- Strong earnings from operations despite environment
- New products, new bicycle brand to increase Dorel's competitive
position
- Excluding mark-to-market losses on foreign exchange contracts, Q2 EPS
is US$1.01
EXCHANGES
TSX: DII.B, DII.AMONTREAL, Aug. 12 /CNW Telbec/ - Dorel Industries Inc. (TSX: DII.B DII.A)
today announced its results for the second quarter ended June 30, 2009. Net
income was US$24.8 million or US$0.74 per diluted share compared with US$31.3
million or US$0.94 per diluted share for the corresponding quarter of 2008. As
described below, the 2009 results include significant mark-to-market losses on
foreign exchange contracts. These losses totaled US$12.6 million in the second
quarter and represent an after tax amount of US$0.27 per diluted share.
Excluding these losses, diluted EPS for the second quarter this year would
have been US$1.01. This earnings improvement was despite a decline in revenues
for the period which slipped 7.2% to US$551.1 million from US$593.7 million
for the same period a year ago.
Year-to-date net income was US$52.8 million or US$1.58 per diluted share
compared to US$66.5 million or US$1.99 per diluted share for the first half of
2008. Excluding year-to-date mark-to-market losses on foreign exchange
contracts, earnings were US$61.3 million, or US$1.84 per diluted share. First
half revenue was US$1.076 billion or a decrease of 6.4% from the US$1.150
billion last year.
To protect itself from variations in foreign exchange rates and their
impact on the Company's cash flow, it enters into foreign exchange forward
contracts and other types of derivative financial instruments, the great
majority of which are at Dorel Europe within the Juvenile segment. As the
Company does not follow the accounting practice of "hedge accounting",
non-cash "mark-to-market" gains and losses are recognized, representing the
difference between the contracted exchange rate and the market rate on these
instruments at the end of a given accounting period. Therefore, the gains and
losses on these instruments are recognized relative to fluctuations in current
exchange rates as opposed to the date of maturity of the contracts, when the
cash flow impact is recorded. The majority of the unrealized losses booked in
2009 thus far pertain to contracts that were in place as of December 30, 2008
on which the related unrealized gains were recorded in 2008.
"For the second consecutive quarter we have surpassed our internal
earnings forecasts due to the implementation of stringent cost constraint
measures, a focus on working capital management and a more stable cost
environment. While sales are down, a significant percentage of the decrease is
attributable to foreign exchange translation. High-end bicycle sales are still
not where we want them to be as consumers remain selective in their
discretionary spending. Overall, our divisions are performing well
notwithstanding the challenging economy. Product development remains a key
driver for Dorel. Exciting new products, such as our revolutionary Safety 1st
Air Protect car seat, are being introduced to the market. At this year's Tour
de France two members of Team Liquigas, riding Cannondale's new 2010 SuperSix
road bike, finished in the top ten and a third took the prestigious King of
the Mountains Polkadot Jersey. This is the first time ever that a Cannondale
sponsored team had two riders finish in the top ten. These are examples of how
our R&D commitment will further grow our strong competitive position,"
commented Dorel CEO and President, Martin Schwartz.-------------------------------------------------------------------------
-------------------------------------------------------------------------
Summary of Financial Highlights
-------------------------------------------------------------------------
Second Quarters Ended June 30
-------------------------------------------------------------------------
All figures in thousands of US $, except per share amounts
2009 2008 Change %
-------------------------------------------------------------------------
Revenues 551,123 593,724 -7.2%
Net income 24,764 31,347 -21.0%
Per share - Basic 0.74 0.94 -21.3%
Per share - Diluted 0.74 0.94 -21.3%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Average number of shares
outstanding - diluted weighted
average 33,388,415 33,397,745
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Summary of Financial Highlights
-------------------------------------------------------------------------
Six Months Ended June 30
-------------------------------------------------------------------------
All figures in thousands of US $, except per share amounts
2009 2008 Change %
-------------------------------------------------------------------------
Revenues 1,076,353 1,149,758 -6.4%
Net income 52,793 66,480 -20.6%
Per share - Basic 1.58 1.99 -20.6%
Per share - Diluted 1.58 1.99 -20.6%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Average number of shares
outstanding - diluted weighted
average 33,384,027 33,397,717
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Juvenile Segment
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Second Quarters Ended June 30
-------------------------------------------------------------------------
2009 2008
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 244,672 282,204 -13.3%
Gross Profit 59,593 24.4% 77,474 27.5% -23.1%
Earnings from
operations 16,725 6.8% 29,571 10.5% -43.4%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Six Months Ended June 30
-------------------------------------------------------------------------
2009 2008
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 498,633 590,887 -15.6%
Gross Profit 132,303 26.5% 168,492 28.5% -21.5%
Earnings from
operations 45,445 9.1% 66,303 11.2% -31.5%
-------------------------------------------------------------------------
-------------------------------------------------------------------------Earnings in the Juvenile segment declined from 2008 levels, but include a
significant proportion of the Company's overall mark-to-market losses on
foreign exchange contracts. In the second quarter this amount was US$12.7
million, whereas 2008 included a small gain of US$1.1 million. If these
amounts are excluded from the results, earnings improved over last year
despite the decline in sales revenue. This improvement was due principally to
improved gross margins made possible through more stable product costs and an
improved product mix.
