De La Rue plans cuts as production fades

 
City A.M. Reporter
BRITISH banknote printer De La Rue yesterday reported a 68 per cent drop in full-year profit due to paper production problems and said it was unable to predict the outcome of talks with the key customer still affected.

De La Rue said production of banknote paper for one of its top customers -- named by a source close to the matter earlier this year as the Reserve Bank of India -- was still suspended after faults were found with it in July, at a cost of £35m.

“Discussions remain ongoing with the principal customer concerned and the authorities, and therefore there remains uncertainty as to the ultimate outcome of these issues, including their financial impact,” the company said yesterday.

De La Rue, which produces over 150 national currencies and security documents including passports, said pre-tax profit before exceptional items for the year to 26 March fell to £33.3m from £104.1m in the previous financial year.

In January, France’s Oberthur Technologies walked away from a bid for De La Rue after a higher indicative offer failed to engage the banknote printer’s board in talks.