3rd Aug 2015 08:15
LONDON (Alliance News) - Industrial thread and consumer textile crafts company Coats Group PLC on Monday posted a fall in pretax profit for the half year to the end of June, hit by declining sales in its struggling crafts business and by the stronger dollar.
Coats said its pretax profit for the half was USD30.4 million, down from USD49.8 million a year earlier. It booked a USD12.5 million exceptional cost in the first half related to the sale of its European, Middle East and Africa crafts business, but even stripping out one-offs, pretax profit fell to USD42.9 million from USD53.7 million.
The drop in profit was driven by lower revenue for the group in the half, as a 13% fall in revenue from its crafts business exacerbated lower sales by its industrial arm. Total revenue for the company was down to USD748.1 million from USD774.9 million, though this rose 4% on a like-for-like basis, which strips out the effect of the stronger dollar.
Industrial revenue, stripping out the effect of the stronger dollar against the euro in the half, was pushed higher by new products and market shares gains in apparel and footwear, but the crafts business continues to take a hit from reduced fashion handknitting sales.
The company is not paying a dividend for the half, the same as the year earlier.
"Consistent delivery of good levels of free cash flow provide a solid platform for ongoing investment in organic and inorganic growth opportunities. Supported by our defined growth strategy, key differentiators and strong underlying business performance, Coats is well positioned for 2015 and beyond," said Paul Forman, Coats' chief executive.
Shares in Coats were up 3.1% to 27.835 pence on Monday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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