· Revenue +29% and adjusted operating profit*(1) +11%, reported operating profit +7%
· Currency business delivered strong growth with revenue +36% and adjusted operating profit*(1) +16%, driven by high volumes
- Banknote Paper volume +36% to 7,200 tonnes
- Banknote Print volume +6% to 3.5bn notes
- Polymer volume +570% to 400 tonnes
· Identity Solutions and Product Authentication revenues +3% and +20%, respectively
· Adjusted basic earnings per share +19% to 16.6p
· Net debt £137.4m, up £16.5m from the year end due to higher working capital
· Group 12 month order book of £363m as at September 2017
STRATEGIC AND OPERATIONAL HIGHLIGHTS
· Increased investment in product development
- R&D investment increased by 33% year on year
- Joint product development and exclusive sales agreement with security features developer and manufacturer Opalux
· Polymer momentum continues - signed 10 year contract to supply Safeguard® substrate for Bank of England new £20 notes
· DLR Analytics launched in May gaining further traction, with 60 central banks signed up
· Joint development agreement with Note Printing Australia for new Australian passport
· De La Rue Authentication Solutions (previously DuPont Authentication) is performing to plan""""""
De La Rue and Opalux Announce Partnership
24 Oct 2017
De La Rue, the worlds leading anti-counterfeiting and security specialist for currency, identity and brand protection, is pleased to announce that it has entered into a strategic partnership with Opalux, a producer of premium first level security features. The partnership will incorporate joint product development and related sales execution on a global basis.
Commenting on the new partnership, Ulrich Walter, the Product Director De La Rues Security Features and Identity Portfolio said: As a security business, we spend every day staying ahead of the counterfeiter across currency, identity, tax stamps and brand protection. One of our core strategic priorities is to grow our security features portfolio by investing in research and development, as well as partnerships. Opalux has an exciting technology that we believe can play a significant role for our global customers, as part of an integrated portfolio and multiple solutions from De La Rue.
Opalux develops and manufactures tunable photonic crystals, smart materials that change colour in response to external stimuli. Based on this platform technology, Opalux has created a range of highly recognisable and secure features with distinct colour effects for government documents. Speaking about the partnership, Andrew Binkley, the Chief Executive Officer of Opalux said: We are excited to combine our leading edge technology and security features with De La Rues integrated portfolio and global reach. We look forward to working together to create a strong set of highly-differentiated solutions.
02 Jun 2016
London, 2 June 2016: Today the Bank of England has revealed the design of their new polymer £5 banknote that is being printed by De La Rue. Bearing an image of Sir Winston Churchill, the note design was unveiled by Governor Mark Carney at Churchills birthplace, Blenheim Palace in Oxfordshire.
The New Fiver retains the portrait of Her Majesty The Queen on the front of the note whilst Churchill appears on the back.
It is not so daft as most people imagine.
Nowadays you can add seismic detectors to easily identify tunneling and use drones to patrol from above with infra red heat sensors etc and only send out the men when and where there is an attempted incursion. A 2,000 mile fence/wall can be monitored effectively.
Nice update and definitely on the right road to recovery but still a long way to go to get back to May14 levels.
As I'm holding these in the SIPP I plan to sit tight and watch the recovery continue for a while yet. Glad I didn't bale out after the profit warnings and subsequent SP slide. Hopefully holding this will be a licence to print money for my retirement in 10 or so years.
It's been a good day overall with the XPP trading update and SP surge putting even this riser in the shade. Kerching.
CCL of Canada have paid a price equivalent to twice turnover to buy Innovia Films who are DLAR's biggest competitor in the supply of polymer for banknotes. Looks to me as if there is a process of industry consolidation and strategic position-taking underway which underpins the value in DLAR.
My thoughts are that this deal is about as big as DLAR could have made from its existing cash resources. The balance sheet is much more stretched than I'd like ideally but DLAR does have some great technology and a decent market position so I'm not worried about the goodwill in the balance sheet as it is clearly worth a lot.
I think they'd love to do a 'disruptive' acquisition but their big rivals are all either government or privately owned and probably will never be for sale. I'm very happy though that they add bolt-on businesses like the DuPont operation to strengthen their long-term growth.
I bought a few more yesterday as soon as I saw the deal. Essentially I think any deal to grow the business is good news for the share price.
"""With low interest rates almost any deal is earnings enhancing but although small this looks like a good deal.""
Maybe Sutherland is smart and doesn't look to completely uproot what is essentially a profitable business by some disruptive big acquisition. Large deals are often difficult to absorb and in many cases can damage shareholder value.
