Dorel Sets Record in First Quarter 2010
Dorel Industries Inc. manufacturer of Cannondale, GT, Schwinn, Mongoose, and IronHorse bicycles, as well as Sugoi apparel, released results for their best ever first quarter. The Recreational/Leisure division which includes the bicycle brands saw a significant jump in
MONTREAL, Canada – Dorel Industries Inc. manufacturer of Cannondale, GT, Schwinn, Mongoose, and IronHorse bicycles, as well as Sugoi apparel, released results for their best ever first quarter.
The Recreational/Leisure division which includes the bicycle brands saw a significant jump in mass merchant bicycle sales and gained market share in children’s bikes. An increase in demand for adult bikes was also cited as a factor. Revenues for the division increased by 12.5%, to € 130.6 million (US$181.7 million) and the gross profit amounted € 33.2 million (US$46.1 million). Earnings from Operations were € 10.9 million (US$15.1 million).
Revenue for all three divisions of the company (Juvenile, Recreational/Leisure, and Home Furnishings) was up 13.5% to € 428.8 million (US$596.3 million). Pre-tax earnings increased by 44.4% to € 35.9 million (US$48.5 million) for the same period in 2009.
Dorel CEO and President Martin Schwartz attributes several factors to the impressive start, noting, “consumer confidence has risen in many of our markets including in most of Europe. Exciting new product introductions and other marketing initiatives in all of our segments coupled with our concentration on opening to mid price points have attracted many to our brands.”
Schwartz also said the Cycling Sport Group has added its Independent Bike Dealer brands to more new dealers in any one quarter than ever before, with notable increases in the western United States, particularly Los Angeles, Northern California and Colorado.
Dorel has launched a new market strategy for its iconic Schwinn brand. The company started a multi-million dollar advertising campaign last month, which encompasses print and television advertising, support programs at retail, and on-line components.
While Schwartz cautioned rising commodity and freight costs could affect margins for the remainder of 2010, he remained confident of the company’s prospects, saying, “The momentum established in the first quarter places Dorel in an advantageous position to benefit from our numerous new product introductions and brand equity.”