Air Products (NYSE: APD) Reports Mixed Q2 FY25 Results, Revises Full-Year EPS Guidance

Air Products (NYSE:APD) has reported its financial results for the second quarter of fiscal year 2025, presenting a mixed bag of outcomes.

While the company missed earnings estimates and experienced a net loss, it managed to maintain stable sales figures and adjust its full-year EPS guidance.

Key Highlights

* APD reported a GAAP loss per share of $7.77 and a net loss of $1.7 billion, largely due to a $2.3 billion after-tax charge related to business and asset actions.

* On an adjusted basis, EPS stood at $2.69, which missed the market expectations by $0.15.

* Adjusted EBITDA also saw a decline, registering at $1.2 billion, compared to the year-ago quarter.

* Despite the lower-than-anticipated earnings and EBITDA, APD managed to maintain stable sales figures, with the second-quarter revenue reported at $2.9 billion, which was slightly below the analysts’ estimates of $2.94 billion.

* The flat sales performance was attributed to higher energy cost pass-through and pricing adjustments, which were counterbalanced by lower volumes and unfavorable currency impacts.

* The divestiture of the LNG business in September and reduced global helium demand led to the volume decline, while inflation and maintenance expenses drove up costs.

* Regionally, the Americas saw a 3% increase in sales to $1.3 billion, attributed to higher energy costs and pricing. However, operating income decreased by 2%, affected by maintenance costs.

* In Asia, sales decreased by 1% to $774 million, with operating income falling by 6% due to lower helium pricing and currency effects.

* Europe experienced a 9% sales increase to $727 million, but operating income decreased by 3% due to higher costs and an unfavorable business mix.

Air Products Revises Full-Year Fiscal 2025 EPS Guidance

The company has also revised its full-year fiscal 2025 adjusted EPS guidance to a range of $11.85 to $12.15, and third-quarter adjusted EPS is anticipated to fall within the bracket of $2.90 to $3.00.

This adjustment follows the challenges faced by Air Products in the second quarter, which included a significant after-tax charge and lower-than-expected earnings.

Furthermore, Air Products predicts that its capital expenditures for the fiscal year will be approximately $5 billion, highlighting the company’s focus on strategic investments and growth initiatives despite the earnings downturn.

Finally, management has noted the difficulty in providing a precise reconciliation of forecasted adjusted EPS to a comparable GAAP range due to the inherent unpredictability of future events and their potential impact on GAAP EPS.

Despite this limitation, Air Products remains committed to executing its strategic plans, such as exiting certain projects to streamline operations and concentrate resources on high-value opportunities, ultimately aiming to enhance shareholder value.