Company Facing 9,500 Lawsuits Re: Exposure To Manganese In Welding Fumes?
( murray )

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BOC 3rd-Qtr Profit Falls on Disposal of U.S. Gas Unit (Update4)

Aug. 3 (Bloomberg, UK) -- BOC Group Plc, Europe's second-largest maker of
industrial gases, said fiscal third-quarter profit fell 72 percent because of a write-off
on the disposal of its U.S. packaged gas unit.

Net income was 18.8 million pounds ($34.3 million), or 3.7 pence a share, in the
three months ended June 30, compared with 66.5 million pounds, or 13.5 pence, in
the year-earlier period, the company said in an e-mailed statement. Profit was
below the median estimate of 81.2 million pounds by 11 analysts surveyed by
Bloomberg News.

Windlesham, England-based BOC recorded a loss of 79.8 million pounds on the
sale, completed July 30, of the packaged gas unit to Airgas Inc. for about $175
million in cash. BOC also said profits were squeezed during the quarter by the
British pound's gains against the U.S. dollar.

``Operating figures are slightly below my estimates because of negative currency
effects,'' said Sal. Oppenheim analyst Juergen Reck, who has a ``Buy'' rating on the
stock. ``The negative surprise is the higher-than-expected costs for the disposal of
the U.S. packaged business.''

The provisional book loss on the disposal has been charged as an exceptional item
in the third quarter, the company said.

Shares

BOC shares fell 32.5 pence, or 3.5 percent, to 901 pence as of 10:07 a.m. in
London.

BOC and rivals such as France's Air Liquide SA supply oxygen, nitrogen and other
gases to steelmakers and computer-chip suppliers and profit when customers
increase their manufacturing. Oil companies, spurred by environmental laws, are
using more hydrogen to remove sulfur from fuels.

``Our global gases businesses have continued to perform strongly and their results
have been complemented by further improvements in BOC Edwards,'' the
semiconductor gases unit, Chief Executive Tony Isaac said in the release.
``Significant new contracts will add to future growth and a recently completed
business disposal will enable our financial performance to be improved.''

The outlook for industrial gases was positive and that the orders for BOC Edwards
remained high, BOC said, adding that the semiconductor-making clients of BOC
Edwards are confident about next year.

`Softening'

BOC Edwards expects a ``softening'' of semiconductor investment in 2006, Isaac
said in a telephone interview.

Operating profit at BOC Edwards tripled to 15.2 million pounds on a sales increase
of 33 percent to 215 million pounds in the third quarter, BOC said.

Pretax profit before exceptional items, the focus of most analysts, gained 13 percent
to 130.3 million pounds, BOC said. Third-quarter sales, including revenue from joint
ventures and shareholdings, rose 6 percent to 1.157 billion pounds.

Industrial gas sales improved in Europe, while strong performance continued in the
south Pacific region, BOC said. A stronger rand affected manufacturing and mining
in South Africa, the company said.

More orders during the previous quarter led to a further increase in adjusted
operating profit from BOC Edwards in the third quarter, although U.S. dollar
exchange rate movements continued to hurt margins, BOC added.

Corus Contract

BOC has signed a 15-year contract with U.K. steelmaker Corus Group Plc, with
BOC increasing by 30 percent its supply of oxygen, nitrogen and argon to the Corus
Strip Products UK plant in Port Talbot, Isaac said in the interview.

The company has signed an agreement U.K.'s BP Plc in which BOC will build a
hydrogen production and utilities complex to supply more than 110 million standard
cubic feet of the gas per day to industrial customers, including the BP refinery in
Toledo, Ohio.

BOC's partner for engineering and construction will be LindeBOC Process Plants of
Tulsa, Oklahoma, he said, adding that construction is expected to begin by
September.

These contracts together with new contracts in China achieved earlier this year
should generate $250 million in sales ``in a couple of years,'' Isaac said.

The company was facing about 9,500 lawsuits, from 8,525 lawsuits it reported in
May, in connection with the exposure to manganese in welding fumes, he said.

BOC in October lost a lawsuit in Illinois that alleged that welding fumes led a man to
develop Parkinson's disease, and the U.K. company said it would appeal the
verdict. ``We have no intention to settle any cases,'' Isaac said.

To contact the reporter on this story: Antonio Ligi in Zurich at   [log in to unmask]

To contact the editor responsible for this story: Mark Rohner at
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Last Updated: August 3, 2004 05:43 EDT

SOURCE: Bloomberg, UK
http://tinyurl.com/5yv56

Reference:

Jury Awards $1 Million In Welder's Suit
http://neuro-mancer.mgh.harvard.edu/ubb/Forum71/HTML/009080.html

Jurors Could Benefit From New Law
http://tinyurl.com/69omj

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