Specialty chemical company Air Products & Chemicals Inc. (APD) announced that it has won a contract from the University of Petroleum and Energy Studies (UPES) in India to build the country's first solar powered renewable hydrogen fuel station. The station is expected to come online in July 2013 and will be located at the Solar Energy Centre near Delhi.
The station will generate hydrogen from solar energy with the help of an electrolyser. The hydrogen that will be produced at the station will be 100% renewable and demonstrates India's commitment toward developing greener alternative energy sources. Although a demonstration project, the fueling station will mark India’s leap toward hydrogen economy.
The UPES project will also open up new avenues for automotive and telecommunication sectors in India. The project is being developed in collaboration with Indian Oil and it is entirely funded by the Ministry of New and Renewable Energy (MNRE) of the Government of India.
The project also demonstrates Air Products' hydrogen fueling capabilities and represents the third hydrogen station installed in India by Air Products. Air Products was the pioneer in setting up the first hydrogen fuel station several years ago at a research and development center in Faridabad, south of New Delhi.
Air Products provides atmospheric, process and specialty gases; performance materials; equipment; and technology products. Last month, the company released its fourth quarter and fiscal 2012 results. It logged adjusted earnings from continued operations of $1.42 a share for the quarter ended September 30, 2012, missing the Zacks Consensus Estimate by a couple of cents.
Consolidated net income, as reported, plunged 57% year over year to $138.7 million or 65 cents a share, pummeled by hefty one-time charges. The company reported a profit of $324.8 million or $1.51 a share a year ago.
Revenues rose 4% to $2,606 million, beating the Zacks Consensus Estimate of $2,574 million. The revenue growth was attributable to higher volumes in the Tonnage Gases, Equipment and Energy, and Electronics and Performance Materials divisions as well as sales increases due to acquisitions, partly offset by the impact of unfavorable currency. The company witnessed sluggish manufacturing activity in the quarter.
For fiscal 2012, the company has reported adjusted earnings of $5.40 a share that missed the Zacks Consensus Estimate of $5.42 but exceeded the year-ago level of $5.36. Sales for the year edged down 1% year over year to $9,612 million, but beat the Zacks Consensus Estimate of $9,577 million.
For fiscal 2013, Air Products plans to take a number of steps including execution of its new Tonnage investments and sustained improvement in its Electronics and Performance Materials unit to attain better productivity. The company expects that its recent strategic moves will act favorably for future growth and profitability despite the weak macroeconomic backdrop.
Air Products anticipates earnings per share between $5.65 and $5.85 for fiscal 2013, and $1.26 and $1.31 for the first quarter of fiscal 2013. The company also expects capital expenditures between $2 billion and $2.2 billion for the year.
Air Products, which competes with Praxair Inc. (PX), currently holds a short-term (1 to 3 months) Zacks #4 Rank (Sell) and we have a long-term (more than 6 months) Underperform recommendation on the stock.
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