View entire earnings release with all financial tables.
| Lehigh Valley, PA
Air Products Reports Fiscal 2025 Second Quarter Results
Media Contacts:
Investor Contacts:
Q2 FY25 Summary of Results (comparisons versus prior year):
- GAAP results, including loss per share# of $7.77 and net loss of $1.7 billion, driven by an after-tax charge attributable to Air Products of $2.3 billion for business and asset actions recorded during the fiscal 2025 second quarter
- Adjusted earnings per share ("EPS")* of $2.69; adjusted EBITDA* of $1.2 billion
Q2 FY25 Announcements
- Appointed Eduardo F. Menezes Chief Executive Officer of Air Products and member of the Board of Directors, joining other Board members elected in January 2025; Wayne T. Smith and Dennis H. Reilley named Chairman and Vice Chairman, respectively
- Increased quarterly dividend to $1.79 per share, marking the 43rd consecutive year of dividend increases
- Announced exit of three U.S. projects: World Energy Sustainable Aviation Fuel expansion project in Paramount, California; green liquid hydrogen project in Massena, New York; and carbon monoxide project in Texas. These and other strategic initiatives, including workforce actions under the Company's global cost reduction plan, resulted in charges of approximately $2.9 billion ($2.3 billion attributable to Air Products after tax, or $10.28 per share).
Guidance
- Revising fiscal 2025 full-year adjusted EPS guidance* to $11.85 to $12.15; fiscal 2025 third quarter adjusted EPS guidance* of $2.90 to $3.00
- Expect fiscal year 2025 capital expenditures* of approximately $5 billion
#Per share amounts are calculated and presented on a diluted basis from continuing operations attributable to Air Products.
*Certain results in this release, including in the highlights above, include references to non-GAAP financial measures on a consolidated, continuing operations basis and a segment basis. Additional information regarding these measures and reconciliations of GAAP to non-GAAP historical results can be found below. In addition, as discussed below, it is not possible, without unreasonable efforts, to identify the timing or occurrence of future events, transactions, and/or investment activity that could have a significant effect on the Company's future GAAP EPS or cash flow used for investing activities if any of these events were to occur.
Fiscal 2025 Second Quarter Consolidated Results
Air Products (NYSE: APD) today reported second quarter fiscal 2025 GAAP results, including loss per share of $7.77 and net loss of $1.7 billion, which compared to fiscal 2024 GAAP earnings per share of $2.57 and net income of $581 million. These results were driven by an after-tax charge attributable to Air Products of $2.3 billion ($10.28 per share) related to strategic business and asset actions, including project cancellations and other cost reduction measures taken during the second quarter. The non-GAAP financial measures discussed below exclude this charge as well as other items as described in the "Reconciliations of Non-GAAP Financial Measures" section beginning on page 8 of this release. Air Products' Board of Directors continues to evaluate strategic opportunities across the Company that could result in additional costs for business and asset actions in future periods.
For the quarter, on a non-GAAP basis, adjusted EPS of $2.69 decreased six percent from the prior year driven by lower volumes and higher costs. These items were partially offset by favorable pricing, which was primarily attributable to non-helium merchant products. The volume decline was driven by the September 2024 LNG divestiture and lower global helium demand, partially offset by higher volumes in our on-site business. Higher costs primarily reflect favorable non-recurring items in the prior year, inflation, and higher expense for maintenance and depreciation, which were partially offset by productivity improvements across the regions. Adjusted EBITDA of $1.2 billion was down three percent.
Second quarter sales of $2.9 billion were flat as four percent higher energy cost pass-through and one percent higher pricing were offset by three percent lower volumes, primarily due to the LNG divestiture, and two percent unfavorable currency.
Fiscal 2025 Second Quarter Results by Business Segment
- Americas sales of $1.3 billion were up three percent versus the prior year, as four percent higher energy cost pass-through and two percent higher pricing were partially offset by two percent lower volumes and one percent unfavorable currency. Operating income of $366 million decreased two percent as higher costs driven by planned maintenance were partially offset by a favorable one-time customer contract amendment and non-helium pricing. Operating margin of 28.4 percent decreased 150 basis points, of which approximately 100 basis points was attributable to higher energy cost pass-through. Adjusted EBITDA of $575 million decreased three percent and included the impact of lower equity affiliates' income.
- Asia sales of $774 million decreased one percent from the prior year as three percent unfavorable currency and one percent lower pricing were partially offset by two percent higher energy cost pass-through and one percent higher volumes. Operating income of $191 million decreased six percent driven by lower helium pricing, net of power and fuel costs, and currency, partially offset by lower costs. Operating margin of 24.7 percent decreased 140 basis points driven by the lower helium pricing. Adjusted EBITDA of $334 million increased two percent, primarily due to business mix.
- Europe sales of $727 million increased nine percent from the prior year as five percent higher energy cost pass-through, four percent higher pricing, and two percent higher volumes were partially offset by two percent unfavorable currency. Operating income of $196 million decreased three percent as higher costs, unfavorable business mix, and currency were partially offset by higher pricing, net of power and fuel costs. Operating margin of 26.9 percent decreased 320 basis points, of which approximately 150 basis points was attributable to higher energy cost pass-through. Adjusted EBITDA of $280 million increased six percent and included the impact of higher equity affiliates' income.
- Middle East and India equity affiliates' income of $78 million increased six percent from the prior year driven by an affiliate in Saudi Arabia.
