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[December 2003]
Johnson Matthey Seeks to Divest Some Ceramics Businesses
In reporting improved results for the six months to 30 September 2003, Johnson Matthey also made a statement regarding future divestment which would impact its ceramic related businesses.Overall, Johnson Matthey saw operating profit before goodwill amortisation rise 13% to €103.1 million and profit before tax and goodwill amortisation rise by 4% to €97.5 million. Earnings per share were up 5% and the interim dividend increased by the same margin. Much of the success in this period was driven by strong growth in the Catalysts business (profits up 28%) and Pharmaceutical Materials (profits up by 8%).
The Colours & Coatings Division saw sales fall by 4% to €126.7 million, reflecting a softening in demand in the European tile market. Profits were up 2% to €11.8 million with an improvement in margins recorded.
The Structural Ceramics business, which sells largely to the tile industry, experienced weaker demand from tile manufacturers in Europe, partly as a reflection of the weakness in some €,-zone economies and partly as a result of the impact of the strong €, on sales from Europe into Asia. However, the Glass coatings business continued to achieve good growth in both sales and profits, benefitting from new product introductions and market share gains.
JM said while it had over the past few years successfully restructured its Colours & Coatings Division and in its view created a business which was among the most profitable in its industry, the Structural Ceramics and Speciality Coatings businesses - which contributed roughly two-thirds of the division's profits last year - had relatively little overlap with the rest of the Johnson Matthey group. It said that, following a strategic review, the Board had decided to invite offers for these two combined businesses.
The remaining Decorative Precious Metals and Glass Coatings businesses, which have close links to the group's other precious metals activities, will be retained and will be transferred to the Precious Metals Division following any divestment of Structural Ceramics and Speciality Coatings.
ENDS