3rd Apr 2025 08:56
(Alliance News) - Coats Group PLC on Thursday said it plans to fully exit from the Performance Materials division's US Yarns business based in North Carolina.
The London-based manufacturer of industrial thread and footwear components said the decision follows a strategic review of the operation which started in the fourth quarter. This process has already resulted in the closure of the Toluca, Mexico facility in December.
The review concluded that the US Yarns business does not fit with Coats' future strategy.
Coats said the exit from the "non-core" operation will result in a positive annualised impact to both the PM division and group adjusted earnings before interest and tax margins.
The exit is expected to complete in the second quarter and is anticipated to generate a modest cash inflow, after closure costs.
Coats said the decision will allow management to focus on "driving forward and growing other parts" of the group's portfolio.
Shares in Coats Group fell 5.0% to 73.60 pence each in London on Thursday morning.
Coats has a significant presence in Asia, with operations and manufacturing facilities in countries like China and Vietnam, which were particularly hit by tariffs from the US on Wednesday.
By Jeremy Cutler, Alliance News reporter
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