Financial Data and Key Metrics Changes - The company reported a 3% decrease in sales on a continuing basis, amounting to GBP1.7 billion, and a 4% decline in underlying operating profit [20][23] - Free cash flow was GBP347 million, driven by proceeds from the disposal of Medical Device Components [21] - Net debt closed at GBP783 million, lower than year-end, with a net debt to EBITDA ratio of 1.4 times [22][36] Business Line Data and Key Metrics Changes - Clean Air sales decreased by 7% to GBP1.2 billion, impacted by weak end markets and platform losses [23][30] - PGM Services sales fell by 9% to GBP207 million, primarily due to lower refining volumes and trading business performance [24][31] - Catalyst Technologies experienced a 20% increase in sales to GBP336 million, with operating profit rising by 43% to GBP50 million [24][33] - Hydrogen Technologies saw sales decline to GBP20 million, resulting in an operating loss of GBP26 million [35] Market Data and Key Metrics Changes - The automotive environment remains challenging, with global vehicle production declining across both light and heavy-duty segments [30] - The company expects a strong second half for PGM Services, driven by higher volumes and increased metal recoveries [39] Company Strategy and Development Direction - The company is focused on transformation and efficiency improvements, with a target of GBP200 million in cost savings for the year [26][60] - Strategic milestones are on track, with a focus on Clean Air and Catalyst Technologies as key growth drivers [44][45] - The company is pursuing opportunities in sustainable technologies, with a strong pipeline of projects [49][50] Management's Comments on Operating Environment and Future Outlook - Management acknowledges a challenging macroeconomic backdrop but emphasizes control over internal transformation efforts [7][8] - Confidence in a strong second half is based on expected improvements in PGM Services and ongoing transformation benefits [6][39] - The company maintains its full-year guidance, expecting at least mid-single-digit growth in operating performance [41] Other Important Information - The company is in the midst of a GBP250 million share buyback program, with half completed by September [22][18] - The new PGM refinery is on budget and on schedule to start commissioning by the end of '25-'26, expected to improve efficiency and reduce working capital [59][95] Q&A Session Summary Question: Visibility on auto markets and guidance for H2 - Management indicated that the decline in Clean Air sales was roughly half due to market conditions and half due to platform losses, with no significant volume recovery expected in the auto market [69][70] Question: Level of R&D in Clean Air and regulatory backdrop - R&D spend for Clean Air is around GBP100 million, primarily focused on new emissions regulations, with expectations for a significant decline in R&D costs post-regulation updates [77][78] Question: Ranking of recovery elements in PGM Services - Management identified refining volumes, life science technology volumes, metal recoveries, and efficiencies as key elements for recovery, with low risk associated with these factors [81][82] Question: Context on US tariffs and localized production - The company has a diversified manufacturing footprint in the US, minimizing the impact of potential tariffs, with only about 5% of sales affected by Canada and Mexico [86][88]

Core Insights - Johnson Matthey PLC (JMPLY) currently holds a Zacks Rank of 2 (Buy), indicating a positive earnings estimate revision trend, while FMC has a Zacks Rank of 4 (Sell), suggesting a less favorable outlook for investors [1] Valuation Metrics - JMPLY has a forward P/E ratio of 9.23, significantly lower than FMC's forward P/E of 18.60, indicating that JMPLY may be undervalued relative to FMC [2] - The PEG ratio for JMPLY is 0.48, compared to FMC's PEG ratio of 1.57, suggesting that JMPLY offers better value when considering expected earnings growth [2] - JMPLY's P/B ratio stands at 1.22, while FMC's P/B ratio is 1.68, further supporting the notion that JMPLY is more attractively valued [2] Overall Value Assessment - Based on the aforementioned metrics, JMPLY has earned a Value grade of A, whereas FMC has a Value grade of C, highlighting JMPLY as the superior value option at this time [3]

