Volumes at Johnson Matthey hit by Amplats shake-up

Speciality chemicals group Johnson Matthey reported that both sales and profits fell in the third quarter, while the outlook for the rest of the year remains mixed.

Speciality chemicals group Johnson Matthey reported that both sales and profits fell in the third quarter, while the outlook for the rest of the year remains mixed.

"In a difficult market environment during the quarter, trading across the group was challenging," the firm said in a statement covering the three months to December 31st.

Sales excluding precious metals (sales) were down 2.0% at £635m during the period. Meanwhile underlying profit before tax slumped 19% to £84.3m, mainly due to a change in the sales mix and lower volumes in Precious Metals.

Johnson Matthey, the world leader in platinum distribution and the sole marketing agent for Anglo American Platinum (Amplats), said that the fall in volumes was partly attributable to Amplats's current restructuring programme announced earlier this month, in which is said that it would close several mines in South Africa.

The chemicals group said that while platinum prices have risen as a result of the shake-up at Amplats, the planned reduction in mining volumes will "impact" its business.

"The results for this division in the second half of the year are therefore expected to be slightly ahead of the first half but substantially lower than the second half of last year."

Mixed outlookThe outlook for the Environmental Technologies division is "stable", with the company expecting to perform better in the second half than the first. Weak trading in Europe and Japan will continue but should be offset by "promising prospects" in the US.

Meanwhile, the underlying performance of the Fine Chemicals division is expected to slip in the second half.

"The group's steady underlying performance is expected to continue for the rest of the financial year and, in line with the guidance in our half year report, we continue to anticipate that the group's performance in the second half will be similar to that for the first six months of the year," the company said.

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020
Why investors should be “cautiously bullish” for 2020
Stockmarkets

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020

Most Popular

Here’s why you really should own at least some bitcoin
Bitcoin

Here’s why you really should own at least some bitcoin

While bitcoin is having a quiet year – at least in relative terms – its potential to become the default cash system for the internet is undiminished, …
16 Sep 2020
Will a second wave of Covid lead to another stockmarket crash?
Stockmarkets

Will a second wave of Covid lead to another stockmarket crash?

Can we expect to see another lockdown like in March, and what will that mean for your money? John Stepek explains.
18 Sep 2020
James Ferguson: How bad data is driving fear of a second wave of Covid-19
UK Economy

James Ferguson: How bad data is driving fear of a second wave of Covid-19

Merryn and John talk to MoneyWeek regular James Ferguson about the rise in infections in coronavirus and what the data is really telling us.
17 Sep 2020