The security printer told shareholders at its Annual General Meeting (AGM) that the highlight of the quarter had been its award of the £400m UK Passport contract, against which rival bidder 3M has said it could mount a legal challenge.

De La Rue chairman Nicholas Brookes told shareholders that first half banknote volumes were expected to be consistent with the previous year, "with revenues aided by favourable exchange".

He added: "Cash Processing Solutions has had a slow start to the year on large sorter sales due to difficult trading conditions and delays to a number of anticipated orders.

"Security Products is trading in line with expectations and Identity Systems, whilst maintaining good order book visibility, has volumes weighted towards the second half of the year."

The group said that operating costs and capital expenditure in relation to the UK Passport contract were being incurred in line with the project plan, "to meet first deliveries during the second half of the 2010/11 financial year".

De La Rue confirmed that, subject to shareholder approval, its previously-announced final dividend of 27.4p per ordinary share would be paid on 31 July 2009 to all shareholders on the register at the close of business on 10 July 2009.

The group said that it expected to end the half year with modest net debt and that the outlook for the current full year remained unchanged.