Passport maker De La Rue warned on Wednesday that its annual profit would be significantly lower than market expectations, as its new top boss, a turnaround specialist, leads a review of the business.
The company did not specify the reason for its lowered expectations, but a previous warning was triggered by a margin squeeze from competitive pressures in banknote printing.
The company had said in May that operating profit for the current year would be “somewhat lower” than the previous year.
Earlier this month, it named Clive Vacher as chief executive officer. He faces significant challenges alongside new chairman Kevin Loosemore.
The company’s woes have been compounded by the loss of its 400 million pound contract to produce Britain’s passports ahead of the country’s planned exit from the European Union.
The group, which prints some 7 billion banknotes and 15 million passports a year, also said it expects adjusted operating profit for the first-half ended Sept.28 to be in the low-to-mid single digit millions. It reported a profit of 17 million pounds for the same period last year.
Shares of the firm have more than halved in value since the first profit warning and could lose as much as 30% on Wednesday, according to premarket indications from traders.
Via Reuters/ Financial Times
