Business is booming.

Directors’ Deals: Buyback could be catalyst for Johnson Matthey shares


There was a lot of logic behind chemicals group Johnson Matthey’s decision in November to abandon investment in its battery materials business.

Although the company had pumped millions into the venture — it had net assets of £340m and employed 430 people as of the end of October — it reasoned that competition in the sector was growing at such a pace that it wouldn’t have made a decent return on the business.

Investors were clearly disappointed, though — the company’s share price sank by 19 per cent on the day and hasn’t recovered since. Most (£314m) of the division’s assets were written off, leading the company to declare a £9m loss before tax for the six months to September 30, despite sales increasing by 23 per cent to £8.59bn.

It agreed the sale of its Advanced Glass Technologies business for £178m in November and said the proceeds would be used to fund a £200m share buyback programme. That, and the disposal of its health business for £325m — or 9.8 times underlying cash profit — last month have failed to lift the gloom.

The main problem for Johnson Matthey is it makes most of its money from its catalytic converter technology, and with a ban on vehicles powered by combustion engines looming in the UK this is a dying business.

Attempts to build other sources of revenue are not, as yet, paying off.

The company’s shares now trade at just over nine times forecast earnings, below its peers and its own five-year average of 13 times earnings. With the buyback programme now under way, executives have felt confident enough of a bounceback to increase their stakes. Chair Patrick Thomas bought over £100,000 of shares on January 6, two days after non-executive Doug Webb bought more than £50,000-worth. At least one institution is betting the slide will continue, though — BlackRock Investment Management currently has a disclosable net short position equating to 1.27 per cent of the company’s shares.

Has book publisher Quarto turned over a new leaf?

Book publisher Quarto Group’s shares have more than doubled in price over the past 12 months, to 130p a share.

This is welcome news for any long-term shareholders in the company, even if the share price remains well below the heights of £3 reached in early 2017, before it announced the first of three years of losses accompanied by declining sales as it sought to cut debt.

Chuk Kin Lau, owner of Hong Kong-based book printer Lion Rock Group, took control of the business alongside one of its co-founders, Laurence Orbach, and others at its 2018 annual meeting.

Lau became chief executive and his companies provided loans offering working capital while debts were restructured. He stepped back in as an interim group chief executive last July after Polly Powell resigned less than a year into the role to concentrate on running her own publishing company, but made way for a new boss, Alison Goff, this month.

He clearly retains confidence in the publisher’s prospects. On January 6, Lau spent almost £1.25m buying 1m shares in Quarto through his company, 1010 Printing.

A day later, he added a further 343,000 shares, bringing his stake above 44 per cent.

Quarto’s fortunes seem to be improving — in the six months to 30 June 2021 it reported a $3m (£2.2m) profit, compared with a $4m loss a year earlier, as revenue grew by more than one-fifth to $56.9m. Net debt was also cut by $21m to $16.4m, although Lau warned that its second half was likely to be tougher due to higher freight costs and shipping capacity issues.

Lau’s recent purchases mean a higher concentration of shares is held by company insiders, though. According to FactSet, the combined holding of four company-linked shareholders is now more than 71 per cent.

Another consideration is that the company is incorporated in Delaware, which has tax implications in terms of dividend payments for some shareholders.

Source link

  1. sliding door says

    Greate post. Keep posting such kind of information on your page.
    Im really impressed by your blog.
    Hey there, You have performed an incredible
    job. I will certainly digg it and individually suggest to
    my friends. I’m sure they will be benefited from this website.

  2. เว็บวาไรตี้ says

    I just like the valuable information you provide in your articles.
    I’ll bookmark your blog and test again right here frequently.
    I’m rather sure I will be informed many new stuff right right
    here! Best of luck for the following!

    Also visit my webpage – เว็บวาไรตี้

  3. IELTS says

    Hey there would you mind letting me know which web host
    you’re utilizing? I’ve loaded your blog in 3 different internet
    browsers and I must say this blog loads a lot quicker then most.
    Can you suggest a good hosting provider at a reasonable price?
    Thanks, I appreciate it!

  4. เว็บวาไรตี้ says

    This text is worth everyone’s attention. When can I find out

    Here is my website :: เว็บวาไรตี้

  5. zeytinburnu escort says

    escort istanbul

  6. Gong kinh can nu dep 2022 says

    Wow! At last I got a webpage from where I know how
    to really get valuable information concerning my study and knowledge.

  7. https://Www.easyfie.Com says

    Hi there, I discovered your blog via Google whilst
    looking for a comparable topic, your site came up, it
    seems to be good. I’ve bookmarked it in my google bookmarks.

    Hello there, just become aware of your blog via Google, and located that it’s really
    informative. I am gonna be careful for brussels.
    I will be grateful if you happen to proceed this in future.

    Many other folks will be benefited out of your writing. Cheers!

  8. Kính thuốc says

    Having read this I thought it was rather enlightening.

    I appreciate you finding the time and effort to put this content
    together. I once again find myself spending way too much
    time both reading and posting comments. But so what, it was still worth it!

  9. yeni escort says

    şişli escort

  10. korsan taksi says

    Great web site you’ve got here.. It’s hard to find quality writing like
    yours nowadays. I honestly appreciate individuals like you!
    Take care!!

  11. Visit here says

    Wow, wonderful blog layout! How long have you been blogging for?
    you make blogging look easy. The overall look
    of your web site is wonderful, as well as the content!

  12. joker123 login says

    I’m gone to say to my little brother, that he
    should also visit this webpage on regular basis to take
    updated from hottest news.

  13. 카지노사이트 says

    Hi there! Someone in my Myspace group shared this website with us
    so I came to check it out. I’m definitely enjoying the information. I’m book-marking
    and will be tweeting this to my followers! Excellent blog and fantastic
    style and design.

  14. slot online says

    Highly descriptive article, I liked that a lot.
    Will there be a part 2?

  15. says

    Post writing is also a excitement, if you be familiar with after that you can write
    if not it is complex to write.

  16. says

    Paragraph writing is also a fun, if you know then you can write or else it is complex to write.

  17. movie says

    Do you have a spam problem on this blog; I also am a
    blogger, and I was wondering your situation; many of us have
    developed some nice procedures and we are looking to exchange techniques with other folks, please shoot me an e-mail if interested.

  18. pvp777 says

    You are so interesting! I do not suppose I’ve truly read a single
    thing like that before. So good to discover another person with genuine thoughts on this
    subject. Really.. thank you for starting this up.

    This website is something that’s needed on the internet,
    someone with a bit of originality!

  19. kebun777 says

    Wonderful blog! I found it while surfing around
    on Yahoo News. Do you have any suggestions on how to
    get listed in Yahoo News? I’ve been trying for a while but I never seem
    to get there! Cheers

  20. 토토사이트 says

    Anyone looking for Gambling totosites? 꽁머니 This
    site is secure and very fun with many games.

Leave A Reply

Your email address will not be published.