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Press release from PR Newswire

Dorel reports second quarter 2013

Friday, August 09, 2013

Dorel reports second quarter 2013

08:22 EDT Friday, August 09, 2013

  • Bicycle segment business fundamentals remain solid despite poor weather impacting current volumes and profitability
  • Juvenile profit down in Europe due to economic conditions but segment's full year earnings expected to equal 2012
  • Home Furnishings' on-line sales continue to drive operating profit improvement

EXCHANGES TSX: DII.B, DII.A

MONTREAL, Aug. 9, 2013 /PRNewswire/ - Dorel Industries Inc. (TSX: DII.B, DII.A) today announced results for the second quarter and six months ended June 30, 2013. Total revenue for the three month period was US$600.5 million, down 5.2% from US$633.7 million for the same quarter last year. Net income was US$13.2 million or US$0.41 per diluted share, a decrease of 56.4% from US$30.3 million or US$0.95 per diluted share reported for the second quarter a year ago. Year-to-date revenue was US$1.2 billion compared to US$1.25 billion last year. Net income for the six months was US$35.5 million or US$1.11 per diluted share compared to US$59.4 million or US$1.85 per diluted share.

"As we announced in June, second quarter earnings in the Recreational/Leisure segment continued to be affected by the late spring across the U.S., Canada and Europe. The resultant global slowdown in the bicycle category lowered sales in just about all markets, creating higher bicycle inventories and industry-wide discounting, particularly in the independent bicycle dealer ("IBD") channel. This discounting, combined with foreign exchange losses and one-time severance costs significantly affected the segment's second quarter profits," explained Dorel President and CEO Martin Schwartz.

"To be clear, these are matters beyond our control. Dorel's bicycle products are proven and our brands remain strong. We have continued to invest strategically in sports marketing to maintain our brand strength. Cannondale's Pro Cycling Team has once again proven beneficial with Peter Sagan winning the Green Jersey in the recent Tour de France for the second consecutive year. The Green Jersey is the race's second most important award. On another positive note, the introduction of Cannondale to the Chinese market last year has been above our expectations. While still a small component of the overall bicycle business, we see further potential in this important market.

"Juvenile's performance was down year-over-year due mainly to reduced profitability in Europe where economic conditions remain difficult and are pressuring earnings. New product development remains a key focus and innovative new introductions are planned for later this year. Dorel Chile continued to post strong top and bottom line numbers. While there was a slight decline in Home Furnishings' sales to the in-store channel, the segment had another solid quarter registering improved earnings, as sales to its e-commerce customers continue to grow significantly," said Mr. Schwartz.

 
Summary of Financial Highlights
Second Quarters Ended June 30
All figures in thousands of US $, except per share amounts
  2013 2012 Change %
Total revenue 600,449 633,711 (5.2%)
Net income 13,224 30,345 (56.4%)
  Per share - Basic 0.41 0.95 (56.8%)
  Per share - Diluted 0.41 0.95 (56.8%)
Average number of shares outstanding -      
Diluted weighted average 32,223,810 32,046,443  
       
       
Summary of Financial Highlights
Six Months Ended June 30
All figures in thousands of US $, except per share amounts
  2013 2012 Change %
Total revenue 1,194,617 1,254,811 (4.8%)
Net income 35,540 59,404 (40.2%)
  Per share - Basic 1.12 1.86 (39.8%)
  Per share - Diluted 1.11 1.85 (40.0%)
Average number of shares outstanding -      
Diluted weighted average 32,152,285 32,080,033  

Juvenile Segment

 
Second Quarters Ended June 30
  2013 2012  
  $ % of rev. $ % of rev. Change %
Total revenue       243,412       254,781   (4.5%)
Gross profit         68,761 28.2%       69,391 27.2% (0.9%)
Operating profit         15,811 6.5%       17,118 6.7% (7.6%)
           
           
Six Months Ended June 30
  2013 2012  
  $ % of rev. $ % of rev. Change %
Total revenue       498,645       524,280   (4.9%)
Gross profit       143,267 28.7%     143,400 27.4% (0.1%)
Operating profit         33,743 6.8%       37,540 7.2% (10.1%)

The organic revenue decline in the Juvenile segment was approximately 6% both in the second quarter and year-to-date. For the quarter, the main cause was a revenue decline in the low double digits at Dorel Juvenile Group ("DJG") USA. This was partially offset by strong gains in Latin America where sales increased by 35%. Despite the decrease in sales at DJG USA, the combination of a mix of higher profit items and effective input-cost management maintained their profit at levels similar to the prior year. The growth in Latin America was mainly fueled by the opening of new retail stores in Chile and Peru as well as the contribution of Dorel Colombia, acquired in late 2012. A total of four new stores were opened in both Chile and Peru, bringing the overall number of stores in operation to 76. Latin American operating profit also improved on this strong sales growth. In Europe, organic revenue was down slightly, as the economic situation there has not improved. Operating profit decreased in Europe with the major causes being less favourable exchange rates on its US dollar purchases and a less profitable sales mix.

