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LONDON (Alliance News) - Johnson Matthey PLC Thursday reported a large rise in pretax profit and its dividend that both comfortably beat market expectations.
The FTSE 100-listed speciality chemicals and metals company reported a pretax profit of GBP495.8 million in the year ended March 31, rising from a GBP406.6 million profit a year earlier. That easily beat analysts' forecasts of GBP437.3 million.
Revenue for the year fell to GBP10.05 billion from GBP11.15 billion, but Johnson Matthey's margin improved as it produced a higher gross profit of GBP817.7 million from GBP799.1 million.
The rise in pretax profit was mainly attributable to a GBP73.0 million gain from the sale of the Precious Metal Products division's gold and silver refining business to Asahi Holdings, which included the sale of a collector, refiner and recycler of precious and rare metals from waste materials.
Administrative costs rose to GBP207.3 million from GBP192.9 million, offset by falls in distribution costs and amortisation.
Johnson Matthey also raised its dividend by more than expected to 68.0 pence per share for the year, representing a 9% rise and ahead of analysts' expectations of 67.5 pence.
Most of the company's divisions experienced a rise in sales. The Emission Control Technology division sales rose 12%, the Process Technologies division sales increased by 7%, and the Fine Chemicals business sales went up 3%. The New Businesses division saw sales rise by 27%, but the Precious Metals Product division experienced a 9% fall in sales.
"In 2015/16, Johnson Matthey's continuing businesses are expected to deliver good underlying growth. A strong performance in Emission Control Technologies and good progress in Fine Chemicals is likely to be partially offset by a weaker year for Precious Metal Products. We anticipate that Process Technologies' performance will be broadly stable and that the operating loss in New Businesses will reduce modestly," said Chief Executive Robert MacLeod.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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