Final Results - Year Ended 31 March 2000
Johnson,Matthey PLC
8 June 2000
Preliminary Results for the year ended 31st March 2000
Continuing strong performance from core businesses. Prospects are very
encouraging.
Results
* Strong performance from continuing businesses with operating profits up 17%
to £146.5 million on sales up 27% at £3,769 million
* Profit before tax excluding exceptional items up 10% to £143.8 million
(including exceptionals up 14% to £157.2 million)
* Earnings per share excluding exceptionals up 7% to 47.5 pence (including
exceptionals up 4% to 51.4 pence)
* Dividend for the year increased by 7% to 20.3 pence
* Electronic Materials sold for US$655 million in cash giving an exceptional
profit of £28.5 million after goodwill write back
* Shareholders' funds up £202.6 million to £755.4 million. Net cash at 31st
March 2000 £165.8 million
* All the group's continuing businesses are delivering good organic growth
Strategy
* Focus on core business achieved with sale of Electronic Materials
* Significant investment programme in Catalysts & Chemicals Division on fuel
cells, diesel emission control, homogeneous catalysts and pharmaceutical
materials
* Precious Metals Division positioned to benefit from significant growth in
demand for platinum group metals
* Rationalisation programme for Colours & Coatings Division to add £4 million
to profits in the next financial year and £7 million per year thereafter
* Cash from sale of Electronic Materials released for investment and
acquisitions
Commenting on the results, Chris Clark, Chief Executive of Johnson Matthey,
said:
'Johnson Matthey performed well last year and prospects are very encouraging
for the year just started. Investment in new technology will help us develop
our businesses further and we are pursuing a number of opportunities to add to
our core operations.'
Enquiries:
Chris Clark, Chief Executive, Johnson Matthey 020 7269 8435
John Sheldrick, Group Finance Director, Johnson Matthey 020 7269 8438
Howard Lee, Gavin Anderson & Co 020 7457 2345
Review of the year ended 31st March 2000
Financial Highlights
In the year to 31st March 2000 operating profit from continuing operations
rose by 17% to £146.5 million on sales that were 27% up at £3,769 million. On
17th August 1999, Electronic Materials Division (EMD) was sold to AlliedSignal
Inc. for US$655 million. EMD made a £0.1 million contribution to profits
compared with £22.1 million for the full year 1998/99. Despite the shortfall
in EMD, Johnson Matthey earned profits before tax and exceptional items of
£143.8 million, 10% up on prior year.
Earnings per share excluding exceptional items were 7% up at 47.5 pence.
Including exceptional items earnings per share were 4% up at 51.4 pence.
As a result of the sale of EMD net cash flow for the group was strongly
positive at £393.3 million. Johnson Matthey ended the year with net cash of
£165.8 million compared with net borrowings of £221.6 million last year.
Shareholders' funds rose by £202.6 million to £755.4 million.
Dividend
The board is recommending to shareholders a final dividend of 14.2 pence
making a total dividend for the year of 20.3 pence, an increase of 7%. The
dividend would be covered 2.3 times by earnings.
Operations
Catalysts & Chemicals Division increased its sales by 26% over last year to
£856 million. The growth reflected increased sales volume and the effect of
higher palladium prices on autocatalysts. The division's operating profit rose
by 14% to £84.8 million.
The Autocatalyst business achieved good growth in operating profit with unit
sales 11% higher than last year driven by strong car sales and tightening
emission standards in all the world's major car markets. These tighter
standards are resulting in more catalysts per vehicle and growing demand for
more technologically sophisticated catalysts.
In August 1999 we announced that Johnson Matthey had agreed with General
Motors Corporation to settle a long-standing commercial dispute. As part of
the settlement agreement Johnson Matthey has entered into collaboration with
General Motors on a significant research and development project on fuel cells
for transportation applications.
The Chemicals business also achieved good growth in operating profit
benefiting from strong demand for platinum group metal (pgm) refining and good
sales of platinum group metal compounds. As anticipated, profits in our
Pharmaceutical Materials business were flat as a result of the increased
competition in methylphenidate as two new generic suppliers entered the market
and prices declined. This was offset by strong sales of carboplatin, fentanyl
and hydromorphone and initial income from a new product in late stage clinical
trials.