Significant product launches late in the quarter in the U.S. included the versatile Safety 1st Elite 80 Air + 3-in-1 car seat, for children in 3 modes of use, infant, convertible and booster. The Elite 80 Air + incorporates both Air Protect® and GCell HX technology? a patented foam designed by Dorel for superior protection around the child's body providing the ultimate in safety. Also introduced was the newly designed Maxi-Cosi Mico AP infant car seat which is now equipped with patented Air Protect technology which provides unparalleled side impact protection. The Mico AP is also the lightest weight car seat in its class on the market.

Recreational/Leisure Segment

 
Second Quarters Ended June 30
  2013 2012  
  $ % of rev. $ % of rev. Change %
Total revenue       238,174     251,911   (5.5%)
Gross profit         54,550 22.9%     63,183 25.1% (13.7%)
Operating profit           3,681 1.5%     21,606 8.6% (83.0%)
           
           
Six Months Ended June 30
  2013 2012  
  $ % of rev. $ % of rev. Change %
Total revenue       441,688     472,829   (6.6%)
Gross profit       105,839 24.0%   121,623 25.7% (13.0%)
Operating profit         13,222 3.0%     42,986 9.1% (69.2%)

Organic revenue decreased by approximately 5% in the quarter and 6% year-to-date, which excludes the impact of varying foreign exchange rates. The revenue decline is attributed to the weather related ongoing global decrease in the bicycle market. For the quarter, gross margins decreased by 220 basis points to 22.9% from 25.1% recorded in 2012. With key IBD competitors carrying heavy amounts of model-year 2013 product, and to make room for 2014 models, competitor discounting activity is rampant and as a result the Company has also offered increased discounts, thus hurting margins. Unfavourable foreign exchange rates have also contributed to depressing gross profit as the US dollar has appreciated against many core currencies driving up the global cost of goods.

Significant cost reductions have been implemented across the segment. This includes a headcount reduction of some 50 positions worldwide, roughly 5% of the segment's workforce. A one-time charge of approximately US$2.0 million was recorded related to severance as a result of these restructuring activities. These cost reductions are across most areas and will have a positive effect going forward.

Home Furnishings Segment

 
Second Quarters Ended June 30
  2013 2012  
  $ % of rev. $ % of rev. Change %
Total revenue 118,863   127,019   (6.4%)
Gross profit 17,145 14.4% 16,574 13.0% 3.4%
Operating profit 7,201 6.1% 6,694 5.3% 7.6%
           
           
Six Months Ended June 30
  2013 2012  
  $ % of rev. $ % of rev. Change %
Total revenue         254,284       257,702   (1.3%)
Gross profit           35,225 13.9%       32,304 12.5% 9.0%
Operating profit           15,149 6.0%       12,485 4.8% 21.3%

The segment's revenue decrease, both for the quarter as well as year-to-date, was mostly in imported upholstery and domestic ready-to-assemble furniture. This was partially offset by the sustained growth of the Internet sales channels. The segment's drop ship vendor program continued to drive the significant growth in on-line sales. The number of products offered on-line continues to grow as well as the ability to efficiently distribute these products throughout North America. The bedroom category, including mattresses and youth oriented beds, has been an area of significant growth as the product offering continues to expand. The segment has also seen an expanded share of the step stool and ladder channel with a growing presence at do-it-yourself and mass retailers under the category-leading brand Cosco. Operating profit improved versus last year despite the drop in sales helped by overhead cost control, a more profitable sales mix and a more favourable rate of exchange on the Canadian dollar.

Other The 2013 second quarter tax rate was 21.1% and year-to-date was 14.3%. This compares to 16.5% for the quarter and 15.4% year-to-date in 2012. The main reason for the variation was a change in the jurisdictions in which the Company generated its income year-over-year. The Company has stated that for the full year it expects its annual tax rate to be between 15% and 20%, and despite the rate recorded in the second quarter, this expectation remains.

