Dorel Sports, like all the divisions of the Dorel group, was negatively impacted by a strong US dollar in its Q4 results.
Dorel Sports revenue fell by US$6.4million (2.5 per cent) to US$253.7million compared to last year. Dorel Sports owns GT, Schwinn and Cannondale, among others. Over the year revenue decreased US$53m (5 per cent) to US$1billion in 2015.
However, organic revenue increased around 3 per cent for the year and was up for the quarter too, largely thanks to the IBD channel "due to increased demand of new model year 2016 bicycles" and electric bikes in the UK: "In the US mass channel…sales of battery powered ride-ons showed strong growth".
Dorel Sports also pointed to unforseen circumstances hobbling Q4 expectations: "Dorel’s largest customer unexpectedly reduced purchases late in the year. In addition, while sales to IBD customers were up double digits in the second half, expectations were to do even better during the fourth quarter, but this did not materialize. As such, results for the quarter were below expectations."
Martin Schwartz, Dorel President and CEO: ”2015 was characterised by good performances in many of our markets overshadowed by challenging currency rates. Overall for the year, these adverse exchange rates impacted our earnings by approximately US$43 million pre-tax. Excluding this impact we would have exceeded prior year earnings for the year. Each of our foreign-based divisions responded to these currency challenges over the course of the year, as reflected in our fourth quarter results which exceeded last year."