Johnson Matthey Plc · LSE:JMAT
Johnson Matthey — FY2025 Earnings Presentation
59 slides from Johnson Matthey's earnings presentation, May 22, 2025
Slide 1: Results for the year ended 31st March 2025 and sale of Catalyst Technologies
Results for the year ended 31st March 2025 and sale of Catalyst Technologies 22nd May 2025
Slide 2: Cautionary statement
Cautionary statement This presentation contains forward-looking statements that are subject to risk factors associated with, amongst other things, the economic and business circumstances occurring from time to time in the countries and sectors in which Johnson Matthey operates. By their nature, forw
Slide 3: Agenda
Agenda 1 Introduction 2 Financial results – 2024/25 3 Strategy update 4 Financial outcomes 5 Conclusion 3
Slide 4: Introduction
J Johnson Matthey Introduction
Slide 5: Highlights
Highlights Catalyst Technologies sale at an attractive valuation Delivering materially JM will be a highly focused, lean and agile business enhanced shareholder returns Driving a step change in cash generation 5
Slide 6: Sale of Catalyst Technologies for £1.8 billion
Sale of Catalyst Technologies for £1.8 billion 1 2 3 4 Transaction details Key financial terms Use of net sale proceeds Next steps All-cash sale of 100% Enterprise value £1.4bn to be returned to Transaction conditional of Catalyst Technologies of £1.8bn on a cash shareholders following on re
Slide 7: The new JM will be a highly focused, lean and agile business
The new JM will be a highly focused, lean and agile business Fully circular offering 1 PGM expertise underpins the group Leading positions in Clean Air and PGM Services, 2 with existing assets providing growth optionality¹ PGMs 3 Lean operating model 4 Step change in cash generation Growing annual c
Slide 8: What JM will deliver by 2027/28
What JM will deliver by 2027/28 1 2 3 At least mid single digit Annualised sustainable free Cash returns of CAGR in pro-forma cash flow of at least £250m at least £200m p.a operating profit¹ driven by cost savings, lower to shareholders² driven by cost savings capex and improved working capital 1. B
Slide 9: Financial results
IM wattiey Financial results
Slide 10: Full year results highlights
Full year results highlights Sales down 2%¹ Earnings per share Free cash flow £521m 149.2p, +6% Operating profit up 5%¹ Free cash flow ex-divestments² £36m Profit on disposals £482m Net debt £799m £250m share buyback complete (1.4 times EBITDA)³ Major impairment and Ordinary dividend maintained rest
Slide 11: Underlying results
Underlying results Underlying results for % change, 2025 2024 % year ended 31st March¹ constant £m £m change FX rates Sales excluding precious metals 3,470 3,904 -11 -10 Operating profit 389 410 -5 -2 Finance charges (55) (82) Profit before tax 334 328 +2 Taxation (71) (68) Profit after tax 263 260
Slide 12: Sales down 2% in a challenging market
Sales down 2% in a challenging market¹ Sales for year ended 31st March % change, 2025 2024 constant £m £m FX rates Clean Air 2,319 2,581 -8 PGM Services 464 462 +1 Catalyst Technologies 669 578 +17 Hydrogen Technologies 60 71 -15 Eliminations (79) (114) n/a Sales excluding Value Businesses 3,433 3,5
Slide 13: Growth in underlying operating profit
Growth in underlying operating profit¹ Total FY Underlying operating profit for % change, 1H 2H year ended 31st March (£m) 2025 2024 constant FX 2025 2025 rates Clean Air 121 152 273 274 +3 PGM Services 51 98 149 164 -8 Catalyst Technologies 50 42 92 75 +24 Hydrogen Technologies (26) (13) (39) (50)
Slide 14: Operating profit benefiting from transformation
Operating profit benefiting from transformation Underlying operating profit (portfolio adjusted) 5% growth¹ £80m £410m (£14m) £399m (£10m) £389m (£29m) £381m (£5m) (£6m) (£37m) 2023/24 Divestments² 2023/24 Pricing/mix Metal price Volumes Transformation Other Underlying Translational 2024/25 ex- bene
Slide 15: Exceptional items
Exceptional items Non-underlying items for year ended 31st March 2025 £m Profit on disposal of businesses Largely relates to the disposal of Medical Device Components 482 Hydrogen Technologies Impairments relating to further slowdown in the hydrogen market (134) PGM Services Strategic review of Chin
Slide 16: Strong balance sheet
Strong balance sheet 1.6 times 1.4 times net debt net debt to EBITDA¹ £125m to EBITDA¹ £208m £951m £250m £373m £799m £138m (£587m) (£572m) (£87m) Net debt Underlying Working Capital Interest Other² Proceeds Dividends Share Net debt 31st March EBITDA capital expenditure and tax from paid buyback 31st