The decrease in Juvenile revenue was in both North America and Europe,
but was most acute in Europe. Sales outside of the US comprise more than half
of the segment's total; therefore the strength of the US dollar has a
significant effect on both revenues and earnings. Second quarter European
sales declined 22% year-over-year, with more than half due to the impact of
foreign exchange. Excluding this, the true organic revenue decline was
approximately 9% in Europe and approximately 6% for the segment as a whole.
Year-to-date, approximately half of the sales decline was also due to the
impact of foreign exchange as European sales decreased 24%, but organically
the decline was approximately 11%, and for the segment as a whole, the organic
decline was approximately 8%.
Subsequent to the end of the quarter, the new Safety 1st Air Protect(TM)
was revealed. Air Protect(TM) is the most innovative and groundbreaking safety
feature ever offered in a car seat. Developed in conjunction with Kettering
University's renowned Crash Safety Center, Air Protect(TM) is designed to
protect children in side impact collisions, putting a state-of-the-art layer
of air protection where it's needed most, around the child's head.Recreational/Leisure
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Second Quarters Ended June 30
-------------------------------------------------------------------------
2009 2008
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 199,093 195,073 2.1%
Gross Profit 44,252 22.2% 45,623 23.4% -3.0%
Earnings from
operations 16,009 8.0% 17,252 8.8% -7.2%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Six Months Ended June 30
-------------------------------------------------------------------------
2009 2008
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 360,521 335,533 7.4%
Gross Profit 81,280 22.5% 80,122 23.9% 1.4%
Earnings from
operations 25,986 7.2% 32,062 9.6% -19.0%
-------------------------------------------------------------------------
-------------------------------------------------------------------------Second quarter Recreational / Leisure revenue increased by 2.1% over
2008, and year-to-date this increase was 7.4%. Excluding the impact of new
business acquisitions and foreign exchange variations, the segment's organic
revenue decline was approximately 5% for the quarter and 4% year-to-date.
Revenues within the segment's core bicycle business at the mass merchant level
were down from the prior year, but these declines were offset by the
contribution of the parts and accessories business that was acquired late in
June of 2008. Bicycle sales by the Cycling Sports Group to the Company's
Independent Bike Dealers (IBD) and sporting goods customers were also down as
consumers are purchasing less of the Company's high-end product or are trading
down to lower priced items. The Company also believes that the poor weather
that was experienced in most of North America throughout May and June also has
a negative impact on sales.
Gross margins and earnings from operations for the quarter decreased from
2008, as did the year-to-date results. Gross margin declines for the quarter
and year-to-date were due principally to a less profitable product mix as
consumers shifted to lower price point products. Gross margins in the quarter
were further negatively impacted by foreign exchange variations including a
mark-to-market loss of US$1.1 million on foreign exchange contracts. Costs
associated with the previously announced re-organization of the segment in the
quarter totalled approximately US$0.3 million.
