Praxair Inc. has reported record net income of $355 million and diluted earnings per share of $1.11 in the third quarter. The company’s shares rose roughly $10 per share to $63 on the news.
For the same quarter last year, the company earned $305 million and 94 cents, respectively. This year’s numbers represent growth in net income and earnings per share of 16 percent and 18 percent, respectively. Praxair, based in Danbury, has a major distribution plant in Suffield.
Sales in the third quarter totaled $2.8 billion. That’s up 20 percent from the $2.3 billion in total sales in the prior year’s quarter. In a news release, Praxair said sales were strong in “every geographic region,” led by South America and Asia.
Operating profit was a record $544 million, or 18 percent more than the $460 million the company made in the third quarter last year.
Praxair said it generated “strong cash flow from operations” of $630 million. The available cash funded $405 million worth of capital expenditures, largely for new production plants under contract for customers in North and South America, China, and India, the company said.
The company also repurchased $537 million in stock. Praxair said business development was “strong” and with new contracts including a second coal gasification oxygen supply system in China and two hydrogen plants for BP in Indiana.
Steve Angel, Praxair’s chairman and chief executive officer, said the company had “another very strong quarter despite some effect from the U.S. Gulf Coast hurricanes, and slowing macroeconomic growth in the U.S. and Europe.”
Global Crisis Concerns
He cautioned, though, that Praxair anticipates the global financial crisis will cause “a contraction in manufacturing output in the U.S. and Europe, combined with slowing growth in Asia and South America for the next several quarters.
“Additionally, we expect the recent strengthening of the dollar to impact consolidated sales and earnings growth by about 8 percent at current exchange rates,” Angel said. “Consequently, we will take appropriate measures to properly align our cost structure as necessary. We remain confident in our business strategy and the ability of the Praxair team to continue to perform.”
For the fourth quarter, he said Praxair expects diluted earnings in the range of $1.03 to $1.08 per share, representing earnings growth of 5 percent to 10 percent.
For the full year, Praxair expects sales of about $11 billion, representing year-over-year growth of about 17 percent, he said.
