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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Johnson Matthey Plc | LSE:JMAT | London | Ordinary Share | GB00BZ4BQC70 | ORD 110 49/53P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
4.00 | 0.21% | 1,870.00 | 1,871.00 | 1,874.00 | 1,890.00 | 1,863.00 | 1,870.00 | 414,531 | 16:35:22 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Chemicals & Chem Preps, Nec | 14.97B | 276M | 1.5064 | 12.43 | 3.43B |
TIDMJMAT
RNS Number : 9185R
Johnson Matthey PLC
20 June 2018
JOHNSON MATTHEY PLC
ANNUAL REPORT & NOTICE OF ANNUAL GENERAL MEETING
Johnson Matthey Plc (the "Company") has today published its 2018 Annual Report and Accounts and Notice of 2018 Annual General Meeting. Both documents are available on the Company's website at www.matthey.com
In accordance with Listing Rule 9.6.1, copies of both documents, together with the Form of Proxy for the 2018 Annual General Meeting, have been submitted to the National Storage Mechanism and will shortly be available for viewing at www.morningstar.co.uk/uk/NSM
The Annual General Meeting of the Company will be held at 11.00 am on Thursday 26th July 2018 at The Institute of Civil Engineers, One Great George Street, Westminster, London, SW1P 3AA.
Information required to be made available by the Company under Rule 6.3.5R of the Disclosure Guidance and Transparency Rules, to the extent not already included in the Company's announcement of preliminary results for the year ended 31st March 2018, issued on 31st May 2018, is set out in the Appendix below.
Simon Farrant
Company Secretary
20th June 2018
APPIX
Risks and Uncertainties
The ongoing review of our principal risks ensures that we reflect on the challenges facing our business and the changes that we have made to our business in response to those challenges.
We continually map our principal risks and uncertainties to strategic and business plans to ensure that we have appropriate coverage of risks. Following the revision of our strategy in 2017, we took a fresh look at our risks to confirm that these continued to be aligned to the strategy. With greater clarity of our strategic priorities we have better focused our risks, understanding the worst case scenarios that could threaten our business model, future performance, solvency or liquidity.
As a result of these exercises, we have concluded that for the most part, the overarching areas of risk remain unchanged. In all cases we continue to review and refine the documented mitigations for each risk.
We have also changed our risk reporting to consider whether the risk profile is increasing, decreasing or remaining constant. We believe that provides our board and shareholders greater transparency in reporting compared to reporting the gross or net risk as high, medium or low.
Changes to our principal risks and uncertainties in 2017/18:
-- Future revenue growth. Now this is the risk specifically associated with our failure to deliver against the growth opportunities identified in our strategy. Previously it was defined more broadly as the risk associated with revenue growth opportunities, investment decisions, significant capital investment, mergers and acquisitions and research and development activities.
-- Applications systems and cyber security. This was added to our principal risks during the year. The external cyber threat is increasing with more sophisticated attacks on a wide range of organisations. The elevation of this risk ensures that the board has greater visibility of the actions we take to mitigate the risk.
Brexit
Whilst not a principal risk and uncertainty, Johnson Matthey continues to monitor closely the potential EU exit (Brexit) risks through our businesses. Our well established Brexit working group is composed of a number of functional experts who look to mitigate risks for a range of Brexit scenarios with a specific focus on trade, regulation and our people. Whilst there remains a great deal of uncertainty as to what Brexit will mean for the company, the Brexit working group is developing and implementing plans to ensure Johnson Matthey is able to navigate the best possible outcome for our people, our business and our customers.
The following table sets out the principal risks and uncertainties facing the group, the mitigating actions for each and an update on any change in the profile of each risk during the course of the year.
Our risks are not listed from greatest risk to lowest risk; we list our strategic risks first, followed by operational risks. As explained above, we added applications, systems and cyber risk this year. It is our newest risk and so it is listed last.
