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Johnson Matthey

Presentation of Results for the half year ended 30 th September 2000 29 th November 2000. Johnson Matthey. E. Johnson Matthey. E. Johnson Matthey. Overview. An excellent first half Profit before tax up 40% to £86.0 million Strong operating performance

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Johnson Matthey

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  1. Presentation of Results for the half year ended 30th September 2000 29th November 2000 Johnson Matthey E Johnson Matthey

  2. E Johnson Matthey

  3. Overview • An excellent first half • Profit before tax up 40% to £86.0 million • Strong operating performance • Double digit growth in all three divisions • Investment for continued growth

  4. E Johnson Matthey

  5. Summary Results 1H 1H 2000 1999 £m £m % Turnover – Continuing2,852 1,693 +68 Op. Profit - Continuing 82.7 67.1 +23 - Discontinued - (0.3) Interest 3.3 (5.2) Profit before tax* 86.0 61.6 +40 Exceptionals - 28.5 Goodwill amortisation (0.1) (0.1) EPS * 27.9p 20.5p +36 Dividend 7.0p 6.1p +15 * Excluding exceptionals & goodwill amortisation

  6. Operating Profit Continuing 1H 1H 1H 2000 1999 2000 at 1999 rates £m £m % £m % Catalysts & Chemicals 46.2 39.3 +18 44.0 +12 Precious Metals 27.3 20.2 +35 26.8 +33 Colours & Coatings 15.5 13.4 +16 16.0 +19 Corporate (6.3) (5.8) (6.2) 82.7 67.1 +23 80.6 +20

  7. Return on Sales Excluding Precious Metals Sales excl. PM’s ROS 1H 1H 1H 1H 2000 1999 Growth 2000 1999 £m £m % % % Catalysts & Chemicals 274 231 +18 16.9 17.0 Precious Metals 61 55 +12 44.8 37.0 Colours & Coatings 124 115 +8 12.5 11.7 459 401 +14 18.0 16.7

  8. Geographical SplitOperating Profit - Continuing 1H 2000 £82.7m 1H 1999 £67.1m 7% 10% 5% 8% 37% 37% 48% 48% Asia Europe Rest of the World North America

  9. Interest 1H 1H 2000 1999 £m £m Financial 3.7 (4.1) Gold & Silver leases (0.4) (1.1) 3.3 (5.2)

  10. Taxation 1H 1H 2000 1999 £m £m Underlying tax 24.5 17.3 Tax on sale of EMD - 9.9 24.5 27.2 Average tax rate 28.5% 30.2% Underlying tax rate 28.5% 28.1%

  11. Free Cash Flow 1H 1H 2000 1999 £m £m Operating profit 82.7 66.6 Depreciation and amortisation 19.8 26.9 Working capital / other (25.4) (19.5) Cash flow from operations77.1 74.0 Interest / tax / dividends (42.7) (50.4) Capex - continuing (39.6) (23.6) - EMD - (11.4) Free cash flow(5.2) (11.4)

  12. Net Cash Flow 1H 1H 2000 1999 £m £m Free cash flow(5.2) (11.4) Acquisitions (1.8) (2.8) Disposals (0.2) 404.1 Shares issued 5.8 (2.0) Net cash flow(1.4) 387.9 Exchange (3.4)6.3 Movement in debt(4.8)394.2

  13. Capital Sep 00 Mar 00 £m £m Net (cash) / debt (161) (166) Equity and minorities815 760 Capital employed654 594

  14. Catalysts & Chemicals Division £m £m +69% +18% 800 50 46.2 40 600 638 39.3 30 400 377 20 200 10 0 0 1H 1H 1H 1H 1999 2000 1999 2000 Sales Operating Profit

  15. Autocatalysts • Sales Volume up 10% • Driven by tighter standards • Legislation in developing countries • Growth in heavy duty diesel

  16. Fuel Cells • Activity steps up • Developing manufacturing processes • Created as stand-alone business

  17. Chemicals • Strong performance from PGM refining activities • Good sales of chemical products • Process catalysts benefit from investment in manufacturing facilities

  18. Pharmaceutical Materials • Growth in platinum based products • Growth in hydromorphone • Decline in generic methylphenidate • New products - chiral methylphenidate

  19. Precious Metals Division £m £m +74% +35% 2500 30 27.3 25 2000 2,087 20 20.2 1500 15 1,198 1000 10 500 5 0 0 1H 1H 1H 1H 2000 1999 2000 1999 Sales Operating Profit

  20. Precious Metals Division • Platinum business performs very well • Good growth in fabricated products • Gold business improves

  21. Platinum & Palladium Prices $/oz 900 800 700 600 500 400 300 200 100 0 Platinum Palladium Sept 1997 Sept 1998 Sept 1999 Sept 2000

  22. Colours & Coatings Division £m £m +7% +16% 20 200 150 15.5 15 127 13.4 119 100 10 50 5 0 0 1H 1H 1H 1H 1999 2000 1999 2000 Sales Operating Profit

  23. Colours & Coatings Division • Excellent results in Tile • Glass also performing well • Tableware markets remain difficult • Benefits of restructuring coming through

  24. Investment in Autocatalyst • New Royston facility • India facility opened • China facility open in spring • Heavy duty diesel

  25. Investment in Chemicals • Expansion of PGM refining • New process catalyst plant

  26. Strategy for Colours & Coatings • Focus on growth markets • Investment in Tile in Spain and Brazil • Investment in Glass in Holland

  27. Prototype Fuel Cell Cars E

  28. Fuel CellsMarket developments • California Fuel Cell Partnership launched • Small scale stationary applications first to market • JM well positioned to benefit • Potential for significant revenues even in early stages

  29. Fuel Cells • Good progress in collaborations • Commitment of over 18 years of R&D • Strong patent position

  30. Outlook • Continued strong growth in Autocatalyst • Robust outlook for the PGMs • Continued improvement in Colours & Coatings • Return to growth in Pharmaceuticals • Increased investment in core businesses • Pursuing acquisition opportunities

  31. E Johnson Matthey

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