In July and August the Company announced the acquisitions of certain
assets of Iron Horse Bicycles, based in the United States, and
Australian-based distributor Gemini Bicycles. The Iron Horse transaction of
US$5.2 million comprised of inventory and various trademarks and trade names,
including the well-recognized "Iron Horse" brand. At a cost of US$2.2 million,
the assets acquired in the Gemini purchase will be merged with Cannondale's
existing Australian operations under the new Cycling Sports Group (CSG)
Australia division and will be dedicated to the Independent Bike Dealer (IBD)
channel.
"I am particularly proud of our successes at this year's Tour de France.
Two riders on Team Liquigas riding Cannondales finished in the top ten with
Vincenzo Nibali placing seventh and Roman Kreuziger placing ninth. In
addition, Franco Pellizotti won the prestigious King of the Mountains Polka
Dot Jersey. As we approach the 2010 model year, early reaction to our new IBD
product line has been outstanding and our pre-delivery order level is up
significantly from last year at this time. Based on the feedback we have
received thus far, we believe we will increase our bike sales next year to the
IBD retail chain, regardless of the economic situation," commented Mr.
Schwartz.Home Furnishings
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Second Quarters Ended June 30
-------------------------------------------------------------------------
2009 2008
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 107,358 116,447 -7.8%
Gross Profit 17,270 16.1% 14,348 12.3% 20.4%
Earnings from
operations 7,713 7.2% 3,561 3.1% 116.6%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Six Months Ended June 30
-------------------------------------------------------------------------
2009 2008
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 217,199 223,338 -2.7%
Gross Profit 30,742 14.2% 25,884 11.6% 18.8%
Earnings from
operations 12,098 5.6% 4,501 2.0% 168.8%
-------------------------------------------------------------------------
-------------------------------------------------------------------------While all of the segment's divisions posted second quarter sales that
were flat or down from last year, earnings more than doubled. The earnings
improvement was driven by Ameriwood as that division continued to show
consistent sales and earnings of domestically produced furniture, helping
factory efficiencies and resultant earnings. Gross margins and earnings were
aided by the more favourable rate of exchange of the Canadian dollar versus
the US dollar as two of the Segment's plants are located in Canada and sell
the majority of their product to US based customers. Included in the 2009 cost
of sales figures are mark-to-market gains on foreign exchange contracts of
US$1.1 million in the second quarter and US$2.2 million year-to-date.
Year-to-date revenues were also down versus last year, though less so
with a decline of 2.7%. As in the quarter, gross margins and earnings improved
despite the lower sales levels due to a more favourable dollar and
improvements at Ameriwood.
Cash flow
During the first half of 2009, cash flow from operating activities was
US$75.0 million an improvement of 17.4% over the US$63.9 million that was
provided by operations in the corresponding period of 2008. As the Company
anticipated, inventory levels remained in line with the first quarter at
US$423.0 million, down from US$509.5 million at year end. Free cash flow,
defined as cash flow from operating activities less, capital expenditures and
dividends, for the first six months of the year was US$49.4 million an
improvement of almost 50% over the first half of 2008.
Quarterly Dividend
The Board of Directors of Dorel declared its regular quarterly dividend
of US$0.125 per share on the outstanding number of the Company's Class A
Multiple Voting Shares, Class B Subordinate Voting Shares and Deferred Share
Units. The dividend is payable on September 9, 2009 to shareholders of record
as at the close of business on August 26, 2009.
Outlook
"Year-to-date our various businesses have generally performed well,
particularly in light of the prevailing general economic conditions. A
continuous focus on product development over the past 18 months has been
instrumental in securing important additional placements at retailers. Though
the challenges within the Recreational / Leisure segment are expected to
remain through the balance of 2009, we continue to look forward to a solid
second half and we remain on track to generate significant free cash flow in
the year.
"Throughout 2009 we have remained committed to the long-term vision that
we hold for Dorel. We are putting into place an improved infrastructure at our
Recreational / Leisure segment and have continued to focus on new product
development and have broadened our product line. We have added valuable brands
with Iron Horse in bicycles and HopHop in Juvenile and we have established new
distribution platforms in Brazil and Australia. We are investing for the
future and believe strongly that the benefits will be seen in 2010 and
beyond," concluded Mr. Schwartz.
Conference Call
Dorel Industries Inc. will hold a conference call to discuss these
results today, August 12, 2009 at 1:00 P.M. Eastern Time. Interested parties
can join the call by dialling 1-800-732-9307. The conference call can also be
accessed via live webcast at www.dorel.com , www.newswire.ca or www.q1234.com.
