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Underlying Operating Performance: Increased by 38%. Clean Air Revenue: Increased by 11%. Platinum Group Metals Revenue: Increased by 33%. Clean Air Margin: Improved by 200 basis points, targeting 14% to 15% by year-end. Free Cash Flow: Significant improvement with a small inflow reported. Net Debt: Increased due to Catalyst Technologies cash outflow and dividend payments. Dividend: Maintained at 22p per share. CapEx: Elevated due to GBP350 million investment in new PGM refinery. Hydrogen Technologies: On track for breakeven by March 2026. Shareholder Returns: GBP1.4 billion to be returned upon Catalyst Technologies sale closure. Employee Engagement: Increased, indicating positive internal culture shifts.

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Release Date: November 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Johnson Matthey PLC (JMPLF) reported a 38% increase in underlying operating performance, with significant growth in Clean Air and Platinum Group Metals. The company successfully implemented a new cash-focused business model, resulting in a turnaround from a significant cash outflow to a small inflow. The sale of Catalyst Technologies to Honeywell is on track, with plans to return GBP1.4 billion to shareholders upon closure. The company achieved a 200-basis-point increase in Clean Air margins, indicating strong progress towards their target of 14% to 15% margin by the full year. Johnson Matthey PLC (JMPLF) is on track to commission a new PGM refinery by March 2026, which is expected to be the world's largest refining plant for Platinum Group Metals.

Negative Points

The company experienced a decline in Clean Air volumes, impacting overall sales despite improvements in operating profit. Net debt increased due to cash outflow from Catalyst Technologies and a significant stock build in the US refinery. There is a small delay in the commissioning of the new PGM refinery, although it is not expected to impact customer delivery. The Catalyst Technologies segment showed significantly weaker performance compared to the prior year, attributed to market conditions. The company is undergoing organizational changes, which may pose challenges in maintaining employee engagement and managing cultural transitions.

Q & A Highlights

Q: Could you provide an update on the ramp-up costs for the new refinery, initially estimated at GBP20 million to GBP30 million? A: Richard Pike, Chief Financial Officer: The ramp-up costs remain similar to the initial estimate. Increased maintenance costs, dual running, and lower metal recovery are still expected to be within that range.

Story Continues

Q: Why hasn't the company focused on working capital improvements before, and is there a risk of inventory levels being too low? A: Richard Pike, Chief Financial Officer: Historically, the focus was on growth, which led to increased working capital. Now, there's a significant opportunity to improve payables, receivables, and inventory management. We are only scratching the surface, so there's no risk of inventory levels being unsustainably low.

Q: Can you discuss the current conditions in PGMS and why it will be down in H2? A: Richard Pike, Chief Financial Officer: Higher metal prices and increased volatility benefit our trading business. However, a large mine closure in the US has reduced refining volumes. We also face increased running costs and lower one-off benefits compared to last year. We expect a decline before recovery as the new refinery becomes operational.

Q: How are you managing cultural changes during this transition, and how do you maintain high engagement scores? A: Liam Condon, Chief Executive Officer: We emphasize strong people leadership, encouraging managers to communicate directly with their teams and address concerns. Safety is a priority, with regular training and dedicated safety days. These efforts help maintain high engagement and a positive culture.

Q: Regarding the GBP2 billion sales target for Clean Air in '27-'28, how should we view the 90% of orders already won? A: Liam Condon, Chief Executive Officer: The 90% figure will increase as we continue to win significant contracts. Recent wins, such as a large LDG tender in Europe, demonstrate our ability to secure high-quality contracts that will contribute to achieving and potentially exceeding the sales target.

Q: Are you seeing any changes in customer behavior regarding PGM Services, and could this lead to more stable earnings? A: Liam Condon, Chief Executive Officer: While there's no significant change in customer behavior, there's increased focus on the source of PGMs and interest in fee-for-service models, which could reduce volatility. However, as PGMs are commodities, some price volatility is inherent.

Q: How does the weaker performance in Catalyst Technologies impact the sale to Honeywell? A: Liam Condon, Chief Executive Officer: The sale conditions are based on regulatory approval and the carve-out process, both of which are on track. The market performance of Catalyst Technologies does not affect the sale.

Q: Can you provide more details on the new contracts for data centers and their impact on margins? A: Liam Condon, Chief Executive Officer: While we are not sharing financial details now, these contracts use the existing Clean Air footprint and are not margin-dilutive. We will provide more information at the full-year results.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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