The Investment Column: De La Rue

DE LA RUE, which makes smartcards and prints banknotes for small African states, is known for many things but over the last few years shareprice performance has not been one of them.

However, as the group sets the presses rolling to print the commemorative stamps to mark the wedding of Prince Edward and Sophie Rhys-Jones, the City is looking more positively at the group. At their 1995 peak the shares stood at pounds 10.50 before plummeting to 133p last year. Yesterday they jumped 5 per cent to 319p after posting annual results down on last year - losses were pounds 7.4m - but giving a positive update on the group's restructuring.

The continuing reorganisation follows chief executive Ian Much's appointment in September. In March, Mr Much announced a shake-up costing pounds 40m and the loss of 500 jobs.

His latest strategy is to set up a new support services division to run alongside the existing card systems, cash systems and printing divisions. The aim is largely to answer criticisms that the smartcard business was the only growth area in the company.

Meanwhile, Mr Much says emerging markets are likely to provide more opportunities - De La Rue prints money in 120 of the world's smaller countries and provides Brazil's entire cash handling services - while in Europe and the US he is looking for acquisitions. Analysts agree both with Mr Much's frank assessment of De La Rue's past failings - "horrible" - and his optimism.

Carl Green, support services analyst at Charterhouse Securities, says: "As soon as the evidence comes through six months down the line it could get even more positive." Despite their recent rally, the

shares are looking good value.

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