Precious Metals Division's (PMD's) sales were 31% ahead of last year at £2,672
million. Sales of platinum group metals rose as a result of increasing demand
and higher prices. Gold sales also increased with higher levels of refining
activity in the Far East. Operating profit for the division rose by 22% to
£45.4 million.
Another year of unpredictable Russian supplies supported pgm prices and
ensured continued market volatility. PMD's marketing operations benefited
from the trading opportunities and record demand for metal from the
autocatalyst and jewellery sectors. Buoyant demand for industrial products
underpinned a good performance from PMD's platinum fabrication facilities.
Gold and Silver operations had a satisfactory year. Good levels of business
for refining and bullion products were offset by weaker margins in a
competitive marketplace.
Colours & Coatings Division's sales were 1% down on last year at £241.2
million. Much of the division's operations are based in Europe and sales
growth was adversely affected by exchange translation because of the weakness
of the euro. On a constant currency basis sales grew by 3%. Operating profits
grew by 11% to £27.9 million despite adverse exchange translation. Margins
improved to 11.6% as a result of both a shift to higher margin products and
continued emphasis on reducing costs.
The Structural Ceramics segment was well up on last year with strong demand
for decorative products from tile producers in southern Europe. The Glass
business also performed well led by continued growth in sales of automotive
glass enamels. The division's inorganic pigments businesses produced
encouraging results with good sales of products for woodstains, paints and
plastics. The division's organic pigments businesses made a loss of £0.4
million and were sold at the end of the year.
The Tableware business saw a further decline in its market and a
rationalisation programme was introduced in the second half of the year to
streamline operations by closing sites, reducing administration costs and
cutting headcount by more than 200. The cost of this programme is £9.8
million of which £5.2 million had been spent by 31st March 2000. It will give
rise to savings of around £4 million in the financial year 2000/01 and £7
million per annum in following years.
Exceptional Items
Overall, exceptional items gave rise to a net profit of £13.6 million on a
pre-tax basis. Most of the gain arose from the sale of EMD for US$655 million
in cash which was completed in August 1999. Some peripheral assets, mainly
property, amounting to £13.7 million were retained. The sale generated a net
gain of £152.2 million compared with book value. After writing back £123.7
million of goodwill it gave rise to an exceptional profit of £28.5 million.
At the end of the year the group sold its organic pigments businesses in
Venezuela and the United States to Dominion Colour Corporation and Continuous
Link Color Inc. respectively. The businesses were sold at a loss of £4.5
million compared with book value. After writing back £1.7 million of goodwill
the disposals gave rise to an exceptional loss of £6.2 million.
An exceptional charge of £9.8 million has been included in operating profit to
cover the cost of the rationalisation programme for the group's Tableware
business. An exceptional gain of £1.1 million arose in the year on disposal
of surplus properties.
Interest and Exchange Rates
The interest charge fell by £13.5 million to £2.4 million as a result of the
interest earned on the sale proceeds of EMD. In the second half of the year
the group had net interest income of £2.8 million. Interest for the year
includes £2.2 million of leasing costs for gold and silver which increased
from £1.3 million last year.
Operating profit from continuing operations rose significantly in North
America, Asia and in the rest of the world but fell slightly in Europe. The
increase in the rest of the world included additional autocatalyst
manufacturing in South Africa and Argentina for the European market.
Exchange rates had a mixed impact on the group's results. The strength of
sterling against the euro and other foreign currencies had an adverse impact
on the group's businesses that export from the UK, particularly in Colours &
Coatings. However the US dollar was also stronger which benefited the
translation of our US subsidiaries' earnings. Overall, exchange translation
improved profits by £0.2 million compared with last year.
Taxation
The group's average tax rate, excluding exceptional items, was slightly higher
than last year at 28.1%. Tax payable in the UK rose compared with last year as
a result of the change in the rules for Advance Corporation Tax. Tax payable
fell in the US following the disposal of EMD but increased in the rest of the
world reflecting the higher level of profit earned in those countries.
Cash Flow
The group's net cash flow for the year was very strong at £393.3 million as a
result of the sale of EMD. Free cash flow (net cash flow from operating
activities after interest, tax, dividends and capital expenditure) for the
continuing businesses was slightly negative at £7.6 million after two years in
which the group had generated £54.8 million at this level. The outflow was
mainly the result of the sharp increase in platinum group metal prices which
occurred towards the end of the year and which resulted in additional funding
requirements for debtors and stocks in Catalysts & Chemicals Division.
