Johnson Matthey is one of the world's largest distributors of precious metals Reuters

Johnson Matthey, the world's biggest producer of catalytic converters for cars, has reported a 5% increase in underlying profits for the first half of the financial year.

Underlying profit before tax came in at £219.6m for the six months ended 30 September period.

However, revenue declined 2% from a year earlier to £5.6bn.

In a statement, Johnson Matthey said it expects a boost to its full-year earnings from a favourable exchange rate.

A weak pound makes the chemical firm's products cheaper and more competitive in foreign markets.

"Johnson Matthey had a solid first half, supported by favourable exchange rates, and our health and safety performance improved," chief executive Robert MacLeod said.

"Our guidance for the full year remains unchanged for our continuing businesses on a constant currency basis; that we expect the group's performance to be slightly ahead of last year.

"In addition, the group will benefit from favourable exchange rates if current rates are maintained."

Sales excluding precious metals increased 5% year-on-year to £1.7bn.

The FTSE 100 company increased its interim dividend by 5% to 20.5p.