Sherwood puts pressure on textile sector
SHARES in quoted textile and clothing companies came under pressure again yesterday after lacemaker Sherwood Group provided further confirmation of trading difficulties in Britain's beleaguered textile and clothing industry.
In particular, Courtaulds Textiles plunged 10p to a new 1996 "low" of 221p - 50 per cent down on its peak price for the year - on market views that the group is particularly exposed to the difficulties afflicting the sector.
In its second profit warning of the year, the Sherwood Group warned that second-half profits would be "appreciably less" than the first half's £3.75 million sterling.
Coats Viyella, having undergone major restructuring earlier this year, is also facing challenging trading conditions but is more upbeat. A trading update from the board yesterday indicated that second-half operating profits were likely to be similar to last year's levels.
The restructuring will bed reflected in exceptional charges of some £55 million, but analysts believe that annual pre-tax profits before exceptional items should emerge at around £140 million sterling, not much changed from 1995 profits.
Part of the reorganisation programme involved the group's shirt-making plant at Maydown, Co Derry, where is being stopped so that made-up shirts can be imported from low-cost countries.