Reporting its fiscal first quarter (Q1) of 2021 results, Air Products today (4th Feb) confirmed increased sales in Asia, Europe the Middle East and Africa, as well as flat sales in the Americas, versus the prior year.
“With our strong portfolio, we are able to meet customers’ and countries’ drive for cleaner and more sustainable solutions,” said Seifi Ghasemi, Air Product’s Chairman, President and CEO as he reflected on the results.
“From our position of financial strength, we continued to execute our growth strategy focused on industrial gas projects that address significant energy and environmental challenges.”
Sales in Asia of $718m increased 4% from the prior year on 6% favourable currency and 1% each higher pricing and energy-pass through. Volumes decreased 4%, primarily from a reduced contribution from Lu’An, while the merchant business remained stable.
Operating income of $215m decreased 6%, primarily due to Lu’An, and operating margin of 29.9% decreased 310 basis points. Adjusted EBITDA of $343m decreased 1%, primarily due to Lu’An, and adjusted EBITDA margin of 47.7% decreased 240 basis points.
Sequentially, sales increased 1%, as 4% favourable currency more than offset 3% lower volumes, including Lu’An.
Sales in the Americas of $922m were flat versus the prior year. 3% higher pricing and 2% high energy pass-through were offset by 5% lower volumes, primarily due to the impact of Covid-19.
Operating income of $226m decreased 12%, due to lower volumes and high planned maintenance, partially offset by higher pricing. Operating margin of 24.2% decreased 330 basis points.
Adjusted EBITDA of $400m decreased 2%, due to lower volumes and higher planned maintenance, partially offset by higher pricing and the acquisition of hydrogen assets. Adjusted EBITDA margin of 42.9% decreased 90b basis points.
Sequentially, sales increased 2% on 5% higher energy pass-through and 1% higher pricing, partially offset by 4% lower volumes, primarily driven by seasonality.
Europe the Middle East and Africa (EMEA)
Sales of $563m in the EMEA region increased 13% over the prior year. Volumes increased 5%, primarily driven by acquisition and high onsite volumes, partially offset by lower packaged gas demand from Covid-19. 3% higher pricing and 6% favourable currency more than offset 1% lower energy pass-through.
Operating income of $142m increased 17%, primarily due to higher pricing, favourable currency and acquisitions, and operating margin of 25.1% increase 90 basis points.
Adjusted EBITDA of $222m increased 18%, primarily due to high pricing, favourable currency and acquisitions, and adjusted ENITDA margin of 39.4% increased 170 basis points.
Sequentially, sales increased 11% on 6% higher volumes, driven by modest Covid-19-related recovery in the merchant business, acquisitions and higher onsite volumes; 2% favourable currency; 2% higher energy cost pass-through; and 1% higher pricing.
“We see great opportunities ahead in gasification, carbon capture and hydrogen for mobility, and we continue to develop and invest in strategic opportunities to drive our growth for decades to come,” Ghasemi concluded.