Johnson Matthey accelerated its transformation drive this year, delivering a sharp jump in cash generation as the company pushes ahead with plans to become a “focused, lean and cash generative group.”
The chemicals and sustainable technologies company reported free cash flow of £168 million, soaring 163% year-on-year, as management pressed ahead with a sweeping strategic overhaul designed to streamline operations and boost shareholder returns.
The company said operating profit for 2025/26 came in line with previously upgraded guidance, with pro forma underlying operating profit rising 6% at constant PGM prices and foreign exchange rates.
Reported operating profit, however, fell 65%, largely due to the absence of major disposal gains booked in the prior year, although this was partially offset by lower impairment and restructuring charges.
Johnson Matthey also posted a major improvement in profitability in its Clean Air division, where the underlying operating margin climbed to 14.5%, up 270 basis points year-on-year. The company said it remains on course to hit its long-term margin target of 16% to 18% by 2027/28.
The group’s PGM Services business faced setbacks after operational metal losses at its US refinery weighed on performance. Despite the disruption, Johnson Matthey confirmed it has started early-stage commissioning of its new UK PGM refinery and expects the site to become operational in calendar year 2027.
The company is also progressing with the £1.325 billion sale of Catalyst Technologies, a deal expected to close by the end of August 2026. Johnson Matthey said £1 billion of net proceeds from the transaction will be returned to shareholders following completion.
In a parallel growth move, the company agreed to acquire CORMETECH Inc. for an enterprise value of $360 million. The acquisition is aimed at strengthening Johnson Matthey’s position in stationary emissions control technologies, including systems serving the rapidly expanding US data centre market.
Looking ahead, Johnson Matthey said it remains on track to deliver sustainable free cash flow of at least £250 million annually by 2027/28, with at least £200 million a year earmarked for shareholder returns from 2026/27 onward.
