De La Rue – Some Progress in Tough Market

De La Rue’s results for the first half of the current financial year (FY) – 2022/23 – saw sales and profits fall, along with a reduced overall profit guidance for the full year. However, although the markets were unimpressed and the shares dropped sharply, there was some positive news too on the progress of the company’s Turnaround Plan, and on its future prospects.

Revenue of £164.3 million was 8.3% lower than the same period the previous year. Gross profit from continuing operations at £41.8 million was 13.8% lower, with adjusted operating profit falling by 46.6% to £9.3 million. However, this result was in line with the company’s previous adjusted operating profit guidance given in July.

Using IFRS standards (International Financial Reporting Standards), the company reported an operating loss from continuing operations of £12.6 million compared with an operating profit of £13.6 million in the first half of 2021/22. The major difference was an exceptional items charge of £21.4 million (which included £19.3 million relating to Portals Paper, and £2.5 million of non-cash additional expected credit loss provision on investments). The company noted that the exit from the Portals agreement was going well, with orders placed with five paper mills being at a lower aggregate cost.