BANK note printer De La Rue increased its profits in the six months to September, the firm reported yesterday, as it successfully slashed costs.
Revenues fell five per cent in the year to £234m as print volumes dropped 10 per cent.
The currency unit defied the trend, with revenues up four per cent to £145.4m. But revenues fell across the cash processing solutions unit, the security products arm and the identity systems business.
However, pre-tax profits jumped 19 per cent to £28.4m. That improvement was driven by an 8.2 per cent fall in ordinary operating expenses to £195.5m.
The firm warned that increased competition from rivals will continue to put pressure on its earnings in the near future.
“The current overcapacity in the bank note paper market has led to a more difficult pricing environment in the printed bank note market,” said chief executive Tim Cobbold.
“Accordingly the board still expects operating profit for the current financial year to be c£90m. This is an increase of over 40 per cent on the previous year and a 125 per cent increase on the performance in 2010/11 when the improvement plan began.”
The group hopes it will be able to counter some of the squeeze from rivals by adding more upmarket security features to notes, such as holograms and foil features, boosting its margins.
De La Rue’s shares soared 9.92 per cent on the announcement.