Restructuring hits Coats Viyella profit

FIRST HALF profits fell £24 million sterling to £47 million at the Coats Viyella textile combine, mainly due to £17 million reorganisation costs aimed at improving profitability through closure of loss making plants and disposals of peripheral businesses. Sales from continuing operations rose 6 per cent to £1.16 billion. Initial benefits of the first half restructuring moves are expected to be reflected in a £10 million increase in operating profits in the second half.

One casualty of the reorganisation programme is expected to be the group's shirt factory employing 400 people at Maydown outside Derry that is to be closed, with production being relocated to plants in lower cost countries overseas. But some of the threatened jobs may be saved if Coats Viyella moves part of its home furnishings division to Maydown.