Johnson Matthey PLC · LSE:JMAT

Johnson Matthey — H1 2003/04 Earnings Presentation

32 slides from Johnson Matthey's earnings presentation, Nov 27, 2003

  1. Slide 1: Presentation of Results for the half year ended 30th September 2003

     Johnson Matthey Presentation of Results for the half year ended 30th September 2003 27th November 2003

  2. Slide 2: Johnson Matthey

     Johnson Matthey

  3. Slide 3: Overview

    Overview  Operating profit up 13% to £103.1 million  PBT up 4% to £97.5 million, EPS up 5% to 31.8p  Strong growth in Catalysts with good contribution from former Synetix businesses  Good performance from Pharmaceutical Materials  Renewed long term contracts agreed with Anglo Platinum  Group t

  4. Slide 4: Johnson Matthey

     Johnson Matthey

  5. Slide 5: Summary Results

    Summary Results 1H 1H 2003 2002 restated £m £m% Turnover 2,165 2,247-4 Sales excluding precious metals 625.1 562.1+11 Operating profit* 103.1 91.0 +13 Interest (8.5) (4.3) Net return on pension 2.9 7.0 Profit before tax* 97.5 93.7 +4 Exceptional items - - Goodwill amortisation (9.9) (4.8) EPS * 31.8

  6. Slide 6: Operating Profit

    Operating Profit 1H 1H 1H 2003 at 1H 2002 2003 2002 exchange rates* restated £m £m % £m % 58.1 +32 Catalysts 56.5 44.0 +28 22.3 -8 Precious Metals 21.9 24.2 -10 11.0 -5 Colours & Coatings 11.8 11.6 +2 21.5 +13 Pharmaceutical Materials 20.7 19.1 +8 *Excluding South (7.8)African rand Corporate (7.8) (

  7. Slide 7: Geographical Split

    Geographical Split Operating Profit 1H 1H 2002 2003 restated £103.1m £91.0m 15% 16% 28% 37% 7% 12% 36% 49% Europe Asia North America Rest of the World 

  8. Slide 8: Interest

    Interest 1H 1H 2003 2002 £m £m Financial (8.0) (3.7) Gold & silver leases (0.5)(0.6) (8.5) (4.3) 

  9. Slide 9: Net Return on Retirement Benefits Assets and Liabilities

    Net Return on Retirement Benefits Assets and Liabilities 1H 1H 2003 2002 restated £m £m Expected return on scheme assets 18.8 23.3 Interest on scheme liabilities (15.9) (16.3) 2.9 7.0 

  10. Slide 10: Taxation

    Taxation 1H 1H 2003 2002 restated £m £m Underlying tax 29.2 27.8 Tax on goodwill amortisation (1.2) - 28.0 27.8 Underlying tax rate 29.9% 29.7% 

  11. Slide 11: Net Cash Flow

    Net Cash Flow 1H 1H 2003 2002 restated £m £m Operating profit 93.086.2 Depreciation and amortisation 41.0 29.9 Working capital / other 8.4 (0.4) Cash flow from operations 142.4115.7 Interest / tax / dividends (66.2) (60.5) Capex (62.4) (58.3) Acquisitions / disposals 2.2 1.0 Shares issued / (bought)

  12. Slide 12: Capital

    Capital Sep 03 Mar 03 restated £m £m Net debt 380402 Equity and minorities 860 811 Capital employed 1,240 1,213 Gearing 44%50% (debt / equity + minorities) Interest cover 12x14x 

  13. Slide 13: Catalysts Division

    Catalysts Division  ECT ahead with growth in Asia and HDD  Strong performance from PCT £m £m +13% +28% 640 593 56.5 60 526 1 480 44.0 45 320 30 160 15 0 0 1H 1H 1H 1H 2002/03 2003/04 2002/03 2003/04 Sales Operating Profit 1 Restated for FRS 17 

  14. Slide 14: Environmental Catalysts and Technologies

    Environmental Catalysts and Technologies  US light vehicle sales 1% down, production more than 7% lower  European sales slightly up, production 2% down on last year  Car sales in China strongly ahead spearheading good growth in Asia  Excellent progress in heavy duty diesel catalysts 

  15. Slide 15: Global HDD Legislation

    Global HDD Legislation Particulate matter emissions (g/kW-hr) 0.20 Japan 2003 0.18 0.16 0.14 US 2004 0.12 EU III (2000) 0.10 0.08 JM current 0.06 technology 0.04 Japan 2005 EU IV (2005) 0.02 US 2007 US 2010 0 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5 6 EU V (2008) NOx emissions (g/kW-hr) 

