Air Products reported net income of $314m, or diluted earnings per share (EPS) of $1.43, for its fiscal second quarter ended 31st March 2008, with net income increasing 38% and diluted EPS increasing 40% compared with the year previous.
Displaying another strong quarter for sales and earnings growth, the results include income from discontinued operations of $0.28 per share and a pension settlement charge of $0.08 per share. Excluding such items, net income of $270m increased 24% and diluted EPS of $1.23 increased 27%.
Second quarter revenues of $2.6m rose 13% on higher volumes in the Tonnage Gases and Electronics and Performance Materials segments, higher pricing in Merchant Gases, and favourable currency – while operating income of $365m increased 18% versus the prior year.
Commenting on the quarter’s solid results, John McGlade, Chairman, President and CEO, said, “We had another strong quarter of double-digit sales and earnings growth. We made good progress on a number of our fiscal 2008 targets, including improving our operating margin and increasing our quarterly dividend by 16%. Finally, we completed the sale of our Polymer Emulsions business and announced our first sale of gas orders in the Middle East.”
Merchant Gases sales of $902m experienced a rise of 15%, while operating income of $167m increased 18% over the prior year on improved pricing and favourable currency impacts. Among other highlights, Tonnage Gases sales of $867m were up 25% on strong volumes and increased natural gas prices, operating income of $111m increased 20% over the prior year on volume growth from new plants in Asia and Europe, and Electronics and Performance Materials sales of $562m rose 6%. Electronics sales were driven by higher specialty materials and tonnage volumes, while Performance Materials volume gains were driven by strong demand in Europe and the Middle East, and new product growth in emerging markets.
The quarter also witnessed increases in Equipment and Energy revenues ($105m) and healthcare sales by 8% ($170m) and focusing on the outlook ahead, McGlade said,
“Despite slowing economic growth, we are positioned to continue double-digit earnings and sales growth while delivering on our commitment to improved margins and returns. This consistent performance is a result of the actions we have taken to shift our business portfolio to higher growth, less cyclical and higher return businesses.”
“We see great opportunities ahead to expand our leading positions in the markets we serve around the world. We will continue to capitalise on our strong business and financial positions to serve our customers, drive for lower costs and productivity, and deliver superior financial results to our investors.”