REG - Coats Group PLC - Trading Statement

CoatsAnnouncement

20/11/2024 07:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20241120:nRST8619Ma&default-theme=true

RNS Number : 8619M  Coats Group PLC  20 November 2024

 

20 November 2024

Coats Group plc

 Trading Update

 

Continued momentum with double-digit sales growth - trading in line with
expectations

 

Coats Group plc ('Coats' or the 'Group'), the world's leading industrial
thread and global footwear component manufacturer, today announces a trading
update for the period 1 July to 31 October 2024 ('the period').

 

                        H1 2024 revenues  1(st) July to 31(st) October 2024 revenues vs same period in 2023
                        CER(1)            Reported                           CER(1)
 Apparel                14%               13%                                14%
 Footwear               7%                15%                                14%
 Performance Materials  -3%               -1%                                1%
 Group                                    10%                                11%

                        8%

 

All following references are at CER unless specified.

 

Following a strong first half, sales growth improved to 11% in the period (H1:
up 8%) with accelerating growth in Footwear and continued momentum in Apparel,
partly offset by sustained weakness in Performance Materials.

 

The Apparel and Footwear divisions continued to benefit from a return to
normalised levels of customer buying and inventory patterns, with both
divisions showing strong year-on-year growth of 14% (H1: up 14% and 7%
respectively), albeit against a weaker prior year comparator due to the impact
of destocking in 2023.

 

The Performance Materials division returned to growth in the period of 1% (H1:
down 3%) but remains impacted by lower order book activity in the personal
protection and composites sectors, particularly in the Americas. The lower
capacity utilisation in the Americas continues to negatively impact
Performance Materials margins.

 

As a result of the strong overall Group sales growth, alongside continued
delivery of our strategic projects, we expect to deliver a full year operating
margin of around 18%.

 

Cash generation remained good through the period, and we anticipate a year-end
leverage position, including the additional pension funding payment, of
1.6-1.7x, in line with previous guidance.

 

Our outlook is unchanged with full year performance expected to be in line
with market expectations. The Group remains well positioned for the medium
term, supported by good momentum in our Apparel and Footwear Divisions and
strong cash generation.

 

 

David Paja, Group Chief Executive said:

"It has been a pleasure to meet many of the Coats team and visit many of our
key sites in my first couple of months as CEO. This has confirmed my view that
we have a premium quality business, executing well with opportunities for
further improvement, and a strong platform for future profitable growth."

 

"In the four months to the end of October the Group continued to perform well,
led by Apparel and Footwear. We are confident in the Group's ability to
sustain this momentum through the final quarter and consequently in delivering
a full year performance in line with market expectations."

 

The Group will release its Full Year 2024 results on 6 March 2025.

_________________________________________________________________________________

Enquiry details

 Investors  Anjali Kotak                    Coats Group plc  +44(0)7880 471 350
 Media      Richard Mountain / Nick Hasell  FTI Consulting   +44 (0)20 3727 1374

 

_________________________________________________________________________________

 

(1.        ) Constant exchange rate (CER) figures are 2023 results
restated at 2024 exchange rates.

 

About Coats Group plc

Coats is a world leader in thread manufacturing and structural components for
apparel and footwear, as well as an innovative pioneer in performance
materials. These critical solutions are used to create a wide range of
products, including ones that provide safety and protection for people, data
and the environment. Headquartered in the UK, Coats is a FTSE250 company and a
FTSE4Good Index constituent. Revenue in 2023 was $1.4 billion.

Trusted by the world's leading companies to deliver crucial, innovative, and
sustainable solutions, Coats provides value-adding products including apparel,
accessory and footwear threads, structural footwear components, fabrics, yarns
and software applications. Customer partners include companies from the
apparel, footwear, automotive, telecoms, personal protection, and outdoor
goods industries.

With a proud heritage dating back more than 250 years and spirit of evolution
to constantly stay ahead of changing market needs, Coats has operations across
some 50 countries with a permanent workforce of more than 15,000, serving its
customers worldwide.

Coats connects talent, textiles, and technology, to make a better and more
sustainable world. Worldwide, there are four dedicated Coats Innovation Hubs,
where experts collaborate with partners to create the materials and products
of tomorrow. It participates in the UN Global Compact and is committed to
validated Science Based sustainability targets for 2030 and beyond, with an
aspiration of achieving net-zero by 2050. Coats is also committed to achieving
its goals in Diversity, Equity & Inclusion, workplace health & safety,
employee & community wellbeing, and supplier social performance. To find
out more about Coats visit www.coats.com
(https://nam11.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.coats.com%2F&data=05%7C01%7C%7Cd427f915c4a04c7a281808db0a8c12ed%7C048ff72770274cd0b672f075b0bdb973%7C0%7C0%7C638115368955536325%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=84xJl8cQryEvN50TOkTQnuGQiFTmWNiC4iTooOH29u0%3D&reserved=0)
.

Cautionary Statement

Certain statements in this interim report are forward-looking. Although the
Group believes that the expectations reflected in these forward-looking
statements are reasonable, we can give no assurance that these expectations
will prove to have been correct. Because these statements contain risks and
uncertainties, actual results may differ materially from those expressed or
implied by these forward-looking statements. We undertake no obligation to
update any forward-looking statements, whether as a result of new information,
future events or otherwise.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTQKCBBOBDDCDD