- Revenues climb 10%
- Sales and earnings in Recreational segment increase year-over-year
- Juvenile rebounding in Europe
- Input and freight costs affect margins
EXCHANGESTSX: DII.B, DII.A
</pre>
<p/>
<p><span class="xn-location">MONTREAL</span>, <span class="xn-chron">Nov. 4</span> /CNW Telbec/ - Dorel Industries Inc. (TSX: DII.B DII.A) today released third quarter and nine month results for the period ended <span class="xn-chron">September 30, 2010</span>. Revenue increased 9.8% to US$569.5 million from US$518.5 million a year ago. Net income for the quarter was equal with last year, at US$30.1 million or US$0.91 per diluted share compared to US$30.2 million or US$0.91 per diluted share.</p>
<p>Revenue for the nine months was US$1.8 billion, up 11.2% from US$1.6 billion a year ago. Year-to-date net income was US$102.6 million or US$3.09 per diluted share, compared to last year's US$83.0 million or US$2.49 per diluted share.</p>
<p>"Dorel has posted solid third quarter results. Our top line improved markedly while earnings were in line with the prior year. This was achieved notwithstanding the combination of much high container freight rates and increased raw material costs which impacted margins, particularly at our US juvenile business and home furnishings divisions," commented <span class="xn-person">Martin Schwartz</span>, Dorel President and CEO. "Dorel's bicycle business is reflecting the investments that we are making in our brands and in R&D with increased sales and earnings. At the same time despite a difficult economy abroad, there was solid progress in our juvenile business in <span class="xn-location">Europe</span> and a continuing strong showing in <span class="xn-location">Brazil</span>."</p>
<p/>
<pre>
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Summary of Financial Highlights
-------------------------------------------------------------------------
Third Quarters Ended September 30
-------------------------------------------------------------------------
All figures in thousands of US $, except per share amounts
2010 2009 Change %
-------------------------------------------------------------------------
Revenues 569,455 518,458 9.8%
Net income 30,119 30,230 -0.4%
Per share - Basic 0.92 0.91 1.1%
Per share - Diluted 0.91 0.91 0.0%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Average number of shares
outstanding - diluted
weighted average 33,159,981 33,338,597
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Summary of Financial Highlights
-------------------------------------------------------------------------
Nine Months Ended September 30
-------------------------------------------------------------------------
All figures in thousands of US $, except per share amounts
2010 2009 Change %
-------------------------------------------------------------------------
Revenues 1,773,463 1,594,811 11.2%
Net income 102,617 83,023 23.6%
Per share - Basic 3.12 2.49 25.3%
Per share - Diluted 3.09 2.49 24.1%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Average number of shares
outstanding - diluted
weighted average 33,260,965 33,389,225
-------------------------------------------------------------------------
-------------------------------------------------------------------------
</pre>
<p/>
<p>Juvenile Segment</p>
<p/>
<pre>
-------------------------------------------------------------------------
Third Quarters Ended September 30
-------------------------------------------------------------------------
2010 2009
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 248,421 247,860 0.2%
Gross Profit 65,282 26.3% 72,334 29.2% -9.7%
Earnings from
Operations 22,093 8.9% 26,126 10.5% -15.4%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Nine Months Ended September 30
-------------------------------------------------------------------------
2010 2009
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 794,005 746,493 6.4%
Gross Profit 217,189 27.4% 204,637 27.4% 6.1%
Earnings from
Operations 80,493 10.1% 71,571 9.6% 12.5%
-------------------------------------------------------------------------
</pre>
<p/>
<p>Third quarter revenue was even with last year at US$248.4 million as compared to US$247.9 million. Year-to-date revenue is up 6.4% to US$794.0 million. Organic sales growth for the quarter was 3% and is 6% year-to-date. Increases in <span class="xn-location">Europe</span> and <span class="xn-location">Brazil</span> offset declines in <span class="xn-location">North America</span> where POS levels for juvenile products slowed and certain retailers reduced orders as a result.</p>
