The Investment Column: De La Rue
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.DE LA Rue, the world's largest independent banknote printer, has found that there is now more money in money. A drastic re-organisation rescued the shares from below 150p last year to back above 300p today. New faces at the top; the forthcoming creation of a services division and widespread cost-cutting have all helped to restore some lustre to its performance. Yesterday, Ian Much, chief executive, promised better times ahead, after unveiling interim profits before tax and exceptionals of pounds 34.7m, up from pounds 19.3m. Should investors buy into the recovery?
De La Rue appears to be back on track. It has benefited from its sharper focus on more profitable operations, a reduced headcount and more aggressive management. Shareholders are in line for about pounds 104m payback, including the pounds 57.4m net gain from the sale of the smart-card operations. This equates to 46p a share, which will be paid via a new company set-up. Security paper and print, which account for about a third of group sales of pounds 338m, has seen a 36 per cent jump in profits this half to pounds 25m. About pounds 100m remains on hand for acquisitions. Much is still to be done, however. Analysts foresee full-year profits of pounds 52m after re-organisation costs. De La Rue is not yet threatening a return to its glory days above 1,000p a share, but with a forward p/e of 14 Mr Much's team should be able to propel the shares above their current 315p. Buy.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments