FORM 10-K - Praxair

Surface technologies provides high-performance coatings and thermal-spray powders in the U.S. and
Europe, with smaller operations in Asia and Brazil.
Sales for 2008 increased $53 million, or 10%, versus 2007. Underlying growth was due to strong coatings
volumes for industrial gas turbines and oilfield drilling parts and realized price increases, partially offset by
lower coatings volumes to the aviation markets due to delays in the production of plane engines. Currency
appreciation, primarily in Europe, contributed 5% to sales growth.
Operating profit for 2008 increased $4 million, or 4%, versus 2007. Increased sales volumes and
productivity initiatives were the primary drivers of operating profit growth.
Sales for 2007 increased $41 million, or 9%, versus 2006. Sales increased 16% excluding the impact of the
divestiture of its aviation services business in July 2006. The strong sales growth was primarily due to higher
volumes of industrial coatings for power turbines and OEM aircraft engine parts and realized price increases.
Currency appreciation, primarily in Europe, contributed 5% to sales growth.
Operating profit for 2007 increased $24 million, or 35%, versus 2006. 2006 included a gain of $7 million
from the aviation services divestiture. Excluding the gain from the aviation services divestiture in 2006,
underlying operating profit increased $31 million, or 51%. The increase was principally driven by volume growth
as well as the favorable benefits of ongoing cost reduction actions and pricing actions to offset increasing raw
material costs.
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