Spectra Systems results hit wrong note for markets

The price of shares in AIM-listed authentication specialists Spectra Systems (LON:SPSY) fell by 8.06% to 114p (as of 14:20 GMT) as revenues rose by 3% during the year ended 31st December. Management said that they remained confident in the prospects of the banknote industry despite some commentators predicting an imminent fall in demand as electronic payment methods gather steam.

CEO Nabil Lawandy commented that: “The Company’s revenues have increased by 3% and PBTA is up 19% over 2017 driven by large orders of covert materials by our G7 customer, increased covert technology royalty payments flowing in from our renewal of the license agreement with a major worldwide supplier of banknotes, and the inline performance of all other operating business lines.

“The delivery of two quality control devices to a tobacco manufacturer and the adoption of TruBrand smartphone authentication technology to protect a top cigarette brand in China has increased our chances of expanding the use of this product to the billions of packs in the market over time.

“We continue to make significant headway on the polymer banknote side of the industry with the initiation of a G20 central bank funded four phase program to qualify a new ink based covert feature as well as by forging a relationship with a global supplier of polymer which is expected to eventually allow us to sell specialty covert banknote substrates and drive up our revenues significantly over time.

“The Board therefore believes that the Company, by achieving key business milestones, will continue to perform well and has excellent prospects for maintaining strong earnings in 2019“.