LONDON (dpa-AFX) - De La Rue plc (DLAR.L), a manufacturer of polymer and security printed products, Wednesday said it expects fiscal 2023 adjusted operating profits to be a mid-single digit percentage below market expectations.
Further, for fiscal 2024, citing a considerable degree of uncertainty around the outlook, the Board currently expects adjusted operating profit to be in the low 20 million pounds range.
In November last year, the company had said that it expects fiscal 2023 adjusted operating profit in the range of 30 million pounds to 33 million pounds, versus analyst estimates of around 36 million pounds.
In fiscal 2022, adjusted operating profit was 36.4 million pounds.
Net debt as of March 25 is expected to be in line with market expectations.
In its trading update, the company noted that the downturn in Currency, impacting both De La Rue and the wider industry, is causing a significant degree of uncertainty in terms of outlook for fiscal 2024.
The demand for banknotes has been at the lowest levels for over 20 years, resulting in a low order book going into FY24. However, there are encouraging signs that the market is recovering. A significant number of new tenders are actively underway but the timing of this recovery remains uncertain.
Further, revenue in the Authentication division is expected to exceed 100 million pounds for the first time in fiscal 2024, driven by the existing order book. It reflects the full-year impact of the Qatar, Bahrain and Oman GRS programmes, and a substantial increase in demand from the Australian passport programme.
This progress will be somewhat offset by the ongoing lower global PC sales which, according to IDC, is likely to start to recover only in calendar year 2024.
De La Rue added that it is in talks with its lending banks in relation to seeking an amendment to its banking covenants, reflecting the revised outlook and also reflecting the increase in its funding costs resulting from higher Bank of England base rates.
De La Rue plans to announce fiscal 2023 results on May 31.
Copyright(c) 2023 RTTNews.com. All Rights Reserved
Copyright RTT News/dpa-AFX