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| Lehigh Valley, PA

Air Products Reports Fiscal 2025 First Quarter GAAP EPS of $2.77 and Adjusted EPS of $2.86

Media Contacts:

Katie McDonald | +1 610 481 3673

Investor Contacts:

Eric Guter | +1 610 481 1872
Mun Shieh | +1 610 481 2951

Q1 FY25 (comparisons versus prior year):

Fiscal 2025 and Recent Highlights

Guidance

#Earnings per share is 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 First Quarter Consolidated Results

Air Products (NYSE: APD) today reported first quarter fiscal 2025 results, including GAAP EPS of $2.77, up one percent from the prior year. GAAP net income of $650 million was up five percent as higher pricing, net of power and fuel costs, was partially offset by higher costs related to shareholder activism, incentive compensation, and inflation. These costs were partially mitigated by productivity improvements. The Company also recognized lower non-service pension costs as well as a gain on de-designated cash flow hedges. GAAP net income margin of 22.2 percent increased 150 basis points due to these factors as well as favorable business mix.

Air Products' first quarter GAAP results for the current and prior year include items that are adjusted in the non-GAAP measures discussed below. First quarter fiscal 2025 items include costs of $0.10 per share associated with shareholder activism and $0.04 per share for non-service pension costs, partially offset by a gain of $0.05 per share on de-designated cash flow hedges. Items for the prior year quarter included non-service pension costs of $0.08 per share.

For the quarter, on a non-GAAP basis, adjusted EPS of $2.86 increased one percent from the prior year. Adjusted EBITDA of $1.2 billion was up one percent as higher pricing, net of power and fuel costs, was partially offset by higher costs and lower equity affiliates' income. Adjusted EBITDA margin of 40.6 percent increased 140 basis points primarily due to favorable business mix and higher pricing.

First quarter sales of $2.9 billion were down two percent from the prior year as two percent lower volumes and one percent unfavorable currency were partially offset by one percent higher pricing. The lower volumes were driven by the divestiture of the LNG business in September 2024 as well as a lower contribution from on-sites and merchant in Europe, which were partially offset by a significant, non-recurring sale of helium to an existing merchant customer in the Americas. The impact attributable to the LNG divestiture was approximately 2%.

Q1FY25 earnings results infographic: $2.86 Adjusted EPS* up 1% vs. Q1FY24 | $1.2B Adjusted EBITDA* up 1% vs. Q1FY24 | 40.6% Adjusted EBITDA Margin* up >140 bp vs. Q1FY24 | ~$3.4B Distributable Cash Flow* over last 12 months, ~$1.6B paid as dividends | *Non-GAAP financial measure. See Reconciliation Tables for reconciliation.

Air Products' fiscal year 2025 first quarter financial results at a glance

Fiscal 2025 First Quarter Results by Business Segment 

  • Americas sales of $1.3 billion were up three percent versus the prior year, with three percent higher volumes primarily due to a significant, non-recurring sale of helium to an existing merchant customer and two percent higher pricing, partially offset by one percent each lower energy cost pass-through and unfavorable currency. Operating income of $388 million increased 10 percent and adjusted EBITDA of $597 million increased six percent, in each case primarily due to the higher volumes and pricing, net of power and fuel costs, partially offset by higher costs. Operating margin of 30.1 percent increased 180 basis points and adjusted EBITDA margin of 46.3 percent increased 150 basis points.
  • Asia sales of $817 million increased three percent from the prior year on two percent higher volumes driven by new assets and two percent higher energy cost pass-through, partially offset by one percent lower currency. Operating income of $216 million increased two percent and adjusted EBITDA of $350 million increased seven percent, in each case primarily due to favorable costs and volumes. Adjusted EBITDA also benefited from higher equity affiliates' income. Operating margin of 26.5 percent decreased 10 basis points while adjusted EBITDA margin of 42.8 percent increased 160 basis points.
  • Europe sales of $697 million decreased five percent from the prior year as five percent lower volumes driven by lower on-sites and helium in our merchant business and one percent lower energy cost pass-through were partially offset by one percent higher pricing. Operating income of $187 million decreased six percent and adjusted EBITDA of $259 million decreased three percent, in each case primarily due to the lower volumes, partially offset by the higher pricing, net of power and fuel costs. Adjusted EBITDA also benefited from favorable costs. Operating margin of 26.7 percent decreased 30 basis points while adjusted EBITDA margin of 37.2 percent increased 80 basis points. 
  • Middle East and India equity affiliates' income of $85 million decreased nine percent from the prior year driven by an affiliate in Saudi Arabia. 
  • Corporate and other sales of $97 million decreased 48 percent compared to the prior year, primarily due to the divestiture of the LNG business in the fourth quarter of fiscal 2024.

Outlook

Air Products continues to expect full-year fiscal 2025 adjusted EPS guidance* of $12.70 to $13.00. For the fiscal 2025 second quarter, Air Products' adjusted EPS guidance* is $2.75 to $2.85.

Air Products expects capital expenditures* in the range of $4.5 billion to $5.0 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 the incurrence of costs for cost reduction actions and impairment charges, or the recognition of gains or losses on certain disclosed items. 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 first quarter earnings teleconference scheduled for 8:00 a.m. Eastern Time on February 6, 2025 by calling 773-305-6853 and entering passcode 3870353 or by accessing the Event Details page on Air Products’ Investor Relations website.


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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 over $65 billion. Approximately 23,000 passionate, talented and committed employees from diverse backgrounds are driven by Air Products’ higher purpose to create innovative solutions that benefit the environment, enhance sustainability and reimagine what's possible to address the challenges facing customers, communities, and the world. 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, 2023 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.