Johnson Matthey PLC · LSE:JMAT
Johnson Matthey — Investor Presentation (May 2004)
43 slides from Johnson Matthey's investor presentation, May 17, 2004
Slide 1: Platinum 2004
Platinum|2004 Johnson Matthey 17th May 2004 www.platinum.matthey.com
Slide 2: Platinum
Platinum • Demand edges up to 6.52 million oz • Sustained by rising auto industry purchases • But purchases for jewellery in China & Japan drop • Output from South Africa and Zimbabwe climbs • Market deficit shrinks to 280,000 oz • Funds contribute to price strength www.platinum.matthey.com
Slide 3: Platinum Demand by Application
Platinum Demand by Application ‘000 oz 2002 2003 % change Autocatalyst: gross 2,590 3,190 23 www.platinum.matthey.com
Slide 4: European Demand for Platinum in Autocatalysts 1999 - 2003
European Demand for Platinum in Autocatalysts 1999 - 2003 '000 oz 1,400 1,200 1,000 Gasoline 800 Diesel 600 400 200 0 1999 2000 2001 2002 2003 www.platinum.matthey.com
Slide 5: Autocatalyst demand – Japan
Autocatalyst demand – Japan Tokyo HDD retrofit boosts Pt demand by 18% www.platinum.matthey.com
Slide 6: Platinum Demand by Application
Platinum Demand by Application ‘000 oz 2002 2003 % change Autocatalyst: gross 2,590 3,180 23 recovery (565) (645) 14 Jewellery 2,820 2,440 (13) www.platinum.matthey.com
Slide 7: Demand for Platinum in Jewellery 1999 - 2003
Demand for Platinum in Jewellery 1999 - 2003 million oz 3.0 2.5 2.0 China 1.5 1.0 0.5 0.0 1999 2000 2001 2002 2003 www.platinum.matthey.com
Slide 8: Retail price of platinum jewellery in Shanghai vs equivalent fixing price
Retail price of platinum jewellery in Shanghai vs equivalent fixing price 300 250 200 150 100 50 0 N 2 N 3 2 3 M 2 M 3 4 2 2 3 3 02 03 04 0 -0 0 -0 -0 -0 -0 l-0 l-0 -0 -0 p- p- n- n- n- ov ov ar ar ar ay ay Ju Ju Se Se Ja Ja Ja M M M Shanghai Retail Price Fixing Price, RMB equiv. www.platinum.matthe
Slide 9: Shanghai Gold Exchange: Weekly platinum trading activity
Shanghai Gold Exchange: Weekly platinum trading activity August 2003 - April 2004 900 1,000 800 950 700 600 900 500 National 850 400 Day $ per kg Holiday Chinese 300 New 800 oz Year 200 750 100 0 700 /0 03 /0 03 /1 03 /1 03 /1 03 /1 03 /0 03 /0 04 /0 04 /0 04 /0 04 /0 04 /0 04 04 20 20 20 20 20 20 2
Slide 10: Demand for Platinum in Jewellery 1999 - 2003
Demand for Platinum in Jewellery 1999 - 2003 million oz 3.0 2.5 2.0 Japan 1.5 China 1.0 0.5 0.0 1999 2000 2001 2002 2003 www.platinum.matthey.com
Slide 11: Demand for Platinum in Jewellery 1998 - 2002
Demand for Platinum in Jewellery 1998 - 2002 million oz 3.0 2.5 Europe etc 2.0 N. America Japan 1.5 China 1.0 0.5 0.0 1999 2000 2001 2002 2003 www.platinum.matthey.com
Slide 12: Platinum Demand by Application
Platinum Demand by Application ‘000 oz 2002 2003 % change Autocatalyst: gross 2,590 3,180 23 recovery (565) (645) 14 Jewellery 2,820 2,440 (13) Industrial 1,545 1,520 (2) Investment 80 15 (81) TOTAL DEMAND 6,470 6,520 1 www.platinum.matthey.com
Slide 13: Platinum Supply by Region
Platinum Supply by Region ‘000 oz 2002 2003 % change South Africa 4,450 4,670 5 www.platinum.matthey.com
