Dorel posts another impressive quarter


    
    - Organic revenue growth of almost 10%
    - Earnings improve in difficult cost environment

    EXCHANGES
    TSX: DII.B, DII.A
    
</pre>
<p/>
<p><span class="xn-location">MONTREAL</span>, <span class="xn-chron">Aug. 5</span> /CNW Telbec/ - Dorel Industries Inc. (TSX: DII.B DII.A) today announced strong results for the second quarter ended <span class="xn-chron">June 30, 2010</span>. Total revenue for the period was up 10.3% to US$607.7 million from US$551.1 million for the same quarter a year ago. Net income was US$35.1 million or US$1.05 per diluted share compared with US$24.8 million or US$0.74 per diluted share for the corresponding quarter of 2009.</p>
<p>Year-to-date revenue was US$1.2 billion, up 11.9% from US$1.08 billion last year. Net income rose to US$72.5 million or US$2.18 per diluted share compared to US$52.8 million or US$1.58 per diluted share for the first half of 2009. Organic revenue growth in both the quarter and year-to-date was approximately 9.5%.</p>
<p>2009 results included significant "mark-to-market" losses on foreign exchange hedging instruments in the pre-tax amount of US$12.6 million in the quarter and US$12.1 million for the first half of the year. After tax, these losses represented the equivalent of US$0.27 per diluted share for the quarter and US$0.25 per diluted share for the first six months. While earnings in 2010 do not include material mark-to-market amounts, currency rate variations versus last year have significantly reduced earnings in all three segments. For the quarter this negative impact reduced pre-tax earnings by approximately US$11 million.</p>
<p>"We are proud of this quarter's results. Despite negative factors such as foreign exchange, high input costs and increasing ocean freight rates, our divisions performed well and succeeded in building business slowly but steadily," said Dorel, President and Chief Executive Officer <span class="xn-person">Martin Schwartz</span>. "We maintained our pace of innovation and accelerated marketing support. Solid top-line results, in conjunction with our cost and productivity efforts, enabled us to deliver meaningful profit improvement year over year.</p>
<p>"We are seeing the benefits of the on-going investments in our bicycle business through improved product development, solidifying our structure and promoting our brands. Our brands are gaining wider acceptance and our bicycles are more in demand. As we continue to capitalize on our strong business model in Home Furnishings, that segment was again a significant contributor to profits as consumers recognize the value of our products, particularly during these uncertain times."</p>
<p/>
<pre>
    
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                       Summary of Financial Highlights
    -------------------------------------------------------------------------
                        Second Quarters Ended June 30
    -------------------------------------------------------------------------
         All figures in thousands of US $, except per share amounts
                                            2010          2009      Change %
    -------------------------------------------------------------------------
    Revenues                             607,695       551,123          10.3%
    Net income                            35,131        24,764          41.9%
      Per share - Basic                     1.07          0.74          44.6%
      Per share - Diluted                   1.05          0.74          41.9%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Average number of shares
     outstanding - diluted weighted
     average                          33,316,586    33,388,415
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                       Summary of Financial Highlights
    -------------------------------------------------------------------------
                           Six Months Ended June 30
    -------------------------------------------------------------------------
         All figures in thousands of US $, except per share amounts
                                            2010          2009      Change %
    -------------------------------------------------------------------------
    Revenues                           1,204,008     1,076,353          11.9%
    Net income                            72,498        52,793          37.3%
      Per share - Basic                     2.20          1.58          39.2%
      Per share - Diluted                   2.18          1.58          38.0%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Average number of shares
     outstanding - diluted weighted
     average                          33,292,611    33,384,027
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    
</pre>
<p/>
<p>Juvenile Segment</p>
<p/>
<pre>
    
