De La Rue confident despite paper problems

21st Jul 2011 13:55

Banknote and security printer De La Rue said that it remains confident in the trading outlook for the full year, despite ongoing paper problems at its Currency Division.The firm's chairman, Nicholas Brookes, said that while print volumes were higher than the first quarter of last year, paper volumes were lower, as expected.De La Rue announced last July that paper production at one of its facilities had "failed to meet certain quality specifications" leading to the suspension of production and shipment of the paper while an investigation took place. In turn, paper production and sales for the year ended 26 March 2011 were lower than previously anticipated.In the group's annual financial report (in respect of the 2010/11 financial year) released on 14 June, the firm revealed that banknote paper production and shipment still remains suspended.Nevertheless, Brookes said on Thursday that in the firm's Solutions Division, Identity Systems performed strongly in the first quarter, driven by a full quarter of its UK Passport contract. Cash Processing Solutions also traded well, while Security Products has experienced challenging market conditions.Meanwhile, "good progress is being made with the implementation of the Improvement Plan announced at the end of May which has a target of achieving an operating profit in excess of £100m within three years," Brookes said.Shares were down 0.79% at 756.50p as of 14:16.BC