2023 Full Year Results

  • 07 March 2024

7 March 2024 (07.00 BST) Coats Group plc (‘Coats,’ the ‘Company’ or the ‘Group’), the world’s leading industrial thread and footwear components manufacturer, announces its audited results for the year ended 31 December 2023.


Strong EBIT margin performance – 17% achieved in H2 – one year ahead of 2024 target with continued market share gains

Continuing operations FY 2023 FY 2022 4 FY 2023 vs FY 2022
    Reported CER Organic
   Revenue $1,394m $1,538m -9% -6% -14%
Adjusted 1          
   EBIT 6 $233m $233m 0% 4% -4%
   Basic earnings per share 8.0c 8.0c 0%    
   Free cash flow $131m $114m      
   Net debt (excl. lease liabilities) $384m $394m      
Reported 2          
   EBIT 6 $184m $181m 2%    
   Basic earnings per share 5 5.2c 4.8c 7%    
   Net cash generated by operating activities $124m $96m      
   Final dividend per share 7 1.99c 1.73c      

Strategic Highlights

  • Continued outperformance against the industry - market share gains in Apparel and Footwear of c.200bps each
  • Clear global market leader in 100% recycled thread products - revenue grew 44% to $172 million at constant currency, despite lower industry volumes
  • Strategic projects delivered further $37 million of accelerated savings, with overall savings on track for $70 million by 2024, for $35-40 million, considerably less than previous guidance of $50 million cash cost
  • Integration synergies from Texon and Rhenoflex has delivered a total of $16 million savings to date ($19 million annualised), well ahead of pre-acquisition expectations ($11 million by 2024)
  • Received Great Place to Work accolade – recognised as one of the world’s top 25 places to work
  • “Off trigger” activated for UK pension scheme, resulting in £2 million per month cash savings in 2024; working towards full pension scheme de-risking in the medium term

Financial Highlights

  • Reported revenue down 9%
  • Organic revenue 14% lower, on improving trend (H1: 19% lower; H2 10% lower) with:
    • Continued outperformance versus industry - Apparel and Footwear markets estimated c.20% lower
    • Apparel brand inventory levels normalised; gradual recovery trend underway
    • Footwear recovery lagging Apparel as destocking commenced later
    • Performance Materials largely reflects customer contract insourcing and US customer phasing issues
  • Achieved 2024 Group adjusted EBIT margin target 17% in the second half, one year ahead of plan
  • Strong adjusted free cash flow of $131 million, despite lower sales volumes, including well-managed working capital
  • Net debt (excluding lease liabilities) lower at $384 million with 1.5x leverage 3, in the middle of our 1-2x target range
  • Proposed final dividend of 1.99 cents, +15%, resulting in full year dividend of 2.80 cents, +15%; reflecting the Board’s confidence in growth strategy and future performance


The Group expects to make good progress in 2024 underpinned by modest revenue growth, with a weighting to the second half, as Apparel and Footwear gradually recover, and with increasing tender activity in Performance Materials. Our continued focus on controlling our costs, including the benefits of strategic projects, increases our confidence in achieving our 17% Group EBIT margin target in 2024.

The Group’s long term track record of outperforming the markets we serve is based on our scale, global footprint, innovation, strong digital platform and technical support capabilities, all of which are becoming more relevant to customers and supportive of our revenue growth ambitions. We expect these growth drivers to be augmented by a gradual market recovery and by continued investment in sustainability and operational efficiency which together give us confidence in delivering strong profit growth and cash generation over the medium term.

Commenting on the results Rajiv Sharma, Group Chief Executive, said:

“There is much to be confident about in Coats' trading performance in the year. Against the backdrop of widespread industry destocking, we gained market share, grew our margin and our adjusted free cash flow. We have also seen that the consumer in general has remained resilient in these challenging markets, albeit with variation by territory.

Encouragingly, as the year progressed sales trends improved, in part due to the timing of the commencement of the current destocking cycle last year. Second half organic revenue was 10% lower compared to a 19% decline in the first half. This improving H2 trend was driven by Apparel, where there is evidence that customer inventory levels are normalising. Within this result, we remain the clear global market leader in 100% recycled thread, reflected in increased revenue of 44% at constant currency, despite lower volumes across the industry.

