De la Rue share price plunged this morning after releasing its interim results. Having opened up at 466p, the banknote and passport maker's stock dropped to 434.5p, down 2.3 per cent from yesterday's close.
Profits tumbled by 38 per cent to the six months ending 26 September, from £20.6m in 2014 to £12.8m.
Group sales were down five per cent from last year, to £204.8m.
Profits in the core currency business were down to £13.9m, from £17.2m the year before.
The company's cash processing division, which operates cash-sorting machines and accounts for around ten per cent of the group's revenue, dragged the results down after reporting losses increased by £1m to $4.7m, and sales dropped 37 per cent.
The company has launched a "root and branch" review into the division's poor performance.
Why it's interesting
Former BAE Systems managing director Martin Sutherland became the group's chief executive last year charged with turning the group around after a run of profit warnings.
De La Rue, which makes British passports and Bank of England banknotes, including the new polymer ones, is in the middle of a manufacturing review and reorganisation, with a new chief financial officer, and has promised more than £13m of savings a year from 2018-19.
What De La Rue said
Martin Sutherland, chief executive, said:
“De La Rue’s half year performance has been better than expected. The Currency business has shown strength and resilience against the ongoing volatile market conditions.
"However, the overall performance was dampened by the poor results in [cash processing]. Our success in winning large overspill orders in the period has strengthened the group’s order book, which gives us confidence and visibility for our full year performance.
"Implementation of the five-year plan we set out in May is now well underway. We have restructured the business to support the delivery of the strategy and increased investment in product development and new technologies. Our review of the manufacturing footprint to improve efficiency and reduce costs is near completion and we will provide more details in the coming weeks. Whilst it will, of course, take time to deliver the full potential of the strategy, we are pleased with the progress made at this early stage.”
If only they could just print more money...