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Published
Jul 31, 2018
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Coats Group sees revenue, profit growth

Published
Jul 31, 2018

Thread manufacturer Coats Group has reported a 7% increase in revenue despite mixed demand from retailers, as the acquisition of a yarn mill in the US helped lift growth.


Coats Group plc


The group supplies threads, zips and trims to the clothing, footwear and automotive industry.

In a statement released on Tuesday, it said revenues edged up 7% to $788 million on the first half of 2018, with adjusted operating profit growing 13% to $100m (12% on a CER basis).

The acquisition of Patrick Yarn Mill, a US-based manufacturer of high-performance engineered yarns, in December 2017 contributed to a 3% increase in total revenue. Meanwhile, the group’s apparel and footwear division saw “continued strong revenue performance”, up 4%.

The momentum in the apparel and footwear business was attributed to the launch of a new Coats.com website and a series of enhancements to the customer facing e-commerce platform, two measures that helped the company deepen its relationships with retailers and brand owners.

Additionally, revenue growth was further supported by the launch of an engineered footwear yarn solution for China and strong demand for the group’s 100% post-consumer recycled thread.

“We have continued to outperform the market in Apparel and Footwear despite continued mixed demand from retailers by maintaining our customer-led approach to service, digital solutions and corporate social responsibility,” said group chief executive Rajiv Sharma.

“Our customers require an increased emphasis on speed, quality, value, innovation and corporate responsibility. To accelerate our transition from industrial to digital, we launched the Connecting for Growth transformation programme in February, which will support our next phase of development.”

The chief executive said the programme, aimed at driving speed, agility and innovation across the organisation, made an encouraging start and was realising benefits faster than initially anticipated. As a result, the group anticipated delivering a full year performance slightly ahead of previous expectations.

The company announced an interim dividend of 0.50 cents per share.

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