De La Rue's (DLAR) shares rose nearly 10 per cent on the back of these half-year figures after the specialist printer boosted operating profit 18 per cent to £39.1m. The rise came despite a fall in turnover and significantly reflects the group's ongoing success at cutting costs. Moreover, and while current over-capacity in the bank note paper market is putting pressure on prices, the group's forward order book has risen by £25m since the end of March to £232m - management expects a 40 per cent rise in full-year operating profit to around £90m
Finances have been turned around, too, with cash inflow from operating activities up from £11.7m to £43.9m. Trading on the banknote side remains tough, however, with print volumes having fallen 10 per cent to 2.6bn notes, although divisional operating profit before exceptional items edged up 6 per cent to £23.7m. Turnover also fell 12 per cent to £95.3m in the solutions division, but divisional profits jumped 43 per cent to £15.4m - reflecting the completion of a number of overseas contracts in identity systems that pushed that unit's profits up by 135 per cent to £13.4m.
Broker Investec Securities expects adjusted pre-tax profit of £77.8m for 2014, giving EPS of 59.1p (from £51.3m and 38p in 2013).
DE LA RUE (DLAR) | ||||
---|---|---|---|---|
ORD PRICE: | 918p | MARKET VALUE: | £916m | |
TOUCH: | 917-919p | 12-MONTH HIGH: | 1,053p | LOW: 808p |
DIVIDEND YIELD: | 4.6% | PE RATIO: | 25 | |
NET ASSET VALUE: | * | NET DEBT: | £88.7m |
Half-year to 28 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
---|---|---|---|---|
2012 | 245 | 23.8 | 22.1 | 14.1 |
2013 | 234 | 28.4 | 21.9 | 14.1 |
% change | -4 | +19 | -1 | - |
Ex-div: 4 Dec Payment: 8 Jan *Negative equity shareholders' funds |