Slide 14: Expanding South African Supply
Expanding South African Supply million oz 5 4 3 2 1 0 1999 2000 2001 2002 2003 Anglo Platinum Impala Lonmin Others www.platinum.matthey.com
Slide 15: Platinum Supply by Region
Platinum Supply by Region ‘000 oz 2002 2003 % change South Africa 4,450 4,670 5 Russia 980 1,050 7 Others 540 520 (4) TOTAL SUPPLY 5,970 6,240 4.5 www.platinum.matthey.com
Slide 16: Platinum Supply and Demand
Platinum Supply and Demand ‘000 oz 2002 2003 % change Demand 6,470 6,520 0.8 Supply 5,970 6,240 4.5 Movements in Stocks (500) (280) www.platinum.matthey.com
Slide 17: Platinum Price
Platinum Price January – December 2003 $ per oz 850 800 750 700 650 600 550 J F M A M J J A S O N D Platinum: London am fix www.platinum.matthey.com
Slide 18: Platinum – NYMEX speculative position versus price
Platinum – NYMEX speculative position versus price Jan 2003 - April 2004 550 950 500 Total Net Spec. Average Price 900 450 400 850 350 800 300 $ per 000 oz 750 250 oz 200 700 150 650 100 50 600 0 550 02 03 03 03 03 03 03 04 04 20 20 20 20 20 20 20 20 20 2/ 2/ 4/ 6/ 8/ 0/ 2/ 2/ 4/ /1 /0 /0 /0 /0 /1 /
Slide 19: Palladium
Palladium • Demand improves to 5.26 million oz • Far less use of inventories by auto companies • Stocks no longer affect purchases for electronics • Dental alloy demand falls further • Russian sales rebound to 2.95 million oz • Market surplus widens substantially www.platinum.matthey.com
Slide 20: Palladium Demand by Application
Palladium Demand by Application ‘000 oz 2002 2003 % change Autocatalyst: gross 3,050 3,460 13 www.platinum.matthey.com
Slide 21: Palladium Autocatalyst Demand 1999 - 2003
Palladium Autocatalyst Demand 1999 - 2003 million oz 7 6 5 Purchases 4 Use 3 2 1 0 1999 2000 2001 2002 2003 www.platinum.matthey.com
Slide 22: Palladium Demand by Application
Palladium Demand by Application ‘000 oz 2002 2003 % change Autocatalyst: gross 3,050 3,460 13 recovery (370) (410) 11 Electronics 760 895 18 www.platinum.matthey.com
Slide 23: Palladium Demand by Application
Palladium Demand by Application ‘000 oz 2002 2003 % change Autocatalyst: gross 3,050 3,460 13 recovery (370) (410) 11 Electronics 760 895 18 Dental and Other 1,390 1,315 (5) TOTAL DEMAND 4,830 5,260 9 www.platinum.matthey.com
Slide 24: Palladium Supply by Region
Palladium Supply by Region ‘000 oz 2002 2003 % change Russia 1,930 2,950 53 www.platinum.matthey.com
Slide 25: Russian Palladium Sales 1999 - 2003
Russian Palladium Sales 1999 - 2003 million oz 6 5 4 Russian sales 3 Mine output 2 1 0 1999 2000 2001 2002 2003 www.platinum.matthey.com
Slide 26: Palladium Supply by Region
Palladium Supply by Region ‘000 oz 2002 2003 % change Russia 1,930 2,950 53 South Africa 2,160 2,310 7 North America 990 940 (5) Others 170 250 47 TOTAL SUPPLY 5,250 6,450 23 www.platinum.matthey.com
Slide 27: Palladium Supply and Demand
Palladium Supply and Demand ‘000 oz 2002 2003 % change Demand 4,830 5,260 9 Supply 5,250 6,450 23 Movements in Stocks 420 1,190 www.platinum.matthey.com
