Johnson Matthey PLC · LSE:JMAT
Johnson Matthey — Investor Presentation (May 2007)
27 slides from Johnson Matthey's investor presentation, May 14, 2007
Slide 1: Platinum 2007
UME) Johnson Matthey Platinum 2007 14th May 2007
Slide 2: Platinum
UME) Johnson Matthey Platinum
Slide 3: Platinum: Key features
Platinum: Key features • Platinum market moves into surplus after 7 years of deficit • Autocatalyst growth through diesel • Jewellery recycling increases • South African supply rises • Supply disruptions in early 2007 • ETF launches www.platinum.matthey.com
Slide 4: Platinum Supply and Demand
Platinum Supply and Demand ’000 oz 2005 2006 % Demand 6,695 6,775 +1.2 Supply 6,640 6,785 +2.2 Movements in stocks (55) 10 www.platinum.matthey.com
Slide 5: Platinum Demand Rises 80,000 oz
Platinum Demand Rises 80,000 oz million oz 8 • Total demand edges 1.2% up 7 6.695 6.775 to 6.78 million oz 6 • Autocatalyst demand climbs, 5 driven by diesel growth 4 • Jewellery demand affected by 3 high metal price 2 • Healthy growth in industrial 1 sectors 0 2005 2006 Auto Jlry Ind. www.platinum.
Slide 6: Platinum Demand: Autocatalyst
Platinum Demand: Autocatalyst million oz 5.0 • Autocatalyst demand rises 4.5 3.795 4.195 400,000 oz to 4.20 million oz 4.0 • Japanese platinum use falls 3.5 marginally 3.0 2.5 • Global heavy duty diesel demand 2.0 now exceeds 200,000 oz 1.5 • European and North American 1.0 platinum uptake rises due
Slide 7: Platinum Demand: Autocatalyst
Platinum Demand: Autocatalyst million oz 5.0 4.0 3.0 2.0 1.0 0.0 2003 2004 2005 2006 Gasoline Diesel www.platinum.matthey.com
Slide 8: Platinum Demand: Jewellery
Platinum Demand: Jewellery million oz 2.0 1.965 1.605 • High prices negatively affect global jewellery demand 1.5 • Total global demand falls 360,000 oz to 1.61 million oz 1.0 • Demand for new metal falls in every region 0.5 • Retail sales resilient in key 0.0 markets 2005 2006 China Japan N. Am. Eu
Slide 9: Platinum: Chinese Jewellery Manufacture
Platinum: Chinese Jewellery Manufacture million oz 1.2 • Net demand for new 1.0 metal falls 115,000 oz to 760,000 oz 0.8 • Retail sales little changed 0.6 in weight, up in value 0.4 • Recycling of unsold stock 0.2 and pieces returned by consumers doubles in 0.0 2005 2006 size Demand Recycling www.pl
Slide 10: Platinum Supply
Platinum Supply million oz 8 6.640 6.785 • 2006 South African 7 expansions raise sales by 175,000 oz 6 5 • Mixed performance from 4 South African mining houses 3 • Production in Russia and 2 elsewhere fairly flat 1 • Pgm basket price remains at 0 historically high levels 2005 2006 RSA Russia Other w
Slide 11: Platinum Outlook
Platinum Outlook • Further growth in demand for diesel autocatalysts • Improved first four months of SGE sales • First half supply disruptions resolved • Second half supplies to recover strongly • Market likely to move into surplus www.platinum.matthey.com
Slide 12: Forecast Platinum Price for the Next 6 Months
Forecast Platinum Price for the Next 6 Months $ per oz 1,500 1,400 1,300 $1,200 – $1,400 1,200 1,100 1,000 900 J A J O J A J O 2006 2007 www.platinum.matthey.com
Slide 13: Palladium
UME) Johnson Matthey Palladium
Slide 14: Palladium: Key features
Palladium: Key features • Palladium supply exceeded demand by more than 1 million oz in 2006 • Autocatalyst substitution for platinum • Jewellery demand falls • Global supplies lower than in 2005 • Fund and investor interest www.platinum.matthey.com
