HAMPSHIRE Banknote printer De La Rue has revealed a boost to underlying profits but said the full impact of a suspended contract is still not known.

A contract to produce bank notes for the world’s newest country, South Sudan, put Basingstoke based De La Rue back on the path to growth with a 13 per cent rise in operating profits to £31.5 million.

Revenues in the six months to September 24 rose 14.4 per cent to £238m.

But the company said it had suffered a £23.3 million hit in the period relating to the suspended contract last summer after it was claimed employees had falsified paper specification tests at its site at Overton.

It said the full financial consequences had yet to be estimated. The contract is widely understood to be with the Reserve Bank of India.

The firm, which prints notes for the Bank of England and 150 other countries, reported bottom-line pre-tax profits of £27.1m in the six months to September 24, compared to £69.4m the previous year.

De La Rue said it made good progress in implementing the first part of an improvement strategy, announced in May, that aims to return the business to an operating profit in excess of £100 million by 2013/14 through a combination of revenue growth and a £30 million reduction in operating costs.

Banknote print volumes at 2.8 billion notes were 12 per cent higher, reflecting the improved order book profile, De La Rue said.

Looking ahead, the company said the strong order book meant the board was confident it would meet expectations for the full year.