Financial Data and Key Metrics Changes - Reported sales decreased by 4% to GBP3.9 billion, while operating profit decreased by 8% due to significantly lower average metal prices [23][27] - Underlying operating profit increased by 11% when excluding the impact of metal prices and foreign exchange rates, driven by cost savings and higher pricing [24][28] - Underlying earnings per share were 141.3 pence, down due to lower operating profit and higher interest [25] Business Line Data and Key Metrics Changes - Catalyst Technologies sales grew by 6%, with operating profit increasing by 56% [27][38] - Hydrogen Technologies saw a 31% increase in sales, but reported an operating loss of GBP50 million due to investments in capacity and product development [40] - Clean Air sales grew by 2%, with a significant increase in underlying operating profit of 26% [35][36] - PGM Services sales decreased by 17% to GBP462 million, primarily due to lower average metal prices [36] Market Data and Key Metrics Changes - The hydrogen market softened in the second half, impacting growth rates [40] - Palladium and rhodium prices decreased by 38% and 64% respectively, affecting PGM Services [36] Company Strategy and Development Direction - The company is focused on building a stronger business model to drive energy transition, with new strategic milestones set for the future [8][53] - The divestment of value businesses has allowed the company to concentrate on core operations, enhancing overall value creation [14][83] - The company aims to increase cash flow targets for Clean Air from GBP4 billion to GBP4.5 billion by 2030-31 [53] Management's Comments on Operating Environment and Future Outlook - Management noted that the macroeconomic environment remains weak, but underlying growth of 11% indicates that the transformation strategy is effective [7][95] - The company is cautious about future guidance, reflecting the current market conditions and potential challenges [99] - Management emphasized the importance of sustainability and customer focus as integral to the company's strategy [92][88] Other Important Information - The company plans to return GBP250 million to shareholders via a share buyback following the completion of the Medical Device Components disposal [26] - The transformation program has achieved cumulative savings of GBP120 million, with an upgraded target of GBP200 million by the end of the year [29][30] Q&A Session Summary Question: Guidance on mid-single-digit growth - Management explained that the cautious outlook reflects the current market conditions, and they aim to exceed this guidance [99] Question: Debt performance and buyback plans - Management acknowledged the improved debt position and indicated that they are following a capital allocation framework, with no immediate plans for a larger buyback [100] Question: Clean Air cash generation assumptions - Management indicated that the Clean Air cash generation target is based on evolving market conditions and increased electric vehicle penetration [101]

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to fi ...

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to fi ...

Financial Data and Key Metrics Changes - Sales decreased by 1% to just under GBP2 billion, while operating profit decreased by 15% due to significant reductions in average metal prices [17][18] - Underlying operating profit increased by 10% to GBP244 million, excluding the impact of foreign exchange and metal prices [21] - Earnings per share decreased due to higher taxes and increased finance charges [18][19] Business Line Data and Key Metrics Changes - Clean Air sales grew by 4%, supported by increased pricing and slightly higher volumes [20][28] - Catalyst Technologies sales increased by 5%, with improved pricing and good growth in formaldehyde [33] - Hydrogen Technologies sales surged by 61% as the business scales [35] - PGM Services sales decreased by 16% to GBP230 million, driven by lower average metal prices and reduced recycling volumes [31] Market Data and Key Metrics Changes - The average price of rhodium has declined significantly, impacting the PGM services [31] - Clean Air outperformed in Asia but underperformed in Europe due to a weaker product mix [29] - The company expects limited growth in vehicle production this year, affecting margins [38] Company Strategy and Development Direction - The company is focused on a transformation journey aimed at sustainable growth and value creation [8][15] - Strategic milestones are on track, with a particular emphasis on improving operational efficiencies and commercial capabilities [12][14] - The company is committed to divesting non-core value businesses, with total cash proceeds from divestments expected to reach at least GBP300 million by the end of '23/'24 [25] Management's Comments on Operating Environment and Future Outlook - The management highlighted a volatile operating environment due to geopolitical conflicts and inflation [5][6] - The company expects at least high single-digit growth in operating performance, assuming constant currency and metal prices [37] - Management remains optimistic about the growth potential in Clean Air and Catalyst Technologies, while acknowledging challenges in PGM services [38][39] Other Important Information - The company maintained a strong balance sheet with net debt around GBP1 billion and a net debt-to-EBITDA ratio of 1.7 times [19] - Capital expenditure for the three years to '24/'25 is now expected to be GBP1 billion, a reduction of 10% [41] - The company is on track to generate at least GBP4 billion of cash through 2031 [30] Q&A Session Summary Question: Impact of Global Business Services on Cost Structure - Management explained that Global Business Services aims to improve processes and reduce costs significantly, with expected savings of GBP15 million this year [81][84] Question: Value Proposition and Pricing Strategy - The company is enhancing its commercial capabilities, focusing on cross-selling and value-based pricing to improve customer relationships and margins [82][89] Question: Volume and Pricing Outlook - Management indicated that overall performance is not dependent on volume increases but rather on pricing and transformation benefits, with expectations for volume growth in the second half [94][96] Question: EV Penetration Impact on Business - Management noted differing expectations for EV penetration across regions, with a positive outlook for China but caution regarding other markets [99][100]