The group ended the year with net cash of £165.8 million compared with net
borrowings of £221.6 million last year.
Strategy
Johnson Matthey's strategy announced in November 1998 to change the focus of
the group has been successfully implemented. EMD was established as a stand
alone entity and sold for a good price. Our core businesses achieved 17%
growth in profits following 20% growth in 1998/99.
The prospects for future growth are very encouraging. We are undertaking a
significant investment programme to take advantage of opportunities in the
strongly growing autocatalyst market. We have recently announced an investment
of £10 million to build a new autocatalyst facility at Royston in the UK to
meet the increasing demand in Europe for more technologically advanced
catalysts. The new factory will initially have capacity to manufacture 3.5
million catalysts a year. In February 2000 we announced the establishment of a
new autocatalyst facility in China which will initially have capacity to
produce 0.6 million car catalysts and 1 million motorcycle catalysts. We are
doubling the capacity of our very successful Indian business at a new site in
Harayana state which will have capacity for 2 million car catalysts and 4
million motorcycle catalysts.
We are also investing in our global manufacturing technology with expenditure
of £20 million over the next 3 years. This investment will give Johnson
Matthey a significant competitive edge enabling the production of catalysts to
the much tighter specifications required for the next generation of clean
cars.
In March 2000 Johnson Matthey unveiled its SCRT system which represents a
major step forward in diesel emission control. This will make heavy duty
diesel truck and bus engines as clean as those of the very latest passenger
cars. In the next few years much more stringent emission control limits will
be introduced for heavy duty diesel engines both in the US and Europe. This
new technology will enable manufacturers to meet these new limits within
industry cost targets.
New catalyst development is increasing in other areas. In January 2000 we
acquired an equity stake in Oy Smoptech Ab as part of a phased acquisition of
the company. Smoptech, which is based in Turku, Finland, has developed a range
of advanced polymer fibres for use as innovative supports for catalysts and in
other chemical process applications in the pharmaceutical and chemical
industries. In Pharmaceutical Materials the major capacity expansion at West
Deptford in the US is well underway and should be operational during calendar
year 2001 to meet anticipated demand arising from new product introductions.
Fuel cells represent a major opportunity for growth with their application in
vehicles and in our homes soon to become a reality. It is expected that there
will be several thousand fuel cell vehicles on the road by 2005 and industry
estimates are that between 600,000 and 1 million fuel cell cars will be
produced per year by 2010. Johnson Matthey is the world leader in catalysts
and catalysed components for fuel cells. We are investing £12 million in the
expansion of our fuel cell development, testing and pilot production
facilities both at our Technology Centre at Sonning Common and in the US.
Our technology lead in fuel cells has enabled us to secure an unrivalled list
of fuel cell customer partnerships. These include XCELLSIS, VW, General
Motors, Siemens, Ballard, IFC, Plug Power and Energy Partners. We recently
announced a new collaboration and supply agreement with James Cropper PLC.
This represents an important step in the development of high volume
manufacturing processes for Johnson Matthey's Membrane Electrode Assembly
(MEA), the key component at the heart of Polymer Electrolyte Membrane (PEM)
fuel cells.
Johnson Matthey continues to be the largest fabricator of platinum group metal
products in the world and has a distribution capability second to none. Our
platinum marketing activities support demand for platinum products worldwide
which is expected to show continued growth in the coming years. The group is
sole marketing agent for Anglo American Platinum Corporation Limited, the
world's leading primary producer of pgms, a relationship which goes back over
70 years. Many of the new uses for pgms have been developed in Johnson
Matthey's own laboratories. We are increasing our investment in this area,
which will underpin the continued long term growth of our core Precious Metals
Division.
Colours & Coatings Division continues to make excellent progress since we
acquired full ownership in February 1998. Return on sales has risen to 11.6%.
We expect the return to continue to improve as the benefits of the
restructuring programme for Tableware come through. We will be investing £10
million on new production facilities at Castellon in Spain to meet rapid
growth in demand from tile manufacturers in southern Europe and around the
world. We are also planning to put further investment in our factory in
Maastricht, Holland which makes specialised automotive glass enamels and other
decorative products for the glass industry.
