"The current year has started well with profits ahead of last year.

The Electronic Materials Division is significantly above last year's level with all four of its business sectors performing well. In Semiconductor Packages we are on course to achieve full production capacity throughput by the end of this financial year. Our licensing agreements with Kyocera, announced on 12th June, are being implemented.

Catalytic Systems is also ahead of last year, with both the US and Europe performing well. Pharmaceutical Materials continues to make excellent progress.

Precious Metals Division has had a satisfactory first quarter in all three business sectors. Platinum Group Metal markets have been volatile in recent months and prices have risen. This has benefited operating profit but interest charges have also increased. Johnson Matthey has now purchased certain amounts of PGM outright due to the prohibitive costs of hedging.

Cookson Matthey Ceramics has seen some improvement from the disappointing profit levels of the second half of last year and its decorative, tile and pigment businesses are making satisfactory progress. However, the minerals business remains depressed principally due to the effect on its zircon operations of poor European construction markets and a squeeze on margins.