De La Rue says ‘signs of recovery’ in cash usage after sharp fall in profits
Cash printer De La Rue has said it sees “signs of a recovery” in money usage this year after a torrid 12 months in which its profit and revenues have contracted sharply.
In its full year results today, the cash maker said revenues had tumbled 6.8 per cent to £349.7m in the year to March while profits had plunged 23.6 per cent to £27.8m.
De La Rue has struggled amidst the fall in cash usage over the past decade and has failed to find new revenue streams to fully make up the slack.
The firm issued a profit warning in April and said demand for cash hit its lowest in over two decades.
The London-listed company said it was also talking to its lenders about amending its banking terms due to the worsening outlook and higher interest rates, while it has requested its pension trustee to defer its deficit contribution for the next five quarters.
However, chief Clive Vacher said in a statement today there were signs of an uptick again in the use of cash.
“Following a significant downturn in Currency demand over the past 18 months, we have witnessed encouraging signs of recovery with strong bid activity, a positive win rate, and the significant majority of FY24 banknote print volume already contracted,” Vacher said.
“In addition, Authentication is on track for significant revenue growth in the current financial year. The actions we have taken over the past few months have built on the essential operational improvements made in the last three years and played a vital role in stabilising the Company”
He added that by renegotiating terms with its lenders and a relaxing of covenants the firm had managed to remove any “material uncertainty” over its ability to continue as a going concern in the full year 2023 accounts.
The firm has doubled down on its guidance for 2024 adjusted operating profit in the low £20m range.