Matthey hits full-year goal

City A.M. Reporter
JOHNSON Matthey, the world’s largest supplier of catalytic converters, expects good progress in the first half of 2010/11 while considerable short-term uncertainties about the global economy remained.

Underlying pre-tax profit declined five per cent to £254.1m in the year to the end of March as vehicle production was slashed amid the global recession. Ten analysts polled had on average expected a profit of £252.5m.

The speciality chemicals company expects underlying pre-tax profit in the current first half to be significantly higher than in the weak year-earlier period, but said the second half was harder to predict.

Finance director Robert MacLeod said the group expects to perform better in the first half than in 2006/7 and 2007/8, but that it was too early to predict how it would fare versus the record results in the first half of 2008/9.

Martin Evans, an analyst at JP Morgan, called the results encouraging. “With a better outlook for automotive catalysts in 2010/11, heavy duty diesel likely to see a steady recovery in the truck market, and robust commodity prices the market is likely to look favourably on these results.”

Johnson Matthey raised its dividend to 39p, beating expectations of a 37.1p payout.