“Praxair is a very focused organisation,” Steve Angel begins, outlining the drivers behind the company’s record 2006 results. “We spend a lot of time on the business details, driving productivity, managing price, conducting rigorous capital decision evaluations and ensuring our projects come in on cost and on schedule. We are focused, disciplined and very execution oriented.”
Angel puts Praxair’s leading performance amongst the world’s top tier gas companies down to disciplined investment and focus on 11 key geographies. “As a result of that focus, we’ve been able to build strong market positions,” he explains. “We’ve got enough density to earn very high returns on our investment.”
Angel says the key to creating a good return is to ensure that “when we make an investment in an air separation unit (ASU) in any corner of the world, we optimise the use of all of the gas molecules, whether for chemicals, steel or for smaller end-users that need packaged gas (cylinder) quantities of gas. In the main, we think that when you operate an atmospheric gases business, the best structure is a localised structure, and we certainly think our results bear that out.”
There are a couple of exceptions, notably the electronics business and surface technology business. “These are technologies that have global applications and can be leveraged worldwide to global customers. In these businesses, we thought the best structure to address these markets was a global one.”
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