Industrial gas producer and supplier,
) reported in line results, being it's second in a row, for the
first quarter of 2013. Adjusted earnings per share came in at
$1.38, no change from the year-ago quarter's earnings and in line
with the Zacks Consensus Estimate.
Including a loss from the Venezuela currency devaluation, GAAP
earnings for the quarter were $1.30 per share, down from $1.38 in
the year-ago quarter.
Earnings for both the quarters were within management's predicted
range of $1.35-$1.40 per share.
Praxair reported total revenue of $2,888 million in the first
quarter, up 2.0% year over year. The results were adversely
impacted by lower working days, negative foreign currency
translation, and cost pass-through; excluding which total revenue
grew by 4%.
During the quarter, healthy performance at manufacturing, energy,
and food & beverages markets helped push North American
revenue by 4% to $1,457 million. Revenue in Europe was down 2% to
$370 million due to lower industrial activities in Spain and
Italy resulting in lower packaged-gases.
Revenue in South America grew 3%, excluding a negative foreign
currency translation, to $531 million while that in Asia was up
10% to $367 million, driven by a volume growth in India, China,
Korea and Thailand. Surface Technologies revenue was $163 million
in the quarter versus $169 million in the year-ago quarter, due
primarily to weak business industrial and military aviation
Cost of sales in the quarter increased 1.4% year over year and
represented 56.7% of the total revenue. Adjusted operating profit
for Praxair in the quarter was $623 million, down 1% year over
year while adjusted margin stood at 21.6%.
Exiting the first quarter 2013, Praxair had cash and cash
equivalent balance of $113 million, down 28% compared with $157
million in the previous quarter. Long-term debt balance was
$7,772 million, up 16.3% sequentially as the company issued notes
worth $1,400 million during the quarter.
Praxair generated net cash of $472 million from operating
activities in the first quarter, up from $402 million in the
year-ago quarter. Capital spending went down 3.5% to $466
million, with a major portion being invested for a new production
Praxair pursues a consistent strategy of returning cash to
shareholders through dividend payments and share repurchases.
During the first quarter 2013, the company paid $178 million in
dividends and repurchased shares worth $150 million.
Alongside the quarterly results, Board of Directors of Praxair
declared a quarterly dividend of 60 cents to be paid on June 17,
2013 to its shareholders of record as on June 7, 2013.
For the second quarter of 2013, management projects earnings per
share to be within the $1.45-$1.50 per share range.
For 2013, adjusted earnings per share are expected to be within
the $5.90-$6.05 range while GAAP earnings are expected to be
within $5.82-$5.97. Sales are expected to be roughly $12 billion.
Capital spending is expected to be in the range of $1.8-$2.0
billion and effective tax rate guidance is projected to be 28%.
Praxair Inc. is the largest industrial gas producer and supplier
in the Americas and one of the leading gas producing companies
worldwide. The stock currently carries a Zacks Rank #3 (Hold).
Other stocks to watch out for in the industry are
Compass Minerals International Inc.
Eastman Chemical Co.
); each holds a Zacks Rank #2 (Buy).
COMPASS MINERLS (CMP): Free Stock Analysis
EASTMAN CHEM CO (EMN): Free Stock Analysis
OLIN CORP (OLN): Free Stock Analysis Report
PRAXAIR INC (PX): Free Stock Analysis Report
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