* Core H1 profit 212.9 mln pounds vs year-ago 187.9 mln
* Emissions Control Technologies operating profit up 16 pct
* Process Technologies operating profit rises 17 percent
* Sees second half in line, excluding Anglo Platinum impact
* Shares climb over 3 percent
By Clara Ferreira-Marques
LONDON, Nov 21 Catalyst maker Johnson Matthey
beat its own expectations with a 13-percent rise in
profit, lifted by increased car and truck production globally,
and tighter European rules on emissions due to come into force
The British speciality chemicals firm - the world's No. 1
maker of catalysts to control car emissions - said underlying
first-half profit before tax totalled 212.9 million pounds
($344.3 million), at the higher end of analyst expectations and
outperforming the group's own forecast, which had warned of the
impact of summer closures at European car plants.
Much of the jump came from its key Emission Control
Technologies business, which accounts for more than half the
group's sales and almost 40 percent of group operating profit.
Underlying operating profit in that division rose 16 percent
in the six months to the end of September, thanks to growth in
sales across regions. That includes long-depressed Europe, where
sales of car catalysts outpaced vehicle production, and where it
saw increased demand for truck catalysts ahead of the
legislation - Euro VI.
Finance Director Robert MacLeod said the group had seen
customers for smaller trucks buying up cheaper Euro V trucks
ahead of the deadline, and buyers of larger vehicles coming in
early for Euro VI trucks, to benefit from fuel efficiency.
But the impact of "pre-buying" on sales in the second half
of the group's financial year was unclear, MacLeod said.
"We have had a pull forward of orders into this half, or
this calendar year, ahead of the new legislation," he said.
"No one really knows what is going to happen (in 2014). The
truck fleet in Europe is pretty old too - are some of these
orders just getting the fleet back up to the right age?"
Analysts particularly welcomed the performance in Europe's
car market, where Johnson Matthey appeared to gain market share
- beating a dip in production with a 9-percent rise in sales.
"There was a market share beat in the car business in
Europe, and on the truck side... 25 percent of their sales were
Euro VI, where revenues are three times as high," analyst Adam
Collins at Liberum in London said.
"There is some concern the pre-buy could result in next year
starting softly, but in the overall scheme of things it doesn't
appear like it will be more than a quarter or so of transition,"
Shares in the group were up 3.3 percent at 1040 GMT at 3,197
pence, outperforming a 0.1 percent rise in the FTSE 100.
Johnson Matthey forecast a second half performance broadly
in line with the first six months of its financial year. That
excludes the impact of ending long-standing platinum buying and
other arrangements with Anglo American Platinum in the
new year, which had included a discount.
Analysts said it could beat that outlook, thanks to
pre-buying into the coming months and higher margins from Euro
Other divisions also helped, with Process Technologies, the
division which makes speciality catalysts, reporting sales up 15
percent and underlying operating profit up 17 percent, helped by
the acquisition of formaldehyde producer Formox in March.
Johnson Matthey's MacLeod said he expected the division could
see more small-scale deals.
It forecast a second-half performance for the unit "slightly
ahead" of the first half.
Precious Metals Products, which refines and recycles, saw
core profit climb by almost a quarter on the year-ago period,
which had been hit by operational woes at its Salt Lake City
refinery, and by a relatively weak platinum price that held back
volumes at its precious metals refining arm.
Fine Chemicals, a division which makes active pharmaceutical
ingredients for the pharmaceutical industry and which Johnson
Matthey has refocused, saw profit tick 1 percent higher, helped
by the sale of ingredients to treat drug addiction and attention
deficit hyperactivity disorder (ADHD).