De La Rue chairman told to quit

The De La Rue boss is under increasing pressure to quit after his company’s latest disastrous update was labeled by a top shareholder as his “Liz Truss moment.”

In yet another setback for long-suffering investors, shares in the 201-year-old banknote printer plunged 23 percent after it posted its third profit warning of the year.

De La Rue – which makes banknotes for countries around the world but lost the contract to print post-Brexit British passports four years ago and is in the process of laying off staff to save money – warned it could even go bankrupt to go.

The shares have lost 50 percent of their value this year and 60 percent since Kevin Loosemore took office as chairman in October 2019.

The update sparked tensions between De La Rue and activist investor Crystal Amber – the second-largest shareholder with a 9.9 percent stake – who has called for Loosemore to step down and pushed for a representative to be appointed. on the board of directors.

Crystal Amber stepped up her campaign yesterday, with founder Richard Bernstein describing the latest profit warning as a ‘Liz Truss moment’ for Loosemore – referring to the former prime minister’s short and difficult tenure, who stepped down after just seven weeks.

Bernstein called on the company to launch a strategic review, including a possible sale, telling the Mail: “This is the third 2022 profit warning for De La Rue.

There’s nothing in today’s update to indicate why there won’t be a fourth in the spring.

“Laying staff is not a strategy, it is a tragedy. De La Rue used to be a great company, but it’s being outclassed by its competitors.

Instead of accepting responsibility, the chairman blames everyone else – including us as shareholders – for being a distraction to expressing our legitimate concerns.

“This is not about Loosemore’s continued existence as chairman. It’s about the long-term survival of De La Rue. Kevin Loosemore must accept responsibility and leave town now.”

Bernstein’s comments were the latest salvo in an ongoing battle between his firm and De La Rue.

Earlier this year, Loosemore accused Bernstein of suggesting “market manipulation” tactics when the investor said he wanted to propose a strategy that could help rebuild De La Rue’s declining share price. Bernstein hit back, claiming that Loosemore’s comments were defamatory.

Behind closed doors, Bernstein suggested that Loosemore should consider resigning. In an unusual move, De La Rue called a shareholder vote – to be held next Friday – on the chairman’s future, seemingly in an effort to prove they had the support of most investors.

But after yesterday’s profit warning, shareholders may be a little more hesitant to throw their weight behind Loosemore.

De La Rue reported a 46.6 per cent drop in profits for the six months ended September 24 to £9.3m as it struggled with rising costs and a slowdown in currency orders.

With first-half sales down 8.3 per cent to £164.3m, the company said full-year profits could now be as low as £30m – some £6m below its forecasts. analysts.

And it raised further concerns with a warning that it could go bankrupt in a “serious but plausible” scenario.

De La Rue has had a rough four years since losing the lucrative contract to print Britain’s post-Brexit passports in 2018. In May, it crashed out of the FTSE 250 index.