Johnson Matthey Case Study Example | Topics and Well Written Essays - 2500 words

Johnson Matthey - Case Study Example 14 Consolidated Income Statement 15 Consolidated and Parent Company Cash Flow Statements 16 PART A: Financial Analysis 1. Company Summary Johnson Matthey is a speciality chemicals company. Focusing on its core skills in catalysts, fine chemicals and precious metals, the company's main activities are organized through its Environmental Technologies, Precious Metals and Fine Chemicals & Catalysts Divisions. Johnson Matthey manufactures catalysts, pollution control systems, and fine chemicals, engages in the refining and fabrication of precious metals and produces active pharmaceutical ingredients (Annual Report, 2009). Important strategic acquisitions are: the acquisition of Argillon Group in February 2008; the selling of non-core Insulators and Alumina businesses to Lapp Insulator GmbH & Co in November 2008; the acquisition of the 49% Alfa Aesar China Limited in March 2009 (Google Finance, 2009) The common stock trades on the London Stock Exchange (LSE: JMAT.L). 2. Strategic Objectives (Annual Report, 2009) For 2009/2010, Johnson Matthey's strategic objective is to generate consistent growth in earnings by developing high added value products and services. The company aims at further supporting R&D and financing organic growth. Although opportunities for growth are on the agenda, the company plans on reducing capital expenditure to generate more cash. The group's financial objectives are: achieving constant and above average growth in earnings per share; achieving an ROI above the group's cost of capital; achieving a 20% ROA for all its divisions; maximizing dividends in line with earnings to ensure sufficient funds are retained to support organic growth The priorities given in strategic direction are: Focusing on its core skills in the... The paper concludes that Johnson Matthey's financial statements are clearly structured, facilitating the company's financial analysis. Also, non-financial statements communicate the group's quality, innovation and efficiency to shareholders in a comprehensive way that identifies the company's strategic objectives. Johnson Matthey is a speciality chemicals company. Focusing on its core skills in catalysts, fine chemicals and precious metals, the company's main activities are organized through its Environmental Technologies, Precious Metals and Fine Chemicals & Catalysts Divisions. Johnson Matthey manufactures catalysts, pollution control systems, and fine chemicals, engages in the refining and fabrication of precious metals and produces active pharmaceutical ingredients (Annual Report, 2009). Important strategic acquisitions are: the acquisition of Argillon Group in February 2008; the selling of non-core Insulators and Alumina businesses to Lapp Insulator GmbH & Co in November 2008; the acquisition of the 49% Alfa Aesar China Limited in March 2009 (Google Finance, 2009) For the fiscal year ended 31 March 2009, Johnson Matthey's revenues increased 4.66% to 7,847.8m.