Oct 9 (Reuters) - British chemicals firm Johnson Matthey ( JMPLF )

said on Thursday it expects its annual profit to come

in at the higher end of its initial forecast range, buoyed by

favourable precious metal prices and currency movements.

The company had previously forecast its underlying operating

profit to grow by mid-single digits for the year ended March 31.

The upbeat trading update underscores the company's turnaround

efforts after it agreed to sell Catalyst Technologies in May,

allowing management to focus on its core operations in clean air

technology and precious metal services.

Precious metals prices including platinum and gold

have rallied strongly this year as expectations of U.S.

interest rate cuts, mounting political and economic uncertainty

pushed investors towards safe haven assets.

If precious metal prices and exchange rates remain at

current levels, it expects a 10 million pound ($13.36 million)

net benefit to full-year operating performance, compared with a

previously forecast 5 million pound adverse impact, the company

said.

Johnson Matthey ( JMPLF ) said it expects negative free cash flow for

the first half ended September 30 but still forecasts an

improvement from the previous year's 169 million pound outflow.

The company said its Catalyst Technologies division, which

was sold to Honeywell International ( HON ) for 1.8 billion

pounds, will be reported as a discontinued operation for the

2025/26 financial year and it expects the deal to be completed

by the first half of calendar year 2026.

Shares in the London-headquartered company rose as much as

3.1% at 2,110 pence in morning trade.

($1 = 0.7484 pounds)