De La Rue warns on profits, shares slide
By Michele Maatouk
Date: Wednesday 23 Nov 2022
(Sharecast News) - Banknote printer De La Rue warned on Wednesday that full-year profits would miss consensus expectations as it said it swung to a half-year loss.
In an update for the six months to 24 September, the company said it swung to an IFRS operating loss of £12.6m from a profit of £13.8m in the same period a year earlier, after an exceptional items charge of £21.4m. Group revenue declined 8.3% to £164.3m.
Revenues in the authentication business rose 2.5% to £45.5m, while the identity solutions segment saw a 14.4% increase to £2.4m. In the currency business, however, revenues fell 12.3% to £116.4m in a "subdued" market.
De La Rue said it now expects full-year adjusted operating profit of between £30m and £33m, below analyst expectations of £36m.
Chief executive Clive Vacher said: "The first half of this financial year has been challenging, with a number of key headwinds. We continue to face supply chain inflation but have proactively managed this to less than half our initial cost-increase expectations.
"Our brand business has been impacted by lower global PC sales and reduced Covid vaccine demand, and, in currency, the whole market has been subdued as customers use stocks built up over Covid."
At 0850 GMT, the shares were down 19% at 80.99p.
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