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(Alliance News) - De La Rue PLC on Wednesday reported a sharp drop in annual profit but remains focused on its turnaround plan.
In the financial year that ended March 27, De La Rue - which manufactures polymer and security printed products including banknotes and tax stamps - recorded pretax profit of GBP9.9 million, sharply lower from GBP36.1 million the year before.
Revenue from customer contracts dropped 16% to GBP397.4 million from GBP472.1 million.
Chief Executive Clive Vacher said: "Both our ongoing divisions are performing well and the group has delivered good growth in adjusted operating profits as we complete the first full year of our Turnaround Plan."
De La Rue said the Currency division's adjusted revenue was 1.8% higher year on year, with Authentication adjusted revenue up 5.1%.
"We saw good growth in adjusted operating margins for Currency in the year, and Authentication has secured GBP195 million of expected multi-year lifetime contracts from April 2020 to date. We have made encouraging progress in our polymer growth plans, securing a new site to double capacity during financial 2022," Vacher continued.
De La Rue said its trading in the first two months of financial 2022 has been positive and in line with management expectations.
Vacher added: "We see a strong pipeline of business for financial 2022 and continue to expect to deliver the full financial and operational benefits of the turnaround plan during the year."
The firm noted its restructuring effort delivered GBP23 million in cost savings in financial 2021.
"We have a target of returning the company to a strong financial position and an operating platform which will deliver sustainable growth at high operating margins and strong cash generation in the medium term. Following an initial period of cash outflow to fund the turnaround plan, we continue to aim for the group to be generating cash flow capable of supporting sustainable cash dividends to shareholders by the end of the turnaround plan in financial 2023," De La Rue added.
Shares in De La Rue were 1.2% lower in London on Wednesday at 198.60 pence each.
By Paul McGowan; paulmcgowan@alliancenews.com;
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