- Corporate and other sales of $95 million decreased 53 percent and operating loss of $118 million increased 35% compared to the prior year, primarily due to the divestiture of the LNG business in the fourth quarter of fiscal 2024. Operating loss in fiscal year 2025 also reflects unfavorable changes to sale of equipment project estimates, which were partially mitigated by productivity improvements.
Outlook
Air Products has provided revised full-year fiscal 2025 adjusted EPS guidance* in the range of $11.85 to $12.15. For the fiscal 2025 third quarter, Air Products' adjusted EPS guidance* is $2.90 to $3.00.
Air Products expects capital expenditures* of approximately $5 billion for full-year fiscal 2025.
| *Management is unable to reconcile, without unreasonable efforts, the Company’s forecasted range of adjusted EPS or capital expenditures to a comparable GAAP range. Air Products provides adjusted EPS guidance on a continuing operations basis, excluding the impact of certain items that management believes are not representative of the Company's underlying business performance, such as those described in the "Reconciliations of Non-GAAP Financial Measures" section beginning on page 8 of this release. It is not possible, without unreasonable efforts, to predict the timing or occurrence of these events or the potential for other transactions that may impact future GAAP EPS. Similarly, it is not possible, without unreasonable efforts, to reconcile forecasted capital expenditures to future cash used for investing activities because management is not able to identify the timing or occurrence of future investment activity, which is driven by management's assessment of competing opportunities at the time the Company enters into transactions. Furthermore, it is not possible to identify the potential significance of these events in advance, but any of these events, if they were to occur, could have a significant effect on the Company's future GAAP results. |
Earnings Teleconference
Access the fiscal 2025 second quarter earnings teleconference scheduled for 8:00 a.m. Eastern Time on May 1, 2025 by calling 773-305-6865 and entering passcode 7519932 or by accessing the Event Details page on Air Products’ Investor Relations website.
Access all earnings materials.
About Air Products
Air Products (NYSE: APD) is a world-leading industrial gases company in operation for over 80 years focused on serving energy, environmental, and emerging markets and generating a cleaner future. The Company supplies essential industrial gases, related equipment and applications expertise to customers in dozens of industries, including refining, chemicals, metals, electronics, manufacturing, medical and food. As the leading global supplier of hydrogen, Air Products also develops, engineers, builds, owns and operates some of the world's largest clean hydrogen projects, supporting the transition to low- and zero-carbon energy in the industrial and heavy-duty transportation sectors. Through its sale of equipment businesses, the Company also provides turbomachinery, membrane systems and cryogenic containers globally.
Air Products had fiscal 2024 sales of $12.1 billion from operations in approximately 50 countries and has a current market capitalization of about $60 billion. For more information, visit airproducts.com or follow us on LinkedIn, X, Facebook or Instagram.
Cautionary Note Regarding Forward-Looking Statements
This release contains “forward-looking statements” within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements about earnings and capital expenditure guidance, business outlook and investment opportunities. Forward-looking statements are based on management’s expectations and assumptions as of the date of this release and are not guarantees of future performance. While forward-looking statements are made in good faith and based on assumptions, expectations and projections that management believes are reasonable based on currently available information, 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: changes in global or regional economic conditions, inflation, and supply and demand dynamics in the market segments we serve, including demand for technologies and projects to limit the impact of global climate change; changes in the financial markets that may affect the availability and terms on which we may obtain financing; the ability to execute agreements with customers and implement price increases to offset cost increases; disruptions to our supply chain and related distribution delays and cost increases; risks associated with having extensive international operations, including political risks, risks associated with unanticipated government actions and risks of investing in developing markets; project delays, scope changes, cost escalations, contract terminations, customer cancellations, or postponement of projects and sales; our ability to safely develop, operate, and manage costs of large-scale and technically complex projects; the future financial and operating performance of major customers, joint ventures, and equity affiliates; our ability to develop, implement, and operate new technologies and to market products produced utilizing new technologies; our ability to execute the projects in our backlog and refresh our pipeline of new projects; tariffs, economic sanctions and regulatory activities in jurisdictions in which we and our affiliates and joint ventures operate; the impact of environmental, tax, safety, or other legislation, as well as regulations and other public policy initiatives affecting our business and the business of our affiliates and related compliance requirements, including legislation, regulations, or policies intended to address global climate change; changes in tax rates and other changes in tax law; safety incidents relating to our operations; the timing, impact, and other uncertainties relating to acquisitions, divestitures, and joint venture activities, as well as our ability to integrate acquisitions and separate divested businesses, respectively; risks relating to cybersecurity incidents, including risks from the interruption, failure or compromise of our information systems or those of our business partners or service providers; catastrophic events, such as natural disasters and extreme weather events, pandemics and other public health crises, acts of war, including Russia’s invasion of Ukraine and new and ongoing conflicts in the Middle East, or terrorism; the impact on our business and customers of price fluctuations in oil and natural gas and disruptions in markets and the economy due to oil and natural gas price volatility; costs and outcomes of legal or regulatory proceedings and investigations; asset impairments due to economic conditions or specific events; significant fluctuations in inflation, interest rates, and foreign currency exchange rates from those currently anticipated; damage to facilities, pipelines or delivery systems, including those we are constructing or that we own or operate for third parties; availability and cost of electric power, natural gas, and other raw materials; the commencement and success of any productivity and operational improvement programs; and other risks described in our Annual Report on Form 10-K for the fiscal year ended September 30, 2024 and subsequent filings we have made with the U.S. Securities and Exchange Commission. You are cautioned not to place undue reliance on our forward-looking statements. Except as required by law, we disclaim any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect any change in assumptions, beliefs, or expectations or any change in events, conditions, or circumstances upon which any such forward-looking statements are based.