The plan is to replace the Iraqi currency

The Essex-based firm, which is the official printer of UK banknotes, said it had delivered the order for Iraqi dinars ahead of schedule.

Its shares surged more than 6% on the news, which it said would help it deliver better-than-expected first half profits.

The interim US authority placed an order for new banknotes after it was forced to take the embarrassing step of printing currency bearing the image of Saddam Hussein.

Urgent need

A spokesman for De La Rue refused to say what image would be on the notes, but said it would not be the former dictator.

New banknotes are urgently needed to plug the shortage of local currency on the streets of Iraq, where the exchange rate with the US dollar is about 0.0016.

The BBC's Shelley Thakral, in Baghdad, said the removal of Saddam Hussein's image would have great symbolic value for Iraqis.

"If you travel around Iraq, you just don't see his face any more, so not to have his face on currency is a big deal," she said.

She said speculation in Baghdad was that the new notes would feature "cultural and architectural" scenes.

De La Rue announced in July it would lead a consortium of global currency specialists to make new banknotes for Iraq.

De La Rue is one of the first British firms to benefit from the multi-billion dollar drive to rebuild the shattered country after the US-led invasion.

Its shares, which plunged in late 2002 and early 2003 on a string of profit warnings, were 6.1% higher at 306.5p in late trade on the London stock exchange.

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Paul Jones, an analyst at Numis Securities, said early delivery of the Iraqi banknotes did not change the value of the contract, which analysts have estimated at up to �8m.

But he said it proved the firm was operating efficiently and was on track to meet his full-year profit forecast �39m.

The Iraq order came as welcome news to De La Rue shareholders, who had seen the value of their investment plunge by around two-thirds since June 2002.

The firm has been hit by weakness in its cash systems unit, which sells counting and sorting machines to banks and financial institutions.