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                        Second Quarters Ended June 30
    -------------------------------------------------------------------------
                                   2010                2009
    -------------------------------------------------------------------------
                                   $  % of rev.        $  % of rev. Change %
    Revenues                 259,791             244,672                 6.2%
    Gross Profit              69,149      26.6%   59,593      24.4%     16.0%
    Earnings from Operations  25,623       9.9%   16,725       6.8%     53.2%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                           Six Months Ended June 30
    -------------------------------------------------------------------------
                                   2010                2009
    -------------------------------------------------------------------------
                                   $  % of rev.        $  % of rev. Change %
    Revenues                 545,584             498,633                 9.4%
    Gross Profit             151,907      27.8%  132,303      26.5%     14.8%
    Earnings from Operations  58,400      10.7%   45,445       9.1%     28.5%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    
</pre>
<p/>
<p>Second quarter Juvenile revenue increased 6.2%, or US$15.1 million, to US$259.8 million. Organic revenue growth was approximately 8% in the quarter. This is consistent with strong first quarter organic revenue growth of just over 7%. Nearly two-thirds of the second quarter increase was in <span class="xn-location">North America</span> where Dorel Juvenile Group has maintained a steady pipeline of new products and has distinguished itself as a reliable "go to" supplier for its customers. Dorel <span class="xn-location">Brazil</span>, benefitting from a substantial demand in car seats due to new government legislation, had an excellent quarter and accounted for one-third of the improvement. Confirming the first half's improved retail climate in <span class="xn-location">Europe</span>, in Euro terms, revenues increased by approximately 8% over 2009.</p>
<p>Earnings in 2009 were reduced by mark-to-market losses on foreign exchange contracts and if these losses are excluded, earnings from operations in the 2009 quarter were US$29.4 million compared to 2010 earnings of US$25.6 million. Earnings in 2010 are being adversely affected by the decline in value of the Euro versus last year. While partially offset by a stronger Canadian dollar, as a whole, the negative impact on the segment in the second quarter of 2010 was around US$6 million pre-tax versus the prior year. Year-to-date this negative impact was also approximately US$6 million.</p>
<p/>
<p>Recreational/Leisure Segment</p>
<p/>
<pre>
    
    -------------------------------------------------------------------------
                        Second Quarters Ended June 30
    -------------------------------------------------------------------------
                                   2010                2009
    -------------------------------------------------------------------------
                                   $  % of rev.        $  % of rev. Change %
    Revenues                 214,888             199,093                 7.9%
    Gross Profit              51,519      24.0%   44,252      22.2%     16.4%
    Earnings from Operations  17,091       8.0%   16,009       8.0%      6.8%
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                           Six Months Ended June 30
    -------------------------------------------------------------------------
                                   2010                2009
    -------------------------------------------------------------------------
                                   $  % of rev.        $  % of rev. Change %
    Revenues                 396,565             360,521                10.0%
    Gross Profit              97,642      24.6%   81,280      22.5%     20.1%
    Earnings from Operations  32,185       8.1%   25,986       7.2%     23.9%
    -------------------------------------------------------------------------
    
</pre>
<p/>
<p/>
<p>Second quarter Recreational/Leisure revenue increased by US$15.8 million, or 7.9%, to US$214.9 million. Year-to-date revenues are up 10.0% or US$36.0 million to US$396.6 million. The organic revenue increase was approximately 5% for both the quarter and year-to-date when the impact of new business acquisitions during 2009 and foreign exchange rate variations are excluded. Though less significant than Juvenile, earnings in 2010 are being negatively affected by the value of the Euro.</p>
<p>Cycling Sports Group (CSG) sales were up considerably over last year with exceptional demand for the division's elite racing bicycles such as the Cannondale SuperSix. As in the first quarter, demand for new model year products remains strong across all brands resulting in expansion of the dealer base and increases in multi-brand dealers.</p>
<p>Schwinn experienced a strong increase in POS year-over-year, due to the multi-million dollar advertising campaign launched in mid April, excellent retailer support and good early spring weather. While increasing selling, general and administration costs, the ad campaign has been effective in enhancing the Schwinn brand. Sales to the segment's mass merchant customers were hindered by a lack of supply due to the global shortage of ocean containers, a situation which is improving.</p>
<p/>
<p>Home Furnishings Segment</p>
<p/>
<pre>
    
    -------------------------------------------------------------------------
                        Second Quarters Ended June 30
    -------------------------------------------------------------------------
                                   2010                2009
    -------------------------------------------------------------------------
                                   $  % of rev.        $  % of rev. Change %
    Revenues                 133,016             107,358                23.9%
    Gross Profit              20,092      15.1%   17,270      16.1%     16.3%
    Earnings from Operations  11,292       8.5%    7,713       7.2%     46.4%
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                           Six Months Ended June 30
    -------------------------------------------------------------------------
                                   2010                2009
    -------------------------------------------------------------------------
                                   $  % of rev.        $  % of rev. Change %
    Revenues                 261,859             217,199                20.6%
    Gross Profit              39,940      15.3%   30,742      14.2%     29.9%
    Earnings from Operations  22,019       8.4%   12,098       5.6%     82.0%
    -------------------------------------------------------------------------
    
