Air Products to book charge, exit energy-from-waste business

AP News
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Posted: Apr 04, 2016 11:31 AM

Air Products will book a pre-tax charge ranging from $900 million to $1 billion in its fiscal second quarter, as the industrial gas supplier leaves its energy-from-waste business.

The Allentown, Pennsylvania, company said Monday the charge stems mainly from writing down assets from the business. Air Products also expects a modest future tax benefit from the write-off.

Company officials said in a statement they pushed to make the business work, but testing "indicated that additional design and operational challenges would require significant time and cost to rectify."

The company had announced in 2012 that it would build and run the world's largest renewable energy plant in the United Kingdom. It said then that the plant was expected to produce enough electricity to power 50,000 homes.

A company spokesman said Monday that the business did not reach commercial operation.

The company expects to discuss the move's financial impact when it announces fiscal second quarter earnings on April 28.

Air Products & Chemicals Inc. provides atmospheric and process gases and equipment to food and beverage businesses as well as petrochemical and electronics customers.

Shares of Air Products slipped $1.92, or 1.3 percent, to $143.39 in midday trading Monday, while broader indexes declined slightly. The stock had climbed about 12 percent so far this year, as of Friday's close.