UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) 16 July 1999
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Air Products and Chemicals, Inc.
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(Exact name of registrant as specified in charter)
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Delaware 1-4534 23-1274455
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(State of other jurisdiction of incorporation) (Commission file number) (IRS Identification number)
7201 Hamilton Boulevard, Allentown, Pennsylvania 18195-1501
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(Address of principal executive offices) (Zip Code)
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Registrant's telephone number, including area code (610) 481-4911
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Item 5. Other Events.
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Based on a review of preliminary quarterly information, the registrant
announced today it anticipates third quarter earnings to be below last year's
earnings and analysts' expectations. Compared to last year, Equipment and
Chemicals have been particularly hard hit. The Company, which plans to release
its third quarter results on July 23, said it expects earnings per share to be
approximately $0.48, excluding a $0.04 per share charge for workforce reduction
related to the Company's ongoing productivity improvement program.
Commenting on the outlook for the quarter, Harold A. Wagner, Chairman
and Chief Executive Officer, said, "We are disappointed in the preliminary
results coming forward from our segments. Markets have not improved as much as
anticipated, which is the primary factor affecting performance. We continue to
implement specific actions to improve what is in our control--productivity and
cost."
The Gases segment is expected to show improvement in both operating
profit and margin compared to last year. Productivity and cost reduction
initiatives contributed to these improvements, despite slower volume growth and
increased price pressure. While prospects look encouraging in the Equipment
segment, new orders did not materialize at the rate anticipated during the
quarter.
The Chemicals segment was impacted by customer operating issues and
outages, particularly in polyurethane intermediates and amines, where
substantial new investment has recently been brought on line. Margin pressures
continue in several businesses, as lower raw material costs are being passed on
to customers.
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Mr. Wagner added, "The markets we serve remained difficult this
quarter. However, we do see some encouraging signs in key businesses like
electronics and higher amines. Continued strong cost performance in Gases and
new orders in Equipment should lead to sequential improvements. And in
Chemicals, we have taken further action to reduce costs and increase prices."
Looking forward, the Company now expects the fiscal year ending
September 30, 1999 to generate earnings per share that are approximately 5-7%
below last year's. Gases performance should continue to progress and Chemicals
profits are expected to improve substantially, provided that key customers
increase demand in accordance with their forecasts.
Additional details will be provided on July 23 in the earnings release
and teleconference.
NOTE: The forward-looking statements contained in this document are based on
current expectations regarding important risk factors. Actual results may differ
materially from those expressed. Important risk factors and uncertainties
include the impact of worldwide economic growth; pricing of both the Company's
products and raw materials such as electricity; customer demand; other factors
resulting from fluctuations in interest rates and foreign currencies; the impact
of competitive products and pricing; success of cost control programs; and the
impact of tax and other legislation and other regulations in the jurisdictions
in which the Company and its affiliates operate.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Air Products and Chemicals, Inc.
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(Registrant)
Dated: 16 July 1999 By: /s/ Paul E. Huck
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Paul E. Huck
Vice President &
Corporate Controller
(Chief Accounting Officer)