Slide 28: Palladium Price January – December 2003
Palladium Price January – December 2003 $ per oz 300 250 200 150 100 J F M A M J J A S O N D Palladium: London am fix www.platinum.matthey.com
Slide 29: Palladium – NYMEX speculative position versus price
Palladium – NYMEX speculative position versus price Jan 2003 - April 2004 1,350 350 1,200 Total Net Spec. Average Price 1,050 300 900 750 250 $ per 000 oz 600 oz 450 200 300 150 150 0 -150 100 02 03 03 03 03 03 03 04 04 2/ 2/ 4/ 6/ 8/ 0/ 2/ 2/ 4/ /1 /0 /0 /0 /0 /1 /1 /0 /0 31 28 30 30 31 31 31 29 30
Slide 30: Looking Ahead
Looking Ahead • Auto industry – diesel car sales www.platinum.matthey.com
Slide 31: Growth of diesel car penetration in Europe, 1996 - 2003
Growth of diesel car penetration in Europe, 1996 - 2003 60 50 40 % 30 20 10 0 1996 1997 1998 1999 2000 2001 2002 2003 www.platinum.matthey.com
Slide 32: Looking Ahead
Looking Ahead • Auto industry – diesel car sales – emissions legislation www.platinum.matthey.com
Slide 33: Evolution of European Vehicle Emissions Legislation
Evolution of European Vehicle Emissions Legislation 0.6 0.5 Euro I 0.4 Euro II HC g/km Euro III 0.3 Euro IV 0.2 Euro V Euro VI 0.1 0 0 0.1 0.2 0.3 0.4 0.5 NOx g/km www.platinum.matthey.com
Slide 34: Looking Ahead
Looking Ahead • Auto industry – diesel car sales – emissions legislation – changing pgm ratios & thrifting www.platinum.matthey.com
Slide 35: Looking Ahead
Looking Ahead • Auto industry • Chinese jewellery demand • South African mine expansions – Profitability www.platinum.matthey.com
Slide 36: Looking Ahead
Looking Ahead • Auto industry • Chinese jewellery demand • South African mine expansions – Profitability – Legislative programme www.platinum.matthey.com
Slide 37: Looking Ahead
Looking Ahead • Auto industry • Chinese jewellery demand • South African mine expansions • Palladium stocks • Fund activity www.platinum.matthey.com
Slide 38: Forecast Platinum Price For The Next 6 Months
Forecast Platinum Price For The Next 6 Months $ per oz 1,000 950 900 850 $780 – $920 800 750 700 J F M A M J J A S O www.platinum.matthey.com
Slide 39: Forecast Platinum Price For The Next 6 Months
Forecast Platinum Price For The Next 6 Months $ per oz 1,000 950 900 850 $780 – $920 800 750 700 J F M A M J J A S O www.platinum.matthey.com
Slide 40: Forecast Palladium Price For The Next 6 Months
Forecast Palladium Price For The Next 6 Months $ per oz 400 350 300 $200 – $340 250 200 150 100 J F M A M J J A S O www.platinum.matthey.com
Slide 41: Forecast Palladium Price For The Next 6 Months
Forecast Palladium Price For The Next 6 Months $ per oz 400 350 300 $200 – $340 250 200 150 100 J F M A M J J A S O www.platinum.matthey.com
Slide 42: Conclusion - Platinum
Conclusion - Platinum • Market to move closer to balance in 2004 • Fundamentals remain strong www.platinum.matthey.com
Slide 43: Conclusion - Palladium
Conclusion - Palladium • Auto industry purchases to improve but thrifting continues • Supplies to rise significantly; market to remain in substantial surplus www.platinum.matthey.com