Chart Industries Inc. has reported its results for the fourth quarter and year ended 31 December 2014.
Net income for the fourth quarter of 2014 was (US) $26.9m, compared to $23.2m in the fourth quarter of 2013. However, net income for the year 2014 was down to $81.9m, compared with $83.2m for the year 2013.
Net sales for the fourth quarter of 2014 increased 7.3% to $326.1m from $303.8m in the comparable period a year ago. Gross profit for the fourth quarter of 2014 was $96.9m compared to $93.8m in the comparable quarter of 2013.
Sam Thomas, Chart’s Chairman, President and Chief Executive Officer, said, “We delivered better than anticipated results in the quarter on improved project execution in Energy and Chemicals (E&C) and strong global results in our Distribution and Storage (D&S) industrial gas business. Those results were partially offset by declines in biomedical respiratory therapy sales and D&S LNG sales in both the US and China.”
“Our focus in 2015 will be to deliver on our industrial gas opportunities and leading industry positions, continue our lean initiatives, and pursue our strategic plan.”
E&C segment sales improved 40% to $110.2m for the fourth quarter of 2014 compared with $78.9m for the same quarter in the prior year on additional project volume and improved project execution on LNG liquefaction and petrochemical applications.
E&C gross profit margins were 30.2% in the 2014 quarter compared with 30% in the same quarter of 2013.
D&S segment sales declined 2% to $160m for the fourth quarter of 2014 compared with $163.8m for the same quarter in the prior year. Strong global results in industrial gas offset a decline in LNG applications compared to the prior year quarter. Industrial packaged gas sales were a strong contributor in all regions. While European results showed continued improvement in euro terms, the strong US dollar negated that benefit in the company’s reported results. D&S gross profit margin declined to 24.7% in the quarter compared with 28.8% a year ago, driven by global sales and product mix differences as well as unfavourable currency impacts.
Chart Industries expects growth in its core industrial gas and biomedical markets in 2015. It is quoting significant LNG liquefaction and distribution opportunities, which could result in orders during late 2015 or 2016 that, if obtained, could prove to be larger than any Chart has captured in the past.
However, 2015 will present significant operational performance challenges driven by lower oil prices and a stronger US dollar. Chart believes that the full impact of oil price and currency headwinds is difficult to assess given the velocity of recent market changes and assimilation of those impacts by its customers, making order timing challenging to predict. It is also executing on disciplined cost reduction actions to address these challenges.
Based on its current backlog and order expectations, net sales for 2015 are expected to be in a range of $1.05bn to $1.2bn.