January 22, 2003

Access the Q1 earnings teleconference scheduled for 11:00 a.m. EST on January 22, 2003 by calling (212) 547-0152 and entering passcode 7711, or listen on the Web.

LEHIGH VALLEY, Pa. (January 22, 2003) � Air Products (NYSE:APD) today reported net income of $126 million, or diluted earnings per share (EPS) of $.56, for its first fiscal quarter ended December 31, 2002. Excluding the cumulative effect of an accounting change for SFAS No. 143*, net income was $129 million, or diluted EPS of $.58. Excluding this accounting change, EPS was up 12 percent over the prior year.

Quarter revenues of $1.4 billion were up 10 percent from the prior year and up four percent sequentially. Excluding acquisitions, divestitures, currency effects, and the sales increase directly associated with higher natural gas costs, underlying sales increased three percent from the prior year, principally reflecting higher worldwide gases volumes, and were down one percent sequentially, principally due to lower chemical volumes.

Operating income was $197 million, up seven percent over the prior year. Positive impacts on operating income came from acquisitions, increased gas volumes, lower than anticipated fiscal year 2002 incentive compensation costs, and favorable currency. Higher raw material and energy, increased pension, and SAP implementation costs partially offset these gains.

Commenting on the quarter, John P. Jones, Air Products' Chairman and Chief Executive Officer, said, "Despite a weaker than expected economic climate, we continued to execute our plans consistent with our strategy, focusing on the elements of our business that we can control, including our portfolio management efforts, process improvement activities and building our leadership positions in growth markets."

Industrial gas sales of $1 billion increased 13 percent versus the prior year. Operating income of $170 million was up 12 percent versus the prior year, led by improved worldwide gases volumes, the company's acquisitions in Asia and U.S. homecare, and the effect of the strengthening Euro.

Sequentially, gases revenues increased six percent and operating income was down one percent, as acquisitions were more than offset by declines in electronics and volume declines in CPI related to the Gulf Coast hurricanes and customer outages.

Chemicals sales of $354 million increased one percent versus the prior year. Operating income of $33 million declined 18 percent with stronger polyurethane intermediate volumes more than offset by lower margins and weaker volumes in the company's amines and performance polymers (emulsions) businesses.

Sequentially, chemicals revenues declined two percent. Operating income was down 21 percent due to higher raw material costs and weaker volumes across performance materials**, partially offset by improved polyurethane intermediate operating rates.

Air Products' equipment segment sales of $67 million were up six percent versus the prior year. Operating income of $4 million was up $3 million versus the prior year. The company secured a new liquefied natural gas heat exchanger order during the first quarter.

Equity affiliate income of $26 million increased 40 percent over the prior year. Adjustments related to divestitures recorded in prior periods more than compensated for the transition of San Fu Chemical Co., Ltd. into the consolidated results.

Regarding Air Products' outlook, Mr. Jones said, "Based on current economic estimates, the range for U.S. manufacturing growth this fiscal year now appears to be one to three percent. While we are seeing higher raw material costs and a slower first-half recovery in the manufacturing sector, particularly in electronics, our currency and tax outlook is now more favorable than it was in October. On balance, we are maintaining our EPS guidance range of $2.40 to $2.60 for the year. We anticipate fiscal second quarter earnings results similar to this quarter."

Air Products will hold its annual meeting of shareholders on Thursday, January 23, 2003, 2:00 p.m. EST, at Cedar Crest College in Allentown, Pa. The meeting can be heard on the Web.

***NOTE: The forward-looking statements contained in this release are based on current expectations regarding important risk factors. Actual results may differ materially from those expressed. Factors that might cause forward-looking statements to differ materially from actual results include, among other things, overall economic and business conditions different than those currently anticipated and demand for Air Products' goods and services; competitive factors in the industries in which it competes; interruption in ordinary sources of supply; the ability to recover increased energy and raw material costs from customers; spikes in the pricing of natural gas; changes in government regulations; consequences of acts of war or terrorism impacting the United States' and other markets; the success of implementing cost reduction programs; the timing, impact and other uncertainties of future acquisitions or divestitures; significant fluctuations in interest rates and foreign currencies; the impact of tax and other legislation and regulations in jurisdictions in which Air Products and its affiliates operate; and the timing and rate at which tax credits can be utilized.

