APD
#Sure.
I obviously cannot and should not comment on the profitability of the Jazan project.
For 2017 we do not have a significant amount of contribution, but there will be some contribution.
And quite honestly it will depend on the exact progress that we make on all of that.
But there will be some.
In 2016 we did not recognize ---+ although we were recognizing sales throughout the year, we did not recognize profit because we wanted to get some kind of a ---+ more of a sure footing that the project is moving forward.
As you know, there has been a lot of talk about shutting down projects in Saudi Arabia and all of that and we wanted to make sure that this project doesn't get canceled and then we would have to divest profit and all of that.
But then by the fourth quarter it became obvious that we have made enough progress that we should recognize some and that is what we did.
The size of that business order of magnitude is about $0.5 billion and we were up 11%.
So we are doing well there.
Well, the thing that as compared to ---+ and I mean we all operate in the same boat compared to our competitors.
I mean we are delivering double-digit growth while other people are showing negative growth.
So we are doing something right.
With respect to next year, we are ---+ there is a possibility that we will do better than what we have given you as a guidance depending on the economy and all of that.
But I just want to remind everybody that we are dealing with some significant worldwide events that we have to see how they will develop.
Now we have given you guidance on the basis that, barring any significant disruption, we will be able to deliver that and that is the way we operate.
Now the economic conditions can get better once the US election is over and people are not sitting on the fence then, yes, it is possible that we will do better than that.
But the one thing I can assure you is that we don't operate on the basis of just delivering the guidance, we do our best to deliver whatever we can.
That is kind of our goal.
Well, on that one unfortunately I can't give you a general answer because it will depend on the specific situations.
But what you said can apply, it can be a specific situation where there is significant synergies because we already have two plants there and an addition of another two or three plants will add value.
So sorry that I can't give you a general answer, but you can be rest assured that we will only do those if they are in line with our goal of getting return on our ---+ on the capital that we employ which is not less than 10%.
Well, we have said that those stranded costs could be in the order of magnitude of $20 million.
They have programs for eliminating those in the next year and a half.
And our guidance obviously reflects that those costs are still with us and we need to work to eliminate those.
I think the number is about $0.05, but the expert on this is <UNK>.
So, <UNK> ---+.
Yes that is a tall order.
Hi, <UNK>.
So just to remind everybody how we look at currency ---+ we don't try to speculate, we take the latest rates and we just project that forward.
So when we do that from where we are today into 2017 and then compare full-year 2017 against 2016 we would have a headwind of about $0.05 to $0.10.
That is for the full year.
And then on a quarter basis we do the same approach, just move things sideways.
We would have in the first quarter both sequentially as well as versus prior year in Q1 about a $0.01 to $0.02 headwind principally driven by the pound.
Well, we have a detailed chart on this thing on the slides that we have ---+ yes, slide 28.
So you can see ---+ and I am sure you know very well which ones are signed before and which ones were signed after.
They will not all be over in 2017 because some of them are delayed and it will drag on into 2018 also.
Sure, I think <UNK> can answer that very easily.
<UNK>.
Yes, thank you for the question.
So LOX/LIN, if we are going to look at that, which let's just say it is the most generic product, goes into the largest number of industries, it was probably the best sort of bellwether of everything.
Year on year that was flat for us.
However, sequentially we were up about 2%, so showing some positive momentum there.
Even in that year-on-year flat however, I would say that during the course of the year we did make some adjustments in our portfolio as part of our Take the Lead program.
We also had one situation, not exactly the same as Carrington that I talked about, but where we did shut down a liquifier and were able to shift load around, but it also involved shedding some customers.
So all in all, I think perhaps the best indication is just the sequential moving forward which gave us 2%.
And I see that as a net positive for us and I think a pretty good reflection of what is going on in North America.
No, I think the guidance that we have given you about $0.25 is based on what we see.
But there are things that can happen that can change that because a lot of these projects, we have won the projects, but the oil and gas companies have put a hold on them, as you know very well, because of the situation.
They can change ---+ if the oil prices significantly change they can change their mind, they can release those and therefore we [can] start working on them.
So the possibility of that I don't see being great, but it is possible, yes.
But the $0.25 is real and it is based on what we have.
So I am glad you brought that up because if you take that $0.25 into account, then we are actually giving you pretty good guidance in terms of growth next year.
But that is based on what we see right now.
Thank you.
Well, that is something that we are hoping that would be the case, but we have to wait and see.
But we are pushing toward more on-site because then you get a more stable revenue growth and a more stable profitability.
But we are paying attention to all parts of our business, whether it is large on-site, our merchant business and our packaged gases business in the areas of the world where we are strong.
So we are not neglecting any part of the business but the trend seems to be more towards the large on-sites.
And obviously if we win one of those projects it adds a lot to that part of the business.
Well, I can actually see bigger than that.
There are projects where you would ---+ like Jazan $2 billion, and there are projects that might require $4 billion.
So you are right, the trend is toward larger projects and that is why having the balance sheet that you can do those projects becomes very important.
And that has been our target because we saw that trend before and that is one of the reasons that we wanted to restructure and make sure that Air Products has a bulletproof, solid balance sheet that we can take on those megaprojects.
You are very right about that.
Okay with that I would like to thank everybody for being on the call.
Thanks for taking time from your busy schedule, especially today with all of the announcements, to listen to our presentation.
We appreciate your interest and we look forward to discussing our results with you again next quarter.
Have a very nice day and all the best.
Thank you.
