Air Products has reported net income of $128m or diluted earnings per share of $0.57 for its fiscal fourth quarter ended 30 September 2006.
This includes $0.13 of discontinued operations related to the sale of the company's amines business and $0.21 for corporate reorganization and streamlining initiatives, as previously announced. Also included is a $0.03 per share charge for the cumulative effect of an accounting change for asset retirement obligations. On a continuing operations basis excluding the impact of these items, net income was $210m and EPS was $0.94, up 19 and 22 per cent, respectively, compared with prior year results.
The discussion of fourth quarter and full year results in this release is based on non-GAAP comparisons. It excludes the impacts of the above items and includes the proforma impact of stock option expensing on fiscal 2005 results.
Fourth quarter revenues of $2,359m were up 18 per cent from the prior year on strong volume performance in the company's merchant gases, tonnage gases, electronics and performance materials, and equipment and energy segments. Record operating income of $305m was up 25 per cent versus prior year.
For fiscal 2006, sales of $8,850m were up 14 per cent and net income of $795m was up 17 per cent over the prior year due to higher volumes broadly across the merchant gases, tonnage gases, electronics and performance materials, and equipment and energy segments. Diluted EPS of $3.50 was up 19 per cent.
Third year running double-digit sales
John Jones, chairman and chief executive officer, said: ''We had a strong fourth quarter and closed out another excellent year in 2006. For the third consecutive year, we achieved double-digit sales and earnings growth and a meaningful improvement in return on capital, which this year was up 130 basis points. In addition to our solid operating performance, we overcame the challenges presented by last year's hurricanes, sold our amines business, reorganized for growth and improved returns, and completed the first $500 million of our $1.5 billion share repurchase program.''
Looking forward, Jones said: ''We enter fiscal 2007 well positioned to drive continued strong top-line and earnings growth and focused on achieving our 12.5 per cent return on capital goal. We expect to see strong volume growth from the full-year impact of the new hydrogen plants we brought on-stream in fiscal 2006, continued growth from new merchant and tonnage plants in Asia, and continuing strength in our electronics and performance materials end markets. While we have challenges in healthcare, we are confident that we are taking the right actions to meaningfully improve the business this year.
''Building off of the momentum we achieved in 2006, our people are generating real productivity across our businesses, using continuous improvement tools and SAP. All of the actions we are taking will make us a more focused, less cyclical, higher growth and higher return company.''
The company currently anticipates fiscal year 2007 EPS in the range of $3.84 to $4.00 per share. On a continuing operations basis, this represents year-over-year earnings growth of 10 to 14 per cent. For the first quarter of fiscal 2007 ending 31 December 2006, EPS is expected to be between $0.90 and $0.95.