BANKNOTE and anti-counterfeiting business OpSec has issued a profits warning on the back of what it calls an extremely difficult second half.

The Washington-based company, which also has offices in the US, Europe, Hong Kong and the Dominican Republic, put out the statement warning that its full-year profits would be well below last year’s.

It said: “Trading conditions during the traditionally stronger second half of the year have, to date, been extremely difficult.

“Overall, earnings for the current financial year are now expected to be substantially lower than last year.”

For OpSec, which has around 85 staff at its Washington head office and 280 globally, the financial year ends on March 31.

The profits warning comes after the company returned to profit in its previous financial year. It posted a £1.2m pre-tax profit in 2011, compared to a £262,000 loss in 2010.

The company’s revenues increased by 15% to £40.4m in the 2010/11 year, while its operating profits more than doubled to £3.4m from £1.6m.

It said that it appeared to have surmounted the effects of the recession and there was a significant pipeline of opportunities in sight, but conversion of these would be essential because a higher-than-usual number of contracts were coming to an end.

However, despite its most recent interim turnover rising to almost £20m, OpSec made a £1.72m pre-tax loss in the first half of its year after being hit with a £1.96m exceptionals charge.

Over the past year, OpSec had been aiming to raise further cash for investment by trying to persuade shareholders to back a £28m takeover bid by Orca Holdings.