Dorel completes successful year


    
    - Record cash flow from operations of US$205 million
    - Continued focus on new product development

    EXCHANGES
    TSX: DII.B, DII.A
    
</pre>
<p/>
<p><span class="xn-location">MONTREAL</span>, <span class="xn-chron">March 10</span> /CNW Telbec/ - Dorel Industries Inc. (TSX: DII.B DII.A) today announced results for the fourth quarter and year ended <span class="xn-chron">December 30, 2009</span>. Revenue for the fourth quarter increased 13.6% to US$545.3 million from US$479.9 million a year ago with pre-tax earnings of US$31.0 million compared to US$19.6 million, an increase of 58.5%. Net income rose 26.3% to US$24.2 million, or US$0.73 per diluted share, from US$19.2 million, or US$0.57 per diluted share last year.</p>
<p>Revenue for the year was slightly lower at US$2.1 billion as compared to US$2.2 billion in 2008. 2009 pre-tax income was US$128.3 million as compared to US$132.0 million in the prior year. Net income decreased 5.0% to US$107.2 million, or US$3.21 per diluted share from US$112.9 million or US$3.38 per diluted share. Organic revenue growth was approximately 7% in the fourth quarter and for the year was a decline of less than 3%.</p>
<p>As has been disclosed throughout the year, significant amounts pertaining to foreign exchange gains and losses across both 2009 and 2008 have had the impact of shifting reported earnings from one year to the other. In 2008 the Company recognized unrealized gains of US$10.5 million (after-tax US$7.4 million or US$0.22 per diluted share) on foreign exchange hedging instruments intended for use in 2009, which reversed in 2009, creating a loss in the current year. Over and above this, in 2009 the Company recorded an additional loss of US$4.2 million on 2010 foreign exchange contracts. The total after-tax negative impact on 2009 results was US$10.0 million or US$0.30 per diluted share. In addition, the fourth quarter results for 2009 include an after-tax net gain of US$2.9 million, or US$0.09 per diluted share, pertaining to the successful resolution of a claim.</p>
<p>"As we entered 2009 we were cautious, yet confident about Dorel's prospects. While we were prudent and focused on cost containment, we did not reduce in any way our commitment to new product development as we recognize that this remains a key driver for us. Despite the downturn, we have continued to allocate funds to business acquisitions and research and development, as we invest for the future. This resulted in the introduction of a number of excellent new products in 2009 which has further strengthened our competitive position in our core Juvenile and Recreational/Leisure segments. Our commitment was most recently evidenced by our announced US$20.8 million investment to be made over the next three years at our Columbus, Indiana car seat facility for a new Design and Development Competency Center," commented Dorel CEO and President, <span class="xn-person">Martin Schwartz</span>.</p>
<p>"We are extremely pleased with the 2009 results. If we exclude the amounts above in relation to our foreign exchange hedging program and the settlement of the claim, our normalized diluted earnings per share improved year over year to US$3.42 from US$3.16 in 2008. This improvement is reflected in our strong cash flow from operations which totalled a record US$205 million. Even after re-investing in the business in the form of capital expenditures and business acquisitions, funding our share buy back program and paying dividends to our shareholders, we reduced our debt levels by almost US$114 million," added <span class="xn-person">Mr. Schwartz</span>.</p>
<p/>
<pre>
    
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                       Summary of Financial Highlights
    -------------------------------------------------------------------------
                      Fourth Quarters Ended December 30
    -------------------------------------------------------------------------
         All figures in thousands of US $, except per share amounts
                                              2009         2008      Change %
    -------------------------------------------------------------------------
    Revenues                               545,303      479,880         13.6%
    Net income                              24,211       19,167         26.3%
      Per share - Basic                       0.73         0.57         28.1%
      Per share - Diluted                     0.73         0.57         28.1%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Average number of shares
     outstanding -
     diluted weighted average           33,303,402   33,404,118
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                       Summary of Financial Highlights
    -------------------------------------------------------------------------
                       For the Years Ended December 30
    -------------------------------------------------------------------------
         All figures in thousands of US $, except per share amounts
                                              2009         2008      Change %
    -------------------------------------------------------------------------
    Revenues                             2,140,114    2,181,880         -1.9%
    Net income                             107,234      112,855         -5.0%
      Per share - Basic                       3.23         3.38         -4.4%
      Per share - Diluted                     3.21         3.38         -5.0%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Average number of shares
     outstanding -
     diluted weighted average           33,400,540   33,398,892
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    
</pre>
<p/>
<p>Juvenile Segment</p>
<p/>
<pre>
    
