Access the Q1 earnings teleconference scheduled for 10:00 a.m. Eastern Time on January 22 by calling
Highlights
— Sales declined one percent versus prior year, up two percent sequentially
— Operating margins improved to 15.9%
— Earnings per share up 20%*
— Raising Full Year Guidance to $4.75 to $4.95
Air Products today reported net income of $252 million, or diluted earnings per share (EPS) of $1.16, for its fiscal first quarter ended December 31, 2020 versus $69 million and $0.32 for the fiscal first quarter of 2009.
The discussion of first quarter results in this release is based on non-GAAP comparisons due to last year’s restructuring charge. A reconciliation can be found at the end of this release.*
First quarter revenues of $2,174 million declined one percent as lower energy and raw material cost pass-throughs offset higher volumes and favorable currency. Operating income of $345 million was up 20 percent from the prior year on improved volumes in Tonnage Gases, and Electronics and Performance Materials; broad productivity gains across the company; and favorable currency impacts. Sequentially, sales improved two percent while operating income gained five percent.
John McGlade, chairman, president and chief executive officer, said, “We are off to a good start in fiscal 2010. Our earnings per share grew 20% and we continued our margin improvement putting us on track to meet our 17% goal in 2011. Both our sequential and year-over-year results benefited from an improving global economy and our efforts to move Air Products to a sustainable, lower cost structure.”
First Quarter Segment Performance
— Merchant Gases sales of $934 million increased one percent as favorable currency was mostly offset by lower volumes. Operating income of $190 million increased 11 percent from the prior year, as significantly improved cost performance and favorable currency more than offset weaker volumes. Operating margin exceeded 20%. Underlying trends continue to improve globally, as volumes were higher in Asia. Comparisons in the U.S. and Europe continued to be difficult due to the weak manufacturing environment in both regions.
— Tonnage Gases sales of $698 million were down six percent as significantly lower energy and raw material cost pass-throughs more than offset higher volumes. Sales volumes were up due to rebounding chemical and steel production and new plant onstreams. Operating income of $100 million decreased eight percent from the prior year primarily on higher planned maintenance costs.
— Electronics and Performance Materials sales of $433 million increased 7 percent as higher volumes and favorable currency more than offset price declines. Operating income of $48 million increased 97 percent from the prior year on improved volumes and productivity.
— Equipment and Energy sales of $109 million were down 9 percent on lower sales activity. Operating income of $8 million increased 11 percent from the prior year on lower development spending.
Outlook
Looking ahead, McGlade said, “We believe we will see continued earnings growth throughout 2010 as the global economy, led by Asia, continues its gradual recovery, and as we drive further cost reductions. We also had a significant number of new business signings in the first quarter and are very excited by the opportunities we see for growth beyond 2010.”
Air Products is raising its guidance for fiscal 2010 to $4.75 to $4.95 per share. The company also expects second quarter EPS from continuing operations to be between $1.15 and $1.20 per share.
Annual Meeting of Shareholders
Air Products will host its Annual Meeting of Shareholders on Thursday, January 28, 2020 at 2:00 p.m. ET. Access the audio Webcast at: www.airproducts.com/Invest/shareholdersvcs/annualmeeting_materials.htm.
Air Products (NYSE:APD) serves customers in industrial, energy, technology and healthcare markets worldwide with a unique portfolio of atmospheric gases, process and specialty gases, performance materials, and equipment and services. Founded in 1940, Air Products has built leading positions in key growth markets such as semiconductor materials, refinery hydrogen, home healthcare services, natural gas liquefaction, and advanced coatings and adhesives. The company is recognized for its innovative culture, operational excellence and commitment to safety and the environment. In fiscal 2009, Air Products had revenues of $8.3 billion, operations in over 40 countries, and 18,900 employees around the globe. For more information, visit www.airproducts.com of reported GAAP results to non-GAAP measures.
Source: PR Newswire
