Germany's Linde, the world's number two industrial gases producer, forecast higher sales and earnings this year, helped by cost cuts and improving demand.

"The measures we have adopted to achieve sustainable efficiency improvements will continue to have an effect," Chief Executive Wolfgang Reitzle told reporters.

Air Liquide, the world's number one, said last month it expected further profit growth this year after a slight rise in 2009 as its markets gradually recover while it cuts costs and debt.

Linde last year launched a four-year programme to cut €650-800 million in costs by the end of 2012, mainly in information technology and purchasing. Linde supplies the steel and chemicals sectors, with other industrial gases used to process solar cells, make LCD flat screens, snap-freeze food, put fizz in drinks and power gas barbecues and patio heaters.

The company said it aimed to improve sales and earnings again in 2011 provided an economic recovery strenghthens. Its 2010 operating profit goal for the gases division is to exceed the operating profit in 2008, it added.

It disclosed 2009 new order intake for its engineering division was €2.458 billion, down from €3.057 billion in 2008 amidst a recession that forced customers to delay new projects.

Analysts have been keen to see the engineering order picture because its projects have a spill-over effect on the gases division, which generate around 70% of group sales.

Linde released its key 2009 results on March 4, with its operating margin a tad higher at 21.3% from 20.2% the year before despite a nearly 7% fall in operating profit, benefitting from more than €200 million in cost efficiency measures.