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                      Fourth Quarters Ended December 30
    -------------------------------------------------------------------------
                             2009                    2008
    -------------------------------------------------------------------------
                           $    % of rev.          $    % of rev.    Change %
    Revenues         248,521                 219,680                    13.1%
    Gross Profit      69,860        28.1%     59,828        27.2%       16.8%
    Earnings from
     operations       20,963         8.4%     25,823        11.8%      -18.8%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                       For The Years Ended December 30
    -------------------------------------------------------------------------
                             2009                    2008
    -------------------------------------------------------------------------
                           $    % of rev.          $    % of rev.    Change %
    Revenues         995,014               1,073,722                    -7.3%
    Gross Profit     274,497        27.6%    309,680        28.8%      -11.4%
    Earnings from
     operations       92,534         9.3%    126,837        11.8%      -27.0%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    
</pre>
<p/>
<p>Fourth quarter</p>
<p/>
<p>Juvenile revenue increased by 13.1% over the prior year's quarter. After factoring in the currency impact in all geographies and the first quarter Baby Art acquisition, organic sales growth for the segment was approximately 5%. Dorel Juvenile Group USA had a particularly strong fourth quarter with sales increasing over 15% while in <span class="xn-location">Europe</span> sales were equal to 2008 levels in local currency. This was the first quarter in 2009 in which Dorel <span class="xn-location">Europe</span> met or exceeded prior year's sales levels.</p>
<p>Earnings from operations decreased by US$4.9 million, however, the prior year's quarter included greater mark-to-market gains on foreign exchange contracts. The fourth quarter of 2009 included higher selling, general and administrative (S,G & A) costs due to exchange on non-US expenses, higher selling costs as a function of greater sales levels and higher administrative expenses mainly attributable to personnel costs. Note that S,G & A costs in the fourth quarter of 2009 were consistent with third quarter levels. Due to heavier spending and capitalized research and development cost write-offs, R & D expense increased by US$3.3 million from last year.</p>
<p/>
<p>Full year</p>
<p/>
<p>2009 revenues decreased from the record 2008 levels by US$78.7 million or 7.3%. If the impact of foreign exchange and acquisitions is excluded, the organic revenue decline was approximately 4%. The decrease was a result of the overall difficult retail environment, the impact of which was most acute in <span class="xn-location">Europe</span> where the Company's product line is focused on mid to higher priced products. Consumers favoured lower cost items, and therefore the sales mix had the impact of lowering margins. Plans have been developed to have greater representation in the lower to middle price point categories.</p>
<p>In the <span class="xn-location">United States</span>, sales declined, but by less than 2%. The decline was due to a conscious effort to eliminate less profitable items. An important area of strength during the year was DJG's presence in the lower and middle priced categories. There were several key product launches in the year, including the new Air Protect(TM) technology. Sales in <span class="xn-location">Australia</span>, in local currency, increased by 13% over last year, and despite a lower average rate of exchange to the US dollar, sales still improved by almost 5%. The results of the start-up business in <span class="xn-location">Brazil</span> were not material, however the market has excellent potential and is seen as a strong contributor going forward.</p>
<p>The impact of the foreign exchange contracts referred to above is mostly within the Juvenile segment. In 2008 gains totalling US$8.9 million were recorded on contracts that matured in 2009. The reversal of these gains in 2009 totalled US$8.4 million. Over and above these amounts, in 2009 the Company recorded an additional loss of US$4.2 million on 2010 contracts. This is a year-over-year variation of US$21.5 million pertaining to these contracts. If these amounts are excluded, earnings from operations in 2009 and 2008 would have been US$105.1 and US$117.9 million respectively. The main driver of the decrease was the decline in European earnings, partially offset by North American earnings which improved due to a better product mix and a lower cost environment.</p>
<p/>
<p>Recreational/Leisure Segment</p>
<p/>
<pre>
    
