Banknote printer De La Rue warned of job cuts across the company after underlying profits dropped by nearly 70% to £33.3m.
The firm, which prints notes for the Bank of England and 150 other countries, added that a problem banknote contract that caused much of the profits shortfall, remains on hold.
It suspended production on the contract, rumoured to be with the Reserve Bank of India, last July after it claimed some employees falsified paper specification test certificates for the contract.
The firm took a £29m charge in the last financial year for the contract, but added that, as talks are still ongoing with the customer and other relevant authorities, it cannot yet assess the full financial impact.
The problems in the paper production division were a major cause of the profits shortfall, but there was also a weakness in demand for banknotes generally.
Revenues for the year to March fell 17% to £464m, while bottom-line pre-tax profits dropped 25% to £72.8m, helped by the sale of its stake in lottery operator Camelot.
The company has 4,000 staff worldwide, including at sites in the UK at Overton in Hampshire, where the problems with the bank note contract surfaced, and Loughton in Essex, Gateshead, Bathford, Dunstable and Westhoughton, Lancashire.
It aims to cut £30m of costs over each of the next three years but said it was too early to comment on where jobs might be lost.
Chief executive Tim Cobbold said he thought that job losses were "inevitable".