DOW JONES NEWSWIRES
Air Products & Chemicals Inc.'s (APD) fiscal second-quarter
net income fell 35% on slumping demand, but Chairman and Chief
Executive John McGlade expects the period to be the low point for
the year.
Still, the industrial gas maker cut its fiscal-year earnings
outlook a second time - to $3.85 to $4.05 a share from January's
reduced view of $4 to $4.30, while seeing earnings in their fiscal
third quarter of 93 cents to $1.02 a share. The mean estimate of
analysts surveyed by Thomson Reuters was $1.06 for the fiscal third
quarter.
Air Products has cut costs, including a 7% cut to its work force
last year, as it reacts to the poor global economic environment.
The company said Wednesday that because of the economy's continued
woes, Air Products continues to look at additional cost-cutting
steps and might record restructuring charges this year.
Despite the poor sales environment, the company was able to
boost its dividend by a penny last month.
For the period ended March 31, Air Products reported net income
of $205.6 million, or 97 cents a share, down from $314.3 million,
or $1.43 a share, a year earlier. Earnings from continuing
operations fell to 89 cents from $1.18. In January, the company
projected 80 cents to 90 cents, below analysts' then-estimates.
Revenue dropped 23% to $1.96 billion on demand woes, the
stronger dollar and lower commodity costs. Analysts polled by
Thomson Reuters, on average, most recently expected $2.08
billion.
Gross margin was flat at 26.4%.
Revenue rose in Air Products' equipment and energy segment, by
far the smaller of the company's four divisions. The biggest
decline was in electronics and performance materials - 41% - amid
slumping sales in the semiconductor industry. The business also
swung to a small loss.
Shares closed Tuesday at $58.05 and were inactive premarket. The
stock is up 15% this year but still down nearly 40% the past eight
months.
-By John Kell and Kevin Kingsbury, Dow Jones Newswires,
201-938-5285; john.kell@dowjones.com