(Bloomberg) — De La Rue Plc shares fell to a record low as the company that’s reprinting UK money following the accession of King Charles III warned that demand for banknotes is the weakest in 20 years.
The stock fell as much as 34% in early London trading after the firm said adjusted operating profit for the fiscal year just ended would miss analyst estimates by “a mid-single digit percentage.” Trading volume swelled to 3.9 million shares, more than 20 times the three-month daily average.
The plunge is the second in four months for De La Rue, which cited a surge in input costs such as energy for a November profit warning.
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Wednesday’s drop saw the company’s market capitalization cut to just 67 million pounds ($83.2 million). The firm was worth close to a billion pounds about a decade ago, but has been hit by a string of warnings as consumers shift to card and digital payments. The company also suffered from the loss of a contract to produce Britain’s blue passports after Brexit.
De La Rue added in the statement that it’s talking with lenders about amending its banking covenants, in part due to the recent jump in Bank of England interest rates.
