Summary
Air Products & Chemicals, Inc. (APD) reported third fiscal quarter 2002 earnings per share (EPS) of $0.63, a 5% increase year-over-year, and net income of $141 million, up 7%. This improvement was primarily driven by a significant reduction in interest expense. While overall revenues declined 5% to $1.37 billion, excluding certain impacts, sales increased 2% due to stronger chemical volumes. Sequentially, revenues improved 5% driven by higher volumes. The company reaffirmed its full-fiscal-year operating EPS guidance of $2.32, but expressed caution regarding the pace of growth in the manufacturing economy. Key segmental performance shows the Chemicals segment with a 3% sales increase and a 21% operating income jump due to improved performance chemicals and polyurethane intermediates volumes. The Industrial Gases segment saw a 10% sales decline year-over-year, though sequential results improved. Notably, the company highlighted strategic initiatives including increased ownership in San Fu Chemical Company in Taiwan, a collaboration with Motorola on semiconductor processing chemicals, and a continued focus on cost reduction and operational efficiency to navigate economic uncertainties.
Key Highlights
- 1Reported Q3 FY2002 diluted EPS of $0.63, a 5% increase year-over-year, and net income of $141 million, a 7% increase.
- 2Revenues for Q3 FY2002 were $1.37 billion, a 5% decrease year-over-year, but underlying sales (excluding pass-throughs, currency, etc.) increased by 2%.
- 3Year-over-year net income and EPS growth were significantly aided by lower interest expense.
- 4Chemicals segment showed strong performance with a 3% sales increase and a 21% rise in operating income.
- 5Reaffirmed full-fiscal-year operating EPS guidance of $2.32, but acknowledged economic uncertainties.
- 6Completed sale of the majority of its U.S. packaged gas business in February 2002, resulting in a $55.7 million gain recognized in the nine-month period.
- 7Increased ownership in San Fu Chemical Company in Taiwan to 70% in July 2002, a strategic move into high-growth electronics and CPI markets.