Dorel has most profitable Q3 ever - BikeBiz

Dorel has most profitable Q3 ever

But cycling division profit drops as consumers shift to ‘lower priced items’
Publish date:

Dorel has seen net income rise, with record profitability in Q3 across the company in its third quarter and nine month results, published yesterday.

Revenue dropped for the firm to US $518.5 million, 6.1 per cent lower than US $552.2 million a year ago. Net income rose by 11.1 per cent compared like-for-like with Q3 2008.

Dorel’s Recreational/Leisure division, which includes the cycling arm of the firm, saw revenue decline. According to the company, that fall is due largely to reduction in sales at ‘mass merchants’, though Dorel noted an increase of sales at independent bike dealers.

In quarter three the division's revenue fell 11 per cent to US $145.1 million from US $163.2 million. Gross profit also fell compared like-for-like with Q3 2008, by 8.7 per cent.

The Dorel statement read: “Consumers are purchasing less of CSG’s higher-end products and are trading down to lower priced items, which carry lower margins. Excluding the impact of new business acquisitions and foreign exchange variations on the segment’s non-US based businesses, Recreational/Leisure’s organic revenue decline was approximately 10 per cent for the quarter and six per cent year-to-date.”

The financials made mention of the acquisition of Iron Horse and Hot Wheels, making special mention of the Charge brand and the fact that it recently won twoawards in the UK.

Dorel President and CEO Martin Schwartz lauded the wider company’s positive results: “The fact that we have exceeded last year’s earnings for the quarter despite a difficult economic period is a tribute to the quality and value of our products and our focus on maximising margins through cost containment, a more stable cost environment and our disciplined minimum margin requirement program.

"Dorel’s multi-national operations, diverse operating segments and broad product lines have traditionally compensated for earnings variations within the Company’s various operating divisions. This is the case in 2009 as strong results within North America in the Juvenile and Home Furnishing segments are offsetting less profitable results at other divisions elsewhere within the Company.”

Dorel now encompasses Cannondale, GT, Sugoi, Schwinn, Mongoose, Iron Horse and the former Hot Wheels, among others.

Featured Jobs

cycles service promo

Shop Manager/ Head Mechanic

Cycleservice Limited I Sidmouth, East Devon I Salary: £22,000 Plus Share Incentives Available I Date Published Wednesday 30th May 2018

Giant St Paul Logo

Bike Fitter / Sales Person

Giant St Pauls I City of London I Salary: Negotiable Dependent on Experience I Date Published Thursday 21st June 2018


Social Media Executive

Sigma Sports I Hampton Wick, Surrey I £22,000 to £24,000 per year I Date Published Monday 4th June 2018