Air Products Profit up 19% as Strong Gas Sales to Electricity Producers Offset Lower Demand from Energy Firms

Air Products and Chemicals Inc forecast a fiscal first quarter profit below Wall Street's expectations, sending the industrial gas supplier's shares down as much as 5.1 percent.

The drop came after Air Products posted a quarterly profit in line with Wall Street's expectations on Friday, as strong industrial gas sales to electronics producers partly offset lower demand from energy companies.

Chief Executive Officer John McGlade said that while the global economy remained cloudy, Air Products had a steady backlog of work.

Still, McGlade expects the company to earn $1.31 to $1.39 per share in the first quarter ending Dec. 31 -- below the analysts' average forecast of $1.45, according to Thomson Reuters I/B/E/S.

We are confident that the prospects for industrial gases and Air Products, in particular, remain bright, and we remain committed to achieving our 2015 goals for growth, margin and, most importantly, return on capital, McGlade said in a statement.

For the fourth quarter ended on Sept. 30, the company reported net income of $324.8 million, or $1.51 per share, compared with $272.1 million, or $1.28 per share, a year earlier.

Analysts expected $1.51 per share.

Revenue rose 11 percent to $2.61 billion, just missing the $2.62 billion analysts expected.

The company supplies argon, oxygen and other industrial gases to retail, manufacturing and construction customers.

Large customers include Apple Inc and Intel Corp .

Sales to those and other electronics customers jumped 12 percent to $587 million.

But sales to energy companies dropped 25 percent to $96 million. The drop was mostly attributable to weak business from liquefied natural gas customers, Air Products said.

Air Products ended its year-long battle for smaller rival Airgas Inc last February, after spending roughly $90 million in legal fees.

Since withdrawing its offer, Air Products has moved aggressively to raise prices and get new supply contracts.

Air Products shares were down 0.3 percent at $82.79 on Friday morning, off an earlier low at $78.81.