Games - I see we are back above £6 today - good stuff!!
Unexpected acquisition but very welcome. DLAR are positioning themselves to be world leaders in anti-counterfeiting measures and polymer notes ahead of the likely decline in printing paper banknotes. With low interest rates almost any deal is earnings enhancing but although small this looks like a good deal.
This looks like a sensible acquisition. They have bought the company for $25M which represents about 1.8X revenue.
Be interesting to learn what the margins are on that business, and if it will scale well alongside DLARs broader offerings.
The UK should not pander to the wierd religious beliefs of others - the Indians worship cows and we eat them, so to please the Indians are we going to stop eating beef - of course not.
I say if they object that is their right they can avoid touching these notes (touching their backsides is OK of course.
The UK has the right to make banknotes to suit the UK not the Indians etc - after all there is no HSE issue here it is just daft political correctness pandered to by the UK's daft ruling class / politicians.
The UK needs a Trump type politician to say UK first and if you don't like it - lump it or leave.
Blimey, them vegans and God knows who else need to get a life! Blimey, whatever next? Am I gonnae have to replace the seats and the steering wheel on the E Class because them waccos don't like leather?
"The Bank said the problem "had only just come to light" and it was treating the concerns with "utmost seriousness"."
Word of advice, Carney .... Do not descend to the level of these nutters. Don't give them air space. If there's tallow in the notes ... fine. Not bothered. Get used to it.
I see that vegans, vegetarians, Sikhs and possibly Muslims and Jews are up in arms because the new plastic notes are made of material that, in the early stages of it's manufacture, includes a spot of tallow.
What on earth is the world coming to! Can De La Rue produce a plastic note that complies with these bonkers PC rules?
Yes I assume the fall is because more was expected - however today we have a director buying more shares (the CFO no less) and this is a good sign for the future:
"Transaction by PCAs of Jitesh Sodha Chief Financial Officer (PDMR) - Purchase of 2,755 Ordinary Shares (held in nominee account in the name of PCAs Susannah Sodha (2,673 shares) and Jasper Sodha (82 shares)). Following this transaction Mr Sodha's beneficial holding is 7,594 ordinary shares."
As part of its ongoing review of Global operations,
De La Rue has today announced that it will continue to print currency at its factory in Malta. The company has been working in Malta for over 40 years and last year announced that it was creating a Centre of Excellence for Identity and Security Print in Malta, as part of a global investment of 33 million in equipment, factory upgrades and skills. The works to create the Centre of Excellence are well advanced, todays announcement will see De La Rue continue to print currency in Malta within the new Centre of Excellence. "
Financial Times' Lex column is backing cash to come good for banknote producer De La Rue.
The company makes cash for clients such as the Bank of England yet experienced troubles in 2014 resulting in mixed results and a tumbling share price.
De La Rue went through somewhat of an overhaul around that time, with Martin Sutherland taking over as chief executive, after selling his own cash processing business in May of that year.
Around 6bn banknotes are typically printed per year by the company to distribute to banks, significantly less than before Sutherland took over two years ago, but more in line with current demand.
Citigroup estimates that this consolidation will generate an extra £40m in savings over the next three years.
Despite many predictions that cash itself is on the way out as banks and companies move towards more digitised methods for transactions, Lex believes that this will not be the case any time soon.
Before the British referendum on its membership of the European Union, the European Central Bank reported that demand for cash was growing by at least 5% per year in most of Europe.
De La Rue also prints passports, and reports suggest that sales could be boosted by as much as £200m.
Shares in the company have risen by 40% this year already.
The market signs are good, and may well show De La Rue investors coming away with more of the very product it produces, Lex concluded.
Joatmon, My holding, bought 6 months ago, is up 45% and like you, I cannot put my finger on a good, solid reason for this very welcome rise. But, heigh, ho, Mr Market, keep buying, or, at least, keep holding.
Cher Eugene, who wishes Centrica would copy De La Rue
Actually I think I was wrong. I think this £5 is printed on polymer from Guardian which owns Innovia Films in Cumbria. I don't know if DLAR are involved in the actual printing process. For obvious reasons there is a lot of secrecy involved.
I don't think it has ever been publicly confirmed but I think they are. Of course they last 10 times as long as paper ones so DLAR will print fewer of them but I understand DLAR also manufactures the polymer so most of what it loses on supplying the banknote paper it will win back on the polymer. Overall though it is international sales and the margins they can achieve there that will make all the difference to DLAR's profits outlook.
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