MARKET REPORT: Johnson Matthey recovers after scaling up demand
Shares in chemicals group Johnson Matthey rose after its biggest investor branded bosses “complacent and incapable” and called for a shake-up.
Standard Investments, which owns 11 percent of the FTSE 250 company, urged the board to launch a strategic review to look at “a sale of part or all of the business.”
In an open letter, the New York-based investor also called for the appointment of non-executive directors to the board.
“Over the past two years we have been in direct contact with the board and management about the many challenges facing the business,” a Standard Investments spokesperson said.
“Despite our patient and constructive approach, the board and management remain complacent and unable to correct a misguided strategy that has led to persistent underperformance. This has created a huge credibility gap with investors and the wider market.”
Shares in the maker of car catalytic converters rose 3.3 per cent, or 45p, to 1397p. But they are still down 16 percent this year and down more than 60 percent since their peak in 2018.
Shake-up: Johnson Matthey’s biggest investor has urged the board to launch a strategic review to look at ‘a sale of part or all of the business’
“Immediate action must be taken to prevent further decline in value for shareholders,” the Standard Investments spokesman said.
Russ Mould, investment director at AJ Bell, said: ‘The market appears to be welcoming Standard Investments’ intervention and that could signal the potential for success in its efforts to bring new voices to the board and radically shake up the business. ‘
The FTSE 100 fell 0.46 percent, or 38.28 points, to 8,262.05 and the FTSE 250 lost 0.36 percent, or 76.12 points, to 20,813.03.
Shares in British Airways owner IAG continued to rise, with the stock rising a further 1.1 per cent (or 3.2p) to 296.4p.
That took gains so far this year to 91% and left shares at their highest level since Covid-19 swept the globe in March 2020.
NatWest also continued its impressive run, rising 0.2 percent, or 0.7 cents, to 406.2 cents.
Bunzl, which supplies everyday products such as toilet rolls, disposable cups and safety helmets, rose 1.1 per cent, or 38p, to 3558p after RBC upgraded its shares.
Drugmaker GSK got a boost when its Jemperli drug for the treatment of rectal cancer reached a regulatory milestone in the US. The stock fell 0.8 percent, or 10p, to 1319.5p.
Fellow FTSE 100 pharma giant AstraZeneca added 0.5 per cent, or 56p, to 10524p after it appointed Rene Haas, the chief executive of chipmaker Arm, as a non-executive director to its board.
Back in the second segment, biotechnology company Puretech Health rose 4.4 percent, or 7.2 cents, to 170 cents after successful trials of its lung disease drug.
But Computacenter fell 3.1 percent, or 70 cents, to 2,168 cents after announcing that chief financial officer Christian Jehle would resign with immediate effect.
Camera and film company Videndum fell 19.9 per cent, or 51p, to 205p after it warned that ‘the recovery in our markets remains slower than expected’. Last year’s Hollywood strikes hit the company.
Stock watch – Filtronic
Satellite communications specialist Filtronic jumped after it said this year’s results will be stronger than what City analysts expected.
The company said it expects “significant revenue and profit growth” thanks to “robust” demand.
Estate agent Cavendish raised its profit forecast for the year from £7.7m to £9.6m and put a 91.9p price target on the stock.
The shares are up more than 250 percent this year. Shares rose 6.9 percent, or 5p, to 77p.
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