Our margin increased 160bps to 16.7% (2022: 15.1%) and we achieved our 2024 17% margin target in the second half of 2023, one year ahead of plan. This strong performance, despite the market conditions, was in part driven by savings from our strategic projects, as well as our acquisition-related synergy activities, and supplemented by a rigorous focus on cost control.

We are particularly pleased with our strong cash generation. We increased our adjusted free cash flow to $131 million in the year, reflecting tight cash management and well-managed working capital.

Our leadership position in industrial threads and footwear components, when combined with our investment in innovation and sustainably-sourced and manufactured products, positions us well to grow our revenue and margin and deliver ongoing strong cash generation in line with our strategy.”

1. Adjusted measures are non-statutory measures (Alternative Performance Measures). These are reconciled to the nearest corresponding statutory measure in note 14. Constant Exchange Rate (CER) metrics are 2022 results restated at 2023 exchange rates. Organic figures are results on a CER basis, and only includes like-for-like contributions from Texon and Rhenoflex post their respective acquisition dates.

2. Reported metrics refer to values contained in the IFRS column of the primary financial statements in either the current or comparative period.

3. Leverage calculated on a frozen GAAP basis and therefore excludes the impact of IFRS 16 on both adjusted EBITDA and net debt. See note 14b for details.

4. Restated to reflect the results of the EMEA Zips business, divested in 2023, as a discontinued operation. This has resulted in a reduction in previously reported 2022 revenues of $46 million and $2 million adjusted EBIT.

5. From continuing operations.

6. EBIT (Earnings before interest and tax) relates to Operating Profit as shown on the face of the P/L.

7. Total dividend per share 2.80 cents.

Conference Call

Coats Management will present its full year results in a webcast at 10.00 GMT today (Thursday, 7 March 2024). The webcast replay can be accessed via www.coats.com/investors/fy2023.

Enquiry details
Investors Julian Wais Coats Group plc +44 (0)797 497 4690
Media Richard Mountain / Nick Hasell FTI Consulting +44 (0)20 3727 1374

About Coats Group plc

Coats is a world leader in thread manufacturing and structural components for apparel and footwear, as well as an innovative pioneer in performance materials. These critical solutions are used to create a wide range of products, including ones that provide safety and protection for people, data and the environment. Headquartered in the UK, Coats is a FTSE250 company and a FTSE4Good Index constituent. Revenue in 2023 was $1.4 billion.

Trusted by the world's leading companies to deliver crucial, innovative, and sustainable solutions, Coats provides value-adding products including apparel, accessory and footwear threads, structural footwear components, fabrics, yarns and software applications. Customer partners include companies from the apparel, footwear, automotive, telecoms, personal protection, and outdoor goods industries.

With a proud heritage dating back more than 250 years and spirit of evolution to constantly stay ahead of changing market needs, Coats has operations across some 50 countries with a permanent workforce of more than 15,000, serving its customers worldwide.

Coats connects talent, textiles, and technology, to make a better and more sustainable world. Worldwide, there are four dedicated Coats Innovation Hubs, where experts collaborate with partners to create the materials and products of tomorrow. It participates in the UN Global Compact and is committed to Science Based sustainability targets for 2030 and beyond, with an aspiration of achieving net-zero by 2050. Coats is also committed to achieving its goals in Diversity, Equity & Inclusion, workplace health & safety, employee & community wellbeing, and supplier social 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.

Group Chief Executive’s review

Purpose and Strategy

Coats is the world’s leading industrial thread and footwear components company. Our purpose is to connect talent, textiles and technology to make a better and more sustainable world. Our strategy is to accelerate profitable sales growth by leveraging innovation, sustainability, digital technologies and our global scale to create world class products and services, delivering value to our stakeholders.

2023 Full Year Results Overview


We are proud that our 2023 financial performance has delivered many positives, despite a challenging market back drop. We are also proud to have been included in the list of the top 25 World’s Best Workplaces by Fortune and Great Place to Work during the year, which is based on an assessment of a range of employee-related factors and attributes.

Reported revenue was 9% lower, in a year that saw widespread industry destocking. Group organic revenue was 14% lower, including like-for-like contributions from Texon and Rhenoflex post their respective acquisition dates. This was an improving trend compared to the first half performance, which was 19% lower on an organic basis. Within this destocking cycle, which was brought about by the impacts from post-COVID supply chain disruption, the consumer has continued to be resilient.