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                      Fourth Quarters Ended December 30
    -------------------------------------------------------------------------
                             2009                    2008
    -------------------------------------------------------------------------
                           $    % of rev.          $    % of rev.    Change %
    Revenues         175,670                 157,894                    11.3%
    Gross Profit      38,688        22.0%     33,691        21.3%       14.8%
    Earnings from
     operations        8,989         5.1%      3,172         2.0%      183.4%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                       For The Years Ended December 30
    -------------------------------------------------------------------------
                             2009                    2008
    -------------------------------------------------------------------------
                           $    % of rev.          $    % of rev.    Change %
    Revenues         681,366                 656,613                     3.8%
    Gross Profit     153,739        22.6%    150,804        23.0%        1.9%
    Earnings from
     operations       39,837         5.8%     41,874         6.4%       -4.9%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    
</pre>
<p/>
<p>Fourth quarter</p>
<p/>
<p>Recreational/Leisure segment revenues increased by US$17.8 million, or 11.3%. Approximately two-thirds of the increase was from new businesses acquired during the second half of the year with the balance from the segment's Independent Bicycle Dealers (IBD) business serviced by the Cycling Sports Group (CSG). Excluding acquisitions and driven by successful new products, CSG posted sales gains of over 25% versus last year. These increases were partially offset by lower sales by Pacific Cycle to the segment's mass merchant customers.</p>
<p>IBD sales did include a greater volume of less expensive, lower margin bicycles which dampened earnings within the CSG division. Despite the lower sales to mass merchants, Pacific Cycle posted improved earnings for the quarter as did the segment's CSG and Apparel Footwear Group (AFG) divisions. The overall significant year-over-year improvement was a clear sign that newer models, particularly in the CSG division, are being well accepted by dealers.</p>
<p/>
<p>Full year</p>
<p/>
<p>Revenues increased 3.8% to US$681.4 million in 2009 compared to US$656.6 million a year ago. This was due to sales growth within the CSG division as well as incremental revenues derived through the business acquisitions completed. Partially offsetting these increases was a sales drop to the segment's mass merchant customers. As a result, the overall segment organic sales decline for the year was just over 3%. Earnings declined despite a greater proportion of sales by CSG to the Company's IBD and sporting goods customers. With the recession, consumers purchased less high end products, trading down to lower priced items, which carry lower margins. In addition, some of the segment's competitors chose to discount their lines early in the year, resulting in an erosion of overall industry profitability.</p>
<p/>
<p>Home Furnishings Segment</p>
<p/>
<pre>
    
