Dorel sees 22% sales gain in first quarter
CEO: Company has ‘turned the corner’ in RTA
By Furniture Today Staff -- Furniture Today, April 30, 2008
MONTREAL — Better performance in its home furnishings segment helped Dorel Inds. to gains of 22% in sales and 25.7% in earnings in the first quarter, the company reported today.
The company posted earnings from operations of $1.6 million in the home furnishings segment, rebounding from a $22,000 loss in the same period a year earlier. The improvement was due mainly to improved results at ready-to-assemble producer Ameriwood, which posted its fourth consecutive profitable quarter, Dorel said.
Sales in the furnishings segment declined 1% to $102.3 million, the company said.
Sales rose sharply in Dorel’s other business segments, juvenile and recreational products. Juvenile volume rose 20.1% to $317.6 million, benefiting from the best quarter ever for Dorel Europe, and recreational sales jumped 54.9% to $136.1 million with the addition of Cannondale and SUGOi to the company’s new Independent Bicycle Dealers division.
Total sales in the quarter came to $566 million, and net income was $35.1 million or $1.05 per share.
“The first-quarter performance clearly indicates that Dorel has the right combination of products and price points at the right time,” said President and CEO Martin Schwartz. “In light of the difficult economy in the United States, we are seeing consumers shopping more at mass merchants where Dorel traditionally has been strong. In Europe, where conditions remain better, consumers continue to seek higher-end products, and Dorel’s European operations enjoy a solid position in the market.”
He added that the company has “turned the corner” in the RTA furniture business.
“Notwithstanding this strong start, it is unclear what the balance of the year will bring due to the weak economy in the U.S. and the current increasing cost environment,” Schwartz said.
