Air Products' PRISM Technology - Analyst Blog
November 17 2011 - 12:52PM
Zacks
Air Products &
Chemicals Inc.’s (APD) PRISM VSA Oxygen Generation System
is now officially supplying Gerdau Steel's Whitby, Ontario, Canada
facility with over 200 tons per day of oxygen for its steelmaking
plant.
Air Products won this long-term
contract, which also includes liquid nitrogen and liquid oxygen
supply, by demonstrating the versatile flexibility of the PRISM
system as the right fit for Gerdau's production schedule.
Recently, Air Products reported its
fourth-quarter 2011 EPS of $1.51 versus $1.35 in the year-earlier
quarter, in line with the Zacks Consensus Estimate of $1.51. For
full-year 2011, the company reported EPS of $5.73, up 14% year over
year, matching the Zacks Consensus Estimate of $5.73.
Net sales amounted to $2.6 billion
versus $2.4 billion in the prior-year quarter, in line with the
Zacks Consensus Estimate of $2.6 billion. The improved results were
mainly driven by growth in the emerging markets and strong
performance in its Tonnage Gases business. Despite a slowing global
economy in the second half of 2011, the company won several
projects and also witnessed double-digit sales and earnings
growth.
For fiscal 2011, sales increased
12% year over year to $10,082 million driven by a 9% volume
increase, which was in line with the Zacks Consensus Estimate.
Based in Pennsylvania, Air Products
benefits from a long-term take-or-pay contract, a consolidated
industry structure, a diverse customer base and sustained pricing
power. However, soaring energy and raw material costs pose a threat
to margin expansion.
In order to compensate for
escalating raw material costs, Air Products has been increasing the
price for a range of chemicals it manufactures for industrial use.
Air Products faces stiff competition from Praxair
Inc. (PX) and The Linde Group.
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