UNDERSTANDING COATS
Coats at a glance
Understanding Coats
Coats at a glance
We are the global market leader in apparel threads, structural components and threads for footwear, and innovative pioneers in performance materials.
We are manufacturers of sustainability-led innovative products, and trusted partner to leading brands across all three segments and multiple industries.
A FTSE250 company and a FTSE4Good Index constituent, Coats takes part in the UN Global Compact and is committed to science-based sustainability targets for 2030 and beyond.
Customers globally
Revenue by division
Permanent employees
Revenue by region
- Reported revenue down 9%
- Organic revenue 14% lower, on improving trend (H1: 19% lower; H2 10% lower) with:
- Continued outperformance vs industry – Apparel and Footwear markets c.20% lower
- 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
- Net debt (excluding lease liabilities) lower at $384 million with 1.5x leverage
- Proposed final dividend of 1.99 cents, +15%, reflecting the Board’s confidence in growth strategy and future performance
- 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 accelerated savings, with overall savings on track for $70 million by 2024
- 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 – and recognised as one of the world’s top 25 workplaces
- “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
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Apparel
Apparel
In the Apparel division, we consolidated our India Distribution Centres into state-of-the-art facilities designed to incorporate future automation in order to capture the near-term growth forecast.
We opened our European Logistics Centre in Romania, rationalising three centres into one whilst still serving 5,000 direct customers. All of this was done seamlessly and without disruption to the business.
In addition to strategic projects, we also divested our EMEA Zips and the Madagascar / Mauritius businesses. This will enable management to focus on areas of the Group that will maximise shareholder value and help shape the future of Coats. I wish both businesses and the employees all the very best for the future under their new ownership.
Footwear
Footwear
Separately from strategic projects, we have integrated the structural components acquisitions into our existing footwear threads business to create a new footwear division. Again, we are ahead of schedule and I am delighted that we have already delivered $19 million of annualised savings, well ahead of the $11 million savings expected by 2024. Our customers are already seeing the benefits of having a single customer-facing team dedicated to servicing this growing segment.
Performance Materials
Performance Materials
Our two new factories in Mexico, designed with best-in-class technologies, are now operational and will complement the ongoing optimisation of the North America footprint. Our Innovation hub in North Carolina continues to be an important part of our customer engagement and source of new products. In 2023, the Division launched 6 new products with promising sales potential and achieved 20% on our Vitality Index.
Chair’s statement
David Gosnell
Chair
“Coats has always thrived
on the foundations of its culture and the people who make it special, and I am proud that we have been externally recognised as one of the top 25 workplaces globally.”