De La Rue sees FY operating profit above top end of market forecasts

De La Rue said on Tuesday that its full-year operating profit is expected to be above the top end of market consensus, driven by good growth in Identity Systems and Product Authentication & Traceability product lines.

In a post-close trading update for the year to 25 March, the banknote printer said full-year revenue for the group is in line with market expectations, with the currency business performing as expected.

Following the completion of the $25m acquisition of DuPont Authentication back in January, net debt as at 25 March 2017 was around £14m higher than at the end of the previous year at approximately £120m.

The company said that while the sustained weakness of the pound gives it a competitive advantage in the export market, this benefit is substantially offset by increased investment in R&D, product management and sales capability, and the rising cost of raw materials such as cotton. As a result, expectations for the financial year of 2017/18 remain unchanged.

Separately, De La Rue announced that chief operating officer and executive director Rupert Middleton has informed the board he wants to step down after the annual general meeting in July after six years at the company.

The position will be replaced by the newly created role of chief operations director, reporting to the CEO as a member of the Executive Leadership Team. The appointment will not be a board position.

A search has been commenced to identify suitable internal and external candidates.