Please review the Summary of Consolidated Financial Information:

AIR PRODUCTS AND CHEMICALS, INC.
SUMMARY OF CONSOLIDATED FINANCIAL INFORMATION
(Unaudited)

(Millions of dollars, except per share)

Three Months Ended



31 December

     2002

       2001

Sales

$1,447.0

$1,316.5

Income Before Cumulative Effect of Accounting Change

$128.7

$113.7

Cumulative Effect of   Accounting Change

(2.9)

--

Net Income

$125.8

$113.7

Basic Earnings Per Share

Income Before Cumulative Effect of Accounting Change

$.59

$.53

Cumulative Effect of   Accounting Change

(.02)

--

Net Income

$.57

$.53

Diluted Earnings Per Share

Income Before Cumulative Effect of Accounting Change

$.58

$.52

Cumulative Effect of   Accounting Change

(.02)

--

Net Income

$.56

$.52

Capital Expenditures

$351.4

$199.4

Depreciation

$156.0

$139.3

AIR PRODUCTS AND CHEMICALS, INC. and Subsidiaries
CONSOLIDATED INCOME
(Unaudited)

(Millions of dollars, except per share)

Three Months Ended
31 December

2002

2001

SALES

$1,447.0

$1,316.5

COSTS AND EXPENSES

Cost of sales

1,033.0

937.1

Selling and administrative

190.8

169.3

Research and development

30.0

30.4

Other (income) expense, net

(3.3)

(4.5)

OPERATING INCOME

196.5

184.2

Income from equity affiliates, net of related expenses

25.8

18.4

Interest expense

31.7

35.1

INCOME BEFORE TAXES AND    MINORITY INTEREST

190.6

167.5

Income taxes

55.1

48.8

Minority interest (a)

6.8

5.0

INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE

$128.7

$113.7

Cumulative effect of accounting change

(2.9)

--

NET INCOME

$125.8

$113.7

BASIC EARNINGS PER   COMMON SHARE

Income before cumulative effect of accounting change

$.59

$.53

Cumulative effect of accounting change

(.02)

--

Net Income

$.57

$.53

DILUTED EARNINGS PER   COMMON SHARE

Income before cumulative effect of accounting change

$.58

$.52

Cumulative effect of accounting change

(.02)

--

Net Income

$.56

$.52

WEIGHTED AVERAGE NUMBER OF COMMON SHARES (in millions)

218.8

215.7

WEIGHTED AVERAGE NUMBER OF COMMON AND COMMON   EQUIVALENT SHARES (in millions)

223.0

220.6

DIVIDENDS DECLARED PER   COMMON SHARE � Cash

$.21

$.20

Minority interest primarily includes before-tax amounts.

AIR PRODUCTS AND CHEMICALS, INC. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

(Millions of dollars)

31 December

ASSETS

2002

2001

CURRENT ASSETS

Cash and cash items

$104.8

$68.3

Trade receivables, less allowances for doubtful accounts
1,031.3

867.4

Inventories and contracts in progress

484.8

485.5

Other current assets

213.6

207.4

TOTAL CURRENT ASSETS

1,834.5

1,628.6

INVESTMENTS IN NET ASSETS OF AND ADVANCES TO EQUITY AFFILIATES

499.7

516.9

PLANT AND EQUIPMENT, at cost

11,160.1

10,324.9

Less - Accumulated depreciation

5,681.5

5,210.2

PLANT AND EQUIPMENT, net

5,478.6

5,114.7

GOODWILL

557.0

380.7