Praxair Reports Record Q2 2010 Earnings
Praxair reported Q2 net income and diluted earnings per share of $371 million and $1.19, respectively, both up 24% from the prior-year quarter.
Second-quarter sales were $2,527 million, 18% above the previous-year quarter. Sales increased due to double-digit volume growth in all geographic regions, led by South America and Asia. By end market, sales to chemicals, metals and electronics showed the strongest growth compared to the prior year. Compared to the first quarter of 2010, overall sales growth was 4%, and was broad-based across all major end-markets.
Operating profit in the second quarter of $547 million grew 22% from the prior-year quarter, and 8% sequentially, reflecting higher volumes and the benefits of previous cost-reduction actions.
The company generated strong cash flow from operations in the quarter of $536 million. Operating cash flow funded $325 million of capital expenditures, primarily for new production plants under long-term contracts with customers, and dividends of $137 million. The after-tax return-on-capital ratio and return on equity for the quarter both increased, to 14.7% and 27.4%, respectively.
For the third quarter of 2010, Praxair expects diluted earnings per share in the range of $1.15 to $1.20.
For the full year of 2010, Praxair expects sales in the area of $10 billion. The company is raising its guidance for adjusted diluted earnings per share to a range of $4.60 to $4.70. Full-year capital expenditures are expected to be about $1.4 billion, and the effective tax rate is forecasted to remain at about 28%.
