Completion of OrthoLite acquisition

30 October 2025

Coats Group plc

Completion of OrthoLite acquisition and new divisional structure

Coats Group plc ('Coats', the 'Group'), a world leading Tier 2 supplier of critical components to the apparel and footwear industry, today announces that, further to Coats' announcements on 16 July 2025 (the 'Acquisition Announcement') and 29 July 2025 (the 'Further Information Announcement'), following receipt of all required regulatory clearances, it has completed the acquisition of OrthoLite Holdings LLC ('OrthoLite'), the global market leader in premium insoles.

This acquisition strengthens the product portfolio and capabilities of the existing Coats footwear business through expansion into the attractive, high growth premium insole segment. OrthoLite is highly complementary, with significant overlap in customers, route to market and operational footprint, and opportunities to accelerate growth through innovation and cross-selling. In addition, the Group is targeting initial annualised joint cost synergies of $20 million available by 2028, leveraging Coats' experience of delivering significant value from footwear acquisitions.

For the purposes of UKLR 7.3.3, Coats confirms that there has been no material change affecting any matter contained in the Acquisition Announcement or the Further Information Announcement.

To reflect the new profile and scale of the Group's businesses, Coats is streamlining its organisational structure into two divisions: Apparel and Footwear. Following the exit from the non-core Americas Yarns business earlier this year, the remaining Performance Materials businesses are being incorporated within this new structure as follows:

· The Personal Protection and Performance Threads businesses (c.80% of Performance Materials) will become part of the Apparel division, which Adrian Elliott will continue to lead.

· The Telecom & Energy business (c.20% of Performance Materials) will become part of the Footwear division, alongside OrthoLite. The enlarged Footwear division will be led by Pasquale Abruzzese.

This new organisational structure better aligns the divisions and their underlying technologies and reduces internal operating complexity. The structural improvements in Performance Materials over the last 12 months, which have delivered substantial margin progression and a return to organic growth, will enable the reorganisation to be implemented efficiently. Coats' external reporting will align to this new structure with effect from the next financial year, the year ending December 2026.

Current Trading

The Group is also pleased to report that trading through the third quarter at both Coats and OrthoLite has continued to be in line with expectations. The Group will release its usual trading update for the four-month period from 1 July to the end of October 2025 on Friday, 7 November 2025.

David Paja, Group Chief Executive, commented:

"The acquisition of OrthoLite is an important step in our strategy to build a more growth-oriented group and we are delighted to welcome Glenn Barrett and our OrthoLite colleagues to Coats. We will now press ahead with our plans to accelerate innovation and sustainability in the footwear industry as we combine the capabilities of two global leaders in adjacent product categories."

Conference Call

Coats Management will host a presentation for analysts and institutional investors via webcast at 08:30 today. To access the meeting, please sign up using the following link: Coats Investor Meeting. The webcast can also be accessed via https://www.coats.com/en/investors/results/.

Enquiries

About Coats Group plc

Coats is a world-leading Tier 2 manufacturer and trusted partner for the apparel and footwear industries. We deliver essential materials, components, and software solutions that help our customers grow, compete and win.

With over 250 years of industry expertise, we're shaping the future of the apparel and footwear supply chain through insight-led innovation, impactful sustainability practices, and digital technologies that unlock better product quality, efficiency and performance.

Headquartered in the UK, Coats is a FTSE 250 company and a constituent of the FTSE4Good Index. In 2024, we generated $1.5 billion in revenue and employed 16,000 people worldwide - all united by a spirit of innovation, quality and service. Learn more at www.coats.com or follow us on LinkedIn.

Transaction Details

Coats has acquired OrthoLite Holdings LLC for an initial enterprise value of $770 million, representing a multiple of 10.0x EV / EBITDA1, reducing to less than 8.0x on a post-synergy basis. This includes $20 million of initial joint annualised cost synergies to be delivered by 2028. There is a further contingent payment of up to $10 million on 2025 EBITDA performance.

Cautionary statement

Certain statements in this full year report are forward-looking. Although the Group believes that the expectations reflected in these forward-looking statements are reasonable, we can give no assurance that these expectations will prove to have been correct. Because these statements contain risks and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

1EBITDA is LTM adjusted.