Quarterly dividend The Board of Directors of Dorel declared its regular quarterly dividend of US$0.30 per share on the outstanding number of the Company's Class A Multiple Voting Shares, Class B Subordinate Voting Shares and Deferred Share Units. The dividend is payable on September 5, 2013 to shareholders of record as at the close of business on August 22, 2013.

Outlook "As we had announced on June 13, 2013 the Recreational / Leisure segment results were still being severely impacted by the weather and this was being compounded by competitor discounting in an attempt to reduce industry-wide inventory backlogs. While discounting is continuing, Dorel's situation will improve as the year progresses. With our strong product portfolio and superior brands, along with the restructuring actions that we have taken, we expect to recover accordingly. Some of this recovery will be in the third quarter and our earnings for the period are expected to be close to prior year levels. As we head into the fall, we are confident that in the fourth quarter, we will return to improved profitability versus the prior year and for the second half we expect Recreational / Leisure earnings will increase over last year," commented Mr. Schwartz.

"In Juvenile, the anticipated improved earnings did not materialize as soon as expected and as in Recreational / Leisure, we expect improvement in the fourth quarter. We have several significant new product introductions scheduled and we will be unveiling several of these at the upcoming Juvenile show in September in Cologne, Germany. Others are also due in North America near the end of the year. In Latin America, growth in earnings will be weighted to the fourth quarter with a strong Christmas retail season anticipated with our expanding number of retail locations in Chile and Peru. For the year we now expect Juvenile earnings to be flat with 2012. In Home Furnishings, we expect that segment's solid performance to continue and its operating profit for 2013 is anticipated to exceed last year's results," concluded Mr. Schwartz.

Conference Call Dorel Industries Inc. will hold a conference call to discuss these results today, August 9, 2013 at 11:00 A.M. Eastern Time. Interested parties can join the call by dialling 1-888-231-8191. The conference call can also be accessed via live webcast at www.dorel.com or www.newswire.ca. If you are unable to call in at this time, you may access a recording of the meeting by calling 1-855-859-2056 and entering the passcode 15705744 on your phone. This recording will be available on Friday, August 9, 2013 as of 2:00 P.M. until 11:59 P.M. on Friday, August 16, 2013.

The condensed consolidated interim financial statements as of June 30, 2013 will be available on the Company's website, www.dorel.com, and will be available through the SEDAR websites.

Profile Dorel Industries Inc. (TSX: DII.B, DII.A) is a world class juvenile products and bicycle company. Dorel creates style and excitement in equal measure to safety, quality and value. The Company's lifestyle leadership position is pronounced in both its Juvenile and Bicycle categories with an array of trend-setting products. Dorel's powerfully branded products include Safety 1st, Quinny, Cosco, Maxi-Cosi and Bébé Confort in Juvenile, as well as Cannondale, Schwinn, GT, Mongoose, IronHorse and SUGOI in Recreational/Leisure.  Dorel's Home Furnishings segment markets a wide assortment of both domestically produced and imported furniture products, principally within North America. Dorel has annual sales of US$2.5 billion and employs 5,400 people in facilities located in twenty-four countries worldwide.

Caution Regarding Forward Looking Statements Certain statements included in this press release may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation.  Except as may be required by Canadian securities laws, Dorel does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements, by their very nature, are subject to numerous risks and uncertainties and are based on several assumptions which give rise to the possibility that actual results could differ materially from Dorel's expectations expressed in or implied by such forward-looking statements and that the objectives, plans, strategic priorities and business outlook may not be achieved. As a result, Dorel cannot guarantee that any forward-looking statement will materialize. Forward-looking statements are provided in this press release for the purpose of giving information about Management's current expectations and plans and allowing investors and others to get a better understanding of Dorel's operating environment. However, readers are cautioned that it may not be appropriate to use such forward-looking statements for any other purpose.

