Coats Group PLC on Thursday cited a recovery in the footwear and apparel sectors as it said it is confident to deliver further strong profit growth set to beat current market expectations.

The London-based manufacturer of industrial thread and footwear components said pretax profit jumped 31% to $102.9 million in the first half of 2024, from $78.6 million a year ago.

Revenue grew 6.6% to $740.7 million from $695.0 million. Cost of sales increased 0.6% to $471.1 million from $468.2 million, while administrative costs came in 13% higher at $91.2 million from $80.7 million.

Coats raised its interim dividend by 15% to 93 cents from 81 cents a year prior.

The company said it continued to make good progress with its first-half performance, above its own expectations. It added that its recovery in footwear was slightly behind that of apparel as destocking started later, but is now back to robust growth of up to 7%.

Coats anticipates a 2024 performance modestly ahead of current market expectations, which it cites as adjusted operating profit of $261.1 million, with a range of $256.3 million to $266.5 million.

The bottom end of the range would be 9.8% higher than the $233.4 million Coats had reported in for 2023.

Coats shares rose 8.3% to 96.90 pence each on Thursday afternoon in London.

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