Johnson Matthey Plc Business Report FY ended Mar. 2018

Business Overview

(in million GBP)
  FY ended Mar. 31, 2018 FY ended Mar. 31, 2017 Rate of change (%) Factors
Net Sales 14,122 12,031 17.4 1)
Operating Profit 359 493 (27.2) 2)
Sales by Sector
Emission Control Technologies 2,454 2,224 10.3 3)
Precious Metal Products  956 919 4.0 4)
New Businesses 312 308 1.3 5)

1) Net Sales
-In the fiscal year ended March 31, 2018, the Company had net sales of GBP 14,122 million, an increase of 17.4% over the previous year. The increase in sales was primarily driven by higher precious metal prices.

2) Operating Profit
-The Company’s operating profit in the fiscal year ended March 31, 2018, decreased by 27.2% from the previous year to GBP 359 million. The decrease was caused by GBP 90 million in major impairment and restructuring charges as well as a GBP 50 million charge in February 2018 due to a legal settlement.

3) Clean Air
-The Company’s Clean Air sector’s sales totaled GBP 2,454 million in the fiscal year ended March 31, 2018, an increase of 10.3% over the previous year.

<Light Duty Vehicle (LDV) Catalysts>
-Sales of light duty vehicle catalysts increased by 4.3% over the previous year to GBP 1,564 million. Sales in Europe were flat, while sales in the Americas and the Asia region showcased growth over the regions’ vehicle production rates.

<Heavy Duty Diesel (HDD) Catalysts>
-Sales of heavy duty diesel catalysts totaled GBP 846 million, an increase of 24.0% over the previous year. Heavy duty catalysts sales grew across all of the Company’s operating regions due to a strong Class 8 market, increased business wins in Europe, and production growth in Asia.

4) Efficient Natural Resources
-In the fiscal year ended March 31, 2018, the Company’s Efficient Natural Resources sector had revenues of GBP 956 million, an increase of 4.0% from the previous year.

<Advanced Glass Technologies>
-Sales in the Advanced Glass Technologies business decreased by 3.5% to GBP 82 million due to destocking in the supply chain in China. This occurred as a consequence of inventory build-up at the end of 2016.

5) New Markets
-The Company’s New Markets division had sales of GBP 312 million in the fiscal year ended March 31, 2018, an increase of 1.3% over the previous year.

<Alternative Powertrain>
-The Alternative Powertrain business unit had sales of GBP 156 million, a decrease of 2.5% from the previous year. While the unit’s sales of fuel cell products grew significantly, a decline in lithium-iron phosphate battery material sales offset those gains.


-Cummins announced the acquisition of the Company’s UK automotive battery systems business, a subsidiary that specializes in high-voltage automotive grade battery systems for electric and hybrid vehicles. The acquisition allows Cummins to expand its electrification and energy storage capabilities as it prepares for delivery of electrified powertrains to customers in 2019. As part of the acquisition, Cummins and the Company also agreed to collaborate on the development of high energy battery materials for commercial heavy duty applications. (From a press release on January 31, 2018)


-For the fiscal year ending March 31, 2019, the Company expects its sales to grow by mid to high single digits.

R&D Expenditure

(in million GBP)
  FY ended Mar. 31, 2018 FY ended Mar. 31, 2017 FY ended Mar. 31, 2016
Overall 193 201 188


Distribution of R&D Expenditure (%)
Division FY ended Mar. 31, 2018
Clean Air 41
Efficient Natural Resources 21
Health 13
New Markets  9
Central Research 16
Total 100


R&D Structure

-As of March 31, 2018, the Company has approximately 1,450 employees working in research and development.

Distribution of R&D Employees (%)
Division FY ended Mar. 31, 2018
Clean Air 41
Efficient Natural Resources 22
Health 6
New Markets 11
Central Research 20
Total 100


R&D Facilities

-The Emission Control Technologies division has research and development facilities in the following eight countries:

  • Brazil
  • China
  • Germany
  • Japan
  • Korea
  • Sweden
  • UK
  • U.S.

-The Company’s research and development activities for fuel cells takes place in Sonning Common, UK.

Product Development

eLNO cathode matterial for high energy battery applications
-In September 2017, the Company announced its investment in automotive battery materials development as well as enhanced lithium nickel oxide (eLNO), a new cathode material for use in high energy battery applications. The Company developed the material across nine of its locations. eLNO enables a significant increase in energy density that will improve performance and cost of electric vehicle applications.

Capital Expenditure

(in million GBP)
  FY ended Mar. 31, 2018 FY ended Mar. 31, 2017
Clean Air 71 89
Efficient Natural Resources 49 53
Health 40 57
New Markets 18 26
Corporate  39 40
Total 217 265

-The Company announced its focus on battery material technology and plans to make an initial investment of up to GBP 200 million, starting in 2018, to build capacity to drive growth. The battery material market is expected to reach more than USD 30 billion in sales when battery electric vehicle penetration increases to around 10%. (From a press release on September 20, 2017)

-The Company’s capital expenditure in the fiscal year ending March 31, 2019 is expected to reach approximately GBP 390 million. Key investments during the fiscal year will include the following:

  • Investments in Clean Air plants in Poland and China
  • Investments in the Company’s eLNO high energy battery material demonstration and commercial plants


Investment Outside UK

-The Company completed construction on a new Clean Air manufacturing plant in Poland to support increased demand for automotive catalysts, particularly with European diesel passenger vehicles.

-In the fiscal year ended March 31, 2018, the Company continued investment into a new platinum group metals catalyst plant in Germany.