Underlying operating profit up 11%, excluding £85 million impact from lower precious metal (PGM) prices; including PGM price impact, down 8%¹
Executing on our strategy and announcing new strategic milestones to 2025/26
Well positioned to navigate changes in market dynamics given strength of portfolio – upgraded Clean Air cash target to at least £4.5 billion in the decade to 2030/31², strong growth and new project wins in Catalyst Technologies and reducing Hydrogen Technologi es investment in line with the slower pace of market development
Further underlying operating margin improvement in Clean Air and Catalyst Technologies
Transformation being delivered to drive efficiency and build a stronger platform for growth – upgrading target to £200 million cost savings by the end of 2024/25
Achieved 30% reduction in Scope 1+2 CO2e emissions since 2019/20 (target was 10%)
Agreed Value Businesses divestments – net proceeds of >£500 million, significantly above our target, and intend to return £250 million to shareholders via a share buyback programme³
Liam Condon, Chief Executive Officer, commented:
In May 2022, we set out Johnson Matthey’s reinvigorated strategy and transformation. We are now two years into executing on that strategy and, with the benefits progressively coming through, I am more confident than ever that we will be successful. We have built on the momentum from the first half, delivering good growth in underlying operating profit in the year, although lower PGM prices have impacted our headline profitability. We are delivering against our strategic milestones, and are announcing new commitments to 2025/26 which will continue to build a strong platform for growth. Our portfolio means we are well positioned in a rapidly changing market environment. Underpinned by our foundational PGM Services business, we are driving value from Clean Air alongside investing for growth in our energy transition businesses – Catalyst Technologies and Hydrogen Technologies. We have significant opportunities ahead and I look forward to our continued progress in catalysing the net zero transition and creating significant value for all stakeholders.
Outlook for the year ending 31st March 2025
For 2024/25, on a continuing basis excluding Value Businesses⁶, we expect at least mid single digit growth in underlying operating performance at constant precious metal prices and constant currency.
In Clean Air we expect modest growth in operating performance, with continued margin expansion driven by efficiency benefits. Beyond this, with the impact of historical platform losses behind us, we expect further growth in operating performance and margin expansion. PGM Services’ operating performance is expected to be broadly stable, with limited impact from precious metal prices. In Catalyst Technologies we expect further strong growth in operating performance, with mid-teens margins. In Hydrogen Technologies we now expect modest sales growth, with a significantly lower operating loss as we manage our investment with the pace of market development.⁷
If precious metal prices and foreign exchange rates remain at their current levels⁸ for the remainder of 2024/25, we expect an adverse impact of c.£5 million to full year operating performance compared with the prior year.⁹,¹⁰
Dividend
The board will propose a final ordinary dividend for the year of 55.0 pence per share at the Annual General Meeting (AGM) on 18th July 2024. Together with the interim dividend of 22.0 pence per share, this gives a total ordinary dividend of 77.0 pence per share, maintained at the same level as the prior year. Subject to approval by shareholders, the final dividend will be paid on 6th August 2024, with an ex-dividend date of 6th June 2024.
PGM Services seminar
We will host a PGM Services seminar on Thursday 27th June to provide a deep-dive into this business.
Enquiries:
Investor Relations
Martin Dunwoodie: Director of Investor Relations and Treasury, +44 20 7269 8241
Louise Curran: Head of Investor Relations, +44 20 7269 8235
Chris Wood: Senior Investor Relations Manager, +44 20 7269 8138
Media:
Sinead Keller: Group External Relations Director, +44 20 7269 8218
Harry Cameron: Teneo, +44 7799 152148
Notes:
1. Unless otherwise stated, sales and operating profit commentary refers to performance at constant exchange rates. Growth at constant rates excludes the translation impact of foreign exchange movements, with 2022/23 results converted at 2023/24 average rates. In 2023/24, the translational impact of exchange rates on group sales and underlying operating profit was an adverse impact of £120 million and £21 million respectively.
2. Cash target from 1st April 2021 to 31st March 2031, pre-tax and post restructuring costs.
3. Target was for net proceeds from divestments of more than £300 million. Share buyback programme conditional upon completion of Medical Device Components sale.
4. Underlying is before profit or loss on disposal of businesses, gain or loss on significant legal proceedings together with associated legal costs, amortisation of acquired intangibles, share of profits or losses from non-strategic equity investments, major impairment and restructuring charges and, where relevant, related tax effects. For definitions and reconciliations of other non-GAAP measures, see pages 46 to 49.
5. Revenue excluding sales of precious metals to customers and the precious metal content of products sold to customers.
6. Baseline is underlying operating profit on a continuing basis excluding Value Businesses (£381 million in 2023/24 as shown on page 9).
7. Outlook commentary for Clean Air, PGM Services, Catalyst Technologies and Hydrogen Technologies refers to underlying operating performance, and assumes constant precious metal prices and constant currency.
8. Average precious metal prices and average foreign exchange rates in May 2024 (month to date).
9. If precious metal prices remain at their current level⁸ for the remainder of 2024/25 there would be a benefit of £1 million on full year operating performance compared with the prior year. A US$100 per troy ounce change in the average annual platinum, palladium and rhodium metal prices each have an impact of approximately £0.5 million, £1 million and £0.5 million respectively on full year 2024/25 underlying operating profit in PGM Services. This assumes no foreign exchange movement.
10. At average foreign exchange rates for May 2024 month to date (£:US$ 1.26, £:€ 1.17, £:RMB 9.10) translational foreign exchange movements for the year ending 31st March 2025 are expected to adversely impact underlying operating profit by £4 million.
