Air Products & Chemicals, Inc. Quarterly Report for Q1 Ended Dec 31, 2010

Summary

Air Products & Chemicals, Inc. (APD) reported strong first-quarter 2011 results, with a notable 10% increase in sales to $2,391.7 million, driven by volume growth across its key segments: Electronics and Performance Materials, Tonnage Gases, and Merchant Gases. The company also demonstrated improved profitability, with operating income up 5% and net income up 7% on a GAAP basis. When excluding acquisition-related costs, the company's underlying performance showed even more significant gains, with a 17% increase in non-GAAP operating income and a 16% rise in non-GAAP diluted earnings per share. Investors should note the company's strategic focus on growth, evidenced by increased R&D spending and the positive contribution from its Tonnage Gases and Electronics and Performance Materials segments. Despite a slight decrease in GAAP operating margin, the non-GAAP figures highlight the underlying strength and operational efficiency improvements. The company maintains a strong financial position and expects its cash flow from operations and financing activities to meet its liquidity needs.

Key Highlights

• 1Sales increased by 10% to $2,391.7 million, driven by strong volume growth in key segments.
• 2Operating income saw a 5% increase on a GAAP basis and a 17% increase on a non-GAAP basis, excluding acquisition-related costs.
• 3Net income increased by 7% to $268.6 million, and diluted EPS rose 6% to $1.23 on a GAAP basis.
• 4Non-GAAP diluted EPS grew by 16% to $1.35, reflecting underlying business performance.
• 5The Merchant Gases segment experienced a 6% sales increase, with significant growth in Asia.
• 6Tonnage Gases sales grew 10%, driven by higher volumes and new plant operations.
• 7Electronics and Performance Materials segment sales surged 21%, primarily due to volume increases.

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