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                      Fourth Quarters Ended December 30
    -------------------------------------------------------------------------
                             2009                    2008
    -------------------------------------------------------------------------
                           $    % of rev.          $    % of rev.    Change %
    Revenues         121,112                 102,306                    18.4%
    Gross Profit      23,931        19.8%     11,522        11.3%      107.7%
    Earnings from
     operations       12,090        10.0%      1,539         1.5%      685.6%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                       For The Years Ended December 30
    -------------------------------------------------------------------------
                             2009                    2008
    -------------------------------------------------------------------------
                           $    % of rev.          $   % of rev.     Change %
    Revenues         463,734                 451,545                     2.7%
    Gross Profit      77,308        16.7%     50,915       11.3%        51.8%
    Earnings from
     operations       36,696         7.9%      7,964        1.8%       360.8%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    
</pre>
<p/>
<p>Fourth quarter</p>
<p/>
<p>Home Furnishings continued its strong year with a revenue increase of 18.4% over the fourth quarter of 2008. These increases were principally at Cosco Home & Office and Ameriwood. Earnings from operations in 2009 include the pre-tax amount of US$5.0 million, US$2.9 million after-tax, pertaining to the successful resolution of a pending claim against a major international law firm in regards to a breach of professional duty. Of this amount, the portion included in cost of sales positively impacts gross margins and excluding this amount would have been 14.5%, a 320 basis point improvement as the segment has improved its operations versus last year.</p>
<p/>
<p>Full year</p>
<p/>
<p>Revenues were up 2.7% from prior year to US$463.7 million. The fact that sales increased in a difficult economic environment is due to Dorel's focus on reasonably priced furniture sold primarily to mass merchants. The turnaround at Ameriwood's domestic ready-to-assemble (RTA) furniture operations, which began in 2008, led the way to profitability for the segment as a whole. Cosco Home & Office is re-focused on its core competency of metal folding furniture and step stools and as a result has cut costs considerably. In addition the resolution of the case referred to above and the related legal costs eliminates what had been a significant on-going expense.</p>
<p>Earnings were helped by a more favourable exchange rate in 2009 as two of the segment's plants are located in <span class="xn-location">Canada</span> and ship mainly to US based customers. It should be noted that as of the fourth quarter, these rates returned to 2008 levels and margins have moderated. Along with the successful business rationalization at Cosco Home & Office and foreign exchange, lower input costs and improved manufacturing operations also contributed to the earnings improvement.</p>
<p/>
<p>Taxes</p>
<p/>
<p>The Company's effective tax rate for 2009 was 16.4% as compared to 14.5% in 2008.</p>
<p/>
<p>Other</p>
<p/>
<p>The Company's cash flow from operating activities in 2009 was US$204.5 million, an increase from US$79.9 million in the prior year. The majority of this increase was due to a decrease in inventory levels, partially offset by increases in accounts receivable and decreases in accounts payable. The Company's investments in the business in the form of capital expenditures and business acquisitions totalled US$62.3 million. After funding the share buyback and dividend programs, debt levels were reduced by US$113.9 million in the year.</p>
<p>As at the 2008 year-end the Company had experienced a significant increase in inventory levels as retailers attempted to reduce their in-stock levels on-hand and as a result inventory levels rose. In 2009 as retailers began to replenish their stock levels, the Company's inventories declined accordingly throughout the year and, as was expected, inventories declined from US$509.5 million as at <span class="xn-chron">December 30, 2008</span> to US$399.9 million as at <span class="xn-chron">December 30, 2009</span>.</p>
<p/>
<p>Outlook</p>
<p/>
<p>"We have set in motion several opportunities in our Juvenile and Recreational/Leisure segments which we believe will continue to place us in a leadership position. In addition to the acquisitions made in our bicycle business, we foresee good opportunities for organic growth through the opening of new geographic markets and exciting new products. Dealer reaction to new model bicycles continues to be excellent, particularly in the Cycling Sports Group division. Significant changes and investment in our Apparel Footwear Group bode well for the future with an expansion into custom branded apparel," stated <span class="xn-person">Mr. Schwartz</span>.</p>
<p>"Response from retailers to Air Protect(TM) has been enthusiastic. There is significant potential with this technology. Dorel has committed to the creation of future platforms to further solidify our leadership position in the car seat category. New models will be developed at various price points. In <span class="xn-location">Europe</span>, equally exciting product introductions such as FamilyFix, Mila and Senzz, introduced last year, will allow for additional inroads in 2010. Each Juvenile division has additional innovative product launches planned throughout 2010. Globally, we will continue to develop emerging markets as we have done in <span class="xn-location">Australia</span> and <span class="xn-location">Brazil</span>. As such, 2010 looks positive and we expect sustainable growth.</p>
<p>"We intend to build on the successes achieved in Home Furnishings. Of note is the turnaround in Cosco Home & Office which is now focused on its proven core metal folding furniture and step stool lines. We will continue to provide excellent value to our customers through continued product development, sourcing efforts and emphasis on improving operational efficiencies.</p>
<p>"Various governmental and other agencies continue to predict that any recovery this year is likely to be slow. As such, over the course of 2010 the Company does not expect a significant improvement in the economy which will continue to impact consumers' buying habits. Dorel is not immune to these conditions, but as 2009 demonstrated, the nature of the great majority of the Company's products, and the customers to which Dorel's products are sold, will protect us to a certain extent," concluded <span class="xn-person">Mr. Schwartz</span>.</p>
<p/>
<p>Conference Call</p>
<p/>
<p>Dorel Industries Inc. will hold a conference call to discuss these results today, <span class="xn-chron">March 10, 2010</span> at <span class="xn-chron">1:00 P.M. Eastern Time</span>. Interested parties can join the call by dialling 1-888-231-8191. The conference call can also be accessed via live webcast at <a href="http://www.dorel.com">www.dorel.com</a> or <a href="http://www.newswire.ca">www.newswire.ca</a>. If you are unable to call in at this time, you may access a tape recording of the meeting by calling 1-800-642-1687 and entering the passcode 59159658 on your phone. This tape recording will be available on <span class="xn-chron">Wednesday, March 10, 2010</span> as of <span class="xn-chron">3:00 P.M.</span> until <span class="xn-chron">11:59 P.M.</span> on <span class="xn-chron">Wednesday, March 17, 2010</span>.</p>
<p/>
<p>Complete financial statements will be available on the Company's website, <a href="http://www.dorel.com">www.dorel.com</a>, and will be available through the SEDAR website.</p>
<p/>
<p>Profile</p>
<p/>
<p>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, Iron Horse 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 4500 employees, facilities in nineteen countries, and sales worldwide.</p>
<p/>
<p>Caution Concerning Forward-Looking Statements</p>
<p/>
<p>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.</p>
<p/>
<pre>
    
