Note Printing Australia Limited is struggling to reduce its dependence on the Reserve Bank, after revenue sourced from other central banks and its passport assembly business dried up last year.
Financial accounts for the 12 months to the end of June 2022 show that NPA derived more than 90 per cent of its revenue from the printing and supply of Australian banknotes to its parent, the Reserve Bank of Australia.
NPA charged the RBA A$121.8 million for banknote-related activities last year – up $46.5 million on 2022.
The company generated total revenue from ordinary activities of $133 million and a comprehensive net loss of $1.5 million.
Despite the large boost in Australian banknote revenue, NPA’s income from alternative revenue streams withered to less than $12 million amid a collapse in demand for local passports and negligible revenue from banknote production for foreign central banks.
This is a marked contrast to 2021, when the passport business and export banknote activities accounted for $35 million of NPA’s operating revenue.
Production of Australian passports has plummeted to only 400,000 a year since the global pandemic paralysed international travel two years ago. Before then NPA was assembling more than 2 million passports a year.
Disclosures in the notes of NPA’s latest accounts indicate that the company’s success in globalising its polymer note technology has yielded little in the way of material ongoing returns.
According to the NPA website, more than 50 countries, including the Bank of England and the Bank of Canada, have adopted Australia’s polymer banknote innovation.
Historically, NPA has printed polymer notes for central banks in Brunei, Malaysia and Singapore, but it is not clear from the company’s annual accounts whether these arrangements continue.
NPA has at least one active long term supply agreement with the Bank of Papua New Guinea.
A delegation of PNG central bank officials visited Australia in June to discuss matters relating to the agreement.
In an outlook statement included in the accounts, NPA’s board chaired by RBA Assistant Governor Susan Woods indicated that some export revenue would be realised in 2023 after the company secured supply contracts in Asia.
“From a demand perspective, NPA has confirmed orders from the RBA and overseas customers within the Asia region, the revenue from these orders currently offsets the impact of reduced demand for passports,” the board stated.
“NPA expects to maintain its strong cash balance and liquidity position.”