De La Rue (DLAR.L) said profit for the financial year 2020/21 could be as much as £37m ($50.8m) — at the top end of its forecast — and that it has repaid all the money it received from the government's furlough scheme.
Shares in the company, which says it is the world's largest designer and commercial printer of banknotes, were down 1.2% on Tuesday morning as markets opened in London.
"As a result of continued positive trading, the board expects adjusted operating profit for the financial year 2020/21 to be around the top end of the £36m [$49.5m] to £37m range previously indicated in the company's trading update of 28 January 2021," it said in a statement on Tuesday.
Back then, it had said it was confident of these expectations, given there are no "unforeseen COVID-19 related events."
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It had also said at the time the improved expectations were "largely driven by a strong currency division performance," adding that the pandemic caused some delays in securing new government revenue solutions contracts with overseas governments by its authentication division, due to a disruption in procurement processes.
Meanwhile, the company has repaid all the money it received from the government's Coronavirus Job Retention Scheme.
Furlough payments received under this scheme totalled approximately £400,000.
The company's end of year net debt was approximately £53m, which it said was lower than market expectations by about £21m.
"This is mainly due to lower capital expenditure during the year, consistent with adjustments made to the timing of capital spend," it explained.
De La Rue expects to record non-cash exceptional asset impairment and accelerated depreciation charges of approximately £13m on historic assets, as a result of the closure of its Gateshead banknote printing operations in December 2020.
De La Rue will announce its results for the full year ended 27 March 2021 on 26 May.
Earlier this year, the company launched a smartphone enabled hologram validation tool. It said this app enables authorised brand protection inspectors to scan the holographic features in certain holographic labels to verify if they are genuine.
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