Praxair has announced record second-quarter net income of $247m, and diluted earnings per share of 75 cents.
Net income grew 22 per cent, and earnings per share grew 23 per cent on a comparable basis including stock option expense in the prior year.
Sales in the second quarter rose eight per cent to $2,076m, compared to $1,919m in the 2005 quarter. Operating profit grew to $382m from $311m in the prior year on a comparable basis. The strong growth in operating profit was due to new business development, higher prices and productivity improvement. Operating profit in the quarter also included $15m from insurance recoveries.
'While some macro-economic indicators point to a slowdown, we have not seen any significant decline in demand from our customers,' said Dennis H. Reilley, chairman and chief executive officer.
In North America, second-quarter sales of $1,158m rose six per cent from $1,097m in the year-ago quarter from higher sales to manufacturing, metals and electronics markets, and higher prices. Operating profit grew to $215m, from $155m in the prior-year period on a comparable basis. The strong growth in operating profit came primarily from higher sales, strong pricing and productivity gains.
In Europe, sales of $296m were three per cent above the prior year, and increased six per cent excluding the effect of a weaker euro. Underlying sales growth came from higher pricing and gases volume growth in Spain and Italy. Operating profit was $65m.
In South America, sales of $340m grew 24 per cent versus the year-ago quarter, and 13 per cent excluding currency effects, from higher pricing and higher sales volumes. Sales growth came from energy, healthcare and metals markets. Operating profit rose to $58m, an increase of 18 per cent versus last year's quarter on a comparable basis.
Sales in Asia grew 13 per cent to $155 million, from $137m in the year-ago quarter. Sales to electronics and metals markets drove the increase. Operating profit increased to $28m, from $23m in the prior-year period on a comparable basis.
For the third quarter of 2006, Praxair expects diluted earnings per share in the range of 70 cents to 73 cents, 19 per cent to 24 per cent above the third quarter of 2005, on a comparable basis. For the full year of 2006, Praxair expects year-over-year sales growth in the area of ten per cent.