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Coats Group PLC on Tuesday lifted its dividend and posted a higher interim profit, due to ‘favourable’ market conditions and pricing action.
The Uxbridge, England-based industrial thread maker reported a pretax profit of $96.8 million in the first half of 2022, reflecting a 15% increase from $84.2 million a year before.
This was on revenue growth of 14% to $801.5 million from $703.3 million.
Coats attributed its performance to ‘favourable’ underlying market conditions and early pricing actions, combined with self-help programmes to offset inflationary pressures.
The FTSE 250 company lifted its interim dividend by 15% to 0.70 cents from 0.61 cents.
Looking ahead, Coats expects to see more normalised growth in the second half of the year.
It believes it is well-positioned in the current macro-economic environment and anticipates its full-year performance to be ‘moderately’ ahead of its previous expectations.
‘During the first half of 2022, we saw outstanding results for the group. We have made good progress in accelerating profitable sales growth and transforming the portfolio to improve margins. Despite inflationary pressures and supply chain challenges, Coats delivered timely pricing actions, productivity and self-help programmes to deliver significantly improved margins now well beyond pre-Covid levels,’ Chief Executive Rajiv Sharma said.
Shares in Coats were trading 2.4% lower at 72.80 pence each on Tuesday morning in London.
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