</pre>
<p/>
<p>Home Furnishings revenues increased 23.9% to US$133.0 million and by 20.6% to US$261.9 million for the second quarter and first half respectively. The increase was at the majority of the segment's divisions as its value-oriented furniture products continued to sustain good POS levels. Earnings for the quarter were improved at US$11.3 million in 2010, an increase of 46.4% from the prior year. Year-to-date earnings have increased 82.0%.</p>
<p>These gains were led by the turnaround at Cosco Home & Office which has produced solid earnings improvement. The progress was achieved despite a higher cost environment and a much stronger Canadian dollar which reduces the segment's earnings as two of its plants are located in <span class="xn-location">Canada</span> and the majority of their production is shipped to the US.</p>
<p/>
<p>Taxes</p>
<p/>
<p>The tax rate in the second quarter was 19.9% and year-to-date is 21.5%, in line with expectations. This compares to 16.9% for the quarter and 16.7% year-to-date in 2009. The increase is due to variations in the jurisdictions in which the Company generated its income year over year. The Company maintains its expectation that the 2010 tax rate will be in the range of 18% to 22%.</p>
<p/>
<p>Quarterly dividend</p>
<p/>
<p>The Board of Directors of Dorel declared its regular quarterly dividend of US$0.15 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 <span class="xn-chron">September 2, 2010</span> to shareholders of record as at the close of business on <span class="xn-chron">August 19, 2010</span>.</p>
<p/>
<p>Outlook</p>
<p/>
<p>Dorel's record results for the first six months have set the stage for a solid year. Revenues are expected to continue to exceed prior year levels. However the pace of earnings established during the first half will not be maintained in the third quarter, due principally to challenges in the Juvenile segment.</p>
<p>In its first quarter earnings release, the Company stated that margins could be affected by rising commodity and freight costs as the year progressed. While margins in the second quarter declined from first quarter levels, the impact of these rising costs was moderate. As the Company enters the third quarter, these issues, as well as the impact of foreign exchange rates will affect earnings in the third quarter.  While rising commodity prices are expected to ease, it will take the current quarter to work through the existing inventory purchased at higher prices.</p>
<p>"We expect to see an easing of these headwinds in the fourth quarter.  Juvenile will be introducing new products which will provide some pricing relief and a better mix of sales. This combined with more stable commodity costs is expected to improve margins as we move into the New Year.  Our Recreational/Leisure and Home Furnishings segments are poised to perform well during the second half.  Our focus is being maintained on innovative, value-added products.  We will maintain our investments in this important area to ensure that retailers can consistently depend on Dorel for quality and reliability. As a leader in many of our categories, we will continue to offer consumers the products they need at popular price points," commented <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">August 5, 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 87309516 on your phone. This tape recording will be available on <span class="xn-chron">Thursday, August 5, 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">Thursday, August 12, 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 websites.</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, IronHorse 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 billion company with 4500 employees, facilities in nineteen countries, and sales worldwide.</p>
<p/>
<p>Caution Regarding Forward Looking Statements</p>
<p/>
<p>Certain statements included in this press release may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. Except as may be required by Canadian securities laws, Dorel does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements, by their very nature, are subject to numerous risks and uncertainties and are based on several assumptions which give rise to the possibility that actual results could differ materially from Dorel's expectations expressed in or implied by such forward-looking statements and that the objectives, plans, strategic priorities and business outlook may not be achieved. As a result, Dorel cannot guarantee that any forward-looking statement will materialize. Forward-looking statements are provided in this press release for the purpose of giving information about Management's current expectations and plans and allowing investors and others to get a better understanding of Dorel's operating environment. However, readers are cautioned that it may not be appropriate to use such forward-looking statements for any other purpose.</p>
<p>Forward-looking statements made in this press release are based on a number of assumptions that Dorel believed were reasonable on the day it made the forward-looking statements. Factors that could cause actual results to differ materially from the Company's expectations expressed in or implied by the forward-looking statements include: general economic conditions; changes in product costs and supply channel; foreign currency fluctuations; customer and credit risk including the concentration of revenues with few customers; costs associated with product liability; changes in income tax legislation or the interpretation or application of those rules; the continued ability to develop products and support brand names; changes in the regulatory environment; continued access to capital resources and the related costs of borrowing; changes in assumptions in the valuation of goodwill and other intangible assets and subject to dividends being declared by the Board of Directors, there can be no certainty that Dorel's Dividend Policy will be maintained. These and other risk factors that could cause actual results to differ materially from expectations expressed in or implied by the forward-looking statements are discussed in Dorel's annual MD&A and Annual Information Form filed with the applicable Canadian securities regulatory authorities. The risk factors outlined in the previously mentioned documents are specifically incorporated herein by reference.</p>
<p>Dorel cautions readers that the risks described above are not the only ones that could impact it. Additional risks and uncertainties not currently known to Dorel or that Dorel currently deems to be immaterial may also have a material adverse effect on our business, financial condition or results of operations.  Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.</p>
<p>Except as otherwise indicated, forward-looking statements do not reflect the potential impact of any non-recurring or other unusual items or of any dispositions, mergers, acquisitions, other business combinations or other transactions that may be announced or that may occur after the date hereof. The financial impact of these transactions and non-recurring and other unusual items can be complex and depends on the facts particular to each of them. Dorel therefore cannot describe the expected impact in a meaningful way or in the same way Dorel presents known risks affecting the business.</p>
<p/>
<p/>
<pre>
    
