Air Products And Chemicals, Inc. · NYSE:APD
Air Products And Chemicals — William Blair 30th Annual Growth Stock Conference 2010
28 slides from Air Products And Chemicals's conference presentation, Jun 17, 2010
Slide 1: William Blair 30th Annual Growth Stock Conference
John Mc Glade Chairman, CEO and President William Blair 30th Annual Growth Stock Conference June 17, 2010
Slide 2: Forward Looking Statement
William Blair 30th Annual Growth Stock Conference 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 acq
Slide 3: Additional Information
William Blair 30th Annual Growth Stock Conference ADDITIONAL INFORMATION On February 11, 2010, Air Products Distribution, Inc. (“Purchaser”), 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 o
Slide 4: Financial Performance
William Blair 30th Annual Growth Stock Conference Financial Performance* FY04 thru FY08 H109 H209 H110 Sales 14% (16%) (25%) 7% ( CAGR| % chg vs PY ) Operating Margin 12.8% +1.8% 14.6% 13.2% 15.5% 16.0% Adj’d Cont Ops EPS 21% (24%) (16%) 28% ( CAGR| % chg vs PY ) ROCE (4 quarter trailing) 9.6% +3.4%
Slide 5: Air Products Supply Modes: Durable Business Models
William Blair 30th Annual Growth Stock Conference Air Products Supply Modes Durable Business Models Onsite/Pipeline Equipment & 37% Services 14% Package Gases Liquid/Bulk & Specialty Materials 24% 25% 5
Slide 6: We have Multiple Growth Opportunities
William Blair 30th Annual Growth Stock Conference We have Multiple Growth Opportunities Energy Environment Emerging Markets Hydrogen for refining Oxyfuel Electronics across Asia Oxygen for gasification Carbon capture Equity Affiliate positions LNG heat exchangers Multiple Gas Expan
Slide 7: Merchant Gases: Strong growth in Asia
William Blair 30th Annual Growth Stock Conference Merchant Gases Strong growth in Asia China Liquid Share 2009 - Majors • Largest Liquid/Bulk Share in Competitor 4 Air Products 15% China among global majors Competitor 3 31% 16% • Leading Merchant Gases Competitor 1 supplier in India 20% Competitor 2
Slide 8: Merchant Gases: Applications Driven Growth
William Blair 30th Annual Growth Stock Conference Merchant Gases Applications Driven Growth Cleanfire® HRi™ Efficient oxygen burner plant design A winning combination! 8
Slide 9: Tonnage Gases: Leading Global Hydrogen Positions
William Blair 30th Annual Growth Stock Conference Tonnage Gases Leading Global Hydrogen Positions Edmonton, Canada Sarnia, Canada Southern California Texas Rotterdam Louisiana 9
Slide 10: Tonnage Gases: Significant New Markets for Oxygen
William Blair 30th Annual Growth Stock Conference Tonnage Gases Significant New Markets for Oxygen •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 capa
Slide 11: Tonnage Gases: Asian Growth Accelerating
William Blair 30th Annual Growth Stock Conference Tonnage Gases Asian Growth Accelerating Superior North America & Europe returns: • Marathon Garyville • Marathon Detroit Continuous • XOM Baton Rouge • Monsanto Louisiana improvement • Total Port Arthur • US Steel Nanticoke, Ont. Operating • XOM Bayt
Slide 12: Electronics: Strong Recovery Continues
William Blair 30th Annual Growth Stock Conference Electronics Strong Recovery Continues • Solid growth in existing and new markets 200% PV – IC silicon (MSI) = 13% LED – TFT-LCD = 20% TFT-LCD Silicon (MSI) – PV = 30% 100% – LED = 14% (‘09 to ‘13 CAGR) 0% 2009 2010 2011 2012 2013 • Majority market sh
Slide 13: Equity Affiliates: Important Source of Growth
William Blair 30th Annual Growth Stock Conference Equity Affiliates Important Source of Growth Italy Mexico India Thailand South Africa 13
Slide 14: Outlook
William Blair 30th Annual Growth Stock Conference Outlook Q3 FY’10 EPS $1.25-$1.29 Improving economy, seasonality New plants on-stream Higher Electronics restructuring costs Higher Energy development spending/outages FY’10 EPS $4.90-$5.00 WW manufacturing growth up ~2% CapEx forecast unc
Slide 15: Offer to Acquire Airgas
Offerto Acquire Airgas AIR _/. PRODUCTS £2:
Slide 16: Airgas transaction highlights
William Blair 30th Annual Growth Stock Conference Airgas transaction highlights 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 $43.53 Accretion Expected to be substantially accretive to Air Products cash EPS in year
Slide 17: Compelling strategic and industrial logic
William Blair 30th Annual Growth Stock Conference Compelling strategic and industrial logic Creates one of the world’s leading integrated industrial gas companies • Largest industrial gas company in North America • Diversified across geographies and distribution channels with competitive positions i
Slide 18: Path forward
William Blair 30th Annual Growth Stock Conference Path forward . . . Litigation • Commenced litigation in Delaware Tender offer • Offer commenced Feb 11 Air Products • Financing committed committed to Regulatory process completing • Prepared to make appropriate divestitures transaction Shareholder m
Slide 19: Air Products' proposals
William Blair 30th Annual Growth Stock Conference Air Products’ proposals 1. Election of three independent director nominees 2. Amend by-laws to implement director eligibility requirements • Would make any Airgas board members (except CEO) not elected at annual meeting ineligible to serve on Airgas
Slide 20: The Air Products opportunity
William Blair 30th Annual Growth Stock Conference The Air Products opportunity STABILITY GROWTH RESULTS • Long term contracts, • Solid backlog and • Double-digit EPS growth consistent and strong growth predictable cash flow opportunities across all • ROCE 3-5% above cost of geographies capital • Div
Slide 21: Thank you
Thank you www.airproducts.com
Slide 22: Non GAAP Appendix: Year over Year Deltas
William Blair 30th Annual Growth Stock Conference Non GAAP Appendix: Year over Year Deltas ($ Millions, except per share data) GAAP Measure Non GAAP Ajusts. Non GAAP Measure BP FY04 and FY08 - Total Co. FY04 FY08 FY04 (1) FY08 (2) FY04 FY08 CAGR Change Sales 6,163.2 10,414.5 6,163.2 10,414.5 14% Ope
Slide 23: Non GAAP Appendix: Half Year Deltas
William Blair 30th Annual Growth Stock Conference Non GAAP Appendix: Half Year Deltas ($ Millions, except per share data) First Half FY09 Second Half FY09 First Half FY10 6 months 6 months 6 months GAAP Measure Q109 Q209 to date Q309 Q409 to date Q110 Q210 to date Sales 2,195.3 1,955.4 4,150.7 1,976
Slide 24: Appendix: ROCE
William Blair 30th Annual Growth Stock Conference Appendix: ROCE $ Millions Quarter Ended Q108 Q208 Q308 Q408 Q109 Q209 Q309 Q409 Q110 Q210 Numerator Operating Income Reported 348.6 393.7 373.1 114.1 260.4 143.8 328.0 345.0 340.6 Equity Affiliate Income 42.4 46.5 30.8 24.5 27.0 28.5 32.2 26.9 32.2 E
Slide 25: Appendix: ROCE Tax Rate
William Blair 30th Annual Growth Stock Conference Appendix: ROCE Tax Rate Q208 Q308 Q408 Q109 Q209 Q309 Q409 Q110 Q210 Reported Income from Cont. Ops. Bef. Tax 352.1 400.7 361.1 102.1 257.4 144.8 332.3 340.3 343.3 Noncontrolling Interest (4.5) (7.6) (4.8) (5.0) (1.6) (4.8) - (5.0) (6.4) Income from
Slide 26: Non GAAP Appendix: ROCE FY04 and FY08
William Blair 30th Annual Growth Stock Conference Non GAAP Appendix: ROCE FY04 and FY08 $ Millions FY04 FY08 Quarter Ended Q403 Q104 Q204 Q304 Q404 Q407 Q108 Q208 Q308 Q408 Numerator Operating Income Reported 181.7 200.2 231.3 223.7 380.4 348.6 393.7 373.1 Equity Affiliate Income 17.8 19.2 19.8 21.8
Slide 27: Non GAAP Appendix: ROCE Tax Rate FY04 and FY08
William Blair 30th Annual Growth Stock Conference Non GAAP Appendix: ROCE Tax Rate FY04 and FY08 Q104 Q204 Q304 Q404 Q108 Q208 Q308 Q408 Reported Income from Cont. Ops. Bef. Tax 169.0 187.6 221.8 217.6 364.9 352.1 400.7 361.1 Noncontrolling Interest (1.9) (4.1) (3.3) (2.5) (6.1) (4.5) (7.6) (4.8) In
Slide 28: Non-GAAP Appendix: FY10 Guidance
William Blair 30th Annual Growth Stock Conference 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 $0.1
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