Slide 17: Free cash flow up materially half-on-half
Free cash flow up materially half-on-half Free cash flow ex-divestments¹ Full year free cash flow ex-divestments¹ of £221m £36m Representing cash £36m conversion² of 9% Half-on-half (£185m) improvement driven by Effective working capital management Strong underlying performance 1H 2H FY 2024/25
Slide 18: Summary: full year results in line with guidance and market expectations
Summary: full year results in line with guidance and market expectations Free cash flow improved materially Delivered materially stronger 2H profit in 2H – momentum building Clean Air margin PGM Services new Catalyst Hydrogen expanded 120 basis refinery on budget Technologies – Technologies – points
Slide 19: Strategy update
IM wattiey Strategy update
Slide 20: The new JM will be a highly focused, lean and agile business
The new JM will be a highly focused, lean and agile business Fully circular offering 1 PGM expertise underpins the group Leading positions in Clean Air and PGM Services, 2 with existing assets providing growth optionality¹ PGMs 3 Lean operating model 4 Step change in cash generation Growing annual c
Slide 21: Leading global businesses
Leading global businesses 2024/25 pro-forma Large addressable Market leading markets positions financials¹: Automotive HDD – #1 Sales: Clean Air Energy LDD – #1 £2.8bn LDG – #3 Operating profit: £296m Automotive Jewellery #1 secondary PGM Pharma Aerospace refiner globally² PGM Serv
Slide 22: Clean Air: leading in autocatalyst markets
Clean Air: leading in autocatalyst markets 2024/25 HDD: 34% Sales LDD: 45% £2.3bn LDG: 21% Our ambition: Operating profit: £273m Maintain position as a leading autocatalyst player and drive continued Operating margin: 11.8% strong margin improvement Note: HDD – heavy duty diesel, LDD – light duty di
Slide 23: Clean Air: serving a more durable market
Clean Air: serving a more durable market Key market developments since 2022¹ Global LD ICE vehicle production¹ (millions) “Stronger Slowdown in global BEV penetration for longer” 80 -7ppt revision to 2034 BEV share² Clean Air 59% LD ICE share in 2034² 70 Equal value to Growing share of hybrids JM as
Slide 24: Clean Air: capturing value with lasting OEM partnerships
Clean Air: capturing value with lasting OEM partnerships Maintain #1 positions Profitable share in LDG, in LDD and HDD including gasoline hybrids HDD current win rate 100%¹ LDG current win rate 50%¹ LDD current win rate 65%¹ A durable business Prioritising key long-term Becoming the supplier w
Slide 25: Clean Air: driving further efficiency
Clean Air: driving further efficiency Operational excellence Optimising manufacturing Reducing capex c.20% lower R&D and SG&A footprint Targeting capex to depreciation spend by end of 2025/26¹ Consolidated footprint from of c.0.5x c.15% headcount reduction 16 plants (50 lines) in 2021/22 by
Slide 26: Clean Air: driving margin improvement to 16-18% by 2027/28
Clean Air: driving margin improvement to 16-18% by 2027/28 Underlying operating profit 16-18%² 11.8% 8.7% 2022/23 Efficiency Volumes Other¹ 2024/25 Overheads Operational and Manufacturing 2027/28+ benefits commercial consolidation excellence 1. Other includes pricing, mix and inflation. 2. 2027/28 m
Slide 27: Clean Air: what this business will deliver by 2027/28
Clean Air: what this business will deliver by 2027/28 1 2 3 4 Maintain #1 positions Profitable share Commercial Sales >£2bn and in LDD and HDD in LDG, including excellence, margin of 16-18% gasoline hybrids operational discipline in 2027/28¹ and streamlining footprint Maintain position as a leading
Slide 28: PGM Services: a world leader in PGMs
PGM Services: a world leader in PGMs 2024/25 Refining: c.50% Sales Products: c.40% £464m PMM: c.10% Our ambition: Operating profit: £149m Maintain position as a world leader in PGMs and drive significant Operating margin: 32.1% working capital improvement Note: PGM – platinum group metal, PMM – Prec
Slide 29: PGM Services: creating value for customers and JM
PGM Services: creating value for customers and JM Driving the top line Growth in new, high value applications Increasing demand for recycled metal >80% 98% 2-4% PGM markets Increasing Value to JM up have longevity demand for is higher than beyond ICE PGMs in new, autocats and to high value independe