<p>In <span class="xn-location">Europe</span>, organic revenue growth in the quarter was 11% and earnings improved. Dorel <span class="xn-location">Europe</span> has experienced less favourable rates of exchange versus the Euro in 2010, although increases in the value of the Euro through the third quarter have helped ease the impact of this issue. Gains abroad were principally on car seats, but were also recorded across most product lines. Dorel <span class="xn-location">Europe</span> has further grown its market share of car seats and year-over-year has substantially increased its sales of Safety 1st mid price point products.</p>
<p>Dorel <span class="xn-location">Brazil</span> again posted significant sales gains as new legislation continues to drive car seat sales and local operations are increasingly benefiting from Dorel's infrastructure and multiple brand portfolio. During the quarter the two largest juvenile trade shows in <span class="xn-location">Europe</span> and the <span class="xn-location">United States</span> took place and Dorel's Juvenile segment divisions were well represented. Several new products were launched and customer feedback was highly positive.</p>
<p/>
<p>Recreational/Leisure Segment</p>
<p/>
<pre>
-------------------------------------------------------------------------
Third Quarters Ended September 30
-------------------------------------------------------------------------
2010 2009
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 172,530 145,175 18.8%
Gross Profit 39,420 22.8% 33,771 23.3% 16.7%
Earnings from
Operations 9,532 5.5% 4,862 3.3% 96.1%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Nine Months Ended September 30
-------------------------------------------------------------------------
2010 2009
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 569,095 505,696 12.5%
Gross Profit 137,062 24.1% 115,051 22.8% 19.1%
Earnings from
Operations 41,717 7.3% 30,848 6.1% 35.2%
-------------------------------------------------------------------------
</pre>
<p/>
<p>Third quarter Recreational/Leisure revenue increased 18.8% to US$172.5 million compared to US$145.2 million. Year-to-date, revenues are up 12.5% to US$569.1 million from US$505.7 million. Excluding the impact of new business acquisitions and foreign exchange variations on the segment's non-US based businesses, the segment's organic revenue increase was approximately 13% for the quarter and 8% year-to-date. Increases, both in <span class="xn-location">Europe</span> and <span class="xn-location">North America</span>, were in the mass merchant and Independent Bike Dealers (IBD) channels, as increased promotional activity and successful new model introductions are driving sales.</p>
<p>Schwinn has seen important gains due to new launches and a concentrated advertising campaign which will resume later this month. A strong end to the year is anticipated. Cannondale's intensified R&D activities have led to the introduction of several new models, including the Cannondale E-Series electric bike, the Super X, the world's lightest mountain bike and the CAAD 10. As announced, the Cycling Sports Group has significantly increased its commitment with Liquigas Sports and its sponsorship of a professional cycling team. The team has had a remarkable year, winning two of the three major UCI Grand Tours. Effective <span class="xn-chron">January 1, 2011</span>, Cannondale will become Co-Sponsor of the newly named Liquigas-Cannondale Pro Cycling Team. SUGOI will also become a sponsor, by providing the team with its newly designed uniforms.</p>
<p/>
<p>Home Furnishings</p>
<p/>
<pre>
-------------------------------------------------------------------------
Third Quarters Ended September 30
-------------------------------------------------------------------------
2010 2009
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 148,504 125,423 18.4%
Gross Profit 17,369 11.7% 22,635 18.0% -23.3%
Earnings from
Operations 7,076 4.8% 12,508 10.0% -43.4%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Nine Months Ended September 30
-------------------------------------------------------------------------
2010 2009
-------------------------------------------------------------------------
$ % of rev. $ % of rev. Change %
Revenues 410,363 342,622 19.8%
Gross Profit 57,309 14.0% 53,377 15.6% 7.4%
Earnings from
Operations 29,095 7.1% 24,606 7.2% 18.2%
-------------------------------------------------------------------------
</pre>
<p/>
<p>Revenue in the segment increased 18.4% to US$148.5 million from US$125.4 million during the third quarter a year ago. Year-to-date, revenues are up 19.8% to US$410.4 million from US$342.6 million. Revenue growth is being driven by sales of both domestic and imported items, mainly in the metal folding furniture, futon, bedroom collection and bookcase categories. Consumers turn to Dorel's value furniture products particularly during a soft economy.</p>