                            DOREL INDUSTRIES INC.
                         CONSOLIDATED BALANCE SHEETS
                       ALL FIGURES IN THOUSANDS OF US $

                                                          as at        as at
                                                    December 30, December 30,
                                                           2009         2008
                                                    ------------ ------------

    ASSETS
    CURRENT ASSETS
      Cash and cash equivalents                     $    19,847  $    16,966
      Accounts receivable                               349,990      316,267
      Income taxes receivable                            16,264       19,798
      Inventories                                       399,866      509,467
      Prepaid expenses                                   17,358       16,236
      Future income taxes                                38,042       37,342
                                                    ------------ ------------
                                                        841,367      916,076

    PROPERTY, PLANT AND EQUIPMENT                       153,279      158,895
    INTANGIBLE ASSETS                                   401,831      395,742
    GOODWILL                                            569,824      540,187
    OTHER ASSETS                                         35,879       19,573
                                                    ------------ ------------
                                                    $ 2,002,180  $ 2,030,473
                                                    ------------ ------------
                                                    ------------ ------------

    LIABILITIES
    CURRENT LIABILITIES
      Bank indebtedness                             $     1,987  $     4,398
      Accounts payable and accrued liabilities          339,294      380,915
      Income taxes payable                               26,970       30,164
      Future income taxes                                    85        2,713
      Current portion of long-term debt                 322,508        8,879
                                                    ------------ ------------
                                                        690,844      427,069
                                                    ------------ ------------

    LONG-TERM DEBT                                       27,075      450,704
                                                    ------------ ------------
    PENSION & POST-RETIREMENT BENEFIT OBLIGATIONS        20,939       20,072
                                                    ------------ ------------
    FUTURE INCOME TAXES                                 128,984      111,874
                                                    ------------ ------------
    OTHER LONG-TERM LIABILITIES                          25,139        6,010
                                                    ------------ ------------

    SHAREHOLDERS' EQUITY
    CAPITAL STOCK                                       174,816      177,422
                                                    ------------ ------------
    CONTRIBUTED SURPLUS                                  20,311       16,070
                                                    ------------ ------------
    RETAINED EARNINGS                                   818,707      738,113
    ACCUMULATED OTHER COMPREHENSIVE INCOME               95,365       83,139
                                                    ------------ ------------
                                                        914,072      821,252
                                                    ------------ ------------
                                                      1,109,199    1,014,744
                                                    ------------ ------------
                                                    $ 2,002,180  $ 2,030,473
                                                    ------------ ------------
                                                    ------------ ------------


                            DOREL INDUSTRIES INC.
                      CONSOLIDATED STATEMENTS OF INCOME
         ALL FIGURES IN THOUSANDS OF US $, EXCEPT PER SHARE AMOUNTS

                            Fourth Quarters Ended      Twelve Months Ended
                          ------------------------- -------------------------
                          December 30, December 30, December 30, December 30,
                                 2009         2008         2009         2008
                          ------------ ------------ ------------ ------------

    Sales                 $   542,137  $   475,781  $ 2,125,459  $ 2,164,767

    Licensing and
     commission income          3,166        4,099       14,655       17,113
                          ------------ ------------ ------------ ------------

    TOTAL REVENUE             545,303      479,880    2,140,114    2,181,880
                          ------------ ------------ ------------ ------------

