Eddy Merckx Cycles Hit by Strong Decline in Road Race Sales
ZELLIK, Belgium – Eddy Merckx Cycles is looking back at a multi-million loss over 2016. “The market for road race bike dropped by 25% last year and as specialist in this category we were hit unexpectedly hard,” explains Bart Van Muylder chairman of the board of Eddy Merckx Cycles and CEO of owner Diepensteyn NV.
“We were not able to compensate in other bike categories as we are hundred percent dedicated to road race,” Van Muylder says. “Our turnover was stable although we anticipated on a growth in sales. Still we are proud we could double our sales over the past two years and we still believe in the future of Eddy Merckx Cycles.”
Last August Diepensteyn increased its investment in the company from 14 to 27,7 million euro to strengthen the solvency and liquidity. In 2016 Eddy Merckx Cycles generated a loss of 5.7 million euros which brings the total loss to 17 million euro over the past years since Diepensteyn owns the bicycle factory. Even though the company increased its sales over the past few years to more than 8.8 million euros in 2016.
Van Muylder explains that a major part of the loss was the result of a full amortization of the Quick-Step team sponsoring which was in the books since 2010. “This sponsoring still dates back to the days before we acquired Eddy Merckx Cycles but as we are no longer involved in this team we decided to redeem this investment in full.”