Slide 30: PGM Services: focused on operational resilience and efficiency
PGM Services: focused on operational resilience and efficiency Old PGM refinery New PGM refinery Mitigating downtime Progress to date Ongoing asset renewal programme Total capex of c.£350m; c.£100m spend remaining 24/7 rapid-reaction team focused Engineering completed; 70% equipment delivere
Slide 31: PGM Services: transforming our refining capabilities
PGM Services: transforming our refining capabilities Improved operational Faster cycle times and Increased capacity (+20%) resilience, safety and continuous operations – enabling better management sustainability working capital benefit of peak volumes as backlog unwinds Lower operating costs partly
Slide 32: PGM Services: transitioning our business to drive growth
PGM Services: transitioning our business to drive growth Transforming operations Driving growth Underlying operating profit At least low single digit CAGR £149m 2024/25 2025/26 2026/27 2027/28 2033/34+ Increased maintenance costs Growing secondary refining volumes from operating current refinery
Slide 33: PGM Services: what this business will deliver by 2027/28
PGM Services: what this business will deliver by 2027/28 1 2 3 4 A world leader New, world-class Sales c.£450m and Strong cash in PGMs PGM refinery margin of around conversion operational 30% in 2027/28¹ Maintain position as a world leader in PGMs and drive significant working capital improvement 1.
Slide 34: Growth optionality from existing assets across the group
Growth optionality from existing assets across the group Clean Air Solutions A market leader in emissions control systems Driving performance in core for emerging applications (e.g. data centres) businesses in short-term Growth – an extension of existing businesses PGM Products A leader in conve
Slide 35: Building a lean, focused and agile organisation
Building a lean, focused and agile organisation Customer-facing resource 1 A sharper customer focus prioritised and business-led Integrating technical and enabling Nurturing a high- 2 More efficient operations functions to streamline processes performance culture Accountability Zero-based budgets
Slide 36: Refreshed milestones to 2027/28
Refreshed milestones to 2027/28 2025/26 2026/27 2027/28 Increase Clean Air underlying operating margin to 16-18% Financial Achieve operating profit breakeven and positive cash flow in HT¹ Carve-out Catalyst Technologies following agreed sale Operational Operate new world-class PGM refinery Improve c
Slide 37: Financial outcomes
Financial outcomes 4 37
Slide 38: Focused on driving cash
Focused on driving cash Improving Clean Air margin Delivering new efficient PGM refinery Pivoting A highly focused, lean to a cash and cash generative focused business… Reducing overheads and rightsizing JM business …delivering materially model enhanced shareholder returns Disciplined capital invest
Slide 39: Capex reducing materially
Capex reducing materially PGM Services Capex to 2027/28 Substantial capex investment into new refinery Trending to maintenance capex beyond 2026/27 £376m (£303m ex-CT) c.£300m (c.£230m ex-CT) Clean Air Capex of less than £40m p.a. – close to maintenance c.£140m c.£120m Hydrogen Technologies
Slide 40: Delivering material working capital benefits
Delivering material working capital benefits Total working capital reduction of c.£250m by 2027/28 New PGM refinery Customer Supplier Inventory Enabling faster interaction interaction management processing, reducing Improving accuracy Consistency Reducing stock metal tied up in and timing of billing
Slide 41: An inflection point for cash generation
An inflection point for cash generation Free cash flow Cash drivers ex-divestments¹ At least Cost savings £250m Capex reducing materially to c.£120m by 2027/28 £36m Working capital benefits 2024/25 2027/28 of c.£250m by 2027/28 1. Net cash flow from operating activities after net interest paid, net
Slide 42: Capital allocation priorities
Capital allocation priorities Target net debt to EBITDA: 1.0 to 1.5x 1 2 3 Organic Shareholder Inorganic investment returns investment PGM refinery Growing annual cash Selective investment returns to investments in core shareholders from areas – only highly Capex to D&A compelling bolt-on at
Slide 43: Outlook for year ending 31st March 2026