Forward-looking statements made in this press release are based on a number of assumptions that Dorel believed were reasonable on the day it made the forward-looking statements. Factors that could cause actual results to differ materially from the Company's expectations expressed in or implied by the forward-looking statements include:  general economic conditions; changes in product costs and supply channel; foreign currency fluctuations; customer and credit risk including the concentration of revenues with few customers; costs associated with product liability; changes in income tax legislation or the interpretation or application of those rules; the continued ability to develop products and support brand names; changes in the regulatory environment; continued access to capital resources and the related costs of borrowing; changes in assumptions in the valuation of goodwill and other intangible assets and subject to dividends being declared by the Board of Directors, there can be no certainty that Dorel's Dividend Policy will be maintained. These and other risk factors that could cause actual results to differ materially from expectations expressed in or implied by the forward-looking statements are discussed in Dorel's annual MD&A and Annual Information Form filed with the applicable Canadian securities regulatory authorities. The risk factors outlined in the previously mentioned documents are specifically incorporated herein by reference.

Dorel cautions readers that the risks described above are not the only ones that could impact it. Additional risks and uncertainties not currently known to Dorel or that Dorel currently deems to be immaterial may also have a material adverse effect on our business, financial condition or results of operations. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

Except as otherwise indicated, forward-looking statements do not reflect the potential impact of any non-recurring or other unusual items or of any dispositions, mergers, acquisitions, other business combinations or other transactions that may be announced or that may occur after the date hereof. The financial impact of these transactions and non-recurring and other unusual items can be complex and depends on the facts particular to each of them. Dorel therefore cannot describe the expected impact in a meaningful way or in the same way Dorel presents known risks affecting the business.

DOREL INDUSTRIES INC.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION
ALL FIGURES IN THOUSANDS OF US $
           
    as at     as at
    June 30, 2013     December 30, 2012
           
    (unaudited)     (unaudited)
          Restated
           
ASSETS          
CURRENT ASSETS          
  Cash and cash equivalents $ 52,417   $ 38,311
  Trade and other receivables   439,799     443,020
  Inventories   505,989     501,652
  Other financial assets   2,362     287
  Income taxes receivable   10,465     17,273
  Prepaid expenses   28,698     19,813
    1,039,730     1,020,356
           
NON-CURRENT ASSETS          
  Property, plant and equipment   156,288     157,127
  Intangible assets   418,538     423,057
  Goodwill   572,379     578,352
  Other financial assets   740     796
  Deferred tax assets   20,485     22,555
  Other assets   2,922     1,625
    1,171,352     1,183,512
  $ 2,211,082   $ 2,203,868
           
LIABILITIES          
CURRENT LIABILITIES          
  Bank indebtedness $ 16,268   $ 11,476
  Trade and other payables   337,300     337,451
  Other financial liabilities   813     4,236
  Income taxes payable   3,546     2,856
  Long-term debt   13,360     13,520
  Provisions   31,803     33,769
    403,090     403,308
           
NON-CURRENT LIABILITIES          
  Long-term debt   324,900     317,970
  Net pension and post-retirement defined benefit liabilities   34,753     35,091
  Deferred tax liabilities   83,825     87,922
  Provisions   1,948     1,969
  Other financial liabilites   41,906     43,600
  Other long-term liabilities   5,322     5,895
    492,654     492,447
           
EQUITY          
Share capital   188,924     180,856
Contributed surplus   26,942     27,192
Accumulated other comprehensive income   40,631     57,619
Retained earnings   1,058,841     1,042,446
    1,315,338     1,308,113
  $ 2,211,082   $ 2,203,868

DOREL INDUSTRIES INC.
CONDENSED CONSOLIDATED INTERIM INCOME STATEMENTS
ALL FIGURES IN THOUSANDS OF US $, EXCEPT PER SHARE AMOUNTS
           
    Second Quarters Ended     Six Months Ended
      June  30, 2013     June 30, 2012     June  30, 2013     June 30, 2012 
      (unaudited)     (unaudited)     (unaudited)     (unaudited)
                        Restated
                         
Sales    $ 598,046   $ 630,898   $ 1,187,112   $ 1,248,049
Licensing and commission income     2,403     2,813     7,505     6,762
TOTAL REVENUE     600,449     633,711     1,194,617     1,254,811
                         
Cost of sales     459,993     484,563     910,286     957,484
GROSS PROFIT     140,456     149,148     284,331     297,327
                         
                         
Selling expenses     62,412     57,493     117,772     109,298
General and administrative expenses      47,994     44,108     100,128     94,623
Research and development expenses     7,696     6,583     14,899     13,570
OPERATING PROFIT     22,354     40,964     51,532     79,836
                         
Finance expenses     5,585     4,631     10,067     9,611
INCOME BEFORE INCOME TAXES     16,769     36,333     41,465     70,225
                         