    EXPENSES
      Cost of sales           412,824      374,839    1,634,570    1,670,481
      Selling, general
       and administrative
       expenses                81,215       68,343      316,168      316,782
      Depreciation and
       amortization             8,044        7,244       27,366       26,510
      Research and
       development costs        8,337        4,607       17,184       13,245
      Restructuring costs          18         (724)         104          726
      Interest on
       long-term debt           3,367        5,772       14,969       21,162
      Other interest              493          239        1,406          961
                          ------------ ------------ ------------ ------------
                              514,298      460,320    2,011,767    2,049,867
                          ------------ ------------ ------------ ------------

    Income before
     income taxes              31,005       19,560      128,347      132,013

    Income taxes                6,794          393       21,113       19,158
                          ------------ ------------ ------------ ------------

    NET INCOME            $    24,211  $    19,167  $   107,234  $   112,855
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------

    EARNINGS PER SHARE
      Basic                    $ 0.73       $ 0.57       $ 3.23       $ 3.38
                               -------      -------      -------      -------
                               -------      -------      -------      -------
      Diluted                  $ 0.73       $ 0.57       $ 3.21       $ 3.38
                               -------      -------      -------      -------
                               -------      -------      -------      -------

    SHARES OUTSTANDING
      Basic -
       weighted average    33,037,554   33,402,192   33,232,606   33,398,544
      Diluted -
       weighted average    33,303,402   33,404,118   33,400,540   33,398,892


                            DOREL INDUSTRIES INC.
               CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                       ALL FIGURES IN THOUSANDS OF US $

                            Fourth Quarters Ended      Twelve Months Ended
                          ------------------------- -------------------------
                          December 30, December 30, December 30, December 30,
                                 2009         2008         2009         2008
                          ------------ ------------ ------------ ------------

    NET INCOME            $    24,211  $    19,167  $   107,234  $   112,855
                          ------------ ------------ ------------ ------------

    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                (9,547)     (10,337)      11,331      (23,348)

    Portion included in
     income as a result
     of reductions in net
     investments in self-
     sustaining foreign
     operations                     -            -            -         (384)
                          ------------ ------------ ------------ ------------
                               (9,547)     (10,337)      11,331      (23,732)
                          ------------ ------------ ------------ ------------

    Net changes in cash
    -------------------
     flow hedges:
     ------------
    Net change in
     unrealized gains
     (losses) on
     derivatives
     designated as
     cash flow hedges             981            -          861            -
    Reclassification
     to income                    245            -          706            -
    Future income taxes          (452)           -         (672)           -
                          ------------ ------------ ------------ ------------
                                  774            -          895            -
                          ------------ ------------ ------------ ------------
    TOTAL OTHER
     COMPREHENSIVE INCOME      (8,773)     (10,337)      12,226      (23,732)
                          ------------ ------------ ------------ ------------
    COMPREHENSIVE INCOME  $    15,438  $     8,830  $   119,460  $    89,123
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------


                            DOREL INDUSTRIES INC.
         CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
                      ALL FIGURES IN THOUSANDS OF US $

                                                       Twelve Months Ended
                                                    -------------------------
                                                    December 30, December 30,
                                                           2009         2008
                                                    ------------ ------------

    CAPITAL STOCK
      Balance, beginning of year                    $   177,422  $   177,271
      Issued under stock option plan                          -          151
      Repurchase and cancellation of shares              (2,606)           -
                                                    ------------ ------------
      Balance, end of year                              174,816      177,422
                                                    ------------ ------------
    CONTRIBUTED SURPLUS
      Balance, beginning of year                         16,070       11,623
      Stock-based compensation                            4,241        4,447
                                                    ------------ ------------
      Balance, end of year                               20,311       16,070
                                                    ------------ ------------
    RETAINED EARNINGS
      Balance, beginning of year                        738,113      641,981
      Net income                                        107,234      112,855
      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                   (7,898)           -
      Dividends on common shares                        (16,614)     (16,707)
      Dividends on deferred share units                     (32)         (16)
                                                    ------------ ------------
      Balance, end of year                              818,707      738,113
                                                    ------------ ------------
    ACCUMULATED OTHER COMPREHENSIVE INCOME
      Balance, beginning of year                         83,139      106,871
      Total other comprehensive income                   12,226      (23,732)
                                                    ------------ ------------
      Balance, end of year                               95,365       83,139
                                                    ------------ ------------