If you are unable to call in at this time, you may access a tape recording of
the meeting by calling 1-877-289-8525 and entering the passcode 21312631# on
your phone. This tape recording will be available on Thursday, August 12, 2009
as of 3:00 P.M. until 11:59 P.M. on Thursday, August 19, 2009.Complete financial statements will be available on the Company's website,
www.dorel.com, and will be available through the SEDAR websites.Profile
Dorel Industries Inc. (TSX: DII.B, DII.A) is a world class juvenile
products and bicycle company. Established in 1962, Dorel creates style and
excitement in equal measure to safety, quality and value. The Company's
lifestyle leadership position is pronounced in both its Juvenile and Bicycle
categories with an array of trend-setting products. Dorel's powerfully branded
products include Safety 1st, Quinny, Cosco, Maxi-Cosi and Bébé Confort in
Juvenile, as well as Cannondale, Schwinn, GT, Mongoose and SUGOI in
Recreational/Leisure. Dorel's Home Furnishings segment markets a wide
assortment of furniture products, both domestically produced and imported.
Dorel is a US$2.2 billion company with 4700 employees, facilities in eighteen
countries, and sales worldwide.
Caution Concerning Forward-Looking Statements
Except for historical information provided herein, this press release may
contain information and statements of a forward-looking nature concerning the
future performance of Dorel Industries Inc. These statements are based on
suppositions and uncertainties as well as on management's best possible
evaluation of future events. The business of the Company and these
forward-looking statements are subject to a number of risks and uncertainties
that could cause actual results to differ from expected results. Important
factors which could cause such differences may include, without excluding
other considerations, increases in raw material costs, particularly for key
input factors such as particle board and resins; increases in ocean freight
container costs; failure of new products to meet demand expectations; changes
to the Company's effective income tax rate as a result of changes in the
anticipated geographic mix of revenues; the impact of price pressures exerted
by competitors, and settlements for product liability cases which exceed the
Company's insurance coverage limits. A description of the above mentioned
items and certain additional risk factors are discussed in the Company's
Annual MD&A and Annual Information Form, filed with the securities regulatory
authorities. The risk factors outlined in the previously mentioned documents
are specifically incorporated herein by reference. The Company's business,
financial condition, or operating results could be materially adversely
affected if any of these risks and uncertainties were to materialize. Given
these risks and uncertainties, investors should not place undue reliance on
forward-looking statements as a prediction of actual results.DOREL INDUSTRIES INC.
CONSOLIDATED BALANCE SHEETS
ALL FIGURES IN THOUSANDS OF US $
as at as at
June 30, December 30,
2009 2008
------------- -------------
(unaudited) (audited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 43,713 $ 16,966
Accounts receivable 374,718 316,267
Income taxes receivable 16,134 19,798
Inventories 423,015 509,467
Prepaid expenses 20,293 16,236
Future income taxes 43,823 37,342
------------- -------------
921,696 916,076
PROPERTY, PLANT AND EQUIPMENT 152,497 158,895
INTANGIBLE ASSETS 396,541 395,742
GOODWILL 544,058 540,187
OTHER ASSETS 14,230 19,573
------------- -------------
$ 2,029,022 $ 2,030,473
------------- -------------
------------- -------------
LIABILITIES
CURRENT LIABILITIES
Bank indebtedness $ 10,342 $ 4,398
Accounts payable and accrued liabilities 351,866 380,915
Income taxes payable 33,165 30,164
Future income taxes - 2,713
Current portion of long-term debt 63,892 8,879
------------- -------------
459,265 427,069
------------- -------------
LONG-TERM DEBT 377,696 450,704
------------- -------------
PENSION & POST-RETIREMENT BENEFIT OBLIGATIONS 20,018 20,072
------------- -------------
FUTURE INCOME TAXES 109,555 111,874
------------- -------------
