Air Products' Q3 op income up on record sales

26 July 2006 16:06  [Source: ICIS news]

HOUSTON (ICIS news)--Air Products said on Wednesday that its fiscal third-quarter operating income rose to $298m (€236m) on record sales, compared with $262m for the same period of 2005.

Net income for the period ended 30 June rose 10% to $210m, compared with $190m for the fiscal third period of 2005. Sales jumped to $2.3bn from $2.0bn.

Allentown, Pennsylvania-based Air Products said gases sales were up 14% at $1.69bn, pushing operating income up 19% to $241m for that business. The company noted that it brought five hydrogen plants on stream in fiscal 2006.

"Electronics gases and specialty materials continued to grow, with solid demand from semiconductor and flat panel markets. The global merchant gas business also saw volume growth in all regions of the world with improved recovery of energy costs in North America," it said.

Air Products' chemicals segment sales of $480m were flat with the prior year, as better pricing offset weaker volumes. Chemicals operating income of $42m was down 10% on lower volumes, principally due to the loss of two polyurethane intermediates customers.

The company raised its full-year earnings estimate to $3.49-3.53/share, an 18-20% improvement over the prior year, excluding any impact from its ongoing chemicals portfolio and business simplification actions.

JPMorgan said the company's results include $9.1m of insurance payments for damages to a New Orleans, Louisiana plant from Hurricane Katrina.

Bank of America said although Air Products' chemicals margins were flat, the 8.7% improvement in operating margin was better than the 7% expected.

By: Patrick Crow
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