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Presentation of Results for the year ended 31 st March 2002 6 th June 2002

Presentation of Results for the year ended 31 st March 2002 6 th June 2002. E. Johnson Matthey. E. Johnson Matthey. Overview. Operating profit up 10% to £193.3 million Strong performance from Catalysts & Chemicals Good contribution from acquisitions in Pharmaceutical Materials

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Presentation of Results for the year ended 31 st March 2002 6 th June 2002

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  1. Presentation of Results for the year ended 31st March 2002 6th June 2002 E Johnson Matthey

  2. E Johnson Matthey

  3. Overview • Operating profit up 10% to £193.3 million • Strong performance from Catalysts & Chemicals • Good contribution from acquisitions in Pharmaceutical Materials • PBT up 4% at £187.2 million

  4. Investment for the Future • Capex 2.8 times depreciation • Autocatalyst – new process technology • PGM refining expansion • New pharmaceutical facility • Fuel cells • Tile facility in Spain • R&D expenditure 13% up

  5. E Johnson Matthey

  6. Summary Results 2002 2001 restated £m £m % Turnover 4,8305,904 -18 Sales excluding 1,093 977 +12 precious metals Operating profit* 193.3 175.0 +10 Interest (6.1) 5.3 Profit before tax* 187.2 180.3 +4 Exceptionals (23.7) 0.5 Goodwill amortisation (6.8) (0.3) EPS* 60.4p 57.2p +6 Dividend 24.6p 23.3p +6 * Excluding exceptional items and goodwill amortisation

  7. 2002 at 2001 exchange rates £m % 97.6 +21 55.5 -3 25.6 -20 30.7 +71 (13.5) (0.5) 195.4 +12 2002 2001 £m £m % Catalysts & Chemicals 94.7 80.9 +17 Precious Metals 55.9 57.4 -3 Colours & Coatings 25.5 32.1 -21 Pharmaceutical Materials 31.3 18.0 +74 Corporate (13.6) (13.3) Discontinued (0.5) (0.1) 193.3 175.0 +10 Operating Profit

  8. ROS 2002 2001 % % 15.9 15.1 39.1 35.5 10.2 13.1 30.9 60.2 n/m n/m 17.7 17.9 Sales excl. PM’s 2002 2001 Growth £m £m % Catalysts & Chemicals 597 535 +11 Precious Metals 143 162 -12 Colours & Coatings 251 246 +2 Pharmaceutical Materials 101 30 +239 Discontinued 1 4 1,093 977 +12 Return on SalesExcluding Precious Metals

  9. Geographical SplitOperating Profit 2002 £193.3m 2001 £175.0m Asia Europe Rest of World North America

  10. Interest 2002 2001 £m £m Financial (2.6) 6.7 Gold & Silver leases (3.5) (1.4) (6.1) 5.3

  11. Exceptional Items 2002 £m Rationalisation of Tableware (24.0) Rationalisation of Meconic (1.3) Sale of unhedged palladium 7.2 Sale of French print business (5.5) Other (0.1) Total (23.7)

  12. Taxation 2002 2001 £m £m Underlying tax 56.0 54.1 Tax on exceptionals (5.8) 0.1 50.2 54.2 Underlying tax rate 29.9% 30.0%

  13. Return on Investment 2002 2001 £m £m Operating profit193 175 Average assets: Equity and minorities 814 770 Cumulative goodwill w/o 46 46 Net borrowings / (cash) 10 (153) Total investment 870 663 Pre-tax ROA 22.2% 26.4% Return on invested capital 15.6% 18.5% WACC 9% 10%

  14. Free Cash Flow 2002 2001 £m £m Operating profit 169 174 Depreciation and amortisation 55 41 Working capital / other - (58) Cash flow from operations224 157 Interest / tax / dividends (113) (79) Capex (131) (95) Free cash flow(20) (17)

  15. Net Cash Flow 2002 2001 £m £m Free cash flow(20) (17) Acquisitions / disposals (145) (6) Shares (bought) / issued (44) 8 Net cash flow(209) (15) Debt acquired with subs. (47) (1) Loan notes issued (41) - Finance leases (4) - Exchange 2(10) Movement in debt(299)(26)

  16. Capital Mar 02 Mar 01 £m £m Net debt / (cash) 159 (140) Equity and minorities818 811 Capital employed977 671 Gearing19% n/m (debt / equity + minorities)

  17. E Johnson Matthey

  18. £m £m -11% +17% 1,800 100 94.7 1,500 80 1,468 80.9 1,303 1,200 60 900 40 600 Sales 20 300 Operating Profit 0 0 2001 2002 2001 2002 Catalysts & Chemicals Division

  19. Catalytic Systems • Global car sales 2 to 3% down in our fiscal year • Our volumes flat on last year • Business sees benefits of investment in technology • All plants converted to precision coating within a year

  20. Heavy Duty Diesel • Retrofit market continues to grow • Major trials in US and Asian cities • Original equipment market takes off in middle of the decade • $600 million market by around 2008

  21. Chemicals • Strong growth in pgm refining • Manufacturing presence in China • Avocado acquisition supports excellent growth in Research Chemicals

  22. Fuel Cells • Expansion at Sonning completed • Good progress on Swindon plant • Market consolidating as major players emerge • Near term opportunities in niche portable power and telecoms applications

  23. Fuel Cell Products

  24. Fuel Cell Vehicles

  25. £m £m -24% -3% 6,000 60 57.4 55.9 5,000 50 40 4,146 4,000 30 3,000 3,167 2,000 20 Sales 1,000 10 Operating Profit 0 0 2001 2002 2001 2002 Precious Metals Division

  26. Platinum & Palladium Prices US $ May02

  27. Precious Metals Division • Platinum demand robust • Diesel catalysts • China jewellery • Good growth in fabricated products • Pressure on margins in Gold and Silver

  28. 35 30 25 20 £m £m +1% -21% 300 15 32.1 250 253 251 10 25.5 200 5 150 0 100 Sales 50 Operating Profit 0 2001 2001 2002 2002 Colours & Coatings Division

  29. Colours & Coatings Division • Glass sector performs well • Structural Ceramics positioned as lowest cost producer • Very difficult conditions in Tableware market • Swift action taken to reduce costs

  30. 35 30 25 20 £m £m +200% +74% 120 15 106 31.3 100 10 80 5 60 18.0 0 40 Sales 35 20 Operating Profit 0 2001 2002 2001 2002 Pharmaceutical Materials Division

  31. Pharmaceutical Materials Division • New product introductions • Growth in specialist opiates • Expansion of contract research • Approval to import narcotic raw materials into US

  32. Patent Protected Pre-clinical Phase I Phase II Phase III Generic Pharmaceutical Materials DivisionNew Products New products in development Jun 02 17 4 7 9 18 Dec 01 12 4 3 10 14

  33. Outlook • Economic climate more encouraging • Car sales forecasts improving • Platinum demand robust • JM well placed for further growth

  34. E Johnson Matthey

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