Wesfarmers Limited (WES), owners of Australian industrial gas company Coregas, recently reported a full year net profit rise of 33.6% and noted its expectation of improved sales for its industrial, medical and specialty gas businesses.
Although some sources suggest this rise to be lower than expected, full year net profit of $1.05bn provided the conglomerate with a positive outlook for continuing solid performances across most businesses.
Though apparently shy of consensus estimates, profits grew by around $264m and Managing Director Richard Goyder said the company had achieved a strong result for 2007/08.
“We’ve seen excellent results across a number of our divisions: Bunnings, Energy, Resources, Industrial and Safety, and Chemicals and Fertilisers,” he reflected.
The divergence in the company’s outlook reflects the scope of its business activities, which were no doubt strengthened by the $500m acquisition of Linde Gas Australia (Linde gas Pty Ltd) in early 2007. The division was subsequently renamed Coregas and operates as a stand-alone business, alongside existing gas and power business units within the Wesfarmers Energy Division.
Linde Gas Australia came up for sale after German parent company The Linde Group was asked to divest the business by the Australian Competition and Consumer Commission, ahead of its global merger with BOC Group Plc.
Coregas, as it is now known, is a major participant in the Australian gas market producing oxygen, nitrogen, argon and hydrogen at its Port Kembla operation and with parent company Wesfarmers seemingly optimistic for the gases future ahead.
Wesfarmers said the chemicals and fertilisers business would make a positive contribution to earnings and looking to the energy business, noted that improved sales were expected for the industrial, medical and specialty gas businesses through extended product supply.
“LPG earnings will continue to remain heavily dependent on international LPG prices, LPG content in the Dampier to Bunbury Pipeline and the gas market in Western Australia,” Wesfarmers said.
Coregas this year held the official opening of its new nitrogen liquefier in Port Kembla, New South Wales in Australia.