                            DOREL INDUSTRIES INC.
                         CONSOLIDATED BALANCE SHEETS
                       ALL FIGURES IN THOUSANDS OF US $

                                                         as at         as at

                                                       June 30,  December 30,
                                                          2010          2009
                                                 -------------  -------------
                                                    (unaudited)     (audited)

    ASSETS
    CURRENT ASSETS
      Cash and cash equivalents                   $     33,987       $19,847
      Accounts receivable                              397,880       349,990
      Income taxes receivable                           14,029        16,264
      Inventories                                      446,438       399,866
      Prepaid expenses                                  18,908        17,358
      Future income taxes                               41,774        38,042
                                                  ------------  -------------
                                                       953,016       841,367

    PROPERTY, PLANT AND EQUIPMENT                      146,272       153,279
    INTANGIBLE ASSETS                                  381,357       401,831
    GOODWILL                                           537,578       569,824
    OTHER ASSETS                                        34,433        35,879
                                                  ------------  -------------
                                                  $  2,052,656  $  2,002,180
                                                  ------------  -------------
                                                  ------------  -------------

    LIABILITIES
    CURRENT LIABILITIES
    Bank indebtedness                             $      2,519  $      1,987
      Accounts payable and accrued liabilities         425,341       339,294
      Income taxes payable                              27,755        26,970
      Future income taxes                                  140            85
      Current portion of long-term debt                 10,506       122,508
                                                  ------------  -------------
                                                       466,261       490,844
                                                  ------------  -------------

    LONG-TERM DEBT                                     318,806       227,075
                                                  ------------  -------------
    PENSION & POST-RETIREMENT BENEFIT OBLIGATIONS       20,179        20,939
                                                  ------------  -------------
    FUTURE INCOME TAXES                                119,508       128,984
                                                  ------------  -------------
    OTHER LONG-TERM LIABILITIES                         24,091        25,139
                                                  ------------  -------------

    SHAREHOLDERS' EQUITY
    CAPITAL STOCK                                      178,155       174,816
                                                  ------------  -------------
    CONTRIBUTED SURPLUS                                 21,936        20,311
                                                  ------------  -------------
    RETAINED EARNINGS                                  876,621       818,707
    ACCUMULATED OTHER COMPREHENSIVE INCOME              27,099        95,365
                                                  ------------  -------------
                                                       903,720       914,072
                                                  ------------  -------------
                                                     1,103,811     1,109,199
                                                  ------------  -------------
                                                  $  2,052,656  $  2,002,180
                                                  ------------  -------------
                                                  ------------  -------------


                            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,
                              2010 	        2009          2010 	    2009
                     -------------  ------------  ------------  -------------
                        (unaudited)   (unaudited)   (unaudited)   (unaudited)


