Air Products And Chemicals, Inc. · NYSE:APD
Air Products And Chemicals — Q2 FY2008 Earnings Presentation
19 slides from Air Products And Chemicals's earnings presentation, Apr 23, 2008
Slide 1: Q2 FY08 Earnings Conference Call
Q2 FY08 Earnings Conference Call April 23, 2008
Slide 2: Forward-Looking Statements
Forward-Looking Statements NOTE: This document contains “forward-looking statements” within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s reasonable expectations and assumptions as of the date of this do
Slide 3: Consolidated Q2 Financials
Consolidated Q2 Financials Fav/(Unfav) vs. ($Millions, Continuing Operations) Q2 FY08 Q2 FY07 Q1 FY08 Sales $2,605 13% 5% SG&A as a % of Sales 12.0% 30bp - Operating Income $365 18% (2%) Operating Margin % 14.0% 60bp (100bp) Net Income $270 24% 5% Diluted EPS $1.23 27% 6% ROCE 12.4% 70bp 10bp ORONA
Slide 4: EPS up 27%
EPS up 27% Q2 FY08 Q2 FY07 Change As-reported diluted EPS $1.43 $1.02 - Discontinued Ops 0.28 0.05 + Pension settlement charge (0.08) - Continuing Operations EPS $1.23 $0.97 $0.26 } Volume $0.08 Price / raw materials 0.01 $0.09 Cost 0.00 Acquisitions 0.02 Currency 0.07 Equity Affiliates income 0.05
Slide 5: Merchant Gases
Merchant Gases Fav/(Unfav) vs. Q2 FY08 Q2 FY07 Q1 FY08 Sales $902 15% 1% - Volume (1%) (1%) - Price 4% 1% - Currency 7% 1% - Acquisitions 5% - Operating Income $167 18% (5%) Operating Margin 18.5% 50bp (110bp) z Lower equipment sales reduced volume growth by (4%) z Pricing actions continue to drive
Slide 6: Merchant Gases: Q2 Sales Analysis vs PY
Merchant Gases: Q2 Sales Analysis vs PY North America Europe Asia Sales % change 8% 27% 22% - Volume 1% (2%) 15% - Price 7% 3% 3% - Currency - 14% 4% - Acquisitions - 12% - z Excludes equipment sales 6
Slide 7: Tonnage Gases
Tonnage Gases Fav/(Unfav) vs. Q2 FY08 Q2 FY07 Q1FY08 Sales $867 25% 10% - Volume 12% 4% - Nat’l gas/RM pass thru 8% 6% - Currency 3% - - Acquisition 2% - Operating Income $111 20% -% Operating Margin 12.8% (50bp) (120bp) z New plants and continued strong loading z Higher natural gas pricing suppress
Slide 8: Electronics & Performance Materials
Electronics & Performance Materials Fav/(Unfav) vs. Q2 FY08 Q2 FY07 Q1 FY08 Sales $562 6% 9% - Volume 5% 8% - Price (1%) - - Currency 2% 1% Operating Income $68 20% 2% Operating Margin 12.0% 130bp (80bp) z Electronics sales 2% 7% z Performance Materials volume 3% 7% 8
Slide 9: Equipment & Energy
Equipment & Energy Fav/(Unfav) vs. Q2 FY08 Q2 FY07 Q1 FY08 Sales $105 (21%) 4% Operating Income $10 (39%) 8% Sales Backlog $203 (42%) (17%) z New ASU letters of intent z Additional LNG orders anticipated by year end 9
Slide 10: Healthcare
Healthcare Fav/(Unfav) vs. Q2 FY08 Q2 FY07 Q1 FY08 Sales $170 8% (1%) − Volume 2% (2%) − Price/mix (1%) - − Currency 7% 1% Operating Income $9 34% (31%) Operating Margin 5.5% 100bp (250bp) z Continued growth in Europe z Strategic alternatives being considered for U.S. business 10
Slide 11: FY'08 Financial Outlook: Raising guidance again
FY ’08 Financial Outlook Raising guidance again FQ2 2008 EPS $1.23 z Higher Electronics & Performance Materials volumes z Higher Merchant Gases volumes & pricing z Higher Tonnage results z Favorable currency z Lower Equipment & Energy results FQ3 2008 EPS $1.25 - $1.30 12%-16% vs PY FY 2008 EPS $4.9
Slide 12: Appendix slides
Appendix slides 12
Slide 13: Appendix: Q2 Sales Analysis
Appendix: Q2 Sales Analysis Change versus Q2 FY07 Q1 FY08 Total Consolidated 13% 5% Comprised of: z Base business growth 5% 2% – Volume 4% 2% – Price 1% - z Acquisitions/Divest. 2% - z Nat’l gas/RM pass thru 2% 2% z Currency 4% 1% 13
Slide 14: Appendix: Q208 Comparisons to prior periods
Appendix: Q208 Comparisons to prior periods ($ Millions, except per share data) Non GAAP GAAP Measure Adjustment Non GAAP Measure % Change % Q208 Pension Non GAAP Q208 vs. Q207 - Total Company Q208 Q207 Change Settlement Q208 Q207 Measure Sales 2,605.3 2,298.0 13% 2,605.3 2,298.0 13% Operating Incom
Slide 15: Appendix: Guidance
Appendix: Guidance Q3 % Full Year % ($/share) Q307 Q308 Guidance Change FY07 FY08 Guidance Change Diluted EPS - Continuing Ops. GAAP $1.24 $1.25-$1.30 1%-5% $4.50 $4.86-$4.96 8%-10% Gain on contract settlement ($0.11) Supp. pension plan charge $0.03 $0.09 Global cost reduction plan $0.04 Donation/sa
Slide 16: Appendix: ROCE
Appendix: ROCE $ Millions Quarter Ended Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407 Q108 Q208 Numerator Operating Income Reported 249.6 265.4 276.4 220.1 317.4 308.6 352.4 373.1 372.0 338.2 Equity Affiliate Income 25.2 22.2 19.9 24.2 27.3 27.6 29.5 30.0 25.3 42.4 Earnings before tax as reported 274.8 28
Slide 17: Appendix: ROCE Tax Rate
Appendix: ROCE Tax Rate Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407 Q108 Q208 Reported Income from Cont. Ops. Before Tax and Min. Int 248.7 262.1 266.6 206.9 305.6 298.8 337.7 361.1 356.3 341.5 Minority Interest (4.8) (5.2) (4.8) (4.1) (5.1) (4.4) (5.2) (6.1) (6.1) (4.5) Income from Cont. Ops. Before Ta
Slide 18: Appendix: ORONA
Appendix: ORONA $ Millions Quarter Ended Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407 Q108 Q208 Operating Income Op. Inc. Reported 249.6 265.4 276.4 220.1 317.4 308.6 352.4 373.1 372.0 338.2 Disclosed Items: Global Cost Reduction Plan - - - 72.1 - - - 13.7 - - Pension Settlement charge 10.3 26.3 Gain on
Slide 19: Thank you
Thank you tell me more www.airproducts.com 19
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