    TOTAL SHAREHOLDERS' EQUITY                      $ 1,109,199  $ 1,014,744
                                                    ------------ ------------
                                                    ------------ ------------


                            DOREL INDUSTRIES INC.
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                      ALL FIGURES IN THOUSANDS OF US $

                            Fourth Quarters Ended      Twelve Months Ended
                          --------------------------------------------------
                          December 30, December 30, December 30, December 30,
                                 2009         2008         2009         2008
                          ------------ ------------ ------------ ------------

    CASH PROVIDED BY
     (USED IN):

    OPERATING ACTIVITIES
    Net income            $    24,211  $    19,167  $   107,234  $   112,855
    Items not
     involving cash:
      Depreciation and
       amortization            14,356       10,939       49,191       45,854
      Amortization of
       deferred
       financing costs             91          212          266          362
      Future income
       taxes                      388         (370)      (3,839)       2,156
      Stock based
       compensation             1,297          709        3,840        4,447
      Pension and
       post-retirement
       defined benefit
       plans                     (694)      (1,144)           -          (27)
      Restructuring
       activities                (452)      (2,590)        (721)      (6,849)
      Exchange gain
       from reduction
       of net investments
       in foreign
       operations                   -            -            -         (384)
      Loss (gain) on
       disposal of
       property, plant
       and equipment              406          (44)         886          (24)
                          ------------ ------------ ------------ ------------
                               39,603       26,879      156,857      158,390

    Net changes in
     non-cash balances
     related to
     operations:
      Accounts
       receivable              (3,552)      23,397      (27,312)      28,223
      Inventories              14,699      (59,156)     113,630     (121,027)
      Prepaid expenses            265        1,387         (378)         677
      Accounts payable,
       accruals and
       other liabilities        7,795       18,808      (39,437)      22,105
      Income taxes             (2,464)      (3,834)       1,156       (8,485)
                          ------------ ------------ ------------ ------------
                               16,743      (19,398)      47,659      (78,507)
                          ------------ ------------ ------------ ------------

    CASH PROVIDED BY
     OPERATING ACTIVITIES      56,346        7,481      204,516       79,883
                          ------------ ------------ ------------ ------------

    FINANCING ACTIVITIES
      Bank indebtedness        (5,591)         418       (3,391)      (1,055)
      Increase of
       long-term debt               -        3,538            -      266,297
      Repayments of
       long-term debt         (57,280)         156     (110,522)     (62,400)
      Share repurchase         (4,515)           -      (10,504)           -
      Issuance of
       capital stock                -            4            -          155
      Dividends on
       common shares           (4,129)      (4,176)     (16,614)     (16,707)
                          ------------ ------------ ------------ ------------
    CASH PROVIDED BY
     (USED IN) FINANCING
     ACTIVITIES               (71,515)         (60)    (141,031)     186,290
                          ------------ ------------ ------------ ------------

    INVESTING ACTIVITIES
      Acquisition of
       companies               (7,720)      (7,648)     (21,661)    (226,190)
      Additions to
       property, plant and
       equipment - net         (9,118)      (9,402)     (21,893)     (26,518)
      Intangible assets        (2,960)      (5,940)     (18,753)     (20,929)
                          ------------ ------------ ------------ ------------
    CASH USED IN
     INVESTING ACTIVITIES     (19,798)     (22,990)     (62,307)    (273,637)
                          ------------ ------------ ------------ ------------

      Effect of exchange
       rate changes on
       cash and cash
       equivalents             (1,331)       2,080        1,703        1,917
                          ------------ ------------ ------------ ------------
    NET INCREASE
     (DECREASE) IN
     CASH AND CASH
     EQUIVALENTS              (36,298)     (13,489)       2,881       (5,547)

    Cash and cash
     equivalents,
     beginning of period       56,145       30,455       16,966       22,513
                          ------------ ------------ ------------ ------------
    CASH AND CASH
     EQUIVALENTS,
     END OF PERIOD        $    19,847  $    16,966  $    19,847  $    16,966
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------


                            DOREL INDUSTRIES INC.
                       INDUSTRY SEGMENTED INFORMATION
                  FOR THE FOURTH QUARTERS ENDED DECEMBER 30
                      ALL FIGURES IN THOUSANDS OF US $

