Coats Group PLC
LSE:COA
Coats Group PLC
Coats Group PLC, a name etched in industrial legacy, weaves its presence through the fabric of global commerce as the world's leading industrial thread manufacturer. With origins tracing back to the late 18th century, Coats has evolved from traditional textile manufacturing to become a dynamic, innovation-driven enterprise. It operates at the nexus of the apparel and footwear industries, offering high-performance threads that are integral to both everyday clothing and high-tech textiles. A significant part of Coats' success lies in its strategic international footprint, with operations spanning notable markets across Asia, Europe, and the Americas. This reach allows it to offer localized solutions to a wide array of clients, from large fashion brands to niche manufacturers, thereby crafting not just thread, but enduring partnerships.
Coats makes its money by meticulously stitching together a diverse portfolio that extends beyond threads. The company delves into several intertwining sectors, including zips, trims, and yarns, while also innovating in the field of technical performance materials. This subsidiary of activities powers industries as varied as automotive, telecommunications, and personal protection, showcasing its versatility and adaptation to modern industrial demands. What propels Coats above its competitors is its commitment to sustainability and innovation, investing in digital solutions like Coats Digital, which offers software tools to streamline the fashion supply chain. This multi-faceted approach not only enhances Coats' revenue streams but also ensures it remains woven into the fabric of future textile technologies.
Coats Group PLC, a name etched in industrial legacy, weaves its presence through the fabric of global commerce as the world's leading industrial thread manufacturer. With origins tracing back to the late 18th century, Coats has evolved from traditional textile manufacturing to become a dynamic, innovation-driven enterprise. It operates at the nexus of the apparel and footwear industries, offering high-performance threads that are integral to both everyday clothing and high-tech textiles. A significant part of Coats' success lies in its strategic international footprint, with operations spanning notable markets across Asia, Europe, and the Americas. This reach allows it to offer localized solutions to a wide array of clients, from large fashion brands to niche manufacturers, thereby crafting not just thread, but enduring partnerships.
Coats makes its money by meticulously stitching together a diverse portfolio that extends beyond threads. The company delves into several intertwining sectors, including zips, trims, and yarns, while also innovating in the field of technical performance materials. This subsidiary of activities powers industries as varied as automotive, telecommunications, and personal protection, showcasing its versatility and adaptation to modern industrial demands. What propels Coats above its competitors is its commitment to sustainability and innovation, investing in digital solutions like Coats Digital, which offers software tools to streamline the fashion supply chain. This multi-faceted approach not only enhances Coats' revenue streams but also ensures it remains woven into the fabric of future textile technologies.
Strong Margins: Coats reported a record profit margin of 19.8%, reaching its medium-term target ahead of schedule, driven by mix, pricing, and cost control.
Solid Results Despite Uncertainty: First-half revenue was $705 million (up 2%), with order deceleration since April due to U.S. consumer confidence and new tariffs.
OrthoLite Acquisition: Coats announced the acquisition of OrthoLite, the market leader in open-cell foam insoles, aiming to expand its footwear division and enhance growth.
Synergy Potential: The OrthoLite deal includes expected annualized cost synergies of $20 million by 2028, mainly through site optimization, procurement, and support functions.
Cash Flow Growth: Free cash flow before dividends rose to $54 million from $39 million, with further increases expected in the second half and into 2026.
Unchanged Outlook: Full-year outlook remains unchanged, in line with market expectations, with balanced trading anticipated between H1 and H2.
EPS and Dividend Growth: Adjusted EPS grew 4% and the interim dividend increased 7.5% to $0.01 per share.
