Johnson Matthey stock falls despite top team reshuffle

The multinational speciality chemicals and sustainable technologies company published what management felt were decent half-year results for the six months to end-September but many stockholders clearly feared the light at the end of the tunnel might well be an onrushing train!

Alastair Judge, who joined JM in the summer of 2018, has been appointed as chief financial officer while current CFO, Richard Pike, takes over as chief operating officer. The board says the changes reflect the new force the company expects to become as it focuses on core strengths and stronger markets globally.

JM expects year-end underlying operating profit growth at the higher end of a mid-single digit percentage ambit.

While the second half should be more fruitful financially, the company expects macro-economic headwinds to blow returns off course.

CEO Liam Condon said: “Following the agreement to sell Catalyst Technologies, we are transforming Johnson Matthey into a more highly focused, lean and cash generative business. Our focus on increased efficiency has driven a strong first half performance with significant growth in pro forma underlying operating profit.

“We are also making good progress in implementing our cash-focused business model, with the benefits starting to come through and a material step up in free cash flow expected for the full year. The carve out of Catalyst Technologies is progressing well and we remain on track to complete the transaction by the first half of calendar year 2026.

“For the full year, we expect to deliver growth in underlying operating profit at the higher end of a mid single digit percentage range. Looking ahead, with momentum building in efficiency and cash generation, we are on track to achieve our medium-term targets and deliver materially enhanced shareholder returns.

“For 2025/26, we expect to deliver underlying operating profit growth at the higher end of a mid single digit percentage range, despite the challenging macroeconomic environment. This is on a pro forma basis, excluding Catalyst Technologies and Value Businesses, and at constant precious metal prices and constant currency.

“Overall performance will continue to be weighted towards the second half. However, second half performance will be lower year-on-year driven by PGM Services, reflecting lower metal recoveries and refining volumes, as expected..”

The board has approved an interim dividend of 22.0 pence per share, maintained at the same level as the prior year.