The Royal Mint Unveils Annual Report 2008-09

18 Jun 2009

The Royal Mint has today reported another profitable and successful year, demonstrating the commitment to long-term sustainable growth.

An operating profit before exceptional items and interest of £8.2 million (2007-08: £9.6m) was realised in spite of the challenging global economic environment, meaning the Royal Mint will pay a dividend of £4.0 million (2007-08: £3.9m) into the public purse. Sales increased to £159 million, an increase of 17% compared to last year, and this strong demand reflects the high quality of Royal Mint products.

The Circulating Coin business delivered its third consecutive year of increased profitability and an 8.8% growth in turnover to £93.2 million (2007-08: £85.0 million), which represents an outstanding achievement given the international recession. The most significant development was undoubtedly the award of the contract to supply plated blanks to the Russian mints for the next five years. This comes on top of the ongoing work to supply the Egyptian Mint with coins and blanks for Egypt's recoinage programme. The Royal Mint clearly remains extremely competitive in the global market and overseas coin and blanks contracts now account for over two-thirds of the Circulating Coin business's activity.

The Commemorative Coin business likewise had a strong year, with turnover increasing by nearly 30% and delivering profits of £7.8 million. There was a marked increase in demand for bullion products in the second half of the year, possibly as investors turned to gold-based bullion products instead of traditional financial products.

The Commemorative Coin business is currently undergoing a transformation as the London 2012 Olympic Coin Programme gains momentum. In early 2009 the Royal Mint ran three competitions to find 29 new designs (one for each Olympic and Paralympic sport) for the 50p coin and was overwhelmed by the number of entries received. The phenomenal level of interest in the Olympics represents an excellent opportunity and it is anticipated that the London 2012 Olympic Coin Programme will be a significant revenue stream.

Mike Davies, Chairman of the Royal Mint, said:

"It is a very exciting time for the Royal Mint. Having built a successful and profitable business, the challenge for this year was to sustain our excellent recent performance and I am pleased this has been achieved. Whilst the Royal Mint continues to meet its primary obligation of supplying the United Kingdom with circulating coins, Andrew and his team have also focused on improving the Royal Mint's commercial operations, with the London 2012 Olympic Coin Programme being just one such example."

Andrew Stafford, Chief Executive of the Royal Mint, concluded:

"Royal Mint products are used by people not just in the UK but across the world every day in a way few other organisations can imagine.

"This has been another excellent year for the Royal Mint but we cannot afford to be complacent. The international downturn will pose challenges but we have a strong business and robust strategy in place to ensure this year's success can be sustained into the future."

- ends -

Notes

ROYAL MINT ANNUAL RESULTS

2008-09
£' 000

2007-08
£' 000

United Kingdom sales

76,787

75,441

Overseas sales

Total

82,222

159,009

56,338

131,779

Operating profit before exceptional items

8,205

9,649

Total assets less current liabilities at 31 March

64,377

67,052

1. The Royal Mint has a history dating back over 1000 years. By the late thirteenth century the organisation was based in the Tower of London, and remained there for over 500 years. By 1812, the Royal Mint had moved out of the Tower to premises on London's Tower Hill. In 1967 the building of a new Royal Mint began on its current site in Llantrisant, South Wales.

2. There were estimated to be 28.2 billion United Kingdom coins in circulation at 31 March 2009, with a total face value of £3.6 billion - allmanufactured by the Royal Mint.

3. 1.3 billion United Kingdom coins were issued during 2008-09.

4. Of the higher denomination coins, it is the 20p piece that is most in demand - with more than 2.4 billion now in circulation.

5. The Royal Mint Annual Report 2008-09 is available on the Royal Mint website

6. The responsible Minister for the Royal Mint is the Chancellor of the Exchequer who is, ex officio, Master of the Royal Mint. He has designated the Exchequer Secretary to assist him in the discharge of these responsibilities.

For further details please contact the Royal Mint Press Office on 020 7255 5478.