Slide 15: Palladium Supply and Demand
Palladium Supply and Demand ’000 oz 2005 2006 % Demand 7,355 6,635 -9.8 Supply 8,405 8,060 -4.1 Movements in stocks 1,050 1,425 www.platinum.matthey.com
Slide 16: Palladium Demand Shrinks
Palladium Demand Shrinks million oz • Total demand contracts by 8 7.355 6.635 10% to 6.64 million oz 7 6 • Increased recycling balances 5 growth in autocatalyst 4 purchases 3 • Sharp fall in palladium 2 jewellery demand from 1.43 1 million oz to 995,000 oz 0 2005 2006 • Electronics demand rises to A
Slide 17: Palladium Demand: Autocatalyst
Palladium Demand: Autocatalyst million oz 5.0 • Strong production 4.5 3.865 4.015 growth in Asia: Japan and 4.0 3.5 China contribute 190,000 3.0 oz extra demand 2.5 2.0 1.5 • Palladium continues to 1.0 0.5 replace platinum in 0.0 gasoline catalysts 2005 2006 China Europe Japan RoW N. Am. everywhere
Slide 18: Pgm choice in Autocatalysts
Pgm choice in Autocatalysts Gasoline Diesel percentage of pgm used (Pt/Pd) percentage of pgm used (Pt/Pd) 100.0 100.0 75.0 75.0 50.0 50.0 25.0 25.0 0.0 0.0 2005 2006 2005 2006 Palladium Platinum Palladium Platinum www.platinum.matthey.com
Slide 19: Palladium Demand: Jewellery
Palladium Demand: Jewellery '000 oz 1,500 • Chinese demand falls by 1,250 440,000 oz to 760,000 oz 1,000 • Pipeline filling of 2004-2005 750 completed 500 • Large amounts of Pd950 250 stock returned for recycling 0 2003 2004 2005 2006 • Retail sales patchy China RoW www.platinum.matthey.com
Slide 20: Palladium Supply
Palladium Supply million oz 9 8.405 8.060 • Supply drops 345,000 oz to 8 7 8.06 million oz 6 • Russian sales fall by 720,000 oz 5 4 • South African expansions 3 partly counterbalance this, 2 1 with sales rising 300,000 oz 0 2005 2006 S.Africa Russia N.Am. Other www.platinum.matthey.com
Slide 21: Palladium Supply: Russia
Palladium Supply: Russia million oz 5 4.620 3.900 • Norilsk production 25,000 oz 4 up on 2005 3 • Final sales of Stillwater/Norilsk metal 2 • 2006 Russian state shipments 1 too late in the year to be 0 supplied to consumers 2005 2006 Norilsk State sales Stillwater www.platinum.matthey.com
Slide 22: Palladium Outlook
Palladium Outlook • Autocatalyst palladium demand to continue expanding in 2007 • Some growth in the palladium jewellery market possible • Russian Dec. 2006 shipments likely to boost 2007 supplies • Another year of substantial surplus expected www.platinum.matthey.com
Slide 23: Forecast Palladium Price for the Next 6 Months
Forecast Palladium Price for the Next 6 Months $ per oz 450 400 $320 – $420 350 300 250 J A J O J A J O 2006 2007 www.platinum.matthey.com
Slide 24: Other pgm
UME) Johnson Matthey
Slide 25: Rhodium
Rhodium $ per oz • Market in deficit in 2006 7,000 6,500 • Supply rose to 824,000 oz 6,000 with South African growth 5,500 and additional Russian stock 5,000 sales 4,500 4,000 • Demand rises to 837,000 oz 3,500 3,000 with autocat the main driver 2,500 J A J O J A 2006 2007 www.platinum.matthey.com
Slide 26: Ruthenium
Ruthenium $ per oz • Demand rose 45% to 900 800 1.29 million oz in 2006 700 • Increase in PMR hard disk 600 500 market share 400 • Build-up of pipeline 300 200 inventory 100 • Recycling yet to catch up 0 J A J O J A 2006 2007 www.platinum.matthey.com
Slide 27: Platinum 2007
UME) Johnson Matthey Platinum 2007 14th May 2007