) reported third-quarter 2012 EPS of 97 cents compared with 80
cents in the year-earlier quarter. The quarter included an asset
impairment charge of 10 cents. Results were, however, in line with
the Zacks Consensus Estimate.
Total revenue in the reported quarter rose 12% year over year to
$1.15 billion, and was above the Zacks Consensus Estimate of $1.14
billion. Sales from same stores were up 9%, with hardgoods gaining
14% and gases and rent growing 7%. Acquisitions contributed 3% to
the sales growth.
Cost and Margins
Costs of goods sold increased to $520.8 million in the quarter
from $458.2 million in the year-earlier quarter. Selling,
distribution and administrative expenses amounted to $433.1
million, up from $387.9 million in the year-earlier quarter.
Operating income was $130.6 million in the quarter versus $108.4
million in the year-ago quarter. Adjusted operating margin in the
third quarter was 11.7% and included an impact of 110 basis points
from SAP implementation costs and depreciation expense.
Cash, as of December 31, 2011 amounted to $45.8 million, down
from $57.2 million as of March 31, 2011. The decrease in free cash
flow from the prior year reflects an increase in capital
expenditures and working capital to support sales growth.
Adjusted cash from operations in the last nine months was $224.8
million versus $187.2 million in the prior-year period.
Management expects adjusted earnings per diluted share for
fourth quarter 2012 to increase 18% to 23% from 88 cents in the
prior year to $1.04 to $1.08, including 8 cents of SAP
implementation costs and depreciation expense, compared with 4
cents in the prior year, and also includes the benefit from share
The sequential increase in adjusted earnings per diluted share
primarily reflects the impact of two additional selling days,
reduced third quarter holiday impact, and continued business growth
in the Distribution segment.
For fiscal 2012, the company expects adjusted earnings per
diluted share to increase 21% to 22% from $3.34 in fiscal 2011 to
$4.03-$4.07, including an anticipated impact of 33 cents related to
SAP implementation costs and depreciation expense, compared with 14
cents in fiscal 2011, and also includes the benefit from share
Special gains and charges for fiscal 2012 are expected to come
in at 17 cents compared with a net charge of 41 cents in fiscal
2011. All special gains and charges are excluded from the quarter
and full year adjusted earnings guidance above.
Based in Randor, Pennsylvania, Airgas, through its subsidiaries,
distributes industrial, medical, and specialty gases, as well as
hard goods in the United States. Airgas competes with
Air Products & Chemicals Inc.
) and American Air Liquide, Inc.
Currently, the company retains a Zacks #2 Rank, which translates
into a short-term (1 to 3 months) Buy rating.
AIR PRODS & CHE (
): Free Stock Analysis Report
AIRGAS INC (
): Free Stock Analysis Report
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