The improving H2 organic trend was driven by Apparel (organic revenue 12% lower in the full year; H1 20% lower) where there is evidence that the anticipated gradual market recovery is underway as customer inventory levels normalise. Destocking commenced later in Footwear, and here the recovery is lagging that of Apparel (organic revenue 16% lower in the full year; H1 23% lower). Performance Materials (organic revenue 17% lower in the full year; H1 14% lower) experienced a lower level of cyclical destocking than Apparel and Footwear. However, it was adversely impacted by customer insourcing of production and previously disclosed customer phasing issues in some US end markets.

While we cannot control the industry backdrop, we are extremely pleased with our continued ability to gain market share. In Apparel we estimate our global market share grew in the year to c.25% (2022: c.23%), an increase in share of c.200bps. In Footwear we estimate our global market share also grew by c.200bps to c.27% (2022: c.25%), with both footwear threads and structural components contributing. Performance Materials offers specialist products across multiple end markets and delivered significant new contract wins in the year, in particular with premium automative OEMs and tier one suppliers. These market share gains across the Group are testament to the strategy we have been pursuing. Our global presence, leadership positions, quality products, flexibility and responsiveness to customers enables us to align ourselves with many of the fastest-growing global brands. This means we can deepen existing relationships, as well as grow our customer portfolio. These brands benefit from our efficient digital platform and technical support capabilities, as well as our ongoing investment in innovation, and a growing portfolio of sustainable products. Our focus on making our own operations sustainable gives brands added confidence to do business with us. This is proving to be a winning formula.

We have also worked hard to deliver further savings in our operations, and we have produced another strong performance. In the face of significantly lower volumes, our adjusted EBIT margin for the full year increased 160bps to 16.7% (2022: 15.1%). We are pleased to have achieved our 2024 17% Group adjusted EBIT margin target in the second half of 2023, one year ahead of plan. As a result, adjusted EBIT was maintained at $233 million (2022: $233 million), despite the significant revenue reduction. The outstanding margin performance was driven in part by savings from our strategic projects, as well as our acquisition-related synergy activities. Our strategic projects delivered accelerated in-year savings of $37 million, taking the cumulative total to $57 million. We continue to expect to deliver cumulative strategic project savings of $70 million in 2024, in line with our guidance. Our acquisition-related synergies have delivered a total of $16 million of synergies by the end of the year (annualised $19 million), well ahead of our pre-acquisition expectations ($11 million in 2024). Away from these projects, our focus on good cost control and driving day-to-day savings has been constant, including the delivery of significant procurement savings, and this has also contributed to the strong margin. Reported EBIT was $184 million (2022: $181 million), which is after exceptional and acquisition-related items largely in relation to the execution of our strategic projects and our 2022 Footwear acquisitions.

We have also maintained an effective pricing strategy, adapting to market conditions as overall inflation rates have begun to reduce. This has helped us deliver both market share gains and margin enhancement. Input costs have moderated in some areas, including lower raw material prices and freight, and we will continue to adapt our pricing strategy accordingly. Customer loyalty is linked to the quality and differentiation of our products, our high levels of customer service and, in some cases, by the degree with which we are integrated with customer systems and processes.

As we had hoped, we are also starting to see success from the cross-selling of our enhanced range of Footwear capabilities to customers, following the 2022 acquisitions. This bodes well for future growth in this division. We continue to see a number of opportunities to be a ‘one-stop shop’ for our customers’ needs.

Our focus on margins also helped us deliver strong cash generation. We delivered increased adjusted free cash flow in the year of $131 million (2022: $114 million), reflecting tight cash management, including well controlled working capital. We ended the year with reduced net debt (excluding lease liabilities) of $384 million (2022: $394 million), and leverage at 1.5x net debt/EBITDA. This continues to be in the middle of our target range of 1-2x net debt/EBITDA.

In December 2023, we activated the agreed “off trigger” mechanism to suspend deficit repair payments for our UK defined benefit pension scheme, following a one-off £10 million payment. As a result, 2024 cash generation will include a £2 million per month tailwind, while deficit repair payments remain switched off, resulting in a c.$30 million cash flow benefit for the business over a full year. We continue to work towards fully de-risking the UK pension scheme over the medium term.

Strategic Projects

Our strategic projects were announced in March 2022 to optimise our footprint, lower our cost base and deliver operating efficiencies, as well as mitigate structural labour availability issues in the US. In part, our success in driving these projects forward and accelerating the delivery of savings has contributed to the strength of our margin during a period of industry-wide volume headwinds, and has put us in an excellent position to benefit from market recovery.

