Banknote printer looks for security solutions growth

(MENAFN- Arab News) LONDON: British banknote printer De La Rue aims to find new opportunities in security solutions while boosting efficiency at its core currency business it said after posting a 22 percent fall in operating profit.
The 202-year-old business reported operating profit of 69.5 million pounds ($107.27 million) for the year to March 28 against 89.3 million pounds the previous year citing pricing pressures in banknote printing.
CEO Martin Sutherland who joined the company in October said he is looking to improve efficiency through modernization in the print and paper banknote division as part of his five-year business plan.
Sutherland also said he would look for new opportunities within the solutions business which accounts for about 30 percent of group revenue by speaking to third parties about collaborating on new products for commercial customers.
Shares in the company fell more than 13 percent in early trading making it one of the biggest fallers on the FTSE mid-cap index and were down 9 percent at 503 pence by 0810 GMT.
'The cautious outlook does not give us any comfort that the headwinds especially in currency are easing and note that the current euro weakness against the US dollar is aiding European competitors' Investec analysts said in a note.
De La Rue which makes more than 150 national currencies and UK passports warned in November that underlying operating profit was expected to fall by about 20 million pounds.
The company posted underlying profit of 57.7 million pounds down from last's year's 77.3 million pounds and said its order book stood at 243 million pounds.
Sutherland said he expects the challenging market conditions to continue in the short term.
'At the moment we are suffering with movement in the foreign exchange between the euro and sterling which gives our European competitors a price advantage over us. That is putting a little bit of pressure on our profits in the short term' he said.