Johnson Matthey Plc (JMAT) Earnings Call Transcript & Summary

Yes. So if I understood it correctly, and please correct me if I didn't, I think your point was relative with the advance of AI that the relative value of battery material assets that we have might be more valuable and why are we selling this? Was that the correct point?

Yes. It's a big filled and you could have running 2 in parallel rather than just running with 1 horse.

Yes. Yes. Yes. So let me briefly just recap the decision that was made, which is actually a strategic decision taken before I joined as CEO to exit battery materials. I've examined that quite extensively. I think it was absolutely the right decision. For the very simple reason that the assessment was internally that Johnson Matthey could, unfortunately, not be competitive in that space. We had good technology. But unfortunately, we didn't have customers and our cost of production was too high. That was the unfortunate situation. That was why the decision was taken then to exit battery materials. We then went to a very expensive strategic review to look at where could Johnson Matthey be competitive, where it could be the world class. And we decided to focus on areas where the company for 200 years has had really core strengths. And that goes back to the Platinum Group Metals, the chemistry and the catalysis of Platinum Group Metals as a core. And in that context, we identified the key role that Platinum Group Metals will play also in the energy transition. And that's the part where the hydrogen business as a both hydrogen and catalyst technology businesses are expected to drive significant growth going forward. The both businesses we're already today, we have leading market positions. We're working on scaling up in both of those businesses. And we think we can be a global market leader in both of those spaces. So that's where our focus is, and it comes off the back of a strategic decision to exit the business where we just -- I think the company assessment was we could not be competitive there.

But hydrogen usually have a lot of competition coming up. Tata is going to build a big factory on green hydrogen. And there will be many other coming up. And I've never seen your name coming up to do something. So I'm scared as a shareholder.

I think the way I'd like to describe what we do in green hydrogen is it's like the Intel chip inside a computer. It's a small component of a bigger machine. But it's actually the most value-enhancing component. And unlike Intel today, most people don't know that JM is on the inside or whether it's electrolyzer or fuel cells. So customers like Tata will hopefully be -- in the future be using plenty of our product inside. And if we do our job properly, hopefully, we'll become known as then JM inside as well. So that's at least the...

That's good. So what's your debt?

So Stephen, do you want to answer that?

Thank you for the question. So we finished the 2023 year with just over GBP 1 billion of debt. We run a cautious or prudent balance sheet. We finished the year with gearing of 1.5x to 2x EBITDA, that's at the bottom end of our range. I think it's fairly cautious, but rest assured that's something that we monitor month in, month out.

Thank you very much for your questions. A follow-on, yes.

Yes. Yes. Where did all that debt come from?

We've had that level of debt for quite a long time, absolutely. And that obviously supports -- or is a factor of the investments that we're making into the business, into research and development and, obviously, into our new growth businesses and building facilities to support those.

Thank you, Stephen. Any other questions in the room? Pause. So if there are no further questions in the room, I'll now pass over to the telephone conference line for questions.

We have no teleconference questions at this time.

There are being no questions from the telephone conference facility, I'll now pass over to the web conference facility.

There are no questions on the webcast.

There are no questions on the webcast. Okay. So thank you for your questions. Thank you to the 2 gentlemen who provided some useful questions for insights for the other shareholders. I'd now like to move to the formal proceedings of this Annual General Meeting. The notice of the Annual General Meeting, together with the explanatory notes, was published and posted to the shareholders on the 12th of June this year. Accordingly, the requisite notice of the meeting has been given. I propose that with your consent, the notice of the meeting should be taken as read. Is there any disagreement to taking it as read? I see no disagreement. Thank you. The notice of the meeting has been taken as read. Voting will be carried out by means of a poll rather than a show of hands. This is in line with best practice and gives all our shareholders the opportunity to have their votes recorded even if they are unable to attend the meeting in person. As a reminder, those joining via the webcast or telephone conference will not be able to vote during today's meeting and was given the opportunity to cast their votes in advance. I'm appointing Equiniti, the company's registrars to act as scrutineers. When you registered at the meeting today, each shareholder, proxy and corporate representative will have been issued with a poll card. If there is anyone who thinks they should have a poll card that does not have one at present, please raise your hand now, and someone will come and allow -- come and assist you. Okay. There are being no offers, we will move on. If you are a shareholder, please complete the poll card by inserting, in block capitals, your full name and address. If you are a proxy or corporate representative, please insert, in block capitals, your name and full name and address of the shareholder you are representing. Please indicate the way in which you wish to cast your vote in respect of each resolution by putting a cross in one of the boxes for, against or withheld. Please note that the vote withheld is not a vote in law and will not be counted. If you wish to vote only some of your shares on a particular resolution or you wish to split how you cast your vote, you should enter the number of votes being cast in the for, against or withheld columns instead of a cross. Please ensure that you sign the poll card and hand it to the representative of Equiniti as you leave the room. If you have already voted by proxy, then you do not need to compete -- complete the poll card. Your vote will be taken into account automatically. If you have voted by proxy and wish to change your vote, you can complete the poll card, and your new voting instructions will be recorded. We will now proceed to vote on the resolutions, which I will formally propose to the meeting. The full text of each of the resolutions is set out in the notice of the meeting, a copy of which you have received. Resolutions 1 to 18 are normal ordinary resolutions, which require a simple majority to be passed. Resolutions 19 to 22 are special resolutions, which must be passed by a majority of not less than 75% of shareholders present and voting, either in person or by proxy. I now formally propose all resolutions to the meeting and declare the poll formally open. The poll will close 10 minutes after the end of the meeting. And if you have any questions about filing in your poll card -- filling in your poll card or if you require any assistance, please speak to the registrar's representative. The scrutineer will calculate the results at the close of the poll. These will be announced later today in the stock exchange announcement and will be published also on the company's website. The proxy voting results received in advance of the meeting will also be shown on the screen. That concludes the formal business of the meeting and brings the 132nd Annual General Meeting of Johnson Matthey Plc to a close. The poll will close in 10 minutes' time, and I remind you to pass your completed poll cards to a representative of Equiniti when leaving the room. Thank you for taking the time to join us today, either in person, via the webcast or by telephone conference, and we look forward to engaging with you in the future. Thank you very much.

Before you perform in terms of the meeting, now I propose and thanks to you the way you have conducted the meeting, the Board and its employees the way they have handled the [indiscernible], yes. So....

Thank you very much for that proposal, and we are honored that one of our shareholders should make such a proposal. Thank you very much on behalf of the Board. Thank you. That ends the meeting.