Johnson Matthey Share Discussion Threads

[philanderer] 07/4/2020 12:11

Barclays. Equal Weight. Tp 2650p

[esg investor] 06/4/2020 14:13

Nice rise today. But do not plan to buy until they implement a clear plan to get the debt right down. Cash generation has not been good and do not believe this type of business warrants high leverage.

[esg investor] 03/4/2020 15:32

can this survive without a rights issue? any views?

[esg investor] 02/4/2020 08:53

imo the pain wont die down until they bite the bullet and raise equity. £1.5-1.6 billion of net debt and relying on credit facilities in the current environment is highly risky.

[esg investor] 01/4/2020 08:44

what are the implications of this?


Trump Administration Weakens Auto Emissions Standards
March 31, 202012:22 PM ET

[esg investor] 31/3/2020 12:07

I wonder what the covenant level is? if EBITDA falls sharply the ratio will soar.


"Our leverage ratio (net debt to EBITDA) is well within our covenant
level..... At 30(th) September 2019, net debt to EBITDA was
2.1x and we anticipate being at a similar level at 31(st) March 2020...."

[esg investor] 31/3/2020 10:02

the trend remains down unfortunately. this company as far too much debt for a business of this kind and something like 70% of customers are closed for business and the balance subject to disruptions.

[esg investor] 30/3/2020 14:38

they used the word "resilient" three times in the trading update, but what is the exposure to the automotive sector? Clean Air was nearly 70% of 2019 operating profits, I assume that is a good indication?

[esg investor] 30/3/2020 09:12

it appears this announcement to customers dated March 17th was edited. when i read it before it had said they were not seeing any disruptions....

[esg investor] 30/3/2020 09:09

that £50 million hit is just a few weeks damage.

[our haven] 30/3/2020 08:40

ESG, clearly the market expectations were that it was going to be worse than this hence the rise.

[esg investor] 30/3/2020 08:06

and the shares go up. the markets are crazy.

[esg investor] 30/3/2020 07:59

I am reading £50 million miss on trading profits, net debt remains elevated at around £1.5 billion (as they say ratios similar to September 2019) and all clean air facilities closed except China.

[esg investor] 27/3/2020 14:14

The company has a March year, which means the financial year ends next Tuesday. will there be a trading update? Is is possible the company is still trading in line with the previous guidance given the economic turmoil?

[esg investor] 27/3/2020 10:02

Impact of COVID-19 on Global Auto Industry: Expect deeper decline than during the Great Recession
26 March 2020

[esg investor] 27/3/2020 10:00

In last years annual report, page 90, it says the company had undrawn committed bank facilities of £597 million. Net debt last March was £866 million, by September it had ballooned to £1.5 billion. not sure what form the new debt was in, but one wonders if the committed bank facilities are fully drawn, especially given the massive investment programme continuing in the second half.

[fuji99] 26/3/2020 12:16

ESG - This is the info related to the automotive segment. In total, JMAT supplies 14 various industries. - - -

[fuji99] 26/3/2020 11:17

ESG - No stock in the world (except pharmas working for Covid-19) would hold well under the present situation. However, JMAT being well diversified will hold far better than many. Regarding catalytic converters, JMAT delivers to almost any car manufacturer. There is a sharp slowdown but there will always be some car industry still manufacturing. For example China is not completely locked down.

[esg investor] 26/3/2020 11:02

fuji99 do you have any knowledge of the catalytic converter market? does the current downturn mean it has fallen off a cliff? why do you believe other areas like agriculture, medical and electronics equipment would be holding up in the current economic situation?

[esg investor] 26/3/2020 10:24

I see that was from the interim results over four months ago. Certainly a lot has changed since then. I think there are many questions that need to be answered, like the state of the catalyst converter market, supply chains, an update on the new manufacturing facilities, the groups financial position and outlook.

[fuji99] 26/3/2020 09:36

This is the last comments of their CEO: (We expect to deliver a stronger second half) " Robert MacLeod, Chief Executive, commented:
We continue to execute well against our strategy and delivered first
half operating performance in line with expectations. I was pleased
with the continued good sales growth, demonstrating our broad based
growth drivers, although operating profit was slightly down as a result
of one-off costs associated with manufacturing inefficiencies in Clean
Air in the first half.

We expect to deliver a stronger second half, primarily driven by the
absence of the one-off costs and seasonality in Efficient Natural Resources.
For the full year, we expect to deliver group operating performance
in line with market expectations.

Given our clear strategy, the strong foundations we have put in place
and the ongoing investment into the business for the longer term, we
remain confident about the future growth prospects across all of our
sectors, which will together drive mid to high single digit growth in
earnings per share over the medium term. Our focus remains on executing
our strategy, delivering on the ambitions that we laid out at our recent
Capital Markets Day and continuing to drive towards our vision to create
a cleaner, healthier world."

[esg investor] 26/3/2020 08:45

Of course I wish you were right. But the interim results were terrible and debt has been soaring. if they succeed in turning that trend around in this current economic environment, it would be something of a miracle.

[fuji99] 25/3/2020 23:10

Catalyst converters for example is just one segment of the business. Please check their website to see how diversified they are. From agriculture to medical and electronics equipment parts etc. A very diversified group, thus why it is very defensive and interesting for the long term. A good yield as well.

[esg investor] 25/3/2020 16:34

You think so? Correct me if i am wrong but isnt the company's main market the automotive sector and hasnt that market completely closed up?