In the first half of the year we conducted a major review of corporate strategy. This resulted in the refocusing of the group on its core activities, where we have genuine leadership and a strong market position, and the establishing of our successful Electronic Materials business as a stand alone company to enable us to unlock shareholder value. Indeed it is the enhancement of shareholder value which is the prime motivation of your board.

Board
During the year the board of Johnson Matthey has been focusing particular attention on the future strategic direction of the group. The non-executive directors played an active role in the strategic review conducted during the autumn, the results of which were announced at our interim results in late November. I am most grateful for their commitment and support.

In March we announced that Gordon Thorburn would retire from the board at the conclusion of this year's Annual General Meeting due to ill health. Gordon has had a long and distinguished career with Johnson Matthey, having joined the board as Group Finance Director in 1983. He was appointed to his current post of Executive Director, Administration in 1987. Over years that witnessed many crucial events in the development of the company, Gordon worked with great dedication and the board will miss his steady hand and wise counsel. We are very sorry to lose his services earlier than we would have hoped and we wish him a long, happy and healthy retirement.

In January Graham Titcombe was appointed as Group Managing Director, reflecting his role as Johnson Matthey's senior operational executive director. He has retained responsibility for Precious Metals Division and from 1st August will additionally assume board responsibility for Colours & Coatings Division.

Charles Mackay joined the board as a non-executive director in January and Mike Dearden was appointed as a non-executive director in April this year. Both have a great deal of valuable and relevant experience of the international markets in which Johnson Matthey operates. We look forward to benefiting from their input.

Finally, I am delighted to announce the appointment of two new executive directors. With effect from 1st August Neil Carson will join the board as Executive Director with responsibility for Catalytic Systems and Chemicals. This reflects the importance of these businesses to the future development of the Johnson Matthey group. Neil, who is currently Division Director of Catalytic Systems, has been with Johnson Matthey for 19 years and has held a series of senior management positions in both our Precious Metals and Catalytic Systems Divisions. Also effective from 1st August David Morgan is appointed to the board as Executive Director, Corporate Development. David has been with the company for 11 years holding a succession of senior financial and planning positions. Since 1995 he has been Group Corporate Development Director and has played a leading role in the development of the group.

People and the Community
People play an essential role in the success of any company and at Johnson Matthey we are extremely fortunate to have a highly professional and dedicated workforce. On behalf of the board I would like to thank all our employees around the world for their hard work and dedication during what has been a challenging year for many of our businesses. The importance of developing our employees to enable them to fulfil their full potential cannot be stressed too highly. This is especially important in the development of our management talent. Our management development policy is featured on page 25.

We have some very exciting opportunities ahead of us. Johnson Matthey is at the forefront of a number of technologies for air pollution control and clean energy generation that will make an increasingly important contribution to quality of life in the years ahead. We are also fully committed to ensuring that we meet our responsibilities to the environment and for maintaining the highest standards of health and safety in all our operations around the world. The company's Environment, Health and Safety policies are presented on page 25. On pages 26 and 27 we have a special feature on Johnson Matthey's contribution to a clean energy future.