Banknote printer and passport maker De La Rue has reported a slump in profit in the first half of the year, after losing a key contract to manufacture UK passports.
Despite revenue rising 5 per cent to £257.6m, operating profit plunged by 36 per cent from £26.6m to £17m.
The company took a hit earlier this year when the government decided to award the contract for post-Brexit British passports to Franco-Dutch group Gemalto. De La Rue’s 10-year contract, worth £400m, will come to an end in July 2019.
On Tuesday, the group said the “challenge of losing the UK passport contract” had led it to refocus its business on different aspects of the security sector.
Martin Sutherland, chief executive of De La Rue, said: "Over the last six months we have conducted a thorough review of our strategy and market positions. In the light of the UK passport decision, we have concluded that we will refocus our identity business on the supply of higher margin security features and components.
"We maintain a strong order book and pipeline which provides good visibility for the second half of this year and into next year. With good revenue coverage from the group's 12 month order book of £365m and based on the orders planned for production and shipment in the second half, we are confident that we will meet our expectations for the full year."
Shares in the company fell almost 2 per cent in early trading.