The programme to manage the millennium IT risk was completed well in advance
of the deadline and the group achieved a smooth and successful transition into
2000. New investment in Information Technology infrastructure to support the
rapid growth of the business continues to be made. The Internet and related
technology provide significant opportunities to further enhance the
capabilities of our businesses in improving efficiency and better serving our
customers. These opportunities and other ways of realising value via the
Internet form the basis of our e-Commerce strategy and are being pursued
energetically. Johnson Matthey's established US catalogue sales business Alfa
Aesar has been trading on the Internet since 1997 and is currently in the
process of being upgraded to offer improved facilities for customers with a
growing interest in e-Commerce.
The group is also looking at the opportunity to grow its core businesses by
strategic acquisitions, and is actively pursuing a number of opportunities.
Following the sale of EMD the group is well positioned to fund these
opportunities out of existing resources.
Outlook
Prospects for all the group's businesses are very encouraging. We are
investing in new technology to maintain continued growth and pursuing a number
of opportunities to add further to our core businesses.
Johnson Matthey
Consolidated Profit and Loss Account
for the year ended 31st March 2000
2000 2000 2000 1999
Before
except'l Except'l
items and items and
goodwill goodwill Total
amort'n amort'n Total restated
NOTE £ million £ million £ million £ million
Turnover 2
Continuing operations 3,769.0 - 3,769.0 2,962.7
Discontinued operations 4 97.0 - 97.0 422.7
------- ------- ------- -------
Group turnover 3,866.0 - 3,866.0 3,385.4
------- ------- ------- -------
Operating profit 2
Continuing operations before
goodwill amortisation 146.5 - 146.5 124.7
Goodwill amortisation - (0.2) (0.2) -
------- ------- ------- -------
Continuing operations before
exceptional items 146.5 (0.2) 146.3 124.7
Exceptional items 3 - (9.8) (9.8) (1.9)
------- ------- ------- -------
Total continuing operations 146.5 (10.0) 136.5 122.8
Discontinued operations 4 (0.3) - (0.3) 22.1
------- ------- ------- -------
Group operating profit 146.2 (10.0) 136.2 144.9
Share of profit in associates - - - 0.3
------- ------- ------- -------
Total operating profit 146.2 (10.0) 136.2 145.2
Profit on sale - continuing
operations
Profit on disposal of
surplus properties - 1.1 1.1 7.2
Profit on sale - discontinued
operations
Sale of Electronic
Materials 3 - 28.5 28.5 -
Sale of Organic Pigments 3 - (6.2) (6.2) -
Sale of UK Minerals - - - 1.6
------- ------- ------- -------
Profit on ordinary activities
before interest 146.2 13.4 159.6 154.0
Net interest (2.4) - (2.4) (15.9)
------- ------- ------- -------
Profit on ordinary activities
before taxation 143.8 13.4 157.2 138.1
Taxation 5 (40.4) (4.9) (45.3) (31.9)
------- ------- ------- -------
Profit after taxation 103.4 8.5 111.9 106.2
Equity minority interests (0.2) - (0.2) 0.7
------- ------- ------- -------
Profit attributable to
shareholders 103.2 8.5 111.7 106.9
Dividends 6 (44.3) - (44.3) (41.3)
------- ------- ------- -------
Retained profit for the year 58.9 8.5 67.4 65.6
------- ------- ------- -------
pence pence
Earnings per ordinary share 7 51.4 49.3
Diluted earnings per
ordinary share 7 51.0 49.3
Earnings per ordinary share
excluding exceptional items
and goodwill amortisation 7 47.5 44.3
Dividend per ordinary share 6 20.3 19.0
Johnson Matthey
Consolidated Balance Sheet
as at 31st March 2000
2000 1999
restated
£ million £ million
Fixed assets
Goodwill 5.1 4.2
Tangible fixed assets 311.3 480.2
Investments 1.0 1.8
------- -------
317.4 486.2
------- -------
Current assets
Stocks 253.2 243.7
Debtors: due within one year 333.5 336.4
Debtors: due after one year 97.9 94.0
Short term investments 16.3 9.2
Cash at bank and in hand 282.0 58.6
------- -------
982.9 741.9
Creditors: Amounts falling due within one year
Borrowings and finance leases (46.2) (165.6)
Precious metal leases (60.6) (24.7)
Other creditors (315.6) (289.2)
------- -------
Net current assets 560.5 262.4
------- -------
Total assets less current liabilities 877.9 748.6
Creditors: Amounts falling due after more than one year
Borrowings and finance leases (70.0) (114.6)
Other creditors (0.2) (1.1)
Provisions for liabilities and charges (47.8) (74.3)
------- -------
