LONDON (ShareCast) - (Sharecast News) - Industrial thread maker Coats said group sales for the four months to end October fell 2% on a reported basis, dragged lower by forex headwinds and a 31% slump in the crafts division.
On a constant exchange basis (CER) sales were up 3% with increasing momentum in the industrial division where sales grew 9%.

On an organic basis, group sales were flat with industrial up 5% and continuing to perform strongly. Coats said full year trading results would be in line with expectations.

Foreign exchange headwinds of 5%, reflects the recent weakening of emerging market currencies such as the Indian Rupee, Chinese Yuan, and Turkish Lira.

Industrial performance was underpinned by higher growth rates in the period in both the apparel and footwear business (up 4% on a CER basis) and the performance materials business (up 28%), when compared to the first half of 2018, Coats said.

"The consistently strong apparel and footwear performance was delivered despite continued mixed demand from retailers, and was underpinned by momentum in our key Asia markets," the company said in a trading statement.

Performance materials CER growth of 28%, consisted of 10% organic growth and 18% contribution from the acquisition of Patrick Yarn Mill and reflected continued double-digit organic growth (up 27%) in hi-tech end uses such as telecommunications and protective clothing.

Crafts, which represent 11% of group sales, fell 29% on a CER basis, largely as a result of lower sales in both North America and Latin America, following de-stocking activity within certain customers, alongside the impact of the exit of the non-core lifestyle fabric business that took place in the first half of 2018.

For the year-to-date, crafts sales are 15% down year on year.

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