS
ASML is well positioned to benefit from the introduction of next-generation lithography, EUV, which is required to keep the chip industry on Moore's Law and is also set to reduce the energy use of ASML's customers.
Positive evolution of ASML's products energy use over the last few years. ASML operates a flexible labour model, with over 25% of temporary employees.
The company has in place cross-licensing agreements for their patent portfolios (excl. EUV and software) with Zeiss, Nikon and Canon (no infringement suits till 12/2014).
The quality and speed of R&D has been a crucial success factor for ASML whose R&D spend is 4 times that of no. 2 Nikon.
A takeover director is in place which could be used as a poison pill to potentially diminish the rights of minorities in the event of a change in control.
„ CORPORATE GOVERNANCE DETAILS
1. Does the company have a combined chair/CEO? No
2. Percent Independent Directors 100.00%
3. Does the company disclose its corporate governance policies or guidelines? Yes 4. Do all executive board members own shares after excluding options held? ND 5. Is the company currently under investigation for accounting irregularities? No 6. Do all common or ordinary equity shares have one-share, one-vote, with no restrictions? Yes 7. Do shareholders have a right to convene an EGM with 10% or less of the shares requesting one? Yes 8. Do shareowners have a right to act in concert through written communication? ND 9. Potential Dilution from Stock Options Outstanding + Not Yet Granted Under Old or New Plans 0.00% 10. Is there a single shareholder or shareholder group which controls a majority of the voting power of the No company?
11. Has the company adopted a shareholder rights plan ("poison pill")? Yes 12. Disclosure on CEO remuneration details (amount detailed if disclosed) Yes
Source: GMI
CORPORATE GOVERNANCE ANALYSIS
ASML shares have been listed on both Euronext Amsterdam and NASDAQ in the US since 1995. The company is subject to the Dutch Corporate Governance Code as well as the US Sarbanes-Oxley Act of 2002 and US SEC regulations. The board is comprised wholly of independent directors and there is no evidence that any large shareholder has undue influence.
Individual components of remuneration are disclosed for key executive directors and there is evidence that management incentives are aligned with shareholders via the use of long-term performance-based share awards.The company has a Takeover Directive in place that provides the Board of Management with the power to issue shares if and to the extent the Board of Management has been authorised to do so by the AGM, with approval required by the
preference share option in situations where, in the opinion of the Board of Directors of the Foundation, the interests of ASML, its business or the interests of its stakeholders are at stake. This may be the case if a public bid has been announced/made, or the justified expectation exists that such a bid will be made without any upfront agreement with ASML. The same may apply if a shareholder, or more than one shareholder acting in concert, holds a substantial % of the issued capital without making an offer, or if, in the opinion of the Board of Directors of the Foundation, the (attempted) exercise of the voting rights is materially in conflict with the interests of the company, its business, or its stakeholders.
The object of the Foundation is to look after the interests of ASML in such way that the interests of ASML and its partners are safeguarded in the best possible way and conflicts of interest are prevented. The preference share option gives the Foundation the right to acquire a number of cumulative preference shares with the effect of dilution of voting power of outstanding ordinary shares by up to one half.
„ E&S ISSUES FOR THE SEMICONDUCTORS SECTOR
1 Products: How energy efficient are the company's designs and products, and does the company
have exposure to eco-efficient applications -- use in smart grid, green buildings, cleantech, etc.?
Analysis for ASML
The green effect of Moore's Law. The trend towards the miniaturisation of semiconductors reduces cost,
size, and power consumption per function on a chip. As a technology leader in lithography systems and software, enjoying a 2011E market share of over 82% in value terms, ASML consequently plays a significant role in improving the energy and material efficiency of electronics. The company targets improving energy efficiency of chips through shrinkage of 20% per year.
Positive evolution of products energy use. ASML reported an improvement in the energy consumption of its
products over the past three years. Its "customer energy use" indicator (measured in nWh per Bit), which aims at assessing the amount of energy ASML's customers use to produce one NAND of memory cells, fell from 71 in 2008 to 31 in 2010 with targets set to reach 25 by 2011 and 10 by 2015. Moreover, ASML estimates that one of its customers' power consumption of 1 GB DRAM (Watt) dropped to 0.8 in 2010 from 1.6 in 2008, and forecasts that it will reach 0.2 Watt/GB by 2015.
EUV: an opportunity from both an environmental and financial prospective. The continuation of Moore's
Law requires the introduction of next-generation lithography, named EUV. It should be noted that the EUV technology also enables greater energy savings. ASML predicts that the introduction of their EUV tool for high- volume production, the NXE:3300B, a volume production tool priced at EUR70m and up (depending on the amount of accessories) and which is scheduled to start shipping in summer 2012, will have positive impacts on the energy consumption of its customers compared to creating structures with another production strategy (spacers). ASML stresses that one single EUV exposure requires relatively less energy than producing the