Air Products attributed higher costs, losses on sales of its Russia business and strength of the US dollar for a 4% drop in Q4 net income to $593 million.
However adjusted EBITDA of $1,145 million was up 10% over the prior year, as higher volumes, pricing and equity affiliates’ income more than offset higher costs and unfavourable currency.
Quarterly sales of $3.6bn increased 26% over the prior year on 15% higher energy cost pass-through, 9% higher volumes, and 8% higher pricing. Volume growth, primarily in Asia and the Americas, was driven by new plants, recovery in hydrogen and better merchant demand.
For the fiscal year 2022, net income of $2,267 million was up 7% over prior year, as higher pricing and volumes, as well as equity affiliates’ income driven by the Jazan project “more than offset higher costs”, and full-year sales of $12.7bn increased 23%.
Seifi Ghasemi, Air Products’ Chairman, President and CEO, said it delivered higher volume and pricing in its base industrial gas business while investing in ‘world-class projects’ to drive the energy transition forward.
He said, “Despite significant macroeconomic challenges, our people stayed focused and agile, serving our customers and demonstrating a bold commitment to make a cleaner, better future a reality.”
Americas sales of $1,542 million were up 38% over the prior year on 19% higher energy cost pass-through while operating income of $333 million increased 15% and adjusted EBITDA of $515 million increased 8%.
Europe sales of $864 million increased 34% over the prior year on 30% higher energy cost pass-through and 19% higher pricing across all product lines and sub-regions, and volumes were stable despite the challenging economic environment with operating income of $150 million.
Middle East and India equity affiliates’ income of $63 million was up $41 million over the prior year, primarily from the Jazan joint venture.
With COP27 set to start next week, Air Products – which has committed at least $15bn to clean energy hydrogen megaprojects through to 2027 – will find itself in the industrial sustainability spotlight. It has set a new goal to reduce Scope 3 carbon dioxide (CO2) emissions intensity by one-third by 2030 and path to achieve net zero operations by 2050.
These include a $4.5bnclean energy complex in Louisiana to produce low-carbon blue hydrogen; a CAD $1.6 billionnet-zero hydrogen energy complex in Edmonton, Alberta, Canada; an approximately $500 milliongreen hydrogen production facility in New York; and the world’s largest green hydrogen-based ammonia production facility powered by renewable energy with ACWA Power and NEOM in Saudi Arabia – where it was announced today, in Cairo, that construction has started (click here).
Dr. Samir J. Serhan, Air Products’ Chief Operating Officer, will discuss the pivotal role hydrogen plays in the energy transition in a keynote address at the Hydrogen Transition Summit at 9:15am (GMT +2) on November 8, in the Innovation Zone alongside COP27.
“Hydrogen is not just the fuel of the future, it is the fuel of today. If we’re truly to build a cleaner, more sustainable world, hydrogen must play a key role,” he said.
Ivo Bols, Air Products’ President, Europe and Africa, will take part in a panel discussion entitled ‘The Global Trilemma: getting the balance right between energy security, affordability and sustainability,’ at 10:10am on November 11 at the Sustainable Innovation Forum during COP27.