De La Rue is prepared to spend up to 200m on acquisitions to boost the revamped business going forward.


Unveiling upbeat results for the year to 31 March which included the first increase in De La Rues divided since November 1997 chief executive Ian Much pronounced the sale of the groups stake in De La Rue Giori (see separate article) and resolution of the legal action with partner M Roberto Giori marked the last of the legacy issues from when he joined the group in September 1998.


Giori began legal action against De La Rue at the end of 1999, and filed a 125m claim. The settlement will cost De La Rue 6.25m, including legal fees.


Operating profit before exceptionals rose by 11.2m to 66.4m on sales of 524.8m (2000: 617.1m). De La Rue jettisoned almost 100m of turnover with the sale of its cards business.


Going forward we can put our energies into getting growth back in the business, added Much, who also unveiled an organisational revamp that will see the firm working as a joined up company in three core operating areas: payment (including cash systems), identity (high security identity documents such as passports) and brand protection. This is an organisational change, weve done our restructuring and we dont need any more of that. This is not cost saving, its about generating extra growth, he explained.


Much believes the move will help the group exploit its group-wide capabilities. Before we were confusing customers. Now the person in front of the client will offer the full range of services, not just those from one factory.


Security paper and print, where profits increased by 10.3% to 50.4m on static sales of 214m, will become part of the Global Services division headed by Jon Marx.


Overall, prints performance was described as satisfactory, with Dunstable the star performer. High Wycombe was hit by the affects of de-stocking by a large customer. Its manufacturing and inventory operations have been revamped and De La Rue has won a three-year contract with Royal Mail for self-adhesive stamps.


The group has won a contract with Microsoft for labels for its new X-box games console, although De La Rues existing contract for labels for Microsofts Windows will end later in the year because the software giant is switching to a plastic substrate through another supplier.


De La Rues Cash Systems wing is benefiting from the changeover to the euro as banks on the continent upgrade ATM machines for euro notes and put in automatic counting and verifying equipment to cope with the mass changeover.


The groups stake in lottery operator Camelot produced operating profits of 10.4m. De La Rues own stake in Camelot has been reduced to 20%, and the new lottery licence halves the amount returned to Camelot shareholders for each 100p collected. De La Rue said the impact on overall profitability would depend on actual lottery ticket sales.


De La Rues results were ahead of market expectations, and the firms share price rose by 9p to 470p on the news.


Story by Jo Francis