Johnson Matthey to sell glass tech business, unveils £200m buyback
Chemicals company Johnson Matthey on Wednesday said it had sold its advanced glass technologies business to Fenzi Holdings for £178m as it reported a half-year loss and announced a £200m share buyback.
The company, which last week issued a profits warning and said it was exiting its battery business, swung to a pre-tax loss of £9m compared with a profit of £26m a year ago.
Offloading the battery unit resulted in a £314m impairment. Johnson Matthey earlier this month scrapped plans to develop high-performance, long-range electric vehicle batteries from a lithium nickel oxide solution, abandoning hundreds of millions of pounds of research and development.
The company also said it was in talks over a potential sale of its struggling health business which has been hit by labour shortages in the US and supply chain constraints.
Underlying operating profit more than doubled to £293m on higher precious metals prices and strong demand.
“Demand remains strong in many of our end markets. However, supply chain volatility especially the shortage of semi-conductors is affecting production for a number of our auto and truck customers,” the company said.
“Global auto production is now forecast to decline 5% for our fiscal year which is a 14% reduction since our trading update in July. Consequently, precious metal prices have also declined, largely because of the lower demand from the automotive industry.”
“We are also experiencing acute temporary labour shortages in the US that are adversely impacting our Health business.”
The company said it expected growth in annual underlying operating performance to be low single digit at constant precious metals prices and constant currency.