GROWING demand for vehicle catalysts and higher metal prices yesterday helped speciality chemical group Johnson Matthey to boost profits by nearly half, beating forecasts.
The platinum refiner and world’s largest supplier of catalytic converters posted underlying pre-tax profit of £164.3m in the six months to 30 September, compared to £114.4m the previous year, against an average market forecast of £157m.
Falling demand for automotive products hit the group last year as the recession affected sales, but the firm said an improved economy helped fuel a recovery in vehicle production in the six months to September.
The group said Chinese quotas on exports of rare earth materials, which are used to store oxygen in gasoline catalysts, were forcing up prices and had lifted the group’s costs. It is working on ways to substitute the materials in its products.
The company, which also refines other precious metals and makes parts for fuel cells and fine chemicals for drugs, expects its second half to be similar to the first six months.
Chief executive Neil Carson said: “The outlook for the second half of the year for the group is good.”