UPDATE 1-Air Products CEO to focus on performance for now, not sale

Wed Jul 23, 2014 3:14pm EDT

(Adds details from conference call, analyst comment, background, share movement)

By Kanika Sikka and Anannya Pramanick

July 23 (Reuters) - Air Products and Chemicals' new chief executive said he would aim to improve the operational performance of the company's businesses and generate cash before deciding on the sale of any unit.

The industrial gas supplier's shares rose 4 percent to a life-high of $135.97.

Seifi Ghasemi, who successfully executed a number of deals as CEO of Rockwood Holdings Inc, was appointed to the top position at Air Products last month and analysts expect him to divest some of the company's businesses.

"Nothing is on sale right now. We are focused on improving performance of all of our businesses", Ghasemi said on a conference call on Wednesday.

The CEO's messages were "well-received by investors who were looking for changes in the company and ways to improve margins," SunTrust Robinson analyst James Sheehan said.

Air Products reported a 9 percent rise in third-quarter profit to $314 million, or $1.46 per share.

The company, however, tightened its continuing operations profit forecast range for 2014. Air Products expects profit of $5.72 to $5.77 per share, compared with $5.70 to $5.85 it forecast earlier.

Lower industrial activity in Latin America and moderating growth in emerging markets is expected to weigh on the company's profit this year, Sheehan said.

Bigger rival Praxair Inc, also cut the upper end of its full-year profit forecast. The company's second-quarter growth was hurt by weak sales volume in South America, mainly due to negative industrial production in Brazil.

Industrial output in Brazil, once one of the most dynamic of emerging economies, has slumped over the last three months and is on track to shrink more than 1 percent this year.

Praxair earned 16 percent of its total quarterly revenue from Latin American countries.

Air Products, which has a relatively lower exposure to the region, is depending on improvement of economic activity in the United States.

Air Products shares were trading up 3 percent at $134.56 on Wednesday on the New York Stock Exchange, while that of Praxair were down less than a percent. (Additional reporting by Sneha Banerjee, Writing by Sayantani Ghosh in Bangalore; Editing by Savio D'Souza and Sriraj Kalluvila)