Airgas Inc.'s (ARG) fiscal second-quarter profit rose 22% and
core profit beat its expectation as revenue rose.
The special-gas provider also raised its 2010 earnings forecast
to $3.22 to $3.32 a share from $3.15 to $3.30 as it projected a
third-quarter profit of 76 cents to 80 cents. Analysts on average
estimated 80 cents, according to Thomson Reuters.
Airgas has benefited of late from demand recovering from
woefully low levels during the economic downturn. It has been the
hostile takeover target of its bigger rival Air Products &
Chemicals Inc. (APD) for months.
Airgas has repeatedly rejected the bid, which most recently
valued the company at $5.6 billion, saying the offer undervalues
it. It reiterated that view Tuesday as Chairman John van Roden
wrote a letter citing the latest quarter's results and saying the
board believes the company is worth more than $70 a share, compared
with the $65.50 offer.
The Federal Trade Commission has cleared the antitrust issues of
the potential deal after a deal under which Air Products would sell
15 air-separation units and related bulk liquid-oxygen and
liquid-nitrogen assets owned by Airgas within four months after the
deal completes.
For the quarter ended Sept. 30, Airgas reported a profit of
$66.6 million, or 78 cents a share, up from $54.5 million, or 65
cents a share, a year earlier.
Excluding takeover and debt-extinguishment costs and pension
impacts, earnings rose to 83 cents from 68 cents. The company in
July predicted earnings of 78 cents to 82 cents a share, above
analysts' then estimate.
Revenue increased 10% to $1.06 billion, in line with analysts'
most recent estimate.
Gross margin narrowed to 55.1% from 55.9%.
Shares closed at $69.99 Monday and didn't trade premarket. The
stock has risen 47% this year.
-By Matt Jarzemsky; Dow Jones Newswires; 212-416-2240