Praxair announced that it expects the combined impacts of hurricanes Katrina and Rita to reduce operating profit by $15 to $18 million, or about four cents of diluted earnings per share, in the third quarter ended 30 September 2005.
The third quarter effects include minor property damage, business interruption, insurance adjustments, start-up and shutdown costs, higher distribution costs and higher energy costs.
While none of the company’s facilities sustained significant property damage from either hurricane, eight facilities in Texas and Louisiana were affected and temporarily shut-in during the hurricanes. Six of the eight facilities resumed operations within ten days of closure and the other two are expected to become operational shortly.
However, demand for oxygen, nitrogen and hydrogen from Praxair’s pipeline systems on the Gulf Coast remains curtailed pending the start-up of customer facilities damaged by the hurricanes or constrained by the availability of electricity, and a shortage of labour in the region.
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