Despite a softening home furnishings business, Dorel Industries Inc. reported revenue of $2.5 billion in United States currency for the fiscal year ended December 30, up 5.3% from the year-prior result. Net income was $108.6 million, or $3.39 per diluted share, up from $104.6 million, or $3.21 per diluted share, in the year earlier.
Dorel said revenue for the fourth quarter increased 10.9% to $622.6 million. Net income was up $29.1 million, or 91 cents per diluted share, versus $27.4 million, or 85 cents per diluted share, in the fourth quarter of fiscal 2011.
Net income per diluted share beat an analyst average estimate handily.
Net income in both 2012 and 2011 benefitted from a reduction in corporate general and administrative expenses based on non-cash gains related to past business acquisitions. The gain in the 2012 fourth quarter was $2 million while that in the 2011 period amounted to $11.1 million, Dorel noted. For the full year, the gains were $3.5 million in 2012 and $12.2 million in 2011. The acquisitions-related non-cash, non-taxable gains aside, net income in the 2012 fourth quarter was $27.1 million versus $16.3 million in the 2011 period. For the full year, those gains excluded, 2012 net income was $105.1 million compared with $92.4 million in 2011.
“We made substantial progress through 2012, particularly in light of the lingering tough economy,” said Dorel president and CEO Martin Schwartz. “The Juvenile segment’s operating profits increased due to improved earnings at Dorel Juvenile Group USA and at Dorel Europe, even in the face of a fragile financial environment abroad. Dorel’s Latin American operations were significant contributors to the segment’s improved operating profit and our investments there continue to pay handsome dividends. Dorel Chile had an outstanding fourth quarter, buoyed by strong retail sales at our 70 stores. Brazil is recovering from a difficult year in 2011, and Dorel Colombia, with its first quarter as part of the company, also delivered sound results.”
Schwartz stated that double digit growth in sales of Dorel’s Cannondale brand helped the company drive the Recreational/Leisure segment’s full-year revenue past $900 million.
“Fourth quarter revenue increased markedly due to the ability to ship more product and strong sales of electric ride-on toys, Schwartz added. “We have proven we can do a good job in the bike business and the growth trend we have established during the last couple of years clearly underlines this. Home furnishings, as expected, experienced slightly lower margins, reducing operating profits in that segment.”