Banknote maker De La Rue says demand for cash recovering despite £16.8m loss

British banknote maker De La Rue continues to struggle with weak demand for cash but reitered its upgraded full-year profit guidance.

The Basingstoke-based firm posted a pretax loss in the six months ended 30 September 2023 of £16.8m compared to £15.9m in the same period last year. Revenue ticked down 1.7 per cent to £161.5m.

Currency revenue fell 2.6 per cent to £113.4m. However, the firm said its currency order book more than doubled since September 2023 to £219.8m as the market recovers.

Earlier this year, it revealed that demand for banknotes had slumped to the weakest level for 20 years.

But it has since reassured investors that demand for currency was picking up and raised its profit expectations for the first half of the year after it.

Data from banking trade body UK Finance published in September showed cash payments increased for the first time in a decade.

The company said on Tuesday that data showed “an underlying demand for fresh banknotes”, expecting cash in circulation to grow around five per cent a year globally.

Adjusted operating profit of £7.9m came in ahead of previous guidance of breakeven, while operating loss narrowed to £3.4m from £12.6m last year.

It reiterated its upgraded profit guidance, forecasting a full-year adjusted operating profit for “in the low £20m”.

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The firm has also extended its banking facilities to July 2025.

“De La Rue’s robust performance in the first half reflects the important actions that we have taken since 2020 to make the company resilient to changing market conditions,” said chief executive Clive Vacher.

“These actions have allowed us to navigate a downturn over the past 18 months, particularly in currency, and I am pleased that the market is now showing signs of continuing recovery.”