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(Wallace Refiners) – Thursday, Platinum group metal giant Johnson Matthey reported its year end with revenue increasing 8%, driven by higher average precious metal prices.
The company said that its operating profit was down 17% due to higher administrative expenses, and a major impairment and restructuring charges. The impairment was related to its eLNO demo plant.
Johnson Matthey noted the sharp downturn and upturn caused by the pandemic.
“In the first half, our sales declined materially, down 20%, as several of our end markets – particularly automotive – saw a significant decline as a result of the pandemic. The second half saw a strong recovery, with sales up 11% year on year, and activity across a number of our businesses is now back to pre-pandemic levels,” wrote the company.
Looking ahead, the company said it sees good prices for platinum group metals due to improved auto production volumes, as well as tightening clean air legislation.
“If precious metal prices remain at their current high level for the whole of the year (especially for rhodium and palladium), we would expect a further net benefit of up to £120 million. Continued strong metal prices may also result in higher working capital, therefore, impacting free cash flow in the short term.”
What money the company makes will put into energy transition.
“We are delivering our efficiency programme, tightly managing working capital and generating cash from our more established businesses, which we are continuing to invest for growth, particularly in battery materials and hydrogen.”
Expenditures in the company’s strategic growth projects are expected to total £600 million (US$851 million) this year.
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