De La Rue chairman informed to give up: Prime investor manufacturers newest revenue warning a ‘Liz Truss second’ for banknote boss
De La Rue’s boss is below mounting strain to give up after his firm’s newest disastrous replace was branded his ‘Liz Truss second’ by a prime shareholder.
In one more setback for long-suffering buyers, shares within the 201-year-old banknote printer tumbled 23 per cent after it posted its third revenue warning of the 12 months.
De La Rue – which makes banknotes for international locations world wide however misplaced the contract to print post-Brexit UK passports 4 years in the past and is within the strategy of shedding employees to avoid wasting money – warned it may even go bust.
Below fireplace: De La Rue shares have misplaced 50% of their worth this 12 months and 60% since Kevin Loosemore (pictured) took over as chairman in October 2019
The shares have misplaced 50 per cent of their worth this 12 months and 60 per cent since Kevin Loosemore took over as chairman in October 2019.
The replace fuelled tensions between De La Rue and activist investor Crystal Amber – its second largest shareholder with a 9.9 per cent stake – which has known as for Loosemore to resign and pushed to nominate a consultant to the board.
Crystal Amber stepped up its marketing campaign yesterday, with founder Richard Bernstein describing the most recent revenue warning as a ‘Liz Truss second’ for Loosemore – referencing the quick and troubled tenure of the previous prime minister, who give up after simply after seven weeks.
Calling on the corporate to launch a strategic evaluate, together with a possible sale, Bernstein informed the Mail: ‘That is the third revenue warning in 2022 for De La Rue.
There’s nothing in in the present day’s replace that indicators why there gained’t be a fourth within the spring.
‘Making employees redundant is just not a method – it’s a tragedy. De La Rue was a fantastic firm however it’s being outclassed by its rivals.
Relatively than settle for accountability, the chairman is blaming everybody else – together with us as shareholders – for being a distraction for articulating our justifiable considerations.
‘This isn’t in regards to the survival of Loosemore as chairman. It’s in regards to the long-term survival of De La Rue. Kevin Loosemore wants to just accept accountability and depart city now.’
Droop: De La Rue makes banknotes for international locations world wide however misplaced the contract to print post-Brexit UK passports 4 years in the past and is within the strategy of shedding employees
Bernstein’s feedback had been the most recent salvo in an ongoing battle between his agency and De La Rue.
Earlier this 12 months, Loosemore accused Bernstein of suggesting ‘market manipulation’ techniques when the investor mentioned he wished to suggest a method, which may assist rebuild De La Rue’s sliding share worth. Bernstein hit again, claiming Loosemore’s feedback had been defamatory.
Behind closed doorways, Bernstein instructed Loosemore ought to contemplate resigning. In an uncommon transfer, De La Rue known as a shareholder vote – attributable to be held subsequent Friday – on the chairman’s future, seemingly in an effort to show that they had the backing of most buyers.
However after yesterday’s revenue warning, shareholders could also be a bit extra reluctant to throw their weight behind Loosemore.
De La Rue reported a 46.6 per cent stoop in income for the six months to September 24 to £9.3million because it grappled with hovering prices and a slowdown in forex orders.
With first-half revenues down 8.3 per cent to £164.3million, the corporate mentioned full-year income may now be as little as £30million – some £6million under analyst forecasts.
And it raised additional considerations with a warning that in a ‘extreme however believable’ situation it may go bust.
De La Rue has had a tortuous 4 years since dropping the profitable contract to print Britain’s post-Brexit passports in 2018. In Might it crashed out of the FTSE 250 index.