Air Products boosts 1Q profit on cost cuts

posted: 18 DAYS 20 HOURS AGO

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LEHIGH VALLEY, Pa. -Air Products and Chemicals Inc. said Friday its first-quarter profit surged due to cost cuts and a rebounding global economy as it raised guidance for the year.

The company supplies oxygen and other gases to industrial and medical companies. When energy demand sags as it has over the past year, the company takes a big hit.

Energy prices have rebounded strongly, however and John McGlade, president and CEO, said he is optimistic about this year.

"We believe we will see continued earnings growth throughout 2010 as the global economy, led by Asia, continues its gradual recovery, and as we drive further cost reductions," McGlade said. "We also had a significant number of new business signings in the first quarter and are very excited by the opportunities we see for growth."

Earnings for the quarter that ended Dec. 31 were $251.8 million, or $1.16 a share. A year ago, Air Products reported a profit of $68.6 million, or 32 cents a share.

Revenue totaled $2.17 billion, down 1 percent from a year ago but 2 percent higher than the third quarter.

In the most recent quarter, sales of merchant gases rose 1 percent to $934 million and tonnage gases sales fell 6 percent to $698 million. Electronics and performance material sales rose 7 percent to $433 million while equipment and energy sales fell 9 percent to $109 million.

The LeHigh Valley, Pa., company raised its guidance for fiscal 2010 to a range between $4.75 and $4.95 a share. In October, it forecast 2010 profit of $4.65 to $4.90 per share. Analysts have forecast 2010 earnings of $4.86 a share.

Shares of Air Products fell 24 cents to $79.62 as part of a broader market sell-off.

2010-01-22 10:52:12