Coats Group PLC Switch off of Pension Deficit Repair Payments (9513V)
2023年12月7日 - 4:00PM
ＲＮＳを含む英国規制内ニュース （英語）
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RNS Number : 9513V
Coats Group PLC
07 December 2023
7 December 2023
Coats Group plc
Agreement with UK Pension Scheme Trustee to switch off Deficit
Repair Payments
Coats Group plc ("Coats" or the "Group") is pleased to announce
that it has reached agreement with the trustee of the Coats UK
Pension Scheme ("scheme") to switch off pension deficit repair
payments(1) from 1 January 2024.
The Group has agreed to pay the scheme a one-off lump sum
payment of GBP10 million ($12.6 million) to move it into an
expected surplus position against the technical provisions funding
basis and enable the switch off threshold to be comfortably
met.
This agreement will result in a free cash flow benefit of GBP2
million ($2.5 million) per month while the payments remain switched
off. The deficit repair payments will remain switched off so long
as the scheme's assets remain above 99% of its technical
provisions(2) .
Jackie Callaway, Chief Financial Officer, said:
"We have made significant progress on pensions in recent years,
and the news today is another major milestone that benefits all
stakeholders. We remain focused on making further progress in order
to maximise Coats' free cash flow generation. We are continuing to
work with the trustee of the scheme on a collaborative basis, with
the medium term aspiration of fully insuring the scheme, removing
UK pension risk from the Group balance sheet and optimising our
capital allocation framework to enable additional growth
opportunities."
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) No 596/2014 as it
forms part of UK Domestic Law by virtue of the European Union
(Withdrawal) Act 2018 ("UK MAR").
Enquiries
Victoria Huxster +44 (0)7880 471350
/ / +44 (0)7720
Investors Julian Wais Coats Group plc 999764
Richard Mountain
/ +44 (0)20 3727
Media Nick Hasell FTI Consulting 1374
1. The scheme's last triennial actuarial valuation at 31 March
2021 showed a deficit between the scheme's assets and its pension
liabilities (the "technical provisions"). Following the valuation,
Coats agreed to pay monthly deficit repair payments at a rate of
GBP21.6m ($27.2m) per annum through to December 2028, increasing in
line with capped price inflation each financial year. By FY24,
these payments will have inflated to c.GBP24m ($30m) per annum or
GBP2m ($2.5m) per month.
2. In the light of significant improvements in the scheme's
funding position over FY 2022, including as a result of the
pensioner buy-in transaction in December 2022, the scheme trustee
and Coats agreed a funding mechanism. Under this mechanism, the
monthly deficit repair payments would "switch off" if the scheme's
updated position ever moves clearly into surplus (assets rise above
101% of updated technical provisions for two months). If the scheme
then subsequently reverts into a clear deficit position (assets
fall back below above 99% of updated technical provisions for two
months), the repair payments would "switch on" again. Following any
switch-on, monthly payments would restart at 150% of the normal
rate for as long as necessary to make good any past payments not
made as a result of prior switch-offs.
3. About Coats Group plc
Coats is a world leader in thread manufacturing and structural
components for apparel and footwear, as well as an innovative
pioneer in performance materials. These critical solutions are used
to create a wide range of products, including ones that provide
safety and protection for people, data, and the environment.
Headquartered in the UK, Coats is a FTSE250 company and a FTSE4Good
Index constituent. Revenues in 2022 were $1.6bn. Trusted by the
world's leading companies to deliver vital, innovative, and
sustainable solutions, Coats provides value-adding products,
including apparel, accessory and footwear threads, structural
components for footwear and accessories , fabrics, yarns, and
software applications. Customer partners include companies from the
apparel, footwear, automotive, telecoms, personal protection, and
outdoor goods industries. With a proud heritage dating back more
than 250 years and a spirit of evolution to constantly stay ahead
of changing market needs, Coats has operations across some 50
countries with a workforce of over 18,000, serving its customers
worldwide. Coats connects talent, textiles, and technology to make
a better and more sustainable world. Worldwide, there are four
dedicated Coats Innovation and Sustainability Hubs, where experts
collaborate with partners to create the materials and products of
tomorrow. It participates in the UN Global Compact and is committed
to Science-Based sustainability targets for 2030 and beyond, with a
goal of achieving net-zero by 2050. Coats is also committed to
achieving its goals in Diversity, Equity and inclusion, workplace
health and safety, employee and community wellbeing, and supplier
social performance. To find out more about Coats, visit
www.coats.com .
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END
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Coats (LSE:COA)
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