In the year of its 200th birthday, Johnson Matthey (JMAT) has put in a solid performance, growing operating profit 18 per cent to £493m for the year. In constant currencies, continuing business revenue was up 3 per cent, while sales growth for the continuing business was up 6 per cent during the second half. Much of the progress was attributable to the process technologies business, which sells licences, catalysts and services related to chemicals and oil and gas.
The group expects earnings to continue to improve at a similar level over the next year, although management warned that any progress would likely be held back by the absence of US post retirement medical benefit credit and higher non-cash pension charges. It expects to take a restructuring charge of £50m-£65m, the restructuring is expected to generate savings of £10m in 2017-18 and £25m annually thereafter.
It is also investing heavily in future growth, with £201m in research and development over the year. Investment in capital expenditure was £265m. Research and development focused on the group's emission control technologies and fine chemicals business.
Analysts at JPMorgan Cazenove forecast adjusted pre tax profit of £494m for the March 2018 year-end, giving adjusted EPS of 212p (from £482m and 209p in 2017).
JOHNSON MATTHEY (JMAT) | ||||
|---|---|---|---|---|
| ORD PRICE: | 3,112p | MARKET VALUE: | £6.02bn | |
| TOUCH: | 3,110-3,113p | 12-MONTH HIGH: | 3,568p | LOW: 2,774p |
| DIVIDEND YIELD: | 2.4% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 1,156p* | NET DEBT: | 32% | |
| Year to 31 Mar | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 10.70 | 349 | 132 | 57.0 |
| 2014 | 11.20 | 407 | 168 | 63.0 |
| 2015 | 10.10 | 496 | 211 | 68.0 |
| 2016** | 10.70 | 386 | 166 | 71.5 |
| 2017 | 12.03 | 462 | 201 | 75.0 |
| % change | +12 | +20 | +21 | +5 |
Ex-div: 8 Jun Payment: 1 Aug *Includes intangible assets of £895m, or 463p a share **Dividend figure excludes special dividend of 150p per share | ||||
