Exceptional items took the shine off an otherwise solid 2018 performance by industrial thread manufacturer Coats Group PLC (LON:COA).
The shares were off 4.6% in early deals after it posted a fall in profit before tax to US$122.8mln from US$129.5mln in 2017, largely thanks to US$22.8mln in costs associated with its “Connecting for Growth” reorganisation programme, including US$20.5mln in severance costs.
The group also had to lob in US$10.2mln to the pension pot owing to the requirement for all UK pension schemes to equalise male and female members' benefits for the effect of Guaranteed Minimum Pensions.
READ Coats raises US$37mln with cash sale of non-core North America Crafts business
Revenue rose 4% to US$1,415mln from a restated US$1,356mln in 2017. Adjusting for exchange rate fluctuations, revenue was up 6% while on a like-for-like basis (i.e. excluding acquisitions) it was up 3%.
We announced our unaudited Full Year results for the year ended 31 December 2018. Details here https://t.co/ETPxBuTIWl #COAFY2018 pic.twitter.com/v6oS32saYb
— Coats Group (@CoatsGroup) March 1, 2019
The full-year dividend has been increased by 15% to 1.66 cents from 1.44 cents.
'We enter 2019 in a strong position, with continued positive momentum in our core Apparel and Footwear and hi-tech Performance Materials businesses. The exit of our non-core North American Crafts business will ensure complete focus on growing our remaining businesses organically and identifying further value-add bolt-on acquisitions,” said Rajiv Sharma, the group’s chief executive.
'Whilst we are cautious around the current macroeconomic uncertainties, based on our current assessment of business trends we remain confident in delivering another year of improving performance through effective execution of our strategy,” he added,