Outlook for year ending 31st March 2026 Expect mid single digit percentage growth in operating profit at constant precious metal prices and constant currency¹ Assumes a full year of contribution from Catalyst Technologies Supported by self-help measures Performance weighted towards 2H Direct
Slide 44: What JM will deliver by 2027/28
What JM will deliver by 2027/28 1 2 3 Cash returns of At least mid single digit Annualised sustainable free at least £200m p.a CAGR in pro-forma cash flow of at least £250m to shareholders² operating profit¹ driven by cost savings, lower driven by cost savings capex and improved working capital 1. B
Slide 45: Conclusion
IM wattiey Conclusion 45
Slide 46: Accelerating value creation
Accelerating value creation Catalyst Technologies JM will be a highly Driving a step change sale at an attractive focused, lean and in cash generation valuation agile business Delivering materially enhanced shareholder returns 46
Slide 47: Q&A
Q&A IM wattiey
Slide 48: Appendix
Appendix 48
Slide 49: Clean Air: key financials
Clean Air: key financials % change, Underlying results for 2025 2024 constant year ended 31st March £m £m FX rates Light duty diesel 1,049 1,094 -2 Light duty gasoline 480 533 -8 Heavy duty diesel 790 954 -16 Total sales 2,319 2,581 -8 Operating profit 273 274 +3 c.£400m of cash Operating profit mar
Slide 50: PGM Services: key financials
PGM Services: key financials % change, Underlying results for 2025 2024 constant year ended 31st March £m £m FX rates Total sales 464 462 +1 Operating profit 149 164 -8 Operating profit margin 32.1% 35.5% EBITDA margin 38.1% 42.0% Note: PGM – platinum group metal. 50
Slide 51: Catalyst Technologies: key financials
Catalyst Technologies: key financials % change, Underlying results for 2025 2024 constant year ended 31st March £m £m FX rates Catalysts 563 518 +10 Licensing 106 60 +77 Total sales 669 578 +17 Operating profit 92 75 +24 Operating profit margin 13.8% 13.0% EBITDA margin 17.8% 17.3% Note: agreed sale
Slide 52: Hydrogen Technologies: key financials
Hydrogen Technologies: key financials % change, Underlying results for 2025 2024 constant year ended 31st March £m £m FX rates Total sales 60 71 -15 Operating loss (39) (50) n/a 52
Slide 53: £200m group transformation programme complete
£200m group transformation programme complete Cost savings Cumulative 2024/25 Target (£m) to date Management spans and layers 30 80 80 Procurement 25 75 70 Real estate 5 15 20 IT and JM Global Solutions¹ 20 30 30 Total savings 80 200 200 Cash cost 55 130 130 1. JM Global Solutions is a simplified an
Slide 54: Reported results
Reported results Reported results for year 2025 2024 ended 31st March £m £m Underlying operating profit 389 410 Profit / (loss) on disposal of businesses¹ 482 (9) Major impairment and restructuring charges² (329) (148) Amortisation of acquired intangibles (4) (4) Reported operating profit 538 249 Re
Slide 55: Free cash flow
Free cash flow Free cash flow for period 2025 2024 ended 31st March £m £m Underlying operating profit 389 410 Depreciation and amortisation¹ 183 186 – Precious metal working capital inflow 47 421 – Non precious metal working capital inflow / (outflow) 40 (224) Net working capital inflow 87 197 Net i
Slide 56: Net debt to EBITDA 1.4 times
Net debt to EBITDA 1.4 times¹ £m Net debt at 31st March 2024 (951) Free cash flow 521 Dividends (138) Share buyback (250) Movement in net debt 133 Lease adjustments² (12) Disposal of businesses 5 Net debt before FX and other movements (825) FX and other non-cash movements³ 26 Net debt at 31st March
Slide 57: Pro-forma sales
Pro-forma sales¹ Sales for year ended 31st March % change, 2025 2024 constant £m £m FX rates Clean Air 2,319 2,581 -8 PGM Services 464 462 +1 Hydrogen Technologies 60 71 -15 Eliminations (79) (114) Sales (pro-forma) 2,764 3,000 -6 Catalyst Technologies 669 578 +17 Value Businesses¹ 37 326 -89 Total
Slide 58: Pro-forma underlying operating profit
Pro-forma underlying operating profit¹ Underlying operating profit for 2025 2024 % change, year ended 31st March £m £m constant FX rates Clean Air 273 274 +3 PGM Services 149 164 -8 Hydrogen Technologies (39) (50) Corporate (87) (82) Underlying operating profit (pro-forma) 296 306 - Catalyst Technol
Slide 59: PGM prices
PGM prices US$ per troy oz 10,000 2,000 8,000 1,500 6,000 Price 1,000 (US$ per troy oz) Current 2024/25 2023/24 (16th May 2025) average average 4,000 500 2,000 Platinum 998 980 957 0 0 01/04/2023 01/04/2024 01/04/2025 Palladium 977 993 1,205 Rhodium Platinum Palladium (left hand axis) (right hand ax