Dorel Industries, Inc. Announces Financial Results

August 11, 2025  by Karen Parrish in Business Strategy, Industry   

— Dorel Juvenile delivers solid earnings performance led by growth in international markets

— Dorel Home implementing restructuring strategy amidst a challenging market

Second quarter revenue was US$292.4 million, compared to US$348.1 million, a decrease of 16.0% from the same period a year ago. Reported net loss was US$44.9 million or US$1.38 per diluted share, compared to US$59.5 million or US$1.83 per diluted share last year. Adjusted net loss  was US$21.1 million or US$0.65 per diluted share compared to US$13.6 million or US$0.42 per diluted share last year.

Revenue for the six months was US$612.8 million, compared to US$699.1 million, down 12.3% from the prior year. Reported net loss was US$70.2 million or US$2.15 per diluted share, compared to US$77.1 million or US$2.37 per diluted share a year ago. Adjusted net loss1 for the six months was US$44.8 million or US$1.37 per diluted share, compared to US$30.5 million or US$0.94 per diluted share last year.

"Dorel Juvenile delivered a strong second quarter in 2025, building on the momentum from the start of the year, and overcoming the challenges posed by U.S. tariffs. Our performance was driven by strong growth in Europe and key international markets, disciplined cost control and favorable foreign exchange movements. Dorel Home experienced a difficult second quarter with tariff uncertainty and liquidity constraints impeding sales. On June 30th, 2025, we announced our expanded restructuring plan and are actively implementing changes to reduce costs and further streamline operations. We remain confident that the benefits of our Home segment transformation will begin to emerge in the fourth quarter of this year, with full impact expected in 2026," stated Dorel President & CEO, Martin Schwartz.

Dorel Home
Dorel announced an accelerated restructuring plan on June 30th, 2025, including the decision to cease manufacturing operations at its Cornwall, Ontario facility. It is expected that the wind-down of these operations will be completed by the end of the third quarter of this year to minimize losses and fulfil customer obligations. This decision is part of a broader transition to a leaner organization with a reduced product line, focused on profitable categories. The segment will operate with a reduced footprint and integrate back-office operations into Dorel Juvenile’s infrastructure. The Home segment is actively working on exiting product categories that are now considered non-core, including a plan to significantly reduce inventory by the end of the year, thereby allowing for a smaller distribution footprint. Warehouse consolidation efforts are underway, with Canadian and California operations transitioning into Dorel Juvenile facilities. The Company is also finalizing its East Coast distribution strategy.

During the quarter, the Home segment recorded restructuring costs of US$22.4 million, of which US$13.2 million was for the non-cash write-down of equipment and inventory. The remaining amount of US$9.2 million was for accrued severance costs, the majority of which is to be paid out after the closure of the Cornwall manufacturing operations at the end of the third quarter of this year. The benefits of the Cornwall, Ontario, manufacturing facility closure will begin only in the fourth quarter of this year, however included in the severance amount were other headcount reductions initiated in May, generating US$0.8 million in monthly savings beginning in June 2025. 

Long-Term Debt and Financing Update
On August 7, 2025, the Company announced it again amended its asset backed loan facility and term loan facility whereby Dorel’s lenders agreed to continue to forebear from enforcing their rights and exercising their remedies under both the ABL facility and term loan facility further to a default by Dorel relating to certain financial covenants. As part of the amendment, the Company will receive access to US$20.0 million additional liquidity under the ABL facility, available in three tranches subject to meeting availability requirements, in order to finance new inventory and must continue to provide the lenders with additional reporting during the forbearance period.

Also as previously announced, the Company has engaged two leading capital market advisors to assist in re-capitalizing the Company’s balance sheet to allow for growth in the Juvenile segment and support the re-organization of the Home segment. The new structure will replace the current debt structure which no longer matches the Company’s needs. As of today, the process has advanced, and the Company expects a new structure to be in place around the end of the third quarter of this year. 

Outlook
“Despite the challenges of U.S. tariffs, the Juvenile segment is well positioned relative to competitors based on its worldwide footprint and domestic manufacturing capabilities in the U.S. This was evidenced in the second quarter as reduced earnings in the U.S. were more than offset by improved earnings in our other markets. With our facilities in the U.S., which could present further opportunities going forward, and our strong international business, we expect to continue to improve earnings and remain on track for a better 2025 versus 2024. Dorel Home is entering a pivotal phase in its transformation journey, with the second half of 2025 focused on executing the structural changes initiated this year. We are confident that the actions taken, streamlining operations, integrating with Dorel Juvenile, and transitioning to a more agile distribution model, will position us for a return to profitability in 2026,” commented Dorel President & CEO, Martin Schwartz.

"The Company continues to work with key customers and suppliers to maintain strong relationships during this period of transition and we are appreciative of that support. We are on track to secure additional financing, and when we do this added liquidity will mean a much healthier Dorel on day one. This will coincide with our reduced cost structure in Dorel Home, and with our on-going growth in Dorel Juvenile, we will have the ability to better serve our customers and work even more closely with our key suppliers,” concluded Mr. Schwartz.

Conference Call
Dorel Industries Inc. will hold a conference call to discuss these results. If you are unable to call in at this time, you may access a recording of the meeting by calling 1-855-669-9658 and entering the passcode 8352001 on your phone. This recording will be available on Monday, August 11, 2025 as of 2:30 PM until 11:59 PM on Monday, August 18, 2025.

Unaudited condensed consolidated interim financial statements as at June 30, 2025 will be available on the Company's website, www.dorel.com, and will be available through the SEDAR+ website.