(Adds more results details, finance director comments)
Feb 3 (Reuters) - Johnson Matthey, the world'sbiggest auto catalyst maker, reported a slight drop inthird-quarter sales on Wednesday and said tough marketconditions will limit its short-term growth opportunities.
Johnson Matthey, which also refines and recycles platinumgroup metals, said group sales for the quarter to end Decembertotalled 736 million pounds ($1 billion), down from 745 milliona year earlier.
Excluding contributions from its Gold and Silver Refiningand Research Chemicals businesses, which have been sold, salesfor the quarter were up 3 percent.
"Looking ahead, the challenging macroeconomic conditions,which have worsened slightly since our half-year results inNovember, are expected to limit the group's short-term growthopportunities," the company said in a statement.
Johnson Matthey, which makes most of its profits from thesale of platinum-rich catalysts for car emission-controldevices, has benefited in recent years from tighter Europeanregulation on emissions, boosting demand for more value-addedcatalysts.
But due to challenging conditions in several key markets,Johnson Matthey started a restructuring review last year,particularly in its Process Technology division, which sellscatalysts and technologies to the oil and petrochemical sector.
The restructuring, which involved job cuts, was expected tocut costs by around 30 million pounds annually.
"We should see a quarter of the annual savings come throughin our fourth quarter, the current quarter we are in," FinanceDirector Den Jones told Reuters.
Investor attitudes towards platinum, which is particularlyused in diesel autocatalysts, were hit heavily this year by theVolkswagen emissions scandal.
($1 = 0.6927 pounds) (Reporting by Olivia Kumwenda-Mtambo; editing by Jason Neelyand Susan Thomas)