    Sales             $    604,174  $    547,253  $  1,197,870  $  1,068,668

    Licensing and
     commission income       3,521         3,870         6,138         7,685
                     -------------  ------------  ------------  -------------

    TOTAL REVENUE          607,695       551,123     1,204,008     1,076,353
                     -------------  ------------  ------------  -------------

    EXPENSES
      Cost of sales        466,935       430,008       914,519       832,028
      Selling, general
       and administra-
       tive expenses        82,217        77,482       167,774       153,810
      Depreciation and
       amortization          7,247         6,311        14,723        11,990
      Research and
       development
       costs                 2,853         3,114         6,780         6,487
      Interest               4,567         4,405         7,845         8,657
                     -------------  ------------  ------------  -------------
                           563,819       521,320     1,111,641     1,012,972
                     -------------  ------------  ------------  -------------

    Income before
     income taxes           43,876        29,803        92,367        63,381

    Income taxes             8,745         5,039        19,869        10,588
                     -------------  ------------  ------------  -------------

    NET INCOME        $     35,131  $     24,764  $     72,498  $     52,793
                     -------------  ------------  ------------  -------------
                     -------------  ------------  ------------  -------------

    EARNINGS PER
     SHARE
      Basic                 $ 1.07        $ 0.74        $ 2.20        $ 1.58
                            ------        ------        ------        ------
                            ------        ------        ------        ------
      Diluted               $ 1.05        $ 0.74        $ 2.18        $ 1.58
                            ------        ------        ------        ------
                            ------        ------        ------        ------

    SHARES OUTSTANDING
      Basic -
       weighted
       average          32,952,376    33,312,383    32,943,021    33,356,817
      Diluted -
       weighted
       average          33,316,586    33,388,415    33,292,611    33,384,027


                            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,
                              2010          2009          2010          2009
                     -------------  ------------  ------------  -------------
                        (unaudited)   (unaudited)   (unaudited)   (unaudited)


    NET INCOME        $     35,131  $     24,764  $     72,498  $     52,793
                     -------------  ------------  ------------  -------------

    OTHER
     COMPREHENSIVE
     INCOME:
    Cumulative
    ----------
     translation
     -----------
     adjustment:
     -----------
    Net change in
     unrealized
     foreign
     currency
     gains (losses)
     on translation
     of net
     investments
     in self-sus-
     taining foreign
     operations, net
     of tax of nil         (39,671)       27,786       (67,567)          658
                     -------------  ------------  ------------  -------------


    Net changes in
    --------------
     cash flow hedges:
     -----------------
    Net change in
     unrealized gains
     (losses) on
     derivatives
     designated as
     cash flow hedges       (2,094)        1,372        (1,345)          841
    Reclassification
     to income or to
     the related
     non financial
     asset                    (519)          221          (681)          221
    Future income
     taxes                   1,121        (1,026)        1,327          (684)
                     -------------  ------------  ------------  -------------
                            (1,492)          567          (699)          378
    TOTAL OTHER
     COMPREHENSIVE
     INCOME                (41,163)       28,353       (68,266)        1,036
                     -------------  ------------  ------------  -------------
    TOTAL
     COMPREHENSIVE
     INCOME           $     (6,032) $     53,117  $      4,232  $     53,829
                     -------------  ------------  ------------  -------------
                     -------------  ------------  ------------  -------------


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

                                                         Six Months Ended
                                                 ----------------------------
                                                       June 30,      June 30,
                                                          2010          2009
                                                 -------------  -------------
                                                    (unaudited)   (unaudited)
    CAPITAL STOCK
      Balance, beginning of period                $    174,816  $    177,422
      Issued under stock option plan                     3,654             -
      Reclassification from contributed
       surplus due to exercice of stock options            884             -
      Repurchase and cancellation of shares             (1,199)       (1,074)
                                                 -------------  -------------
      Balance, end of period                           178,155       176,348
                                                 -------------  -------------

    CONTRIBUTED SURPLUS
      Balance, beginning of period                      20,311        16,070
      Exercice of stock options                           (884)            -
      Stock-based compensation                           2,509         1,859
                                                 -------------  -------------
      Balance, end of period                            21,936        17,929
                                                 -------------  -------------