1 Existing market outlook Risk and impact Mitigation Changes since 2017 The risk of a change * Strategic planning process in place to assess and annual report to the outlook for understand trends across our sectors and markets with As we continue to our key markets is an understanding and assessment of the impact of strengthen our strategic either unplanned or economic and geopolitical uncertainty and legislative planning process, unforeseen and as changes. the robustness of a result we are poorly our scenario planning positioned to respond. is also increasing. * Plans in place to execute mitigation strategies. However, uncertainty This risk would include will always be present legislative change, in the external for example as a result * Mechanisms to monitor changes and launch mitigation environment. of Brexit or changes actions if required. in customer or consumer This risk is unchanged. behaviour impacting our business. ------------------------------------------------------------ --------------------------- 2 Future growth Risk and impact Mitigation Changes since 2017 To deliver growth * A clear strategy, which is continuously reviewed in annual report as communicated in the light of new information, and a business review This risk has been our capital markets process to track execution of that strategy. refined to consider day, we are making our key growth areas significant investments as described in our in key growth opportunity * Appropriate investment in R&D, capital and talent capital markets day. areas. This risk considers identified to support realisation of the strategy. This risk is therefore the potential failure not directly comparable to deliver this growth with that reported and create value. * Ongoing monitoring and review of new technologies and in 2016/17. market competitiveness. * Project Management Offices (PMOs) in place to ensure appropriate governance in place and plans are delivering to expected timelines. ------------------------------------------------------------ --------------------------- 3 Maintaining our competitive advantage Risk and impact Mitigation Changes since 2017 Failure to maintain * Strong customer relationships, built around technical annual report our competitive advantage proposition, reputation in the market and a high This risk is unchanged. in existing markets level of technical service. We will continue to and, as a result, evolve our position not meeting customers' to maintain our evolving needs as * Regular strategy reviews to retest the external competitive efficiently as our environment. advantage. competitors. * Embedding analysis of competitor strategy and benchmarking relative performance. * Strong balance sheet to support significant ongoing investment in R&D. * Active prioritisation of R&D and capital investment to areas of greatest opportunity. ------------------------------------------------------------ --------------------------- 4 Environment, health and safety Risk and impact Mitigation Changes since 2017 In common with other * Setting the tone from the top with senior managers annual report similar manufacturing leading by example. This risk is unchanged. companies, the group Health and safety operates in a challenging continues to be our safety environment * Understanding of our business risk profile. priority and we take that is subject to our responsibility numerous health, safety for environmental
and environmental * Systems and processes to facilitate adherence to impact very seriously laws, regulations corporate policies, procedures and standards. and standards. If we fail to operate * Ongoing investment in the business to ensure that our safely we could injure equipment is appropriate. our people. We could breach applicable laws, regulations * Training and awareness activities. and standards which could adversely impact our employees, result * Risk, audit and safety checks. in lost production time and could attract negative media and * Safety culture programme and behavioural standards. regulator interest. * Investigations to determine the cause of incidents and accidents and the development of remediation plans. * An independent hotline for employees to report concerns. ------------------------------------------------------------ --------------------------- 5 Sourcing of strategic materials Risk and impact Mitigation Changes since 2017 As JM has limited * Strengthening supplier relationship management, annual report suppliers from which regular reviews to discuss supplier capacity This risk is inherent to source certain constraints. in our Automotive strategic raw materials, and Health related any significant breakdown businesses, where in the supply of these * Continuing to build expertise in supply chain, validated materials materials would lead logistics, procurement and trade export controls. are utilised in our to an inability to products. manufacture and satisfy customer demand. * Supplier quality management processes. Risk landscape unchanged * Safety stocks held in strategic locations. * Research and development to consider alternative materials. * Business continuity management, identification of critical failure risks and plans in place to manage these. ------------------------------------------------------------ --------------------------- 6 People ------------------------------------------------------------ --------------------------- Risk and impact Mitigation Changes since 2017 To execute the JM * Assessment of skills and capability requirements. annual report strategy and deliver With greater clarity growth, we need to of our strategic ensure that we have * JM leadership values and behaviours. priorities the breadth and depth we have tightened of leadership and this risk to focus the appropriate * Robust talent management processes. on the skills and capabilities. capabilities we need now and in the future. * Leadership development programmes. We are investing in our leadership and growing talent through * Building high quality personal development plans in robust succession place for all leaders. planning to build our future leaders. ------------------------------------------------------------ --------------------------- 7 Security of metal and highly regulated substances Risk and impact Mitigation Changes since 2017 On any given day, * Assay and other process controls. annual report the group has significant As reflected at the quantities of high half year, we saw value precious metals * Stock takes to check inventories. this risk increase or highly regulated in response to the substances on site impact of the metal and in transit; loss * Security awareness campaigns and training. price on our balance or theft due to a sheet. failure of the security management systems * Security management systems and site security associated with the systems. protection of metal or highly regulated substances may result * Audits of site security systems and process controls. in performance impact, reduced customer confidence * Use of approved carriers for transit. and potential legal action. * Liaison with local law enforcement for high risk sites. * Insurance coverage for losses from theft or fraud. ------------------------------------------------------------ --------------------------- 8 Intellectual capital management --------------------------- Risk and impact Mitigation Changes since 2017 Failure to identify * Business intellectual capital management strategy. annual report and protect the group's We are developing intellectual capital market leading or failure to identify * Ensuring we maintain a data security strategy to intellectual third party intellectual protect our intellectual capital. capital, through capital rights could intellectual lead to a loss in property, in the battery business advantage, * Investment in cyber security (see risk 13). materials and health loss of freedom to markets, both of which operate and reputational are crowded and litigious. damage associated * Annual research and development and intellectual Although cyber risk with litigation. property reviews. to our business is considered separately, it is also recognised * Monitoring of third party intellectual capital. as a threat to this risk area. As such we are investing in * Use of intellectual capital lawyers to provide our mitigating activity specialist guidance. to manage our increased risk profile. * Training and awareness. ------------------------------------------------------------ --------------------------- 9 Failure of significant sites Risk and impact Mitigation Changes since 2017 Potential risks include * Assessment of significant sites. annual report a disruptive event Risk landscape unchanged. such as fire, flood or earthquake, a major * Business impact analysis for sites covering all incident at site level activities, e.g. supply chain, production, commercial such as an explosion etc.
