LONDON (Alliance News) - Bank note printer De La Rue PLC Wednesday said its restructuring programme was paying off as it reported a rise in pretax profit in its last financial year, as a strong performance from its Identity Systems division and higher bank note paper volumes more than offset weakness in its cash processing unit and bank note printing volumes.
It posted a pretax profit of GBP59.8 million in the year to March 29, up from GBP43.7 million a year earlier, as revenue rose to GBP513.3 million, from GBP483.7 million.
The revenue rise more than offset exceptional costs of GBP17.5 million, including ongoing costs relating to its improvement plan of GBP3.5 million, a GBP2.2 million for the resolution of a tax liability and an impairment charge of GBP14.2 million as it lowered its expectations for cash generating units within its cash processing business.
The banknote printer and passport manufacturer maintained its total dividend at 42.3 pence per share.
The company's banknote print volumes fell to 6.2 billion notes, from 6.3 billion a year earlier, but this was offset by an increase in the volumes of bank note paper output to 9,600 tonnes from 8,700 tonnes. As a result, revenues for the company's currency division rose 15%.
De La Rue's cash processing business saw revenues drop 6%, due to lower larger sorter sales and service revenues. This, combined with increased machine trial costs on potential orders, led to a divisional loss of GBP4.1 million. De La Rue is targeting break even for the business in the current financial year.
Profit in the company's Identity Systems business rose to GBP22.0 million, from GBP16.3 million, despite a 8% decline in revenue, as the company improved the unit's operating efficiency and more longer-term contracts reached completion.
The company has spent a total of GBP35.2 million on its restructuring plan over the last three years. The company said that its business was in a "fundamentally better shape today and with a culture of continuous improvement embedded in our business there will be further efficiencies ahead."
The plan delivered savings of GBP20 million during the year, De La Rue said, and total yearly savings of GBP40 million over the plans three years.
"Although good progress continues to be made on revenue growth initiatives, we have yet to see their full benefit due to the more challenging market conditions," the company said in a statement.
De La Rue maintained its expectations for the new financial year, saying that it had entered the year with a good order book, although the pricing environment in the currency market has recently been more difficult.
Shares in De La Rue were trading up 4.1% at 843.00 pence Wednesday morning, shortly after market open, the biggest gainer on the FTSE 250.