OTHER LONG-TERM LIABILITIES 6,000 6,010
------------- -------------
SHAREHOLDERS' EQUITY
CAPITAL STOCK 176,348 177,422
------------- -------------
CONTRIBUTED SURPLUS 17,929 16,070
------------- -------------
RETAINED EARNINGS 778,036 738,113
ACCUMULATED OTHER COMPREHENSIVE INCOME 84,175 83,139
------------- -------------
862,211 821,252
------------- -------------
1,056,488 1,014,744
------------- -------------
$ 2,029,022 $ 2,030,473
------------- -------------
------------- -------------
DOREL INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF INCOME
ALL FIGURES IN THOUSANDS OF US $, EXCEPT PER SHARE AMOUNTS
Second Quarters Ended Six Months Ended
------------------------- --------------------------
June 30, June 30, June 30, June 30,
2009 2008 2009 2008
------------ ------------ ------------ -------------
(unaudited) (unaudited) (unaudited) (unaudited)
Sales $ 547,253 $ 590,742 $ 1,068,668 $ 1,141,775
Licensing and
commission income 3,870 2,982 7,685 7,983
------------ ------------ ------------ -------------
TOTAL REVENUE 551,123 593,724 1,076,353 1,149,758
------------ ------------ ------------ -------------
EXPENSES
Cost of sales 430,008 456,279 832,028 875,260
Selling, general
and administrative
expenses 77,953 81,604 155,177 162,033
Depreciation and
amortization 6,311 7,275 11,990 13,293
Research and
development costs 2,573 2,508 5,048 5,221
Restructuring costs 70 802 72 1,625
Interest on
long-term debt 4,092 5,332 8,151 10,037
Other interest 313 619 506 522
------------ ------------ ------------ -------------
521,320 554,419 1,012,972 1,067,991
------------ ------------ ------------ -------------
Income before income
taxes 29,803 39,305 63,381 81,767
Income taxes 5,039 7,958 10,588 15,287
------------ ------------ ------------ -------------
NET INCOME $ 24,764 $ 31,347 $ 52,793 $ 66,480
------------ ------------ ------------ -------------
------------ ------------ ------------ -------------
EARNINGS PER SHARE
Basic $ 0.74 $ 0.94 $ 1.58 $ 1.99
------------ ------------ ------------ -------------
------------ ------------ ------------ -------------
Diluted $ 0.74 $ 0.94 $ 1.58 $ 1.99
------------ ------------ ------------ -------------
------------ ------------ ------------ -------------
SHARES OUTSTANDING
Basic - weighted
average 33,312,383 33,397,192 33,356,817 33,397,192
Diluted - weighted
average 33,388,415 33,397,745 33,384,027 33,397,717
DOREL INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
ALL FIGURES IN THOUSANDS OF US $
Second Quarters Ended Six Months Ended
------------------------- --------------------------
June 30, June 30, June 30, June 30,
2009 2008 2009 2008
------------ ------------ ------------ -------------
(unaudited) (unaudited) (unaudited) (unaudited)
NET INCOME $ 24,764 $ 31,347 $ 52,793 $ 66,480
------------ ------------ ------------ -------------
OTHER COMPREHENSIVE
INCOME:
Cumulative
----------
translation
-----------
adjustment:
-----------
Net change in
unrealized foreign
currency gains
(losses) on
translation of net
investments in
self-sustaining
foreign operations,
net of tax of nil 27,786 (1,842) 658 28,221
Portion included in
income as a result
of reductions in
net investments in
self-sustaining
foreign operations,
net of tax of nil - (384) - (384)
------------ ------------ ------------ -------------
27,786 (2,226) 658 27,837
------------ ------------ ------------ -------------
Net changes in cash
flow hedges:
Net change in
unrealized gains
(losses) on
derivatives
designated as cash
flow hedges 1,372 - 841 -
Reclassification to
income 221 - 221 -
Future income taxes (1,026) - (684) -
------------ ------------ ------------ -------------
567 - 378 -
------------ ------------ ------------ -------------
TOTAL OTHER
COMPREHENSIVE
INCOME 28,353 (2,226) 1,036 27,837
------------ ------------ ------------ -------------
TOTAL COMPREHENSIVE
INCOME $ 53,117 $ 29,121 $ 53,829 $ 94,317
------------ ------------ ------------ -------------
------------ ------------ ------------ -------------
DOREL INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
ALL FIGURES IN THOUSANDS OF US $
Six Months Ended
June 30, June 30,
2009 2008
------------- -------------