or other events such as geopolitical instability. * Building plans that enable a comprehensive response to an event and annual testing. The consequences associated with this risk include * Insurance of activities. the impact on our ability to manufacture goods and satisfy customer demand. ------------------------------------------------------------ --------------------------- 10 Ethics and compliance Risk and impact Mitigation Changes since 2017 Failure to comply * Code of ethics and tone from the top set by senior annual report with ethical and leadership. This risk is reassessed regulatory on an ongoing basis compliance standards in the light of the leading to reputational * Use of subject matter experts, internal and external, evolving regulatory damage, to civil or to identify risks, set standards and provide advice and business background. criminal legal exposure and training. In response, we review for the company or our policies, processes for individuals or and controls and amend to risk of contractual * Suite of legal compliance policies and procedures to these as appropriate. breach. mitigate key ethics and compliance risks. Examples of this include General Data Protection * Code of ethics in place supported by online training Regulations (GDPR) and formal acknowledgement. and the CCO (Corporate Criminal Offence). * Global network of ethics ambassadors. * Independent confidential speak up hotline for employees, contractors and third parties. * Investigation / response to all matters overseen by an Ethics Panel. ------------------------------------------------------------ --------------------------- 11 Business transition Risk and impact Mitigation Changes since 2017 To position the group * Strategic PMO in place to monitor progress and annual report for future growth provide assurance across the workstreams. Risk landscape unchanged. and maximise available A number of programmes efficiencies, we continue are in place to mitigate to evolve the way * Programme management in place for key initiatives, this risk. in which we run our with group owners cascading plans and agreed business. This includes deliverables with business leads. standardising some activities across the group, directed * Audit of key projects with third party assurance by strong functional where appropriate. leaders, in order to ensure best practice is used and maintained * Communication and employee engagement plans across the group. associated with key initiatives. The risk is that we fail to achieve the benefits of these efficiencies, lose our business agility and / or fail to maintain a very high level of customer responsiveness. ------------------------------------------------------------ --------------------------- 12 Product quality ------------------------------------------------------------ --------------------------- Risk and impact Mitigation Changes since 2017 Our products are used * Regulatory framework for compliance in place. annual report in a wide range of The regulatory environment applications, processes continues to tighten and systems. The safety * Developing robust new product introduction process and our customers and quality of these and technical change processes. are experiencing greater products is crucial scrutiny which has to ensuring they operate created pressure for as intended. * Developing robust manufacturing systems supported by our business standardised processes. Should a product fail to perform as expected, we could be responsible * Monitoring and reporting of quality performance, for consumer harm taking corrective action where required. or exposed to liability claims. This could lead to loss of future * Quality management systems in place supported by business, reputational education and audit. damage and loss of licence to operate. * Robust contract terms and conditions. ------------------------------------------------------------ --------------------------- 13 Applications, systems and cyber Risk and impact Mitigation Changes since 2017 Risks that our * Ensuring we maintain a data security strategy in line annual report applications with the evolving threat. The external cyber and systems security threat is increasing is inadequate or fails with more sophisticated to adapt to changing * Investment in information security systems, attacks on a wide business requirements monitoring and assurance in support of our data range of organisations. and / or external security strategy. Against this backdrop threats. we are investing in our IT infrastructure The impact of these * Mapping of all at risk data and understanding of to support a more may adversely affect regulatory requirements. efficient business our financial position and, in doing so, and could harm our we are increasing reputation. * Maintenance of a breach reaction plan. the global consistency and connectivity of our applications and infrastructure. As such, we have decided to elevate the risk of cyber attack from within the risk of failure of a critical site to a principal risk in its own right, to ensure greater board visibility. ------------------------------------------------------------ ---------------------------
Responsibility Statement of the Directors in Respect of the Annual Report and Accounts
Each of the directors as at the date of the Annual Report and Accounts, whose names and functions are set out below:
-- Tim Stevenson, Chairman -- Robert MacLeod, Chief Executive -- Anna Manz, Chief Financial Officer -- Odile Desforges, Non-Executive Director -- Alan Ferguson, Non-Executive Director -- Jane Griffiths, Non-Executive Director -- Chris Mottershead, Non-Executive Director -- John O'Higgins, Non-Executive Director -- John Walker, Executive Director
states that to the best of his or her knowledge:
-- the group and parent company accounts, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the company and the undertakings included in the consolidation taken as a whole; and
-- the management report (which comprises the Strategic Report and the Directors' Report) includes a fair review of the development and performance of the business and the position of the company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.
This responsibility statement was approved by the board on 30th May 2018 and is signed on its behalf by Tim Stevenson, Chairman
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
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(END) Dow Jones Newswires
June 20, 2018 02:00 ET (06:00 GMT)
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