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- **EPS Growth**: FY26 target of 7%-9% driven by new assets, pricing, and productivity, despite $0.40-$0.45 helium headwind.
- **Cost Efficiency**: $250M annual savings from 3,600 headcount reductions, supporting 2026 EPS growth.
- **Project Updates**: NEOM ammonia production starts in 2027; Louisiana blue hydrogen project on hold until offtake agreements.
- **Helium Market**: FY26 headwind stabilizing post-2027; FY25 helium impact $0.49, better than forecast.

### CEO Summary Section
- **Financial Performance**: Delivered FY25 EPS of $12.03, above market expectations, with operating income margin of 23.7% and return on capital of 10.1%. Achieved 43rd consecutive year of dividend growth.
- **2026 Priorities**: Target high single-digit EPS growth (7%-9%), optimization of large projects (e.g., NEOM), and capital allocation focus on core industrial gas business. CapEx expected at $4 billion for FY26, reducing to $2.5 billion post-2028.
- **Cost Savings**: 3,600 headcount reductions (16% of peak workforce) to save $250 million annually, supporting productivity and offsetting inflation.
- **Projects Update**: NEOM project 90% complete, expected to start ammonia production in 2027. Louisiana blue hydrogen project on hold until offtake agreements secured.

### CFO Financial Commentary
- **FY25 Results**: GAAP EPS of $12.03, with non-helium merchant pricing and productivity offsetting helium headwinds. Helium contributed a $0.49 EPS headwind, slightly better than forecasted $0.50-$0.55.
- **FY26 Outlook**: EPS guidance of $12.85-$13.15 (7%-9% growth), driven by new asset contributions, pricing actions, and project rationalization. Q1 FY26 EPS expected at $2.95-$3.10, 3%-8% YoY growth.
- **Liquidity**: Committed to cash flow neutrality through 2028, with $1.6 billion returned to shareholders in FY25.

### Q&A Highlights
- **Louisiana Project**: Evaluating proposals to divest carbon capture assets, seeking partners for hydrogen/ammonia supply. Project economics depend on 45Q credits and offtake agreements; update expected by end-2025.
- **Helium Market**: FY26 headwind of $0.40-$0.45 EPS, with stabilization expected post-2027 due to industry storage solutions. FY26 guidance assumes similar helium trends to FY25.
- **NEOM Commercialization**: Green ammonia demand in Europe could be 7x NEOM capacity by 2030. Seeking regulatory clarity on ammonia cracking in Europe, with potential 1% fuel mandate conversion.
- **Asia Gasification Assets**: Sold two underperforming coal gasification projects, reducing operating profit drag and freeing capital for core business.

Air Products and Chemicals, Inc.(APD)-20251106-2025 Q4 Earnings call transcript

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