    RETAINED EARNINGS
      Balance, beginning of period                     818,707       738,113
      Net income                                        72,498        52,793
      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                  (5,495)       (2,401)
      Dividends on common shares                        (9,065)       (8,360)
      Dividends on deferred share units                    (24)          (13)
                                                 -------------  -------------
      Balance, end of period                           876,621       778,036
                                                 -------------  -------------

    ACCUMULATED OTHER COMPREHENSIVE INCOME
      Balance, beginning of period                      95,365        83,139
      Total other comprehensive income                 (68,266)        1,036
                                                 -------------  -------------
      Balance, end of period                            27,099        84,175
                                                 -------------  -------------

    TOTAL SHAREHOLDERS' EQUITY                    $  1,103,811  $  1,056,488
                                                 -------------  -------------
                                                 -------------  -------------


                            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,
                              2010          2009          2010          2009
                     -------------  ------------  ------------  -------------
                        (unaudited)   (unaudited)   (unaudited)   (unaudited)

    CASH PROVIDED BY
     (USED IN):

    OPERATING
     ACTIVITIES

    Net income        $     35,131  $     24,764  $     72,498  $     52,793
      Items not
       involving cash:
      Depreciation and
       amortization         12,407        11,371        25,135        21,839
      Amortization of
       deferred
       financing costs          50            56            79           106
      Accretion expense
       on contingent
       considerations          466             -           941             -
      Future income
       taxes                   222        (4,566)       (6,060)       (6,591)
      Stock based
       compensation          1,175           852         2,172         1,458
      Pension and
       post-retirement
       defined benefit
       plans                 1,412           910           910         1,596
      Restructuring
       activities                -           (26)            -          (113)
      (Gain) loss on
       disposal of
       property, plant
       and equipment            (4)          403             2           409
                     -------------  ------------  ------------  -------------
                            50,859        33,764        95,677        71,497
    Net changes in
     non-cash
     balances related
     to operations:
      Accounts
     receivable             25,873         9,674       (59,401)      (56,887)
      Inventories          (80,192)        2,506       (57,756)       86,580
      Prepaid expenses         105          (608)       (2,431)       (3,673)
      Accounts payable,
       accruals and
       other long-term
       liabilities          68,495        26,586       100,062       (28,903)
      Income taxes         (12,588)        5,138         4,902         6,367
                     -------------  ------------  ------------  -------------
                             1,693        43,296       (14,624)        3,484
                     -------------  ------------  ------------  -------------

    CASH PROVIDED BY
     OPERATING
     ACTIVITIES             52,552        77,060        81,053        74,981
                     -------------  ------------  ------------  -------------

    FINANCING
     ACTIVITIES
      Bank
       indebtedness        (12,440)        1,434           655         5,218
      Increase of
       long-term debt      149,431             -       200,000             -
      Repayments of
       long-term debt     (165,122)      (42,091)     (220,122)      (18,263)
      Share repurchase      (5,294)       (3,433)       (6,694)       (3,475)
      Issuance of
       capital stock         2,895             -         3,654             -
      Dividends on
       common shares        (4,947)       (4,161)       (9,065)       (8,360)
                     -------------  ------------  ------------  -------------
    CASH USED IN
     FINANCING
     ACTIVITIES            (35,477)      (48,251)      (31,572)      (24,880)
                     -------------  ------------  ------------  -------------

    INVESTING
     ACTIVITIES
      Acquisition of
       businesses                -             4             -        (6,484)
      Additions to
       property, plant
       and equipment -
       net                 (10,467)       (5,519)      (16,095)       (6,860)
      Intangible
       assets               (4,560)       (5,538)       (9,297)      (10,379)
                     -------------  ------------  ------------  -------------
    CASH USED IN
     INVESTING
     ACTIVITIES            (15,027)      (11,053)      (25,392)      (23,723)
                     -------------  ------------  ------------  -------------

      Effect of
       exchange rate
       changes on
       cash and cash
       equivalents          (5,456)        3,467        (9,949)          369
                     -------------  ------------  ------------  -------------

    NET (DECREASE)
     INCREASE IN CASH
     AND CASH
     EQUIVALENTS            (3,408)       21,223        14,140        26,747

    Cash and cash
     equivalents,
     beginning of
     period                 37,395        22,490        19,847        16,966
                     -------------  ------------  ------------  -------------