Presentation of results for the half year ended 30th September 2023 22nd November 2023 Cautionary statement | --- | --- | |----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ...

Financial Data and Key Metrics Changes - Overall operating performance was in line with market expectations, with underlying sales up 6% to £4.2 billion, operating profit down 21% to £465 million, and earnings per share at 179p compared to 213p last year [9][10][27] - Net debt stood at £1 billion, with a net debt-to-EBITDA ratio of 1.6x, at the lower end of the target range of 1.5x to 2x [10][12] - Proposed total dividend remained at 77p, consistent with the previous year [10] Business Line Data and Key Metrics Changes - Clean Air sales grew 2%, driven by increased pricing that offset a decline in volumes due to supply chain disruptions [11][16] - PGMS sales decreased 8% to £570 million, impacted by lower average metal prices and reduced refinery intakes [18] - Catalyst Technologies saw a 17% increase in sales to £560 million, primarily due to strong growth in licensing and refills [19] - Hydrogen Technologies revenues more than doubled to £55 million, mainly from fuel cells [20] Market Data and Key Metrics Changes - Clean Air experienced a 4% increase in light-duty diesel sales in Europe, while heavy-duty diesel sales were up 3% [16][17] - The market for Platinum Group Metals (PGMs) remains volatile, with significant price fluctuations affecting overall performance [26][68] Company Strategy and Development Direction - The company is focused on driving growth through its Catalyst Technologies and Hydrogen Technologies businesses, which are key to the net-zero transition [29][30] - Plans to divest non-core parts of the portfolio within the next 12 months to concentrate on growth areas [29] - The company aims to generate at least £4 billion in cash by 2031, supported by tighter emissions legislation and significant contract wins [55] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing the net-zero transition as a significant growth driver due to increased regulatory pressure and incentives globally [4][32] - The company anticipates mid-single-digit growth in operating performance for the next year, assuming stable precious metal prices [25][26] - Management highlighted the importance of improving commercial capabilities and operational efficiencies to enhance margins [40][59] Other Important Information - The company has made progress in its cost transformation program, achieving £45 million in savings towards a target of at least £150 million by 2024 [21][27] - Significant investments are being made in Hydrogen Technologies to meet customer demand and scale up production [49][54] Q&A Session Summary Question: Guidance for next year regarding operating profit and cash generation from Clean Air - Management acknowledged high inflation and the need for cost savings, emphasizing that cash generation from Clean Air is expected to be lumpy but on track for long-term targets [64][66] Question: Explanation of metal price impacts and margin increase actions - Management noted the volatility of metal prices, particularly rhodium, and outlined strategies to mitigate risks through pricing and cost management [67][68]

