Air Products And Chemicals, Inc. · NYSE:APD
Air Products And Chemicals — Barclays ROC Stars Conference 2010
32 slides from Air Products And Chemicals's conference presentation, May 18, 2010
Slide 1: Barclays ROC Stars Conference - Paul Huck, SVP and CFO
Paul Huck SVP and CFO Barclays ROC Stars Conference May 18, 2010
Slide 2: Forward Looking Statement
Barclays ROC Stars Conference 2010 Forward Looking Statement This presentation contains “forward-looking statements” within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including earnings guidance and comments regarding the Company’s proposed acquisition of Air
Slide 3: Additional Information
Barclays ROC Stars Conference 2010 ADDITIONAL INFORMATION On February 11, 2010, Air Products Distribution, Inc., a wholly owned subsidiary of Air Products and Chemicals, Inc. ("Air Products"), commenced a cash tender offer for all the outstanding shares of common stock of Airgas, Inc. ("Airgas") not
Slide 4: Financial Performance
Barclays ROC Stars Conference 2010 FY04 thru FY08 H109 H209 H110 Sales ( CAGR| % chg vs PY ) 14% (16%) (25%) 7% Operating Margin 12.8% +1.8% 14.6% 13.2% 15.5% 16.0% Adj’d Cont Ops EPS ( CAGR| % chg vs PY ) 21% (24%) (16%) 28% ROCE (4 quarter trailing) 9.6% +3.4% 13.0% ROCE (instantaneous) 10% 11% 12
Slide 5: We have Multiple Growth Opportunities
Barclays ROC Stars Conference 2010 We have Multiple Growth Opportunities l Hydrogen for refining l Oxygen for gasification l LNG heat exchangers Energy Environment Emerging Markets l Oxyfuel l Carbon capture l Multiple Gas Applications l Electronics across Asia l Equity Affiliate positions l Expandi
Slide 6: Leading Merchant Gases supplier in India
Barclays ROC Stars Conference 2010 • Leading Merchant Gases supplier in India • Generating growth through our value-added technology
Slide 7: Merchant Gases: Applications Driven Growth
Barclays ROC Stars Conference 2010 Cleanfire ® HR i ™ burner Efficient oxygen plant design Merchant Gases Applications Driven Growth A winning combination!
Slide 8: Merchant Gases: Winning New Customers with Industrial Gases
Barclays ROC Stars Conference 2010 Merchant Gases Winning New Customers with Industrial Gases Integra ® Cylinders
Slide 9: Hydrogen Still Fueling Future Growth
Barclays ROC Stars Conference 2010 Refinery Conversion Low-Conversion Refinery H 2 scf/ bbl 0 - 150 Sulfur spec. None High-Conversion Refinery 800 -1000 + <30 to <15 ppm s Other 20% Residual Fuel 34% Other 17% Residual fuel 1% Transportation Fuel 46% Transportation Fuel 82% Conversion 45% Crude 25%
Slide 10: Leading Global Hydrogen Positions
Barclays ROC Stars Conference 2010 Tonnage Gases Leading Global Hydrogen Positions Southern California Edmonton, Canada Sarnia, Canada Texas Louisiana Rotterdam
Slide 11: Tonnage Gases: Steel, Gasification, Cleaner Coal
Barclays ROC Stars Conference 2010 • Steel − Asian infrastructure growth − Mill modernization • Gasification − Power − Feedstock independence − Low BTU hydrocarbons • Cleaner coal − Power − CO2 capture 200,000-300,000 tons-per-day new oxygen capacity by 2018 100 + new plants
Slide 12: Tonnage Gases: Asian growth accelerating
Barclays ROC Stars Conference 2010 Tonnage Gases Asian growth accelerating • With Premiere Customers: Sinopec, Petrochina, CNOOC, Jushi Group, Samsung and TSMC • In All Key Markets - Steel, Non-Ferrous Metals, Electronics, Chemicals, Refining, Coal Gasification • With Our Premiere Offerings − Oxygen
Slide 13: Tonnage Gases: Projects and Superior Returns
Barclays ROC Stars Conference 2010 Projected 2010 • Marathon Garyville • XOM Baton Rouge • Total Port Arthur • XOM Baytown • MarkWest Texas Projected 2011-2012 • XOM Rotterdam • Shell Rotterdam • Marathon Detroit • Monsanto Louisiana Continuous improvement Operating bonuses Base take or pay Franchis
Slide 14: Electronics: Strong Recovery Continues
Barclays ROC Stars Conference 2010 Electronics Strong Recovery Continues • Solid growth in existing and new markets – TFT-LCD = 20% – PV = 30% – LED = 14% (‘09 to ‘13 CAGR) • Majority market share positions with industry leaders – #1 in IC, TFT-LCD and foundry • #1 in Electronic industry powerhouses