(unaudited) (unaudited)
CAPITAL STOCK
Balance, beginning of period $ 177,422 $ 177,271
Repurchase and cancellation of shares (1,074) -
------------- -------------
Balance, end of period 176,348 177,271
------------- -------------
CONTRIBUTED SURPLUS
Balance, beginning of period 16,070 11,623
Stock-based compensation 1,859 2,630
------------- -------------
Balance, end of period 17,929 14,253
------------- -------------
RETAINED EARNINGS
Balance, beginning of period 738,113 641,981
Net income 52,793 66,480
Adjustment to opening retained earnings
from adopting a new accounting standard
for inventories, net of tax of $1,415 (2,096) -
Premium paid on share repurchase (2,401) -
Dividends on common shares (8,360) (8,358)
Dividends on deferred share units (13) (7)
------------- -------------
Balance, end of period 778,036 700,096
------------- -------------
ACCUMULATED OTHER COMPREHENSIVE INCOME
Balance, beginning of period 83,139 106,871
Total other comprehensive income 1,036 27,837
------------- -------------
Balance, end of period 84,175 134,708
------------- -------------
TOTAL SHAREHOLDERS' EQUITY $ 1,056,488 $ 1,026,328
------------- -------------
------------- -------------
DOREL INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
ALL FIGURES IN THOUSANDS OF US $
Second Quarters Ended Six Months Ended
------------------------- --------------------------
June 30, June 30, June 30, June 30,
2009 2008 2009 2008
------------ ------------ ------------ -------------
(unaudited) (unaudited) (unaudited) (unaudited)
CASH PROVIDED BY
(USED IN):
OPERATING ACTIVITIES
Net income $ 24,764 $ 31,347 $ 52,793 $ 66,480
Items not involving
cash:
Depreciation and
amortization 11,371 12,704 21,839 23,790
Amortization of
deferred financing
costs 56 47 106 106
Future income taxes (4,566) 4,331 (6,591) 660
Stock based
compensation 852 1,149 1,458 2,630
Pension and
post-retirement
defined benefit
plans 910 789 1,596 820
Restructuring
activities (26) (1,193) (113) (1,877)
Exchange gain from
reduction of net
investments in
foreign operations - (384) - (384)
Loss on disposal of
property, plant and
equipment 403 4 409 24
------------ ------------ ------------ -------------
33,764 48,794 71,497 92,249
Net changes in
non-cash balances
related to
operations:
Accounts receivable 9,674 24,022 (56,887) (45,518)
Inventories 2,506 (25,145) 86,580 (8,472)
Prepaid expenses (608) (903) (3,673) (140)
Accounts payable,
accruals and other
liabilities 26,586 7,805 (28,903) 23,615
Income taxes 5,138 (1,079) 6,367 2,138
------------ ------------ ------------ -------------
43,296 4,700 3,484 (28,377)
------------ ------------ ------------ -------------
CASH PROVIDED BY
OPERATING ACTIVITIES 77,060 53,494 74,981 63,872
------------ ------------ ------------ -------------
FINANCING ACTIVITIES
Bank indebtedness 1,434 4,941 5,218 3,931
Increase of
long-term debt - 5,782 - 257,957
Repayments of
long-term debt (42,091) (6,400) (18,263) (61,556)
Share repurchase (3,433) - (3,475) -
Dividends on common
shares (4,161) (4,179) (8,360) (8,358)
------------ ------------ ------------ -------------
CASH (USED IN)
PROVIDED BY
FINANCING ACTIVITIES (48,251) 144 (24,880) 191,974
------------ ------------ ------------ -------------
INVESTING ACTIVITIES
Acquisition of
subsidiary
companies 4 (31,270) (6,484) (218,082)
Additions to
property, plant
and equipment -
net (5,519) (6,543) (6,860) (11,824)
Intangible assets (5,538) (5,743) (10,379) (10,377)
------------ ------------ ------------ -------------
CASH USED IN
INVESTING
ACTIVITIES (11,053) (43,556) (23,723) (240,283)
------------ ------------ ------------ -------------
Effect of exchange
rate changes on
cash and cash
equivalents 3,467 (826) 369 758
------------ ------------ ------------ -------------
NET INCREASE IN CASH
AND CASH EQUIVALENTS 21,223 9,256 26,747 16,321
Cash and cash
equivalents,
beginning of period 22,490 29,578 16,966 22,513
------------ ------------ ------------ -------------
CASH AND CASH
EQUIVALENTS, END OF
PERIOD $ 43,713 $ 38,834 $ 43,713 $ 38,834
------------ ------------ ------------ -------------
------------ ------------ ------------ -------------
DOREL INDUSTRIES INC.
