Air Products' Q3 profits hit by healthcare charges

23 July 2008 12:22  [Source: ICIS news]

LONDON (ICIS news)--Air Products’ fiscal third-quarter net income dropped to $70.1m (€44.5m) due to an impairment charge for its US healthcare business which it plans to sell, the company said on Wednesday.

Excluding the impairment charge of $237m after tax, income from continuing operations of $288m increased 16%, the US-based industrial gases company said in a statement.

Sales for the quarter ended 30 June were up 16% at $2.8bn on higher volumes in the merchant gases and electronics and performance materials segments, higher pricing in merchant gases, favourable currency, and higher natural gas cost pass-through, it said.

Operating income came in at $67.6m, compared with $352.4m year on year, the company said.

Excluding the US healthcare impairment charge, operating income of $382m rose 9%, it added. 

“Our businesses again delivered strong growth in a challenging economic environment,” said John McGlade, chairman, president and CEO.

“Our consistent operating performance reflects the actions we have taken to transform Air Products into a higher growth and less cyclical company under any economic scenario,” he added. 

McGlade said the company expected to continue to benefit from new business signings and the geographic diversity of its markets and portfolio of businesses.

“We are not, however, relying on growth and pricing alone. We will continue to focus relentlessly on driving productivity and reducing costs," he added.

The company said it anticipated fiscal fourth quarter year-on-year earnings growth of 19-23%.   

Air Products said on Tuesday that it was moving forward with the decision to sell its troubled US healthcare business.

The company said it planned to report the business unit as a discontinued operation beginning in the fiscal fourth quarter and would continue to operate and serve patients until the business was acquired by a new owner.

($1 = €0.63)

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By: Hilde Ovrebekk
+44 20 8652 3214

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