    CASH AND CASH
     EQUIVALENTS,
     END OF PERIOD    $     33,987  $     43,713  $     33,987  $     43,713
                     -------------  ------------  ------------  -------------
                     -------------  ------------  ------------  -------------


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

                      -------------------------------------------------------
                                    Total                      Juvenile
                      -------------------------------------------------------
                              2010          2009          2010          2009
                        (unaudited)   (unaudited)   (unaudited)   (unaudited)

    Total revenue     $    607,695  $    551,123  $    259,791  $    244,672
    Cost of sales          466,935       430,008       190,642       185,079
    Selling, general
     and administrative
     expenses               76,691        71,247        36,700        36,187
    Depreciation and
     amortization            7,210         6,307         5,444         4,742
    Research and
     development costs       2,853         3,114         1,382         1,939
                      -------------------------------------------------------
    Earnings from
     operations             54,006        40,447  $     25,623  $     16,725
                                                  ---------------------------
                                                  ---------------------------
    Interest                 4,567         4,405
    Corporate expenses       5,563         6,239
    Income taxes             8,745         5,039
                      ---------------------------
    Net income        $     35,131  $     24,764
                      ---------------------------
                      ---------------------------
    Earnings per Share
    ------------------
    Basic                    $1.07         $0.74
                              ----          ----
                              ----          ----
    Diluted                  $1.05         $0.74
                              ----          ----
                              ----          ----


                      -------------------------------------------------------
                         Recreational / Leisure            Home Furnishings
                      -------------------------------------------------------
                              2010          2009          2010          2009
                        (unaudited)   (unaudited)   (unaudited)   (unaudited)

    Total revenue     $    214,888  $    199,093  $    133,016  $    107,358
    Cost of sales          163,369       154,841       112,924        90,088
    Selling, general
     and administrative
     expenses               32,150        26,508         7,841         8,552
    Depreciation and
     amortization            1,514         1,194           252           371
    Research and
     development costs         764           541           707           634
                      -------------------------------------------------------
    Earnings from
     operations       $     17,091  $     16,009  $     11,292  $      7,713
                      -------------------------------------------------------
                      -------------------------------------------------------
    Interest
    Corporate expenses
    Income taxes

    Net income

    Earnings per Share
    ------------------
    Basic
    Diluted


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

                      -------------------------------------------------------
                                    Total                      Juvenile
                      -------------------------------------------------------
                              2010          2009          2010          2009
                        (unaudited)   (unaudited)   (unaudited)   (unaudited)

    Total revenue     $  1,204,008  $  1,076,353  $    545,584  $    498,633
    Cost of sales          914,519       832,028       393,677       366,330
    Selling, general
     and administrative
     expenses              155,454       142,347        78,298        74,347
    Depreciation and
     amortization           14,651        11,962        11,185         8,733
    Research and
     development costs       6,780         6,487         4,024         3,778
                      -------------------------------------------------------
    Earnings from
     operations            112,604        83,529  $     58,400  $     45,445
                                                  ---------------------------
                                                  ---------------------------
    Interest                 7,845         8,657
    Corporate expenses      12,392        11,491
    Income taxes            19,869        10,588
                      ---------------------------
    Net income        $     72,498  $     52,793
                      ---------------------------
                      ---------------------------

    Earnings per Share
    ------------------
    Basic             $       2.20  $       1.58
                              ----          ----
                              ----          ----
    Diluted           $       2.18  $       1.58
                              ----          ----
                              ----          ----


                      -------------------------------------------------------
                         Recreational / Leisure            Home Furnishings
                      -------------------------------------------------------
                              2010          2009          2010          2009
                        (unaudited)   (unaudited)   (unaudited)   (unaudited)

    Total revenue     $    396,565  $    360,521  $    261,859  $    217,199
    Cost of sales          298,923       279,241       221,919       186,457
    Selling, general
     and administrative
     expenses               61,058        51,344        16,098        16,656
    Depreciation and
     amortization            2,962         2,511           504           718
    Research and
     development costs       1,437         1,439         1,319         1,270
                      -------------------------------------------------------
    Earnings from
     operations       $     32,185  $     25,986  $     22,019  $     12,098
                      -------------------------------------------------------
                      -------------------------------------------------------
    Interest
    Corporate expenses
    Income taxes

    Net income

    Earnings per Share
    ------------------
    Basic
    Diluted
    

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

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Dorel Industries Inc.

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