TOUGHER emission controls have delivered fruitful gains for a Teesside chemical company.

Johnson Matthey says the continuing drive to cut diesel engine pollution is providing a “solid” base for growth.

The firm is known for catalysts, which make exhaust gases harmless, and says ongoing European legislation changes are delivering strong demand.

Bosses said they expect such clamour to be prolonged, revealing the greater fuel efficiency of diesel cars should negate any fall in vehicle production across the continent.

They also said the company, which operates sites across Billingham and Stockton, would continue working on catalysts for European petrol engines as it seeks to cover a cyclical dip in the US, where lower levels of truck building have hit needs for heavy-duty diesel parts.

Robert MacLeod, chief executive, said emission controls, coupled with favourable exchange rates owing to sterling’s weakness, have provided confidence.

Speaking upon the announcement of the company’s half-year results to September 30, he said: “We have had a solid first half and I’m pleased with the performance of emission control.

“The light-duty catalyst business continued to benefit from sales of higher-value catalysts to meet Euro 6b regulations, and we have seen customers increasingly shift towards more advanced systems for diesel vehicles.

“We expect the proportion of diesels produced in Western Europe to reduce, however, those engines will continue to offer greater efficiency and lower emissions, compared to petrol counterparts.

“As such, we expect diesel to remain an important technology to enable customers to meet lower fleet emissions.”

Mr MacLeod said the pollution work was helping Johnson Matthey overcome issues across its other divisions, citing the low oil price as a critical factor for suppressed demand in its energy arm, which includes an operation to purify natural gas.

He revealed overall sales, excluding its precious metals division, were up five per cent to £1.67bn.

With currency movements removed, Mr MacLeod said sales and underlying profit dipped one and three per cent respectively, though he added at current exchange rates, the business expects translation benefits to add around £65m to full-year profits.

He added: “We remain well positioned in growth markets and will continue to make the world cleaner and healthier.”

Johnson Matthey runs Stockton’s Davy Process Technology, which operates across the oil, gas and chemical sectors, and precious metal producer Chilton.

It also oversees Tracerco, based in Billingham, near Stockton, which previously developed an illegal fuel test system.