Net assets 759.9 558.6
------- -------
Capital and reserves
Called up share capital 221.1 218.5
Share premium account 116.7 103.9
Associates' reserves (0.1) 0.1
Profit and loss account 417.7 230.3
------- -------
Shareholders' funds 755.4 552.8
Equity minority interests 4.5 5.8
------- -------
759.9 558.6
------- -------
Johnson Matthey
Consolidated Cash Flow Statement
for the year ended 31st March 2000
2000 1999
£ million £ million
Reconciliation of operating profit to net cash inflow
from operating activities
Operating profit 136.2 144.9
Depreciation and amortisation charges 46.6 64.3
Profit on sale of tangible fixed assets and investments (0.9) (0.4)
(Increase) / decrease in owned stocks (26.7) 4.8
Increase in debtors (77.2) (23.9)
Increase / (decrease) in creditors and provisions 52.3 (13.7)
------- -------
Net cash inflow from operating activities 130.3 176.0
------- -------
Cash Flow Statement
Net cash inflow from operating activities 130.3 176.0
Dividends received from associates 0.1 0.1
Returns on investments and servicing of finance (2.5) (16.5)
Taxation (33.5) (32.4)
Capital expenditure and financial investment (65.7) (61.4)
Acquisitions (2.9) (8.7)
Disposals 393.7 4.4
Equity dividends paid (42.2) (39.8)
------- -------
Net cash inflow before use of liquid resources
and financing 377.3 21.7
Management of liquid resources (169.8) 4.9
Financing
Issue and purchase of share capital 8.0 (1.6)
Decrease in borrowings and finance leases falling
due within one year (126.9) (9.4)
Decrease in borrowings falling due after more
than one year (36.8) (13.0)
------- -------
Net cash outflow from financing (155.7) (24.0)
------- -------
Increase in cash in the period 51.8 2.6
------- -------
Reconciliation of net cash flow to movement in net debt
Increase in cash in the period 51.8 2.6
Cash outflow from movement in borrowings and
finance leases 163.7 22.4
Cash outflow / (inflow) from term deposits included
in liquid resources 169.8 (4.9)
------- -------
Change in net debt resulting from cash flows 385.3 20.1
Borrowings disposed of with subsidiaries 8.0 -
Translation difference (5.9) (16.6)
------- -------
Movement in net debt in year 387.4 3.5
Net debt at beginning of year (221.6) (225.1)
------- -------
Net funds / (debt) at end of year 165.8 (221.6)
------- -------
Johnson Matthey
Total Recognised Gains and Losses
for the year ended 31st March 2000
2000 1999
restated
£ million £ million
Profit attributable to shareholders 111.7 106.9
Currency translation differences on foreign
currency net investments (5.6) 6.8
------- -------
Total recognised gains and losses relating to the year 106.1 113.7
-------
Prior year adjustment (note 8) (9.0)
-------
Total recognised gains and losses recognised since
last annual report 97.1
-------
Note of Historical Cost Profits and Losses
for the year ended 31st March 2000
There were no material differences between reported profits and losses and
historical cost profits and losses on ordinary activities before tax for
2000 and 1999 (restated).
Movement in Shareholders' Funds
for the year ended 31st March 2000
2000 1999
restated
£ million £ million
Profit attributable to shareholders 111.7 106.9
Dividends (44.3) (41.3)
------- -------
Retained profit for the year 67.4 65.6
Other recognised gains and losses relating to the year (5.6) 6.8
New share capital subscribed 15.7 2.8
Preference shares cancelled (0.3) -
Goodwill written back on disposals 125.4 -
------- -------
Net addition to shareholders' funds 202.6 75.2
Opening shareholders' funds (originally £561.8 million
before deducting prior year adjustment of £9.0 million) 552.8 477.6
------- -------
Closing shareholders' funds 755.4 552.8
------- -------
Johnson Matthey
Notes to the Preliminary Financial Statements
for the year ended 31st March 2000
1 Basis of preparation
The financial information contained in this release does not constitute the
company's statutory accounts for the years ended 31st March 2000 or 1999
but is derived from those accounts. Statutory accounts for 1999 have been
delivered to the Registrar of Companies and those for 2000 will be delivered
following the company's Annual General Meeting. The auditor's reports on
those accounts were unqualified and did not contain any statement under
sections 237(2) and 237(3) of the Companies Act 1985. The accounts for the
year ended 31st March 2000 were approved by the Board of Directors on
6th June 2000.