During 2023, we accelerated delivery of savings from these projects with $37 million achieved in the year, amounting to a total of $57 million of savings since 2022. We continue to expect to deliver total savings of $70 million by 2024. We now expect to deliver these savings for $35-40 million, considerably less than the previous guidance of $50 million cash costs (cumulative cash costs to date of $26 million, net of $11 million property proceeds).

During the year, our initiatives continued in Performance Materials’ US and Mexico operations to optimise our footprint, deliver operating efficiencies and mitigate US structural labour availability issues. Following on from the opening of our new, Mexican state-of-the-art facility at Huamantla towards the end of 2022, and investment in our existing site at Orizaba in 2023, our second new plant at Toluca, Mexico commenced pilot production towards the end of the year. Production at this site will increase gradually during 2024. With production and operations being transferred progressively from the US, we have also been reducing and consolidating our US footprint from five sites to two, and this process is continuing in 2024.

The other major focus of our strategic projects has been the transformation of our Asian operations, with a particular focus on China and India. This project has optimised our footprint and efficiency in our long-established Indian operations, while bringing a greater focus to the increasingly important domestic market in China, where there are opportunities with local brands. In India, work has been undertaken to consolidate warehouse and office space, with a reduction in headcount enhancing efficiency. In China, we have reorganised the Shenzhen facility, improved its lay out and reduced headcount. The outsourcing of zip production in China was also completed before the end of the year, as expected. Finally, we have commenced the consolidation of our under-utilised UK-based footwear production site into our existing site in Indonesia. With increasing numbers of customers setting-up in-country, this will move us closer to customers and lower production, energy and freight costs, as well as reduce CO2e emissions.

Alongside our strategic project footprint actions, we have continued to review our overall portfolio to ensure we remain focused on the most attractive markets, where we have leading positions. As part of this initiative, we divested the small operations in Madagascar and Mauritius in January 2023, as well as completing the divestment of our European Zips business on 31 August 2023, for a cash consideration of around $1 million on a debt free basis.

Footwear Acquisitions

Our 2022 acquisitions of Texon and Rhenoflex, combined with our existing footwear thread business, has made us the leading global supplier of threads and structural components to the footwear market.

Not only do we have a strong market position with the benefits of scale, but we also have a focus on fast-growing sports and athleisure brands which attract premium pricing. Our brand-specified positions have considerable longevity, typically lasting through the life of the product. As described in more detail below, our Footwear business – consistent with the predecessor brands – has a focus on innovation and sustainability, with a leading portfolio of sustainable products. This also enables growth ahead of the market.

One of the many attractions of combining these businesses has been the potential to cross-sell our enhanced range of products to customers, with whom we have longstanding relationships. We are now beginning to see the initial benefits of our cross-selling efforts. For example, we have succeeded in adding structural components to a well-known US performance brand’s footwear product, where we already supply thread. In addition, we have achieved similar success with two leading Chinese brands. We have also ‘upsold’ our Rhenoprint,™ sustainable structural component process to a mid-market global sports wear retailer, who is an existing structural component customer.

Our Footwear scale, position and exciting range of products enabled us to increase our market share in the year despite lower volumes across the industry. This positions us well for when the market recovers.

Our cross-selling and market share gains have been achieved while we have been focusing on completing the initial phase of business integration. At the time of acquisition, we expected to deliver $11 million of annualised cost savings in 2024 from combining the businesses. These savings principally relate to the consolidation of duplicated roles and back-office functions, and the delivery of procurement savings. We have delivered a total of $16 million of savings by the end of the year (annualised $19 million), well ahead of our plan. Having increased the adjusted EBIT margin from 12% pre-acquisition to a 16% margin in 2023, we have achieved a margin that is consistent with our pre-acquisition business case, despite much lower volumes in the market during the year. This outcome is the result of the actions we have taken, including integration synergies, pricing and mix-effects as well as continuous improvement activities.

Strategic Enablers: Innovation, Sustainability and Digital

Our strategic enablers are Innovation, Sustainability and Digital and these underpin our strategy to accelerate profitable sales growth while delivering sustainable value to our stakeholders. We have continued to progress our enablers during the year, with pleasing results.


