Dorel Reports 9.8% 3Q Sales Increase

November 4, 2010  by in UnCategorized   

By Home Furnishings Business in Financial Reports on November 5, 2010

Juvenile and RTA furnishings vendor Dorel Inds. (NASDAQ: DIIB) reported Thursday that third-quarter 2010 sales rose 9.8 percent from a year ago to $569.5 million.

Net income of $30.1 million for the period remained virtually flat compared with third-quarter 2009.

Revenue through 2010's first nine months rose 11.2 percent over the same point last year to $1.8 billion; and year-to-date net income stood at $102.6 million compared with $83 million through third-quarter 2009.

"Dorel has posted solid third quarter results," said Montrea-based Dorel's President and CEO Martin Schwartz. "Our top line improved markedly while earnings were in line with the prior year. This was achieved notwithstanding the combination of much high container freight rates and increased raw material costs which impacted margins, particularly at our US juvenile business and home furnishings divisions. Dorel's bicycle business is reflecting the investments that we are making in our brands and in R&D with increased sales and earnings. At the same time despite a difficult economy abroad, there was solid progress in our juvenile business in Europe and a continuing strong showing in Brazil."

Looking ahead, although input and freight costs have begun to retreat, consumer demand is currently soft, particularly in home furnishings. Expectations are for full year earnings to be on plan. Net income will exceed the prior year.

"Our bicycle segment continues to improve, for both our mass merchant and IBD businesses," Schwartz said. "Investments in brand building and product innovation are proving to be successful with consumers in North America and Europe. ...  In Juvenile, we faced challenges on costs and currency, but we are optimistic looking forward based on our commitment to ensure a pipeline of upcoming new and innovative products. Dorel Europe continues to make progress and our investment in Brazil has proven to be a very good one, with sales growth and earnings far exceeding expectations."