Slide 15: Equity Affiliates: Important Source of Growth
Barclays ROC Stars Conference 2010 Equity Affiliates Important Source of Growth Mexico Italy India South Africa Thailand
Slide 16: Outlook
Barclays ROC Stars Conference 2010 Outlook Q3 FY’10 EPS $1.25-$1.29 l Improving economy, seasonality l New plants on-stream l Higher Electronics restructuring costs l Higher Energy development spending/outages FY’10 EPS $4.90-$5.00 l WW manufacturing growth up ~2% l CapEx forecast unchanged, ~$1.3B-
Slide 17: Offer to Acquire Airgas
Offer to Acquire Airgas
Slide 18: Airgas transaction highlights
Barclays ROC Stars Conference 2010 Consideration All-cash offer for all Airgas shares at $60.00 per share Premium Premium of 38% to ARG unaffected price on 2/04/10 of $43.53 Accretion Expected to be substantially accretive to Air Products cash EPS in year one Synergies Substantial cost synergies yie
Slide 19: Compelling strategic and industrial logic
Barclays ROC Stars Conference 2010 Compelling strategic and industrial logic Creates one of the world’s leading integrated industrial gas companies • Largest industrial gas company in North America • Diversified across geographies and distribution channels with competitive positions in all three sup
Slide 20: Synergies
Barclays ROC Stars Conference 2010 Synergies Supply Chain • Consolidate filling locations • Consolidate specialty gas plant locations • Move from local delivery to hub and spoke • Combine purchasing requirements • Utilize Shared Services for Packaged Gas operations and Product Management Overheads •
Slide 21: Path forward
Barclays ROC Stars Conference 2010 Path forward . . . Air Products committed to completing transaction Litigation • Commenced litigation in Delaware Tender offer • Offer commenced Feb 11 • Financing committed Regulatory process • Prepared to make appropriate divestitures Shareholder meeting proposal
Slide 22: Air Products' proposals
Barclays ROC Stars Conference 2010 1. Election of three independent director nominees 2. Amend by-laws to implement director eligibility requirements • Would make any Airgas board members (except CEO) not elected at annual meeting ineligible to serve on Airgas Board for three years • If not elected
Slide 23: Air Products' director nominees
Barclays ROC Stars Conference 2010 John P. Clancey − Age 65 − Chairman Emeritus, Maersk Inc. − Former President and Chief Executive Officer, Sea-Land Service, Inc. − Principal and founder, Hospitality Logistics, International − Former Director, UST Inc. − Former Director, Foster Wheeler AG − Former
Slide 24: Well positioned for long-term value creation
Barclays ROC Stars Conference 2010 RESULTS • Double-digit EPS growth • ROCE 3-5% above cost of capital The Air Products opportunity STABILITY • Long term contracts, consistent and predictable cash flow • Diversified across geographies and distribution channels • Airgas opportunity creates competitiv
Slide 25: Thank you
Thank you www.airproducts.com
Slide 26: Non GAAP Appendix: Year over Year Deltas
Barclays ROC Stars Conference 2010 Non GAAP Appendix: Year over Year Deltas
Slide 27: Non GAAP Appendix: Half Year Deltas
Barclays ROC Stars Conference 2010 Non GAAP Appendix: Half Year Deltas
Slide 28: Appendix: ROCE
Barclays ROC Stars Conference 2010 Appendix: ROCE
Slide 29: Appendix: ROCE Tax Rate
Barclays ROC Stars Conference 2010 Appendix: ROCE Tax Rate
Slide 30: Non GAAP Appendix: ROCE FY04 and FY08
Barclays ROC Stars Conference 2010 Non GAAP Appendix: ROCE FY04 and FY08
Slide 31: Non GAAP Appendix: ROCE Tax Rate FY04 and FY08
Barclays ROC Stars Conference 2010 Non GAAP Appendix: ROCE Tax Rate FY04 and FY08
Slide 32: Non-GAAP Appendix: FY10 Guidance
Barclays ROC Stars Conference 2010 Non-GAAP Appendix: FY10 Guidance ($ Millions, except per share data) FY10 Guidance vs. FY09 Diluted EPS Continuing Ops FY09 GAAP $3.00 FY09 Global Cost Reduction Plan $0.94 FY09 Pension Settlement $0.02 FY09 Customer Bankruptcy and Asset Actions $0.10 FY09 Non GAAP
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