  16. Slide 16: Heavy Duty Diesel

    Heavy Duty Diesel  Full portfolio of HDD technologies  Strong market position, proven durability  Retrofit programmes in cities around the world  Opportunities in light duty diesel markets 

  17. Slide 17: Process Catalysts and Technologies

    Process Catalysts and Technologies  Successful integration of Synetix  Good growth in process catalysts  PGM refining business continues to be affected by weak palladium prices  Research Chemicals business again performs well 

  18. Slide 18: Process Catalysts and Technologies

    Process Catalysts and Technologies  Focus on seven catalyst markets  Leading positions in each of these segments  Major strategic growth opportunity in GTL 

  19. Slide 19: Fuel Cells

    Fuel Cells  Numbers of pre-commercial small stationary fuel cells almost double  Vehicle test fleets continue to expand  Growing demand for MEA products from Swindon 

  20. Slide 20: Precious Metals

    Precious Metals  Fall in palladium and rhodium prices  Platinum demand remains robust £m £m - 9% -10% 1,800 30 1,523 1 1,500 1,380 24.2 24 21.9 1,200 18 900 12 600 300 6 0 0 1H 1H 1H 1H 2002/03 2003/04 2002/03 2003/04 Sales Operating Profit 1 Restated for FRS 17 

  21. Slide 21: Platinum, Palladium and Rhodium Prices

    Platinum, Palladium and Rhodium US$ Prices 1,000 900 800 700 600 500 400 300 200 100 0 March 2002 September 2002 March 2003 September 2003 Platinum Palladium Rhodium 

  22. Slide 22: Precious Metals

    Precious Metals  PGM basket price very similar to last year  Strong platinum price offset by much weaker palladium and rhodium  Continued decline in trading activity  Fabricated pgm businesses continue to perform well  Gold refining business down. Margins remain under pressure 

  23. Slide 23: Precious Metals

    Precious Metals  Renewed Anglo Platinum contracts  Carries relationship well into next decade  Short term fall in group income  Income will grow as pgm sales increase  Underpins longer term growth of division 

  24. Slide 24: Pharmaceutical Materials

    Pharmaceutical Materials  Good growth in profits  Strong performances from West Deptford and Macfarlan Smith £m £m - 2% +8% 75 25 66 65 1 20.7 60 19.1 20 45 15 30 10 15 5 0 0 1H 1H 1H 1H 2002/03 2003/04 2002/03 2003/04 Sales Operating Profit 1 Restated for FRS 17 

  25. Slide 25: Pharmaceutical Materials

    Pharmaceutical Materials  West Deptford – increased sales of controlled substances and platinum drugs  Macfarlan Smith – profits well ahead with good growth in sales of specialist opiates  Pharm-Eco – weak market in first quarter, however gained new business and market since recovered 

  26. Slide 26: Pharmaceutical Materials

    Pharmaceutical Materials  New opiates facility at West Deptford completed. In production by end of fiscal year  New production capacity for specialist products at Macfarlan Smith  Significant progress on prostaglandins  New product pipeline increased to 71 compounds in development, with several

  27. Slide 27: Colours & Coatings

    Colours & Coatings  Good progress despite mixed markets  Glass performs well £m £m - 4% +2% 150 15 132 127 1 11.6 11.8 100 10 50 5 0 0 1H 1H 1H 1H 2002/03 2003/04 2002/03 2003/04 Sales Operating Profit 1 Restated for FRS 17

  28. Slide 28: Colours & Coatings

    Colours & Coatings  Good growth in Glass business  Structural Ceramics down in weak markets  Speciality Coatings benefits from lower costs 

  29. Slide 29: Colours & Coatings

    Colours & Coatings  Strategic review by Board  Invite offers for combined Structural Ceramics and Speciality Coatings businesses  Retain businesses with close links to rest of Johnson Matthey 

  30. Slide 30: Outlook

    Outlook  Further growth from Catalysts and Pharmaceutical Materials  PMD impacted by renewed Anglo Platinum contracts  Currency effect – impact of weak US dollar  Confident of growth in earnings and dividends 

  31. Slide 31: Longer Term Outlook

    Longer Term Outlook  Major growth opportunities in Catalysts, Fuel Cells and Pharmaceutical Materials  Renewed Anglo Platinum contracts underpin long term growth of Precious Metals 

  32. Slide 32: Johnson Matthey

     Johnson Matthey

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