2 Segmental information
Turnover Operating profit Net operating
assets
2000 1999 2000 1999 2000 1999
restated restated restated
£ million £ million £ million £ million £ million £ million
Activity analysis
Catalysts &
Chemicals 856.2 677.2 84.8 74.2 350.0 298.6
Precious Metals 2,671.6 2,041.3 45.4 37.3 76.5 75.5
Colours & Coatings 241.2 244.2 27.9 25.1 170.4 169.7
Corporate - - (11.6) (11.6) (2.8) (18.3)
------- ------- ------- ------- ------- -------
3,769.0 2,962.7 146.5 125.0 594.1 525.5
Discontinued
operations 97.0 422.7 (0.3) 22.1 - 254.7
------- -------
Total turnover 3,866.0 3,385.4
------- -------
Goodwill amortisation (0.2) -
Exceptional items included in total
operating profit (note 3) (9.8) (1.9)
------- ------- ------- -------
136.2 145.2 594.1 780.2
Other exceptional items 23.4 8.8
Net interest (2.4) (15.9)
------- -------
Profit on ordinary activities
before taxation 157.2 138.1
------- -------
Net cash / (borrowings and finance leases) 165.8 (221.6)
------- -------
Net assets 759.9 558.6
------- -------
Turnover Operating profit Net operating
assets
2000 1999 2000 1999 2000 1999
restated restated restated
£ million £ million £ million £ million £ million £ million
Geographical analysis by origin
Europe 2,450.5 2,087.7 52.2 58.1 365.3 350.6
North America 1,052.0 807.8 69.3 54.1 126.0 90.4
Asia 887.2 505.1 8.8 3.6 57.0 38.3
Rest of the World 195.8 159.5 16.2 9.2 45.8 46.2
------- ------- ------- ------- ------- -------
4,585.5 3,560.1 146.5 125.0 594.1 525.5
Discontinued
operations 110.2 451.0 (0.3) 22.1 - 254.7
------- -------
4,695.7 4,011.1
Less inter-segment
sales (829.7) (625.7)
------- -------
Total turnover 3,866.0 3,385.4
------- -------
Goodwill amortisation (0.2) -
Exceptional items included in total
operating profit (note 3) (9.8) (1.9)
------- ------- ------- -------
136.2 145.2 594.1 780.2
Other exceptional items 23.4 8.8
Net interest (2.4) (15.9)
------- -------
Profit on ordinary activities
before taxation 157.2 138.1
------- -------
Net cash / (borrowings and finance leases) 165.8 (221.6)
------- -------
Net assets 759.9 558.6
------- -------
3 Exceptional items
An exceptional charge of £9.8 million (1999 £1.9 million) has been included
in operating profit. This comprises:
2000 1999
£ million £ million
Cost of rationalising Tableware (9.8) -
Profit on sale of shares in
Ballard Power Systems, Inc. - 3.0
Loss on closure of Australian autocatalyst
manufacturing business - (2.4)
Closure costs on withdrawal from plating
and bushings manufacture - (2.5)
------- -------
(9.8) (1.9)
------- -------
The sale of the group's Electronic Materials Division produced a net profit
of £28.5 million, and the sale of the group's Organic Pigments businesses
produced a net loss of £6.2 million (see note 10 for more details).
4 Discontinued operations
Turnover Operating profit
2000 1999 2000 1999
£ million £ million £ million £ million
Electronic Materials 91.6 414.7 0.1 22.1
Organic Pigments 5.4 6.3 (0.4) (0.3)
UK Minerals - 1.7 - 0.3
------- ------- ------- -------
97.0 422.7 (0.3) 22.1
------- ------- ------- -------
5 Taxation
2000 1999
£ million £ million
United Kingdom 22.6 12.3
Overseas 17.8 23.5
------- -------
40.4 35.8
Tax on cost of rationalising Tableware (2.9) -
Tax on profit on sale of Electronic Materials 9.9 -
Tax on loss on sale of Organic Pigments (2.1) -
ACT saving on foreign income dividends (FIDs) - (3.9)
------- -------
45.3 31.9
------- -------
6 Dividends
A final dividend of 14.2 pence (1999 13.3 pence) per ordinary share is
proposed for payment on 7th August 2000 to shareholders on the register at
23rd June 2000. Together with the interim dividend of 6.1 pence (1999
5.7 pence) this would make a total dividend of 20.3 pence (1999 19.0 pence)
giving a total payment of £44.3 million (1999 £41.3 million).
