Examination of Witnesses (Questions 77
- 79)
WEDNESDAY 21 OCTOBER 2009
MR ANDREW
STAFFORD AND
MR ADAM
LAWRENCE
Q77 Chairman:
Can I welcome you both. Could you introduce yourselves formally,
please?
Mr Stafford: Good afternoon. I
am Andrew Stafford, the Chief Executive of the Royal Mint. I have
at this moment to make an apology. Mike Davies is the Chairman,
but unfortunately he has been unable to make the Committee hearing
because the train service from Coventry was cancelled due to a
fatality on the line. We have advised that Adam Lawrence, the
Finance Director, was the other witness who was attending, and
Adam has made it, but Mike Davies will not be attending and he
will be writing to you to send his personal apologies, but it
was unavoidable.
Q78 Chairman:
Okay. Your profits are down and your rate of return is down. Why
is that?
Mr Stafford: The answer is that
our turnover grew year on year—
Q79 Chairman:
No, the profit I asked you about.
Mr Stafford: Forgive me, I am
just about to say that the mix of our business did change quite
substantially year on year, particularly in the commemorative
coin business where a lot of the turnover in the last twelve months
was from bullion coin as people sought to buy more gold coins
at a much lower margin than our collector coins. So our growth
in turnover was not comparable with the growth in margins from
our commemorative coin business. Therefore, we have seen a reduction
in our profitability of the percentage of sales but our return
on average capital employed, which is our key measure, clearly
performed very well.
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