Our innovation drives product differentiation and profitable growth. It is carried out in collaboration with customers and derived from our long-term technology roadmaps. The primary focus of our innovation is sustainability, most notably around the adoption of products made from recycled products and bio-materials. However, it also encompasses more efficient production techniques, increasingly lightweight products with enhanced protective characteristics, and end-of-life recycling technologies.

Examples of our innovation, which have been recently launched, include the following:

  • Verde - a bio-based and biodegradable solution for environmentally conscious designers. It is made from sustainably sourced wood pulp, plant-based binders and natural pigments. Being lightweight, tear resistant and easy to handle, this versatile material can be used in a wide variety of fashion and homeware accessories, and is vegan-friendly.
  • Cycle - a circular upcycling process for taking leather scraps from the production process and re-using them in new products, to minimise waste. This is a first for the industry and has application in the luxury goods sector, in particular.
  • EcoRegen - a range of 100% lyocell threads made from sustainably sourced wood pulp, for a range of apparel applications. It is fully biodegradable and compostable due to its cellulosic origin. It demonstrates outstanding comfort characteristics as well as a reduced carbon footprint, dry and wet strength and superior elongation characteristics.
  • FlameProTM High Visibility - an inherently flame resistant, high-visibility fabric that is one of the lightest protective fabrics of its kind, making it easy and comfortable to wear in a work environment. The product includes renewable fibres and does not need dyeing, making it more sustainable than any comparable product on the market today.

We manage our innovation strategy for the long term, with individual product developments often multi-year from inception to launch. We have continued to invest in innovation through the current destocking cycle, with ongoing investment meaning we continue to have a product portfolio that is well-positioned to benefit from our evolving markets, as consumer and customer requirements change.


Sustainability is at the very heart of our business. It encompasses the products we create and sell through innovation, as well as how we manage our operations. Our investment in sustainability is a compelling proposition to the increasing number of brands who demand sustainable products, driven by consumer sentiment. These brands also want to align with a supply chain having compliant, sustainable operations. This investment therefore helps us increase our market share over time, as well as reduce our costs, as we become more efficient and use less resources.

We have set medium term targets to help us reach our Net Zero commitment by 2050, with our Net Zero targets submitted for SBTi approval during 2023. Our Net Zero commitment will be achieved initially through our 2030 SBTi goals, which are to reduce our scope 1 and 2 emissions by over 46%, with scope 3 reduced by 33% over the same time frame. By 2030 we also aim to have 70% of our global energy consumption from renewables and all our products sourced sustainably, eliminating the use of all product made from new, oil-extracted materials. To achieve this we are adopting a circularity approach, creating products and packaging solutions that enable recycling and reuse, within our own operations and across the wider garment industry.

In March 2023, we announced new and challenging interim sustainability targets for 2026, using an 2022 baseline 1. The seven targets reflect the ongoing focus on our people, water, emissions and waste reduction categories, as well as product innovation and materials transition. We have improved our performance against these targets during 2023, in relation to the prior year baseline. In particular, we have met our 2026 target for reduction in scope 1 and 2 CO2e emissions, albeit this was impacted by lower production volumes during the year.

Materials transition is an important metric, as it enhances our revenue growth and reduces our Scope 3 CO2e emissions. In line with GHG Protocols, we have changed our disclosure approach for the first time from recycled sales revenue to a materials transition approach, based on the volume of primary raw materials that we purchase. This has expanded our disclosure to cover more sustainable end-use categories for sewing thread, as well as footwear component materials. During the year, the proportion of sustainable materials within our overall production increased to 29%, (2022: 25%) driven by increased recycled polyester fibres and filaments in our thread products. Our target is to transition to 60% of sustainable primary raw materials by 2026, and 100% by 2030. We remain the clear global market leader in the sales of 100% recycled thread products and our 2023 revenue increased by 44% to $172 million at constant currency, in a year of lower production volumes across the industry.

During 2023 we inaugurated our new Sustainability Hub in Madurai, India. This unit has a full range of upstream processing equipment that will allow it to take new, more sustainable, raw material types and process them into innovative threads. The Hub has a number of partnerships already in place, with more to come, working closely with established companies and start-ups that have innovative material solutions that meet our criteria.

The Madurai Sustainability Hub has built a strong team of sustainability and innovation experts and professionals and recruited and trained local talent from various fields, such as textile engineering, chemistry, biotechnology, design, marketing, and management. It collaborates with external partners, such as universities, research institutes, NGOs, and industry associations, to access the latest knowledge and technologies. The Hub works closely with our established Innovation Hub in Shenzhen, China, which takes threads developed in Madurai and turns them into prototype finished products. Many of the developments under way relate to innovative bio-materials, but work is also being undertaken on recycled or more sustainable plastic-based materials.