Income taxes expense     3,545     5,988     5,925     10,821
NET INCOME   $ 13,224   $ 30,345   $ 35,540   $ 59,404
                         
EARNINGS PER SHARE                        
  Basic     $0.41     $0.95     $1.12     $1.86
  Diluted     $0.41     $0.95     $1.11     $1.85
                         
SHARES OUTSTANDING                        
  Basic - weighted average     31,865,525     31,859,015     31,765,123     31,906,375
  Diluted - weighted average     32,223,810     32,046,443     32,152,285     32,080,033

DOREL INDUSTRIES INC.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME
ALL FIGURES IN THOUSANDS OF US $
 
  Second Quarters Ended   Six Months Ended
  June  30, 2013 June 30, 2012   June  30, 2013 June 30, 2012
  (unaudited) (unaudited)   (unaudited) (unaudited)
        Restated         Restated
                           
NET INCOME   $ 13,224   $ 30,345     $ 35,540   $ 59,404
                           
OTHER COMPREHENSIVE INCOME (LOSS):                          
                           
Items that are or may be reclassified subsequently to net income:                          
Cumulative translation account:                          
Net change in unrealized foreign currency gains (losses) on translation of net investments in foreign operations, net of tax of nil           (3,711)           (24,737)               (19,349)           (9,965)
                           
                           
Net changes in cash flow hedges:                          
Net change in unrealized gains (losses) on derivatives designated as cash flow hedges     (294)     2,635       3,824     904
Reclassification to income     251     252       503     495
Reclassification to the related non-financial asset     (628)     (2,602)       (758)     (5,066)
Deferred income taxes     41     (151)       (1,211)     920
      (630)     134       2,358     (2,747)
                           
Items that will not be reclassified to net income:                          
Defined benefit plans:                          
Remeasurements of the net pension and post-retirement benefit liabilities     (4)     25       4     809
Deferred income taxes     1     (6)       (1)     (359)
      (3)     19       3     450
                           
TOTAL OTHER COMPREHENSIVE INCOME (LOSS)     (4,344)     (24,584)       (16,988)     (12,262)
                           
TOTAL COMPREHENSIVE INCOME   $ 8,880   $ 5,761     $ 18,552   $ 47,142

DOREL INDUSTRIES INC.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY
ALL FIGURES IN THOUSANDS OF US $
                             
  Attributable to equity holders of the Company
          Accumulated other comprehensive income      
    Share Capital   Contributed Surplus   Cumulative Translation Account   Cash Flow Hedges   Defined Benefit Plans   Retained Earnings   Total Equity
    (unaudited)   (unaudited)   (unaudited)   (unaudited)   (unaudited)   (unaudited)   (unaudited)
                             
Balance as at December 30, 2011, as previously reported $ 174,782 $ 26,445 $ 52,760 $ 6,082 $ - $ 969,586 $ 1,229,655
Impact of change in accounting policy   -   -   -   -   (6,444)   6,520   76
                             
Balance as at December 30, 2011, as restated $ 174,782 $ 26,445 $ 52,760 $ 6,082 $ (6,444) $ 976,106 $ 1,229,731
                             
Total comprehensive income:                            
  Net income   -   -     -   -   59,404   59,404
  Other comprehensive income (loss)   -   -   (9,965)   (2,747)   450     (12,262)
  $ - $ - $ (9,965) $ (2,747) $ 450 $ 59,404 $ 47,142
                             
  Issued under stock option plan   1,055   -   -   -   -   -   1,055
  Reclassification from contributed surplus due to exercise of stock options   223   (223)   -   -   -   -   -
  Repurchase and cancellation of shares   (4,021)   -   -   -   -   -   (4,021)
  Premium paid on share repurchase   -   -   -   -   -   (12,928)   (12,928)
  Share-based payments   -   1,342   -   -   -   -   1,342
  Dividends on common shares   -   -   -   -   -   (9,569)   (9,569)
  Dividends on deferred share units   -   42   -   -   -   (42)   -
                             
Balance as at June 30, 2012 $ 172,039 $ 27,606 $ 42,795 $ 3,335 $ (5,994) $ 1,012,971 $ 1,252,752
                             
                             
Balance as at December 30, 2012, as previously reported $ 180,856 $ 27,192 $ 66,388 $ (1,036) $ - $ 1,034,298 $ 1,307,698
Impact of change in accounting policy   -   -   3   -   (7,736)   8,148   415
                             