                          ---------------------------------------------------
                                     Total                    Juvenile
                          ---------------------------------------------------
                               2009         2008         2009         2008

    Total revenue         $   545,303  $   479,880  $   248,521  $   219,680
    Cost of sales             412,824      374,839      178,661      159,852
    Selling, general
     and administrative        76,050       65,069       37,374       27,893
    Depreciation and
     amortization               8,007        7,213        6,473        5,144
    Research and
     development costs          6,362        2,949        5,032        1,692
    Restructuring costs            18         (724)          18         (724)
                          ---------------------------------------------------
    Earnings from
     operations                42,042       30,534  $    20,963  $    25,823
                                                    -------------------------
                                                    -------------------------
    Interest                    3,860        6,011
    Corporate expenses          7,177        4,963
    Income taxes                6,794          393
                          -------------------------
    Net income            $    24,211  $    19,167
                          -------------------------
                          -------------------------
    Earnings per Share
    ------------------
      Basic                    $ 0.73       $ 0.57
                               -------      -------
                               -------      -------
      Diluted                  $ 0.73       $ 0.57
                               -------      -------
                               -------      -------


                          ---------------------------------------------------
                             Recreational / Leisure       Home Furnishings
                          ---------------------------------------------------
                               2009         2008         2009         2008

    Total revenue         $   175,670  $   157,894  $   121,112  $   102,306
    Cost of sales             136,982      124,203       97,181       90,784
    Selling, general
     and administrative        27,816       28,002       10,860        9,174
    Depreciation and
     amortization               1,174        1,839          360          230
    Research and
     development costs            709          678          621          579
    Restructuring costs             0            0            0            0
                          ---------------------------------------------------
    Earnings from
     operations           $     8,989  $     3,172 $     12,090  $     1,539
                          ---------------------------------------------------
                          ---------------------------------------------------


                            DOREL INDUSTRIES INC.
                       INDUSTRY SEGMENTED INFORMATION
                   FOR THE TWELVE MONTHS ENDED DECEMBER 30
                      ALL FIGURES IN THOUSANDS OF US $

                          ---------------------------------------------------
                                     Total                    Juvenile
                          ---------------------------------------------------
                               2009         2008         2009         2008

    Total revenue         $ 2,140,114  $ 2,181,880  $   995,014  $ 1,073,722
    Cost of sales           1,634,570    1,670,481      720,517      764,042
    Selling, general
     and administrative       291,962      294,338      149,135      154,164
    Depreciation and
     amortization              27,227       26,415       20,776       20,041
    Research and
     development costs         17,184       13,245       11,948        7,928
    Restructuring costs           104          726          104          710
                          ---------------------------------------------------
    Earnings from
     operations               169,067      176,675  $    92,534  $   126,837
                                                    -------------------------
                                                    -------------------------
    Interest                   16,375       22,123
    Corporate expenses         24,345       22,539
    Income taxes               21,113       19,158
                          -------------------------
    Net income            $   107,234  $   112,855
                          -------------------------
                          -------------------------
    Earnings per Share
    ------------------
      Basic                    $ 3.23       $ 3.38
                               -------      -------
                               -------      -------
      Diluted                  $ 3.21       $ 3.38
                               -------      -------
                               -------      -------


                          ---------------------------------------------------
                             Recreational / Leisure       Home Furnishings
                          ---------------------------------------------------
                               2009         2008         2009         2008

    Total revenue         $   681,366  $   656,613  $   463,734  $   451,545
    Cost of sales             527,627      505,809      386,426      400,630
    Selling, general
     and administrative       106,209      101,886       36,618       38,288
    Depreciation and
     amortization               5,009        4,708        1,442        1,666
    Research and
     development costs          2,684        2,336        2,552        2,981
    Restructuring costs             -            -            -           16
                          ---------------------------------------------------
    Earnings from
     operations           $    39,837  $    41,874  $    36,696  $     7,964
                          ---------------------------------------------------
                          ---------------------------------------------------
    

For further information: For further information: MaisonBrison: Rick Leckner, (514) 731-0000; Dorel Industries Inc.: Jeffrey Schwartz, (514) 934-3034

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