WASHINGTON (dpa-AFX) - Industrial chemical and gas producer Air Products & Chemicals, Inc. (APD) reported Friday a profit for the first quarter that decreased from last year, primarily reflecting lower equipment sales and lower volumes in performance materials and merchant gases. Adjusted earnings per share for the quarter met analysts' expectations, while quarterly revenues trailed their estimates. The company also issued earnings forecast for the second quarter, below Street view, and maintained its earnings guidance for the full-year 2012. 'As we expected, economic growth continued to slow this quarter, depressing volumes and limiting earnings growth. In spite of these economic headwinds, we did improve our operating performance, while lowering costs and winning significant new tonnage contracts,' Chairman, President and CEO John McGlade said in a statement. Allentown, Pennsylvania-based Air Products reported net income of $248.1 million or $1.16 per share for the first quarter, lower than $268.6 million or $1.23 per share in the prior-year quarter.
Excluding items, adjusted net income for the quarter was $291.9 million or $1.36 per share, compared to $295.8 million or $1.35 per share in the year-ago quarter. On average, 18 analysts polled by Thomson Reuters expected the company to report earnings of $1.36 per share for the first quarter. Analysts' estimates typically exclude special items. Revenues for the quarter increased a percent to $2.42 billion from $2.39 billion in the same quarter last year, but missed thirteen Wall Street analysts' consensus estimate of $2.53 billion. Underlying revenues were up 1 percent. Sales for the merchant gases segment were nearly flat at $989.3 million, and tonnage gases segment sales grew 6 percent to $809.8 million from a year ago. Electronics and performance materials segment generated sales of $535.2 million, 2 percent higher than last year, while equipment and energy segment sales declined 21 percent year-over-year to $88.8 million. The company noted that higher volumes from new plants in tonnage gases were offset by lower equipment sales and lower volumes in performance materials and merchant gases. Operating margin for the quarter expanded 80 basis points to 15.9 percent, while adjusted operating margin contracted 100 basis points. Earlier in the month, Air Products agreed to divest its homecare business in continental Europe to Germany-based Linde AG (LNEGY.PK) for 590 million euros, or $751 million as the business was no longer a natural fit with its core gases business. Looking ahead to the second quarter of fiscal 2012, the company expects earnings in a range of $1.37 and $1.43 per share. Analysts expect the company to earn $1.48 per share. For fiscal 2012, the company continues to anticipate earnings in the range of $5.90 to $6.30 per share, representing year-over-year growth of 3 to 10 percent. Street is currently looking for full-year 2012 earnings of $6.01 per share. 'We expect second quarter economic activity to remain slow. We are forecasting Asia and North America growth to accelerate in the second half of our fiscal year. Coupled with our improved operating performance and new plant on-streams, this should lead to stronger sales and earnings growth in the last half of our year,' McGlade added. APD closed Monday's regular trading session at $89.92, down $0.69 on a volume of 1.81 million shares, higher than the three-month average volume of 1.07 million shares.
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