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Air Products and Chemicals Outlines Upbeat Profit View After Fiscal Second-Quarter Gain on Pricing

05/10/2021 08:13

12:10 PM EDT, 05/10/2021 (MT Newswires) -- Air Products and Chemicals (APD) reported fiscal second-quarter earnings that fell short of expectations, compressed by COVID-19 and a winter storm that struck the US Gulf coast, but the industrial gases supplier said confidence in a global recovery has grown enough to resume offering profit guidance which beat most analysts' estimates.

The Allentown, Pennsylvania-based company reported adjusted earnings of $2.08 a share for the quarter ended March 31, up from $2.04 a year earlier but short of analysts' $2.11 average estimate in a Capital IQ poll. Sales rose 13% to $2.5 billion, ahead of the consensus for $2.35 billion. COVID-19 reduced the bottom line by $0.10 to $0.15 per share, the company said.

"We continued to improve pricing, and we again generated strong cash flow," Chief Executive Seifi Ghasemi said in a statement. "Although we still see uncertainties ahead, our confidence in major economies around the world is growing, particularly in light of the increasing pace of vaccination," he said on a conference call, according to a Capital IQ transcript.

The company said it expects full-year fiscal 2021 adjusted earnings per share of $8.95 to $9.10, versus the $8.98 analyst consensus. For its fiscal third quarter, Air Products and Chemicals projected adjusted earnings per share of $2.30 to $2.40; analysts estimated $2.29.

The company said the guidance does not include the effects of the expected closing this fiscal year of its pending $12 billion acquisition of the Jazan gasifier and power plant from Saudi Aramco or the ongoing recommissioning of a Chinese coal gasification plant at a customer's request.

Americas industrial gases sales rose 13% to $1.06 billion, with pricing gains offsetting the 6% volume decline from the pandemic and storm effects, according to the company. The lower volumes and higher energy costs cut segment operating income by 2%, however. Asia sales of $698 million were up 6%, while Europe, Middle East and Africa jumped 19% to $585 million.

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