INDUSTRY SEGMENTED INFORMATION
FOR THE SECOND QUARTERS ENDED JUNE 30
ALL FIGURES IN THOUSANDS OF US $
----------------------------------------------------
Total Juvenile
----------------------------------------------------
2009 2008 2009 2008
(unaudited) (unaudited) (unaudited) (unaudited)
Total revenue $ 551,123 $ 593,724 $ 244,672 $ 282,204
Cost of sales 430,008 456,279 185,079 204,730
Selling, general and
administrative 71,718 76,496 36,117 40,270
Depreciation and
amortization 6,307 7,255 4,742 5,116
Research and
development costs 2,573 2,508 1,939 1,720
Restructuring costs 70 802 70 797
----------------------------------------------------
Earnings from
operations 40,447 50,384 $ 16,725 $ 29,571
--------------------------
--------------------------
Interest 4,405 5,951
Corporate expenses 6,239 5,128
Income taxes 5,039 7,958
--------------------------
Net income $ 24,764 $ 31,347
--------------------------
--------------------------
Earnings per Share
------------------
Basic $ 0.74 $ 0.94
------------ ------------
------------ ------------
Diluted $ 0.74 $ 0.94
------------ ------------
------------ ------------
----------------------------------------------------
Recreational / Leisure Home Furnishings
----------------------------------------------------
2009 2008 2009 2008
(unaudited) (unaudited) (unaudited) (unaudited)
Total revenue $ 199,093 $ 195,073 $ 107,358 $ 116,447
Cost of sales 154,841 149,450 90,088 102,099
Selling, general and
administrative 27,049 26,836 8,552 9,390
Depreciation and
amortization 1,194 1,535 371 604
Research and
development costs - - 634 788
Restructuring costs - - - 5
----------------------------------------------------
Earnings from
operations $ 16,009 $ 17,252 $ 7,713 $ 3,561
----------------------------------------------------
----------------------------------------------------
DOREL INDUSTRIES INC.
INDUSTRY SEGMENTED INFORMATION
FOR THE SIX MONTHS ENDED JUNE 30
ALL FIGURES IN THOUSANDS OF US $
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Total Juvenile
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2009 2008 2009 2008
(unaudited) (unaudited) (unaudited) (unaudited)
Total revenue $ 1,076,353 $ 1,149,758 $ 498,633 $ 590,887
Cost of sales 832,028 875,260 366,330 422,395
Selling, general and
administrative 143,714 151,534 74,275 87,410
Depreciation and
amortization 11,962 13,252 8,733 9,521
Research and
development costs 5,048 5,221 3,778 3,686
Restructuring costs 72 1,625 72 1,572
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Earnings from
operations 83,529 102,866 $ 45,445 $ 66,303
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Interest 8,657 10,559
Corporate expenses 11,491 10,540
Income taxes 10,588 15,287
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Net income $ 52,793 $ 66,480
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Earnings per Share
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Basic $ 1.58 $ 1.99
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Diluted $ 1.58 $ 1.99
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Recreational / Leisure Home Furnishings
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2009 2008 2009 2008
(unaudited) (unaudited) (unaudited) (unaudited)
Total revenue $ 360,521 $ 335,533 $ 217,199 $ 223,338
Cost of sales 279,241 255,411 186,457 197,454
Selling, general and
administrative 52,783 45,423 16,656 18,701
Depreciation and
amortization 2,511 2,637 718 1,094
Research and
development costs - - 1,270 1,535
Restructuring costs - - - 53
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Earnings from
operations $ 25,986 $ 32,062 $ 12,098 $ 4,501
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For further information: MaisonBrison: Rick Leckner, (514) 731-0000;
Dorel Industries Inc.: Jeffrey Schwartz, (514) 934-3034
