Industrial gasses and engineering co. Linde's profit falls

The Munich-based company said net profit for the January-March period fell to 160 million euros ($246.4 million) compared with euro445 million in the year ago quarter, when the figure was bolstered by the sales of some business units, including part of its U.S. gas cylinder business to Airgas Inc.

Sales for the first quarter were up 2 percent to euro3 billion ($4.62 billion) compared to euro2.9 billion a year ago. Adjusted for currency effects, sales would have been up nearly 8 percent.

Linde is a supplier of industrial, medical and therapeutic gasses. It also provides engineering for natural gas plants, air separation plants, as well as hydrogen and synthesis gas plants.

"We have seen a solid start to the new financial year and are therefore confident about the remaining ... year," said Wolfgang Reitzle, the company's chief executive.

"We confirm our short-term and medium-term forecasts. We continue to assume that group sales will increase in the current financial year and that earnings will increase at a faster rate than sales. By 2010, we are seeking to achieve a group operating earnings of more than euro3 billion ($4.62 billion)," he said.

Operating profit in the first quarter rose 6 percent to euro602 million ($927.08 million), compared to euro569 million in the year ago quarter.

Linde's gasses division saw a 4.5 percent increase in reported sales in the first quarter to euro2.3 billion ($3.54 billion) compared to euro2.2 billion in the year ago quarter.

The company said it expects its gases division sales to see average annual growth of about 7 percent in 2008 and said it "wants its gasses division to grow at a more rapid pace than the market and to increase its earnings at a faster rate than sales."

The company said its engineering division saw a 9 percent increase in first quarter sales to euro542 million ($834.68 million) from euro498 million in the year ago quarter.

In terms of an outlook for the engineering division, the company said, based on the global demand for international plant construction, business remains good. Linde expects an increase in sales in the engineering division in the coming years of 8 percent to 10 percent per year on the basis of a high order backlog and anticipated processing orders.

Linde shares were down nearly 5 percent to $142.30 in Frankfurt trading.

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