Balance as at December 30, 2012, as restated $ 180,856 $ 27,192 $ 66,391 $ (1,036) $ (7,736) $ 1,042,446 $ 1,308,113
                             
Total comprehensive income:                            
  Net income   -   -   -   -   -   35,540   35,540
  Other comprehensive income (loss)   -   -   (19,349)   2,358   3   -   (16,988)
  $   $ - $ (19,349) $ 2,358 $ 3 $ 35,540 $ 18,552
                             
  Issued under stock option plan   6,464   -   -   -   -   -   6,464
  Reclassification from contributed surplus due to exercise of stock options   1,377   (1,377)   -   -   -   -  
  Reclassification from contributed surplus due to settlement of deferred share units   227   (347)   -   -   -   -   (120)
  Share-based payments   -   1,381   -   -   -   -   1,381
  Dividends on common shares   -   -   -   -   -   (19,052)   (19,052)
  Dividends on deferred share units   -   93   -   -   -   (93)   -
                             
Balance as at June 30, 2013 $ 188,924 $ 26,942 $ 47,042 $ 1,322 $ (7,733) $ 1,058,841 $ 1,315,338

DOREL INDUSTRIES INC.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
ALL FIGURES IN THOUSANDS OF US $
             
    Second Quarters Ended   Six Months Ended
    June  30, 2013   June 30, 2012   June  30, 2013   June 30, 2012
    (unaudited)   (unaudited)   (unaudited)   (unaudited)
                      Restated
CASH PROVIDED BY (USED IN):                        
                         
OPERATING ACTIVITIES                        
Net income   $ 13,224   $ 30,345   $ 35,540   $ 59,404
Items not involving cash:                        
  Depreciation and amortization     13,957     12,965     27,080     25,994
  Amortization of deferred financing costs     98     90     190     231
  Accretion expense on contingent consideration and put option liabilities     578     544     1,172     1,459
  Change of assumptions on contingent consideration and put option liabilities     -     (973)     -     (973)
  Unrealized (gains)/losses due to foreign exchange exposure on contingent consideration and put option liabilities     (2,169)     (680)     (1,975)     357
  Other finance expenses     4,909     3,997     8,705     7,921
  Income taxes expense     3,545     5,988     5,925     10,821
  Share-based payments     327     642     1,076     1,228
  Defined benefit pension and post-retirement costs     933     722     1,492     1,699
  Gain on disposal of property, plant and equipment     (197)     (44)     (218)     (80)
      35,205     53,596     78,987     108,061
Net change in balances related to operations:                        
  Trade and other receivables     41,435     23,164     (3,979)     (50,517)
  Inventories     9,717     (66,384)     (13,312)     (57,284)
  Other financial assets     (12)     (212)     24     (832)
  Prepaid expenses     (310)     529     (9,552)     (4,077)
  Other assets     21     -     (1,293)     -
  Trade and other payables     (11,718)     52,655     5,400     71,596
  Net pension and post-retirement defined benefit liabilities     (499)     (554)     (1,733)     (1,755)
  Provisions, other financial long-term liabilities and other long-term liabilities     (900)     1,091     (2,701)     (646)
      37,734     10,289     (27,146)     (43,515)
                         
  Income taxes paid     (4,247)     (6,766)     (9,609)     (9,848)
  Income taxes received     1,663     4,736     9,891     5,569
  Interest paid     (6,695)     (6,694)     (8,213)     (8,344)
  Interest received     -     260     496     572
                         
CASH PROVIDED BY OPERATING ACTIVITIES     63,660     55,421     44,406     52,495
                         
FINANCING ACTIVITIES                        
  Bank indebtedness     (9,726)     (7,358)     5,605     1,113
  Increase of long-term debt     -     721     19,957     18,731
  Repayments of long-term debt     (15,424)     -     (13,084)     -
  Repayments of contingent consideration and put option liabilities     -     -     (1,995)     (168)
  Financing costs     (213)     (185)     (218)     (192)
  Share repurchase     -     (15,889)     -     (16,949)
  Issuance of share capital     571     245     5,620     934
  Dividends on common shares     (9,562)     (4,779)     (19,052)     (9,569)
CASH USED IN FINANCING ACTIVITIES     (34,354)     (27,245)     (3,167)     (6,100)
                         
