Yahoo Finance Air Products Builds ASUs in Zambia
Air Products and Chemicals Inc. (APD) announced that it has entered into an agreement with Kansanshi Mining Plc–the largest copper miner in Africa– to build two oxygen plants at the site of a copper smelter in Zambia.
Per the agreement, Air Products will construct two oxygen plants with a production capacity of 750-metric ton per day and all air separation unit (:ASU) related equipment and design for Kansanshi. The facility will be jointly developed by Kansanshi and Air Products and the ASUs are expected to come online in 2014.
Air Products already exists in Zambia, operating many oxygen plants at other copper mines. This presence has helped the company win the contract and design the new plant based on already constructed plants in the region..
Recently, Air Products released its fourth quarter and fiscal 2012 results. The company logged adjusted earnings from continued operations of $1.42 a share for the fourth quarter of fiscal 2012 ended September 30, 2012, missing the Zacks Consensus Estimate by a couple of cents.
Consolidated net income, as reported, plunged 57% year over year to $138.7 million (or 65 cents a share), pummeled by the hefty one-time charges. The company reported a profit of $324.8 million (or $1.51 a share) a year ago.
Revenues rose 4% to $2,606 million, beating the Zacks Consensus Estimate of $2,574 million. The revenue growth was attributable to higher volumes in the Tonnage Gases, Equipment and Energy, and Electronics and Performance Materials divisions as well as sales increases due to acquisitions, partly offset by the impact of unfavorable currency. The company witnessed sluggish manufacturing activity in the quarter.
For fiscal 2012, adjusted earnings of $5.40 a share missed the Zacks Consensus Estimate of $5.42 and exceeded the year-ago level of $5.36. Sales for the year edged down 1% year over year to $9,612 million, but beat the Zacks Consensus Estimate of $9,577 million.
For fiscal 2013, Air Products plans to take a number of steps including execution of its new Tonnage investments and sustained improvement in its Electronics and Performance Materials unit to attain better productivity. The company expects that its recent strategic moves will act favorably for future growth and profitability despite the weak macroeconomic backdrop.
The company anticipates earnings between $5.65 and $5.85 per share for fiscal 2013. For first-quarter fiscal 2013, earnings are expected in the band of $1.26 to $1.31 per share. Air Products expects capital expenditures between $2 billion and $2.2 billion for the year.
Air Products, which competes with Praxair Inc. (PX), currently holds a short-term (1 to 3 months) Zacks #5 Rank (Strong Sell) and we have a long-term (more than 6 months) Neutral recommendation on the stock.
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