Johnson Mathy (LON:JMAT), the chemical and tech company listed on FTSE 100, saw its share price drop by 5% on Thursday as it saw a significant final contract during its recent six-month trading.
The company reported a 20% decline in sales due to reduced demand for clean air, efficient natural resources and the provision of new markets. Nevertheless, reported revenues rose 2%, led by an average previous rise in metal prices.
Following the painful underlying trend, reported operating profit was 74% contracted, ranging from £259 million to £68 million. Similarly, pre-tax profits fell by more than 88% year-on-year following “major” impairment and restructuring costs £78 million.
Regarding the balance sheet, Johnson Matey reported cash flow of £482 million, but net liability to EBITDA was 1.6, and the return on investment capital fell to 10.6%, driven by a decline in operating profit.
The situation has been similarly rough for the company’s shareholders, with the reported EPS falling 87% to 12.3p, with the interim dividend per share slides from 18% to 20.0p due to reduced profits and increased net financial fees.
Robert MacLeod said, responding to the challenged pandemic trade environment and aiming for the future: “It was a challenging time, but the steps we took to create a simpler, more agile and efficient business, combined with the dedication of all of my colleagues at Johnson Matey, sailed us well. We are pleased that we delivered sales performance ahead of the market expectations and good cash generation, and further advance our group’s transformation.”
“(…) I am excited by the prospects of medium-term growth driven by accelerating global trends, and aim to reduce the impact of climate change. We are investing in the future and continue to focus on implementing growth opportunities such as battery materials, fuel cells, and hydrogen production technologies.”
Following the Sting trading update, Johnson Matey’s shares fell 4.59%, down to a share of 2,433.00pa on 11/20/19. The price is below the highest share of 2,654.00pa since lockdown, but is quite consistent with the recurring fees over the past six months.
Analysts currently have a consensus-holding attitude towards stocks and a target price of 2,555p. This is almost the beginning of the day. This is a P/E ratio of 18.40, which appears to be a good value compared to the average 26.81 for the base materials sector. The MarketBeat community currently has a “low-performance” stance of 53.32% on its stock.