INVESTING ACTIVITIES                        
  Acquisition of businesses     -     (1,501)     -     (4,397)
  Additions to property, plant and equipment     (10,885)     (8,138)     (17,530)     (14,701)
  Disposals of property, plant and equipment     229     85     288     135
  Additions to intangible assets     (5,535)     (4,116)     (10,877)     (10,434)
CASH USED IN INVESTING ACTIVITIES     (16,191)     (13,670)     (28,119)     (29,397)
                         
  Effect of foreign currency exchange rate changes on cash and cash equivalents     1,781     (1,811)     986     (1,668)
                         
NET INCREASE IN CASH AND CASH EQUIVALENTS     14,896     12,695     14,106     15,330
                         
Cash and cash equivalents, beginning of period     37,521     32,399     38,311     29,764
                         
CASH AND CASH EQUIVALENTS, END OF PERIOD   $ 52,417   $ 45,094   $ 52,417   $ 45,094

DOREL INDUSTRIES INC.
INDUSTRY SEGMENTED INFORMATION
SECOND QUARTERS ENDED JUNE 30
ALL FIGURES IN THOUSANDS OF US $
                                 
    Total Juvenile Recreational / Leisure Home Furnishings
    2013 2012 2013 2012 2013 2012 2013 2012
    (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Total revenue   $ 600,449 $ 633,711 $ 243,412 $ 254,781 $ 238,174 $ 251,911 $ 118,863 $ 127,019
Cost of sales     459,993   484,563   174,651   185,390   183,624   188,728   101,718   110,445
Gross profit     140,456   149,148   68,761   69,391   54,550   63,183   17,145   16,574
Selling expenses     61,804   56,954   27,384   25,929   30,319   26,462   4,101   4,563
General and administrative expenses     44,263   40,193   20,486   21,551   18,850   14,073   4,927   4,569
Research and development expenses     7,696   6,583   5,080   4,793   1,700   1,042   916   748
Operating profit     26,693   45,418 $ 15,811 $ 17,118 $ 3,681 $ 21,606 $ 7,201 $ 6,694
Finance expenses     5,585   4,631                        
Corporate expenses     4,339   4,454                        
Income taxes     3,545   5,988                        
Net income   $ 13,224 $ 30,345                        
                                   
Earnings per Share                                  
  Basic   $ 0.41 $ 0.95                        
  Diluted   $ 0.41 $ 0.95                        
                                   
Depreciation and amortization included in operating profit   $ 13,913 $ 12,969 $ 10,163 $ 9,539 $ 2,708 $ 2,243 $ 1,042 $ 1,187

 

DOREL INDUSTRIES INC.
INDUSTRY SEGMENTED INFORMATION
SIX MONTHS ENDED JUNE 30
ALL FIGURES IN THOUSANDS OF US $
                   
    Total Juvenile Recreational / Leisure Home Furnishings
    2013 2012 2013 2012 2013 2012 2013 2012
    (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Total revenue   $ 1,194,617 $ 1,254,811 $ 498,645 $ 524,280 $ 441,688 $ 472,829 $ 254,284 $ 257,702
Cost of sales     910,286   957,484   355,378   380,880   335,849   351,206   219,059   225,398
Gross Profit     284,331   297,327   143,267   143,400   105,839   121,623   35,225   32,304
Selling expenses     116,527   108,105   54,817   51,276   53,757   47,992   7,953   8,837
General and administrative expenses     90,791   82,641   44,845   44,870   35,565   28,326   10,381   9,445
Research and development expenses     14,899   13,570   9,862   9,714   3,295   2,319   1,742   1,537
Operating profit     62,114   93,011 $ 33,743 $ 37,540 $ 13,222 $ 42,986 $ 15,149 $ 12,485
Finance expenses     10,067   9,611                        
Corporate expenses     10,582   13,175                        
Income taxes     5,925   10,821                        
Net income   $ 35,540 $ 59,404                        
                                   
Earnings per Share                                  
  Basic   $ 1.12 $ 1.86                        
  Diluted   $ 1.11 $ 1.85                        
                                   
Depreciation and amortization included in operating profit   $ 26,994 $ 25,913 $ 19,816 $ 19,234 $ 5,036 $ 4,297 $ 2,142 $ 2,382
 
 

 

 

SOURCE Dorel Industries Inc.

For further information: <p> </p> <p> MaisonBrison Communications<br/> Rick Leckner<br/> (514) 731-0000 </p> <p> Dorel Industries Inc.<br/> Jeffrey Schwartz<br/> (514) 934-3034 </p>

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