Reflecting the progress we made driving sustainability during 2022, we received an improved Carbon Disclosure Project (CDP) Climate Change rating in February 2024 of B (previously B-). Our CDP Water rating remained at B.

We are proud to have been included in the list of the top 25 World’s Best Workplaces by Fortune and Great Place to Work (GPTW) in November 2023. To put this achievement into context, we are one of only two UK-listed companies to have received this accolade in 2023. GPTW selects companies based on their dedication to creating exceptional workplace cultures, prioritising people, fostering a culture of trust and empowering colleagues worldwide to achieve their full potential.

1. 2022 baseline restated to reflect divestments. Effluent Compliance metric now measured on the percentage of tested effluent analytes meeting the specification limits under ZDHC Guidelines; a standard set above local regulatory requirements.


Our digital offering is another differentiator for the business. We are able to invest in our digital operations by virtue of our scale, and this investment gives our customers a seamless service from our operations around the world. Our cloud-based digital backbone gives us greater visibility of data and enables greater operational efficiency for us and for our customers, with business conducted at the touch of a button. As our operations and those of our customers become more integrated, it increases customer retention and loyalty.

We have migrated 100% of enabled customers to our ShopCoats digital customer ecosystem. This offers highly efficient automated processes, including ordering, sample production, processing and status management capabilities. From its inception in 2021 to the end of the year, the ShopCoats digital system has processed just under $1.3bn of customer orders, with the number of orders received through ShopCoats increasing over time.

Our Coats Digital business, part of Apparel, sells software to third party customers, with an overarching theme of making operations more efficient. With a growing focus on operational efficiency, interest in our software products is also increasing. The business had an excellent year, gaining more than 30 new customers and increasing its recurring software-as-a-service (SaaS) based revenue.

Board Update

At the upcoming AGM, the Board is proposing a resolution to re-appoint David Gosnell, Chair of the Group, as a Director of the Company. The Board has concluded unanimously that a three year extension to David’s tenure as Chair to 2027, is in the best interests of the Company and shareholders. This will be subject to his re-election at the 2024 AGM and annually thereafter. Such an extension would provide continuity, enabling David to oversee the current period of significant development to conclusion. This includes completion of the integration of the major 2022 footwear acquisitions and the Group’s strategic projects, as well as further potential de-risking of the pension scheme. The Board is also going through a period of evolution, with two recent Non-Executive Director appointments and the forthcoming Senior Independent Director, and Audit Committee Chair transitions, as Nicholas Bull steps down from the Board at the 2024 AGM.

David was appointed Chair in 2021. However, as he has served as a Non-Executive Director from 2015, this resolution would extend his Board appointment beyond the usual nine year term. The Board considers this to be compliant with provision 19 of the Code which allows an extension for a limited time where the Chair was an existing director, subject to a clear explanation being provided. The Board considers that David continues to demonstrate objective judgment and promotes constructive challenge amongst Board members. In addition, Nicholas Bull and Steve Murray, in his role as incoming Senior Independent Director, directly consulted with shareholders holding around 70% of the Company's shares at 31 January 2024 to explain the rationale for this proposal and seek their views. The shareholders indicated clear support for David continuing as Chair, with the majority supportive of a three year extension, subject to annual re-election at the AGM.


Notwithstanding the widespread industry destocking in the year we delivered a good financial performance, including an increased margin and strong levels of free cash flow. Including further progress made on pension schemes during the year, the Group’s Balance Sheet continues to be in a strong position. We are well-positioned in our markets; we continue to gain market share, and we see further growth and margin opportunities as the market gradually recovers.

With these factors in mind, the Board has decided to propose a final dividend of 1.99 cents per share, a 15% increase on the prior year. This equates to a full year dividend of 2.80 cents per share, also an increase of 15%. Subject to approval at the AGM, the final dividend will be paid on 30 May 2024 to ordinary shareholders on the register at 3 May 2024, with an ex-dividend date of 2 May 2024.

The Board will continue to review the level of dividend payment to shareholders, on the basis of the performance of the business and its longer-term potential, including margin and earnings progression, as well as cash generation, within the context of our capital allocation policy.