4 EXHIBIT 99.1 For More Information: Thomas C. Deas, Jr. Jeffrey P. Cornwell 687-5253 AIRGAS, INC. REPORTS EARNINGS AND RECORD CASH FLOW IN THIRD QUARTER RADNOR, Pennsylvania, January 29, l998 -- Airgas, Inc. (NYSE-ARG) today reported financial results for its third quarter ended December 31, l997. For the third quarter, sales increased 24% to a record $367.8 million from $297.2 million in the third quarter last year. After-tax cash flow (net earnings plus depreciation, depletion, amortization and deferred income taxes) increased by 15% to a record $34.4 million, or $.48 per share, compared to $29.9 million, or $.43 per share for the same quarter last year. Net earnings increased by 8% to $11.8 million, or $.17 per share, compared to $11.0 million, or $.16 per share, a year ago. For the nine months ended December 31, l997, after-tax cash flow, before non-recurring gains, increased by 15% to a record $99.2 million or $1.41 per share, compared to $86.4 million, or $1.27 per share in the same period last year. Net earnings (before non-recurring gains) increased 6% to $35.3 million or $.50 per share, compared to net earnings of $33.4 million or $.49 per share last year. Sales for the period increased 25% to $1,059.6 million. Including non-recurring gains, after-tax cash flow and net earnings for the nine months ended December 31, 1997, were $116.3 million or $1.64 per share and $45.7 million or $.65 per share, respectively. Since April 1, 1997, Airgas has completed the acquisition of seventeen industrial gas distributors with aggregate annual sales of approximately $60 million, including two large regional distributors, Industrial Gas Products and JWS Technologies, Inc. Airgas has also acquired two industrial products distributors with combined annual sales of approximately $106 million, and four carbon dioxide distributors with combined annual sales of approximately $74 million. Peter McCausland, Airgas' Chairman and Chief Executive Officer, said "Given all the consolidation, integration, and repositioning going on at Airgas, I am very pleased with our performance, which was highlighted by solid gas sales growth, strong cash flow growth, continued growth in key national and regional gas accounts, extension of our carbon dioxide and dry ice capabilities, and growth in the tools and safety product lines. We are now the third largest safety-products distributor in the U.S. Our industrial products distribution businesses grew sales at a 16% annual rate and contributed to cash flow as well as earnings this quarter. We achieved this while simultaneously initiating a tremendous effort to reposition Airgas for higher future growth. We are combining 34 hubs into 16 regional companies, establishing a national infrastructure for purchasing and logistics which involves building five large distribution centers, reorganizing certain non-core businesses, standardizing our information systems, and hiring product specialists to increase sales of safety equipment, tools, and other Airgas strategic products." 5 The non-recurring gains included in Airgas' results for the nine months ended December 31, 1997 were generated by the sale of a non-core business and a partial recovery of previously reported refrigerant losses. Airgas, Inc. is the largest distributor of industrial, medical and specialty gases and related equipment in North America. Its distributor network includes approximately 700 locations in 42 states, Canada and Mexico. Airgas can be visited on the Internet at http://www.airgas.com. Forward-Looking Statements This press release may contain statements that are forward-looking, as that term is defined by the Private Securities Litigation Reform Act of 1995 or by the Securities and Exchange Commission in its rules, regulations and releases. The Company intends that such forward-looking statements be subject to the safe harbors created thereby. All forward-looking statements are based on current expectations regarding important risk factors. Accordingly, actual results may differ materially from those expressed in the forward-looking statements, and the making of such statements should not be regarded as a representation by the Company or any other person that the results expressed therein will be achieved. Important risk factors include, but are not limited to, the Company's ability to consolidate and integrate new acquisitions, expenses associated with the Company's new ADI Division, the Company's ability to pursue claims and recoveries in connection with the fraudulent breach of contract related to refrigerant R-12 purchases and other factors described in the Company's 1997 Form 10-K filed with the Securities and Exchange Commission. Consolidated statements of earnings follow on page 3. 6 AIRGAS, INC. CONSOLIDATED STATEMENTS OF EARNINGS (Amounts in thousands, except per share data) (Unaudited) Three Months Ended Nine Months Ended December 31, December 31, 1997 1996 (a) 1997 1996 (a) ____ ____ ____ ____ Net sales: Distribution $272,958 $251,582 $812,395 $741,309 Direct Industrial 61,372 29,556 159,433 66,445 Manufacturing 33,480 16,065 87,750 42,259 _______ _______ _________ _______ Total net sales 367,810 297,203 1,059,578 850,013 _______ _______ _________ _______ Costs and expenses: Cost of products sold (excluding depreciation, depletion and amortization) Distribution 136,309 126,363 408,783 372,811 Direct Industrial 43,795 20,481 114,766 49,450 Manufacturing 15,847 9,449 41,537 25,521 Selling, distribution and administrative expenses 118,939 94,991 338,481 270,722 Depreciation, depletion and amortization 20,218 16,540 56,809 45,801 Recovery of refrigerant losses (b) - - (14,500) - _______ _______ _______ _______ Total costs and expenses 335,108 267,824 945,876 764,305 _______ _______ _______ _______ Operating income: Distribution 26,902 25,668 82,778 76,396 Direct Industrial 2,463 990 4,911 2,172 Manufacturing 3,337 2,721 11,513 7,140 Recovery of refrigerant losses (b) - - 14,500 - ______ ______ _______ ______ Total operating income 32,702 29,379 113,702 85,708 Interest expense, net (13,456) (10,385) (39,234) (28,419) Other income, net 442 213 2,488 564 Equity (loss) in earnings of unconsolidated affiliates 943 (106) 1,262 8 Minority interest (219) (177) (837) (558) ______ ______ ______ ______ Earnings before income taxes 20,412 18,924 77,381 57,303 Income tax expense 8,586 7,964 31,654 23,883 ______ ______ ______ ______ Net earnings $ 11,826 $ 10,960 $ 45,727 $33,420 ====== ====== ====== ====== 7 Net earnings (excluding non-recurring gain and recovery of refrigerant losses)(c) $ 35,320 $33,420 ====== ====== Diluted earnings per share (d) $ .17 $ .16 $ .65 $ .49 ======= ======= ======= ====== Diluted earnings per share (excluding non-recurring gain and recovery of refrigerant losses) (c), (d) $ .50 $ .49 ======= ====== Weighted average shares 71,500 70,200 70,500 68,200 ====== ====== ======= ====== (a) Certain reclassifications have been made to previously issued financial statements to conform to the current presentation. (b) The results for the nine months ended December 31, 1997 include a $14.5 million ($9.4 million after-tax) gain from a partial recovery of refrigerant losses. (c) The results for the nine months ended December 31, 1997 excluding the after-tax effect of the gain from partial recovery of refrigerant losses noted in footnote (b) and the after-tax gain of $980 thousand related to the sale of a non-core business. (d) Effective with its third quarter ended December 31, 1997, Airgas implemented SFAS No. 128 which establishes new standards for computing and presenting earnings per share (EPS) and requires the disclosure of Basic and Diluted EPS. For Airgas, Diluted EPS is the same as Airgas' previously reported EPS amounts. All prior periods have been restated to conform to the new rules. Basic EPS amounts were $.17 and $.67 for the third quarter and nine months ended December 31, 1997, respectively ($.16 and $.51 for the same periods in the prior year). Excluding the non-recurring gain and recovery of refrigerant losses, Basic EPS was $.52 for the nine months ended December 31, 1997.