Coats Group PLC Trading Update (1989O)
May 16 2018 - 2:00AM
UK Regulatory
TIDMCOA
RNS Number : 1989O
Coats Group PLC
16 May 2018
16 May 2018
Coats Group plc
Trading update
Coats Group plc ('Coats' or the 'Company'), the world's leading
industrial thread manufacturer, announces a trading update for the
period 1 January to 30 April 2018 ahead of its Annual General
Meeting later today.
Year-on-year sales performance (January to April)
Reported CER * Organic **
Industrial 9% 6% 3%
Apparel and Footwear 6% 3% 3%
Performance Materials 24% 19% 4%
Crafts *** (4)% (4)% (4)%
Group 8% 5% 2%
* Constant exchange rate (CER) restates 2017 figures at 2018 exchange rates
** On a CER basis excluding contributions from bolt-on acquisitions
*** Includes North America and Latin America Crafts. Prior year
sales includes the impact of $10m lost sales in relation to the
Albany, GA, tornado in January 2017
Group sales for the period grew 5% year-on-year on a CER basis,
driven by a strong performance in the Industrial business (up
6%).
This growth was driven by continued momentum in the Apparel and
Footwear business (up 3%). In particular, the core thread business
grew robustly (up 4%) as key Asian markets performed strongly. The
Performance Materials business grew by 19% year-on-year, with 4%
organic growth and a 15% contribution from the acquisition of
Patrick Yarn Mill which has performed well and in line with our
expectations. Organic growth in Performance Materials was
underpinned by continued double-digit growth in hi-tech end uses
(for example, flame retardant yarns), with some weakness in certain
traditional end use segments in North America.
Crafts sales declined 4% on a CER basis. This was due to the
North American business, where market conditions remained tough,
alongside the adverse impact in the period of the introduction of
own-label handknitting products at a major customer (which
commenced in H2 2017).
Reported sales growth for the Group of 8% in the period was
above the CER growth of 5% due to the US Dollar weakening against
certain key trading currencies, for example the Chinese Yuan, Euro,
Indian Rupee and Mexican Peso.
Connecting for Growth programme
As announced in February, Connecting for Growth is a two year
transformation programme designed to drive speed, agility,
innovation and lower costs across the organisation, whilst enabling
the next phase of growth at Coats and accelerating our transition
from the industrial age to the digital age.
Encouraging progress has been made since February, and the
programme is on track. After reinvestments of c.$10 million per
annum, the programme is anticipated to deliver net annualised
operating cost savings of $15 million by 2020, as previously
announced.
Outlook
The Group continues to perform well, and anticipates delivering
2018 full year results in line with management's expectations.
Enquiry details
UK media Richard Mountain / Nick Hasell +44 (0) 20 3727 1374
Investors Rob Mann +44 (0) 20 8210 5175
This announcement contains inside information for the purposes
of the Market Abuse Regulation.
About Coats Group plc
Coats is the world's leading industrial thread manufacturer and
a major player in the Americas textile crafts market. At home in
some 50 countries, Coats employs 19,000 people across six
continents. Revenues in 2017 were US$1.5bn. Coats' pioneering
history and innovative culture ensure the company continues leading
the way around the world, providing complementary and value added
products and services to the apparel and footwear industries;
applying innovative techniques to develop high technology
Performance Materials threads and yarns in areas such as automotive
composites and fibre optics; and extending the crafts offer into
new markets and online. Headquartered in the UK, Coats is a FTSE
250 listed company on the London Stock Exchange. To find out more
about Coats visit www.coats.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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