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News ReleaseAir Products Reports Fiscal 2009 First Quarter Earnings

January 21, 2009 Lehigh Valley, Pa.

Air Products (NYSE:APD) today reported net income of $69 million or diluted earnings per share (EPS) of $0.32 for its fiscal first quarter ended December 31, 2008. This includes a $0.55 per share charge for the previously announced global cost reduction plan and a $0.10 per share loss from discontinued operations.

Excluding the impact of these items, income was $206 million and diluted EPS was $0.97, down 21 and 18 percent, respectively, compared with the prior year. The discussion of first quarter results in this release is based on non-GAAP comparisons. It excludes the impacts of the above items. A reconciliation can be found at the end of this release.*

First quarter revenues of $2,195 million declined nine percent and operating income of $288 million was down 24 percent from the prior year on weaker volumes, primarily in the Electronics and Performance Materials and Merchant Gases segments, and unfavorable currency.

John McGlade, chairman, president and chief executive officer, said, “Over the quarter, we saw further deterioration in business conditions, resulting in one of the weakest economic environments we’ve ever seen. It was evident that the shocks to the global economy have shattered consumer confidence, which has significantly impacted customers’ operating rates across most of our end markets. In response, we continue to take aggressive actions to reduce our costs and drive to a lower cost structure.”

First Quarter Segment Performance

  • Merchant Gases sales of $925 million declined eight percent due to currency. Operating income of $171 million declined 15 percent from the prior year, as strong pricing was offset by weaker volumes across all regions and unfavorable currency impacts.
  • Tonnage Gases sales of $744 million were down six percent and operating income of $109 million decreased two percent from the prior year on unfavorable currency impacts and lower volumes from weakness in steel and chemicals end markets. Hydrogen volumes were higher despite unfavorable hurricane impacts.
  • Electronics and Performance Materials sales of $407 million declined 21 percent. Operating income of $25 million declined 63 percent from the prior year. Electronics manufacturing declined significantly on falling consumer demand. Performance Materials volumes dropped on lower demand from coatings, autos, housing and other end markets.
  • Equipment and Energy sales of $120 million were up 19 percent on higher air separation unit sales. Operating income of $7 million decreased 25 percent from the prior year on lower LNG heat exchanger activity.


McGlade said, “While the global economic environment is poor, we continue to build and maintain our strong positions, taking the necessary near-term actions to deliver improvement and growth in the future. We have a good backlog of projects and opportunities in front of us. Our solid balance sheet and access to capital will enable us to take advantage of these opportunities.”

The company expects second quarter EPS from continuing operations to be between $0.80 to $0.90 per share and full year EPS from continuing operations to be between $4.00 and $4.30 per share.

Annual Meeting of Shareholders

Air Products will host its Annual Meeting of Shareholders on Thursday, January 22, 2009 at 2:00 p.m. ET. Access the audio Webcast at: Air Products (NYSE:APD) serves customers in industrial, energy, technology and healthcare markets worldwide with a unique portfolio of atmospheric gases, process and specialty gases, performance materials, and equipment and services. Founded in 1940, Air Products has built leading positions in key growth markets such as semiconductor materials, refinery hydrogen, home healthcare services, natural gas liquefaction, and advanced coatings and adhesives. The company is recognized for its innovative culture, operational excellence and commitment to safety and the environment. Air Products has annual revenues of over $10 billion, operations in over 40 countries, and 21,000 employees around the globe. For more information, visit

NOTE: The information above 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 document regarding important risk factors. Actual performance and financial results may differ materially from projections and estimates expressed in the forward-looking statements because of many factors, including, without limitation, continuing deterioration in economic and business conditions; weakening demand for the company's products, future financial and operating performance of major customers and industries served by the Company; unanticipated contract terminations or customer cancellations or postponement of projects and sales; asset impairments due to economic conditions or specific product or customer events; the impact of competitive products and pricing; interruption in ordinary sources of supply of raw materials; the ability to recover unanticipated increased energy and raw material costs from customers; costs and outcomes of litigation or regulatory activities; consequences of acts of war or terrorism impacting the United States’ and other markets; the effects of a pandemic or epidemic or a natural disaster; charges related to current portfolio management and cost reduction actions; the success of implementing cost reduction programs and achieving anticipated acquisition synergies; the timing, impact, and other uncertainties of future acquisitions or divestitures; the ability to attract, hire and retain qualified personnel in all regions of the world where the Company operates; significant fluctuations in interest rates and foreign currencies from that currently anticipated; the continued availability of capital funding sources in all of the Company's foreign operations; the impact of new or changed environmental, healthcare, tax or other legislation and regulations in jurisdictions in which the Company and its affiliates operate; the impact of new or changed financial accounting standards; and the timing and rate at which tax credits can be utilized and other risk factors described in the Company’s Form 10K for its fiscal year ended September 30, 2008. The Company disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained in this document to reflect any change in the Company’s assumptions, beliefs or expectations or any change in events, conditions or circumstances upon which any such forward-looking statements are based.

*The presentation of non-GAAP measures is intended to enhance the usefulness of financial information by providing measures which the Company’s management uses internally to evaluate the Company’s baseline performance. Presented below are reconciliations of reported GAAP results to non-GAAP measures.

Consolidated Results

  Q1 YTD
Millions of Dollars Operating
Income Diluted
2009 GAAP $114.1 $ 90.0 $.42  
2008 GAAP 380.4 262.3 1.18  
% Change GAAP (70)% (66)% (64)%  
2009 GAAP $114.1 $ 90.0 $.42  
Global Cost Reduction Plan 174.2 116.1 .55  
2009 Non-GAAP Measure $288.3 $206.1 $.97  
% Change Non-GAAP Measure (24)% (21)% (18)%  
2009 Forecast GAAP       $3.45-$3.75
Global Cost Reduction Plan       $.55
2009 Forecast Non-GAAP Measure       $4.00-$4.30

View entire earnings release with all financial tables. (57 KB) 

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  • Press Contact
    Katie McDonald
    Air Products and Chemicals, Inc.
    7201 Hamilton Boulevard
    Allentown, PA 18195-1501
    (610) 481-6642
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    Simon Moore
    (610) 481-7461
    Air Products and Chemicals, Inc.
    7201 Hamilton Boulevard
    Allentown, PA 18195-1501
    (610) 481-2729
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