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UK's Johnson Matthey expects supply chain volatility to hit annual profit

Reuters logo Reuters 26/05/2022

(Reuters) -British chemicals maker Johnson Matthey Plc forecast 2022-23 operating profit at the lower half of market estimates on Thursday, as supply disruptions due to China's lockdowns and component sourcing from Ukraine hurt its auto customers.

The group, which makes catalytic converters and other pollution filters for cars, reported underlying operating profit for the year ended March 31 was 553 million pounds ($694.79 million), compared with 473 million pounds a year earlier.

"For 2022/23, we are facing a period of greater political and economic uncertainty with a combination of factors that may affect the year ahead," Johnson Matthey said in a statement.

Johnson Matthey is exiting its battery materials business and shifting focus to its core hydrogen technologies and emission control catalysts businesses.

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It has been subject to takeover speculations in recent weeks after industrial investor Standard Industries bought a stake in the company, and more recently after reports that South Korea's LG Chem was scouting for overseas acquisitions.

Johnson Matthey said it would sell parts of its battery materials business to battery chemicals firm EV Metals for about 50 million pounds, a day after Canada-based firm Nano One Materials purchased the Canadian arm of the British company's division.

As part of new Chief Executive Officer Liam Condon's strategy, the company said it would commence a new programme to save 150 million pounds in costs annually by 2024-25.

($1 = 0.7959 pounds)

(Reporting by Muhammed Husain in Bengaluru; Editing by Rashmi Aich)


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