Airgas Inc. (ARG) announced the purchase of Industrial Welding Supplies of Hattiesburg, LLC, a Mississippi-based distributor of industrial, medical and specialty gases and related supplies. Notably, Industrial Welding Supplies operates under the brand name Nordan Smith.
Airgas bought the business with operations spread over 17 locations all through Mississippi, Arkansas and Alabama. The combined operations produce over $30 million in annual revenue.
The acquired locations will be merged into Airgas’ Mid South and South region, which are among the company’s 12 regions that constitute its distribution business. Of the 17 locations, six will be included into the Mid South region of Airgas USA, LLC. The Mid South region provides services to customers across Oklahoma, Arkansas, Kansas, North Texas, Missouri, Northern Louisiana, Western Tennessee, and Northwest Mississippi. The remaining eleven locations will be included in the South region, which provides services to customers across Florida, Georgia, Alabama, Mississippi, and Tennessee.
Integrating the17 locations will enhance Airgas’ distribution business as Nordan Smith offers an extensive range of industrial, medical and specialty gases as well as production and distribution facility. The acquisition will make the company’s services smooth and aid in generating higher revenues. The share price of Airgas climbed 0.6% to close at $88.97 as on Friday.
Total revenue in the fiscal third quarter 2012 rose 12% year over year to $1.15 billion. Airgas also posted strong third quarter earnings of 97 cents per share, showing an improvement from 80 cents earned in the year-earlier quarter and coming in line with the Zacks Consensus Estimate.
Management expects adjusted earnings per diluted share for fiscal fourth quarter 2012 in the band of $1.04 to $1.08, reflecting an increase of 18% to 23% from the prior year. For fiscal 2012, the company expects earnings in the band of $4.03-$4.07, up 21% to 22% from 2011.
The current Zacks Consensus Estimate for fourth-quarter 2012 is $1.07 per share. For full years 2012 and 2013, the Zacks Consensus Estimates are $4.05 and $4.71 respectively.
The quantitative Zacks #2 Rank (short-term Buy rating) for the company indicates slight boost on the stock over the near term.
Based in Radnor, Pennsylvania, Airgas, Inc, through its subsidiaries, engages in the distribution of industrial, medical, and specialty gases in the United States.The company competes with Air Products & Chemicals Inc. (APD).
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