By Lisa Beilfuss
Air Products & Chemicals Inc. (APD) on Thursday said sales
fell 6.5% in its fiscal second quarter, as foreign-exchange
headwinds and lower energy prices pressured the company's top
line.
The company also issued a downbeat outlook for the current
quarter but said it still expects to report an adjusted profit of
$6.35 to $6.55 a share for the fiscal year. Air Products said it
now estimates capital spending of $1.7 billion for the year, at the
low end of its budget.
Air Products reported a second-quarter profit of $290 million,
or $1.33 a share, up from $283.5 million, or $1.32 a share, a year
earlier. Excluding certain items, per-share profit rose to $1.55
from $1.32.
Revenue fell to $2.4 billion from $2.6 billion, as underlying
sales growth of 5% "was more than offset by unfavorable currency
and lower energy pass-through," the company said.
Analysts had a expected a profit of $1.55 a share on revenue of
$2.6 billion.
For the third quarter ending in June, Air Products expects
earnings of $1.55 to $1.60 a share, versus the $1.65 analysts
expect.
Rival Praxair earlier this week said its quarterly profit fell
7%, as the strong dollar and lower commodity prices pressured
sales--issues it expects to impact results throughout the year.
Allentown, Pa.-based Air Products produces chemical ingredients
for antifreeze, rocket fuel, semiconductors and food among a host
of other goods. It also builds large gas-supply plants that provide
manufacturers with oxygen, hydrogen and other gases via long-term
contracts.
In response to pressure from activist investor William Ackman,
whose hedge fund Pershing Square Capital Management L.P. owns a
9.8% stake in the company, Air Products replaced its chief
executive last fall and has been pursuing broad restructuring.
During the first six months of the company's fiscal year, it has
cut 1,100 positions. In the March quarter, Air Products took a
$55.4 million charge stemming from restructuring.
Air Products shares, up about 6% this year, were inactive in
pre-market trading.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
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