Johnson Matthey Plc (OTCPK:JMPLF) Q3 2022 Earnings Conference Call November 23, 2022 4:00 AM ET Company Representatives Liam Condon - Chief Executive Officer Stephen Oxley - Chief Financial Officer Anish Taneja - Chief Executive Officer, Clean Air Martin Dunwoodie - Head of Investor Relations Conference Call Participants Maggy Schooley - Stifel Kevin Fogarty - Numis Charlie Bentley - Jeffreys Ranulf Orr - Citi Andrew Stott - UBS Riya Kotecha - Bank of America Gunther Zechmann - Bernstein Alycia Samsudin - B ...

Financial Data and Key Metrics Changes - The company reported a 21% increase in group sales to £1.9 billion compared to £1.7 billion in the same period last year [71] - Underlying operating profit doubled to £293 million, driven by higher sales and efficiency improvements [67][72] - Underlying earnings per share increased from £0.48 to £1.15 [91] Business Line Data and Key Metrics Changes - Clean Air sales increased by 24% to £1.2 billion, with operating profit doubling to £150 million [73][76] - Efficient Natural Resources saw sales grow by 33% to £523 million, with underlying operating profit more than doubling to £197 million [78][81] - Health segment sales decreased by 26% due to labor shortages and pricing pressures [82] Market Data and Key Metrics Changes - The Clean Air business is expected to generate over £4 billion in cash over the next 10 years, driven by regulatory changes [29] - The company is experiencing challenges in the automotive market due to supply chain shortages, particularly in microchips [75] - Precious metal prices remain high, contributing approximately £70 million to profits, although prices have declined from year-end levels [72] Company Strategy and Development Direction - The company announced its intention to exit the Battery Materials business to focus on higher-return growth opportunities [6][20] - A new CEO, Liam Condon, will join in March 2022, tasked with reviewing the company's strategy [12][16] - The company aims to leverage its scientific expertise in metals chemistry to focus on three growth areas: circularity, hydrogen technologies, and decarbonization of chemical processes [63] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging operating environment but emphasized strong foundations in Clean Air and Efficient Natural Resources [18][63] - The outlook for full-year underlying operating performance has been adjusted to low-single-digit growth due to supply chain issues and a decline in global auto production [101] - The company is committed to returning £200 million to shareholders through a buyback process [8][105] Other Important Information - The company has fully impaired its Battery Materials assets pending the sale process [21][88] - A share buyback of £200 million will commence in the new year following the sale of Advanced Glass Technologies [8][24] - The company is in discussions regarding the potential sale of its Health business [23] Q&A Session All Questions and Answers Question: Is the £200 million revenue target from hydrogen by 2025 still valid? - Yes, the company remains confident in achieving the £200 million target for fuel cells, supported by recent contracts and market acceleration [110] Question: Is the company being selective in Euro VII business? - Yes, the company is focusing on high-return customers and is being selective to maximize cash flow generation [111] Question: What is the annualized EBIT impact of the new markets? - The new markets are currently running at a negative EBIT, but this will improve as the Battery Materials costs are removed upon exit [114] Question: What is the target for working capital days? - The target for working capital days remains 50 to 60, and the company expects to return to this range [113] Question: What is the expected CapEx breakdown? - The expected CapEx is £400 million, with £200 million for sustaining and the remainder for growth, particularly in hydrogen technologies and refinery upgrades [121] Question: Will cash from disposals be used for shareholder returns? - Yes, cash from disposals will be considered for shareholder returns, but the focus remains on investing in growth [129] Question: What is the approach to succession planning? - The existing team will continue executing the current strategy, and succession planning will involve both internal and external candidates [130] Question: Are there plans for further disposals beyond Health and Battery Materials? - The company will consider further disposals of non-core operations as part of its portfolio simplification strategy [131]