22nd Nov 2019 09:06
(Alliance News) - Coats Group PLC said Friday that challenging market conditions have led to slower sales performance.
The industrial thread manufacturer said sales growth for the financial year to October 31 was 1% at constant exchange rates, driven by growth in Apparel and Footwear and Performance Materials businesses.
For the four months from July to October sales were flat at constant currencies, reflecting "slightly lower" activity in both Apparel & Footwear and Performance Material businesses, against the "strong growth" of 4% in the comparative period in 2018, Coats said.
On a reported basis, sales in the period were down 1% year-on-year, an improvement on the 3% decline in the first half. "This was largely due to the anticipated softening of the foreign exchange translation headwinds that we entered 2019 with," the company said.
Apparel & Footwear business was flat in the period, up 1% for the year-to-date, as underlying retail markets remained mixed. Meanwhile Performance Materials business sales for the period were in line with 2018, "maintaining performance after a strong period of growth of 10% for the same period last year", the company said.
"The challenging market conditions have led to a slower sales performance in the period and as a result we now expect to deliver adjusted operating profit of USD196.0 million - USD201.0 million in 2019," the company said.
"The group will continue to drive performance through a focus on customer service and building on its innovation and digital capabilities, supported by its self-help initiatives," Coats said.
Coats shares were down 8.8% in London at 67.50 pence each on Friday.
By Loreta Juodagalvyte; [email protected]
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