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6 June, 2019 - 12:02 By Tony Quested

Batteries included as JM powers up new market opportunities

Robert MacLeod

Cambridge sustainable tech world leader Johnson Matthey has hiked its dividend by seven per cent after soaring sales and profits in the year to March 31.

Revenue was up five per cent to £10.745 billion with profit before tax 53 per cent higher at £488 million. The dividend rose to 85.5p per share.

Sales grew 10 per cent and underlying operating profit eight per cent at constant rates driven by strong growth in Clean Air. JM has a strong balance sheet with net debt of £866 million and a market cap of £5.92bn.

On top of the success in the Clean Air arena, JM achieved its planned market share of c.65 per cent in European light duty diesel. Sector sales grew 11 per cent – well ahead of the decline in global vehicle production, driven by double digit growth in both light and heavy duty catalysts.

Sales grew four per cent in Efficient Natural Resources with strong operating profit driven by higher average precious metal prices and net benefits from improved efficiency and weaker performance in advanced glass technologies. 

In Health, sales were up three per cent and operating profit slightly down reflecting product mix and net costs associated with footprint optimisation.

New Markets saw strong sales growth but lower operating profit mainly due to Battery Materials as JM invested in eLNO. 

The company reports continued progress on commercialising eLNO and says customer feedback remains positive. JM recently secured a site in Poland for its first commercial plant as well as its first long-term supply agreement for raw materials with Nemaska Lithium. Reported operating profit was £531m, up 48 per cent. 

Chief executive Robert MacLeod said: “We had another good year with strong sales and operating profit growth as we progress our strategy to deliver our vision for a cleaner, healthier world.

“In the year, Clean Air performed strongly and we are investing in new plants to satisfy future demand, particularly from Asia which will be our next key growth driver. 

“We remain excited by the growth opportunity in Battery Materials and commercialisation of eLNO®, our leading ultra-high energy density cathode material, continues at pace. 

“We made further investments in Health to develop our pipeline of products and in Efficient Natural Resources we continue to drive efficiencies whilst focusing on high growth market segments. 

“To support our long term growth and as we broaden our presence in sustainable technologies, we are also developing innovative solutions for fuel cells and battery materials recycling.

“Delivery of our strategy is underpinned by the fundamental changes we are making across all aspects of the group. Our business is becoming more agile and efficient, with greater capability to deal with the fast changing world around us. 

“We have invested in safety, people, systems and processes whilst continuing to target further improvement. The ongoing roll out of our single global ERP system which will standardise processes and transform the way we work is an example. Together, all of these actions are enabling us to strengthen our platform for growth.

“For 2019/20, we expect growth in operating performance at constant rates to be within our medium term guidance of mid to high single digit growth.”

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