Air Products and Chemicals (APD) Q4 2024 earnings summary

Executive summary

• Q4 adjusted EPS was $3.56, up 13% year-over-year, at the upper end of guidance, driven by strong performance in Americas, Europe, and Asia segments.

• Fiscal 2024 GAAP EPS rose 67% to $17.24, driven by a $1.2B after-tax gain from the $1.8B LNG business sale; adjusted EPS up 8% to $12.43.

• Completed LNG business divestiture on September 30, 2024, impacting future results and guidance.

• Core industrial gas business and clean hydrogen form the two-pillar growth strategy, with major hydrogen infrastructure investments and a 15-year supply agreement with TotalEnergies.

• Increased annual dividend to $1.77/share, returning ~$1.6B to shareholders in 2024, with over 40 consecutive years of dividend increases.

Financial highlights

• Q4 FY24 sales were $3.2B; adjusted EBITDA $1.4B (+12% YoY); adjusted EBITDA margin 44.1% (+460bp YoY); adjusted operating income $849M (+15% YoY); adjusted operating margin 26.6% (+350bp YoY).

• Full-year FY24 sales were $12.1B, down 4% YoY due to lower energy cost pass-through, partially offset by higher pricing.

• Adjusted EBITDA for FY24 was $5.0B, up 7%, with margin up 440 bps to 41.7%.

• Distributable cash flow for FY24 was $3,356M, with $1,565M paid in dividends.

• GAAP net income for FY24 was $3.9B, up 65%; Q4 net income was $2.0B, up 181%.

Outlook and guidance

• Fiscal 2025 adjusted EPS guidance is $12.70–$13.00, up 2–5% YoY (6–9% YoY excluding LNG headwind); Q1 FY25 adjusted EPS guidance is $2.75–$2.85.

• FY25 capital expenditures expected at $4.5B–$5.0B.

• No significant growth forecast for Q1 due to economic uncertainty in China.

• LNG business will not contribute to FY25 results following its divestiture.

• Long-term EPS growth target of at least 10% annually.