Banknote printer De La Rue’s further Sh258m ache in Kenya exit

Banknote printer De La Rue has spent an extra £1.3 million (Sh258.6 million) to put off workers, write off property and pay attorneys , bringing the cumulative spending on closing down operations of its Nairobi unit to £13.9 million (Sh2.77 billion).

The worldwide agency, which in January 2023 suspended banknote printing operations within the nation owing to low demand, says within the newest buying and selling replace that the extra value was made up of £1.1 million (Sh218.8 million) for impairment of property, £0.2 million (Sh39.78 million) redundancy fees and £0.1 million (Sh19.89 million) on different prices.

“Since this [exit from Kenya] programme commenced, £13.9 million of prices have been incurred in relation to this. Minimal additional prices are anticipated in relation to this programme within the monetary 12 months 2024,” stated De La Rue in a buying and selling replace protecting six months to the top of September 2023.

De La Rue, which was using about 300 folks in Kenya by its subsidiary De La Rue Kenya EPZ Restricted, had within the 12 months ended March 25, 2023 used £5.5 million (Sh1.09 billion) on redundancy fees, £4.9 million (Sh974.7 million) to jot down off property, plant and tools and £2 million (Sh397.8 million) to impair stock.

The agency additionally incurred a £2.5 million (Sh497.3 million) cost for redundancy and authorized charges in relation to restructuring initiatives in each the foreign money and authentication divisions to right-size the divisions for future operations.

De La Rue has been printing notes for Kenya by the native three way partnership that’s 40 per cent owned by the Kenyan authorities, however determined to droop its notes printing line and cheques enterprise after Central Financial institution of Kenya instructed it no extra orders could be coming for at the very least 12 months.

The Kenyan unit made a lack of £0.1 million (Sh19.89 million) within the half 12 months interval ended September 2023, in contrast with a £0.5 million (Sh99.46 million) as income shrank from £10.8 million (Sh2.15 billion) to £0.2 million (Sh39.78 million).

De La Rue in late 2018 received an £85 million (Sh16.9 billion) tender to design and manufacture Kenya’s new foreign money era notes because the nation moved to take away the faces of people from its foreign money.

The winding down of Kenyan operations means De La Rue will now be left with three banknote websites —UK, Malta and Sri Lanka— down from 4 in the beginning of the 12 months and 5 in 2020, highlighting the declining demand for banknotes globally as digital transactions achieve traction.

The agency has been finishing up substantial enlargement in its Malta facility and is eyeing establishing foreign money printing models that are anticipated to be prepared by 2025.

De La Rue has been working in Kenya for over 25 years from the place it served different markets reminiscent of Tanzania, Uganda, Zambia and Rwanda.