REG - Coats Group PLC - Trading Statement

CoatsAnnouncement

23/11/2021 07:00

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RNS Number : 1973T  Coats Group PLC  23 November 2021

23 November 2021

Coats Group plc

Trading update: 6% organic revenue growth vs 2019, on track for Full Year
expectations

Coats Group plc ('Coats', the 'Company' or the 'Group'), the world's leading
industrial thread manufacturer, today announces a trading update for the
period 1 July 2021 to 31 October 2021 ('the period'). Given the exceptional
circumstances of 2020, we include 2019 detail in this statement.

 

·      6% organic growth vs 2019, despite Covid disruption in Vietnam
during the period, which has now subsided

·      Pricing and productivity actions continue to offset inflationary
pressures

·      Performance for the year anticipated to be in line with Group
expectations

 

                         July to October Revenue vs 2020  July to October Revenue vs 2019
                         Organic(2)                       Organic(3)
 Group                   22%                              6%
 Apparel & Footwear      25%                              5%
 Performance Materials   17%                              8%

 

All following references are on an organic CER basis.

 

Strong organic Group revenue performance for the period, up 22% year-on-year,
and up 6% versus 2019 (H1 up 1%).

 

Strong operational performance, demand recovery, market share gains and
customer wins have continued, despite recent lockdown impacts in Vietnam which
have now subsided. The lessons learnt from shutdowns around the globe in 2020
mean the Group continues to be well-placed to manage regional Covid disruption
as our global footprint and organisational agility allow many of our customers
to be supported from other manufacturing sites.

 

Apparel & Footwear grew 5% vs 2019 (vs flat in the first half). We
continued to see positive end market sentiment across the US, Europe and Asia.
Sports and athleisure continued to perform well.

 

Performance Materials grew 8% (organic) vs 2019; all segments continued to
perform strongly apart from US Personal Protection which has a healthy demand
pipeline but continues to be impacted by US labour availability issues.

 

Pricing and procurement actions and self-help productivity programmes continue
to offset heightened inflationary pressures in the supply chain (raw
materials, energy, labour and freight inflation).

 

Outlook

 

Given the Group's continued positive trading we anticipate performance for the
Full Year 2021 to be in line with our expectations.

 

For the remainder of the year, and into 2022, we will continue to drive
profitable revenue growth by focusing on our strong customer relationships,
our digital, innovation and sustainability credentials and ongoing pricing and
productivity actions.

 

The Group will release its Full Year 2021 results on 3 March 2022.

 

 (1)  (Constant Exchange Rate (CER) are 2020 and 2019 results restated at 2021
      exchange rates;)
 (2)  (Organic on a CER basis includes like-for-like contributions from Pharr HP
      (post acquisition date of February 2020);)
 (3)  (Organic on a CER basis includes like-for-like contributions from Threadsol
      (post acquisition date of February 2019) and excludes contribution from Pharr
      HP (acquired in February 2020))

 

( )

Appendix:

 

                         July to October Revenue vs 2020        July to October Revenue vs 2019
                         Reported     CER(1)       Organic(2)   Reported     CER(1)       Organic(3)
 Group                   22%          22%          22%          9%           11%          6%
 Apparel & Footwear      25%          25%          25%          4%           5%           5%
 Performance Materials   16%          17%          17%          26%          29%          8%

                         YTD Revenue vs 2020                    YTD Revenue vs 2019
                         Reported     CER(1)       Organic(2)   Reported     CER(1)       Organic(3)
 Group                   31%          30%          29%          6%           8%           3%
 Apparel & Footwear      35%          34%          34%          0%           2%           2%
 Performance Materials   20%          20%          18%          24%          26%          6%

( )

 

_________________________________________________________________________________________

 

 Enquiry details
 Investors        Victoria Huxster                Coats Group plc  +44 (0)7880 471 350
 Media            Richard Mountain / Nick Hasell  FTI Consulting   +44 (0)20 3727 1374

_________________________________________________________________________________________

 

About Coats Group plc

Coats is the world's leading industrial thread company. At home in some 50
countries, Coats has a workforce of 17,000 people across six continents.
Revenues in 2020 were US$1.2bn. The pioneering history and innovative culture
of Coats ensure it leads the way around the world. It provides complementary
and value-added products, services and software solutions to the apparel and
footwear industries. It applies innovative techniques to develop high
technology Performance Materials threads, yarns, fabrics and composites in
areas like personal protection, telecoms, energy, transportation, and
household and recreation. Headquartered in the UK, Coats is a FTSE 250
company, a constituent of the FTSE4Good Index Series, a participant in the UN
Global Compact and a member of the Ellen MacArthur Foundation. It has also
committed to developing a long-term target to reach net-zero emissions by
2050, the highest level of ambition on climate under the Science Based Target
initiative.

 

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