Johnson Matthey to recognise £50m charge after settling contract dispute lawsuit
Source - SMW
Johnson Matthey said it will recognise a charge of £50m in connection with the resolution of a lawsuit, and added that it expects US tax changes will reduce its effective tax rate by 2% in the financial year ending 31 March 2019 and beyond.
'We announce that the lawsuit against JMI has been settled on mutually acceptable terms with no admission of fault,' Johnson Matthey said.
The company said that it estimates that recent US tax changes will result in a £30 million one-off non-cash benefit in income tax expense for the year ending 31st March 2018 but noted that the non-cash benefit will be excluded from the tax on underlying profit.
The effective tax rate on income is expected to be around 18%, the company said, adding that its outlook for the year ending 31 March 2018 remained unchanged.