Air Products announced on Feb. 24 that it has decided to exit three projects in the U.S. as part of a review process by its new board of directors and chief executive officer. The company expects a pre-tax charge of up to $3.1 billion in the second quarter of fiscal 2025, primarily for write-downs of assets and termination of contractual commitments. However, this charge is not expected to impact adjusted earnings per share in fiscal 2025.
One of the primary impacted projects is the Paramount Sustainable Aviation Fuel (SAF) expansion project in California with World Energy. Air Products has terminated its agreement with World Energy and plans to fully exit the project. The company said the decision to exit this project stems from the expansion program and the commercial challenges facing existing operations.
The change marks a strategic realignment for Air Products in the sustainable energy sector, particularly with respect to the Sustainable Aviation Fuel (SAF) program. While the company remains optimistic about the potential of SAF and other green energy markets, the current market environment and operational challenges have prompted a reexamination of relevant investment decisions. Moving forward, Air Products will continue to optimize its portfolio, focusing on projects with stronger commercial viability and market prospects.