The Canadian conglomerate Dorel Industries Inc. (aka Dorel Group) continues to ride on a wave of success fueled by Corona not only, but above all thanks to the best results of its Sports Division, which sells bicycle products and its Juvenile Division, which sells strollers and seats, etc.
In the second sales quarter (May to June) of the current fiscal year 2021, Dorel Group increased its sales by 5.7 percent to USD 764.99 million (EUR 650.31 million). Dorel Sports accounts for more than 40 percent of this total turnover – to be precise 317.34 million USD (269.77 million euros, plus 11.1 percent – see also the table below). The remaining sales are distributed between the two other business areas managed by the Dorel Group, Dorel Home (236.78 million US $ = 201.28 million euros, minus 9.2 percent) and Dorel Juvenile (210.87 million US $ = 179.26 million) Euros, plus 18.7 percent).
Adjusted net total earnings for the second quarter of sales were $ 23.03 million (19.58 million euros), 47.1 percent above the comparable prior-year period.
»Given the ongoing chaotic environment in the supply chain, we are very satisfied with the performance of our companies in the second quarter. Although we struggled with record increases in container freight rates and higher product costs in many categories, we report significantly improved earnings. The demand for our products remained robust. However, as the stocks were insufficient due to the lack of availability of sea containers, we were not able to fully satisfy the needs of consumers, ”explained Dorel Group President and CEO Martin Schwartz, referring to the results of the second sales quarter of 2021.
Half-year sales and adjusted profit
All this led to a Dorel Group half-year sales of 1.47 billion USD (1.25 billion euros, up 13 percent). Of this, 587.65 million (499.55 million euros) are attributable to Dorel Sports (plus 24 percent), 465.48 million (395.70 million euros) to Dorel Home (plus 1.6 percent) and 420.72 million USD ( 357.65 million euros) to Dorel Juvenile (plus 12.9 percent).
As a result, adjusted net income for the first half of 2021 was $ 35.24 million. For comparison: in the first six months of the previous year it was just 2.04 million USD (1.73 million euros).
Dorel Sports: all three bicycle business areas are growing
»Dorel Sports had a remarkable quarter and again achieved record sales and results. The demand for bicycles shows no signs of weakening, ”says Schwartz happily.
The growth in sales did not only affect the Cycling Sports Group (CSG, Cannondale, Fabric, GT etc.), which exclusively sells premium bicycles, but also the Pacific Cycle Group (PCG – Mongoose, Schwinn, Kid Trax etc.) as well as the Brazilian bicycle producer Caloi, which also belongs to Dorel Sports. All three Dorel Sports offshoots made gains. However, the largest percentage increases were recorded by CSG and Caloi.
With the above-mentioned Dorel Sports half-year sales of USD 587.65 million (EUR 499.55 million), the reported and adjusted operating income of USD 53.5 million (EUR 45.48 million – compared to reported 26, 2 million USD = 22.27 million euros or adjusted 26.6 million USD = (22.61 million euros in the first half of 2020).
outlook
Despite good figures, Schwartz is extremely cautious about the future: “As in many industries, the supply uncertainty is greater than ever before. Demand for container freight continues to drive costs up and hinder our ability to meet continued strong consumer demand for our products. Additionally, virus outbreaks in different parts of the world and even the availability of labor for Dorel and our stakeholders are risks that we are grappling with. Our ability to successfully tackle these issues with our suppliers and retail partners will be critical to delivering a strong second half of the year. “
The uncertainties in the situation described affect Dorel Sports in particular: the component bottlenecks and the related lack of supply would unfortunately currently completely slow down higher sales: »Since demand is likely to remain very strong in the rest of the year, we will only see the results of the previous year in the second half of the year exceed if the current delivery problem can be limited. “
Text: Jo Beckendorff, image / table: Dorel Group
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