German industrial Linde says 1Q profit sank 64 percent

FRANKFURT, Germany - Linde AG said Friday that first-quarter profits fell 64 percent compared with last year, when the industrial gasses and engineering company recorded the sale of some businesses.

Linde said net profit for the January through March period fell to 160 million euros ($246.4 million) compared with 445 million euros in the year ago quarter, which included the sale of part of its U.S. gas cylinder business.

Sales for the first quarter were up 2 percent to 3 billion euros ($4.62 billion) compared to 2.9 billion euros 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 3 billion euros ($4.62 billion)," he said.

Operating profit in the first quarter rose 6 percent to 602 million euros ($927.08 million), compared to 569 million euros in the year ago quarter.

Linde's gasses division saw a 4.5 percent increase in reported sales in the first quarter to 2.3 billion euros ($3.54 billion) compared to 2.2 billion euros in the year ago quarter.

The Munich-based 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 542 million euros ($834.68 million) from 498 million euros 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 fell 4.4 percent to close at 92.25 euros ($141.74) in Frankfurt trading.

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