7 Earnings per ordinary share
Profit for the year attributable to shareholders, less preference dividends,
is £111.7 million (1999 restated £106.9 million). This is divided by the
weighted average number of shares in issue calculated as 217,458,190 (1999
216,947,859) to give basic earnings per share of 51.4 pence (1999 restated
49.3 pence).
Excluding exceptional items, the tax thereon, the benefit of the ACT saving
on FIDs, and goodwill amortisation, earnings per share were 47.5 pence (1999
44.3 pence).
2000 1999
restated
£ million £ million
Attributable profit 111.7 106.9
Goodwill amortisation 0.2 -
Exceptional items (13.6) (6.9)
Tax thereon 4.9 -
ACT saving on FIDs - (3.9)
------- -------
Adjusted profit 103.2 96.1
------- -------
Earnings per share excluding exceptional items
and goodwill amortisation 47.5p 44.3p
The calculation of diluted earnings per share is based on the weighted
average number of shares in issue adjusted by the dilutive outstanding share
options and long term incentive plan.
8 FRS 15 - 'Tangible Fixed Assets'
Under the provisions of FRS 15, which the group adopted on 1st April 1999,
the group has restated the carrying amount of tangible fixed assets to
depreciated historical cost as a change in accounting policy. Consequently
the group has restated its comparatives for the year to 31st March 1999.
The effect on operating profit is immaterial, but the profit on disposal of
surplus properties has been increased by the difference between book value
and historical cost at the date of disposal (£6.9 million). Most of this gain
(£6.4 million) related to the disposal of the group's former head office site
in Hatton Garden. The revaluation reserve, which was £9.0 million at
31st March 1999, has been eliminated.
9 Cumulative preference shares
On 17th September 1999 the company's outstanding cumulative preference shares
were cancelled and the nominal value (£0.3 million) repaid to the
shareholders.
10 Disposals
Electronic Materials
On 9th July 1999 the group announced it had agreed to sell its Electronic
Materials Division to AlliedSignal Inc. and the sale was completed on
17th August 1999.
Net assets disposed of were:
£ million
Goodwill 2.3
Tangible fixed assets 191.3
Investments 1.2
Stocks 57.8
Debtors and prepayments 56.8
Cash and bank overdrafts 9.0
Borrowings (7.3)
Precious metal leases (6.5)
Creditors and provisions (56.5)
Minority interests (0.2)
Goodwill previously written off to reserves 123.7
-------
371.6
Profit on disposal 28.5
-------
400.1
-------
Satisfied by:
£ million
Cash 409.5
Costs incurred (6.9)
Costs incurred - accrued (2.5)
-------
400.1
-------
Organic Pigments
On 31st March 2000 the group sold its Organic Pigments businesses located
in Venezuela and the USA to Dominion Colour Corporation and Continuous Link
Color Inc. respectively.
Net assets disposed of were:
£ million
Tangible fixed assets 4.8
Stocks 1.2
Debtors and prepayments 1.3
Borrowings (0.7)
Creditors and provisions (0.8)
Minority interests (1.9)
Goodwill previously written off to reserves 1.7
-------
5.6
Loss on disposal (6.2)
-------
(0.6)
-------
Satisfied by:
£ million
Cash 0.8
Cash - deferred 0.1
Costs incurred (0.7)
Costs incurred - accrued (0.8)
-------
(0.6)
-------
Johnson Matthey
Financial Calendar 2000
23rd June
Final ordinary dividend record date
19th July
109th Annual General Meeting (AGM)
7th August
Payment of final dividend subject to declaration at the AGM
30th November
Announcement of results for six months ending 30th September 2000
Johnson Matthey Public Limited Company
Registered Office: 2-4 Cockspur Street, Trafalgar Square, London SW1Y 5BQ
Telephone: 020 7269 8400
Internet address: http://www.matthey.com
E-mail: jmpr@matthey.com
Registered in England No. 33774
Registrars
Lloyds TSB Registrars, The Causeway, Worthing, West Sussex BN99 6DA
Telephone: 01903 502541
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