<p>While consumer demand was strong for Dorel's products, as reflected in the increase in sales, third quarter shipments were at lower margins due to higher input and container freight costs as well as a less favourable rate of exchange. These costs have started to ease, though the benefit of lower costs will not be immediate as inventory on hand has been acquired at these higher input levels.</p>
<p/>
<p>Taxes</p>
<p/>
<p>The third quarter income tax recovery of US$1.5 million was as a result of the recognition of a tax benefit of US$2.9 million pertaining to a prior year's estimated tax position as well as a significant change in the earnings being generated in certain lower tax rate jurisdictions. This change occurred in the third quarter and reflects the annual tax position expected in those jurisdictions.</p>
<p>The Company's year-to-date tax rate is 15.2%, similar to the 14.7% recorded in 2009. Based on the lower than anticipated third quarter tax figure and current expectations for the balance of the year, it is now expected that the tax rate for 2010 will be in the range of 14% to 18%.</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">December 2, 2010</span> to shareholders of record as at the close of business on <span class="xn-chron">November 18, 2010</span>.</p>
<p/>
<p>Outlook</p>
<p/>
<p>As expected, revenues continued to exceed prior year levels and the pace of earnings slowed in the third quarter relative to the first half of the year. Margins were pressured by higher input and ocean freight costs at most divisions. Although these costs have begun to retreat, consumer demand is currently soft, particularly in Home Furnishings. Expectations are for full year earnings to be on plan. Net income will exceed the prior year.</p>
<p>"Our bicycle segment continues to improve, for both our mass merchant and IBD businesses. Investments in brand building and product innovation are proving to be successful with consumers in <span class="xn-location">North America</span> and <span class="xn-location">Europe</span>. The strategies put in place in Recreational / Leisure are working, the team is focused on great execution, and we'll continue to see progress. In Juvenile, we faced challenges on costs and currency, but we are optimistic looking forward based on our commitment to ensure a pipeline of upcoming new and innovative products. Dorel <span class="xn-location">Europe</span> continues to make progress and our investment in <span class="xn-location">Brazil</span> has proven to be a very good one, with sales growth and earnings far exceeding expectations," 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 tomorrow, <span class="xn-chron">November 5, 2010</span> at <span class="xn-chron">8:30 A.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 19624903 on your phone. This tape recording will be available on <span class="xn-chron">Friday, November 5, 2010</span> as of <span class="xn-chron">11:30 A.M.</span> until <span class="xn-chron">11:59 P.M.</span> on <span class="xn-chron">Friday, November 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
September 30, December 30,
2010 2009
------------ ------------
(unaudited) (audited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 34,790 $ 19,847
Accounts receivable 354,956 349,990
Income taxes receivable 12,918 16,264
Inventories 527,915 399,866
Prepaid expenses 19,557 17,358
Future income taxes 40,245 38,042
------------ ------------
990,381 841,367
PROPERTY, PLANT AND EQUIPMENT 150,143 153,279
INTANGIBLE ASSETS 399,781 401,831
GOODWILL 556,950 569,824
OTHER ASSETS 41,641 35,879
------------ ------------
$ 2,138,896 $ 2,002,180
------------ ------------
------------ ------------
LIABILITIES
CURRENT LIABILITIES
Bank indebtedness $ 10,350 $ 1,987
Accounts payable and accrued liabilities 414,600 339,294
Income taxes payable 24,025 26,970
Future income taxes 182 85
Current portion of long-term debt 12,955 122,508
------------ ------------
462,112 490,844
------------ ------------
LONG-TERM DEBT 335,603 227,075
------------ ------------
PENSION & POST-RETIREMENT BENEFIT OBLIGATIONS 21,258 20,939
------------ ------------
FUTURE INCOME TAXES 122,711 128,984
------------ ------------
OTHER LONG-TERM LIABILITIES 33,385 25,139
------------ ------------
SHAREHOLDERS' EQUITY
CAPITAL STOCK 178,264 174,816
------------ ------------
CONTRIBUTED SURPLUS 22,912 20,311
------------ ------------
RETAINED EARNINGS 896,479 818,707
ACCUMULATED OTHER COMPREHENSIVE INCOME 66,172 95,365
------------ ------------
962,651 914,072
------------ ------------
1,163,827 1,109,199
------------ ------------
$ 2,138,896 $ 2,002,180
------------ ------------
------------ ------------
DOREL INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF INCOME
ALL FIGURES IN THOUSANDS OF US $, EXCEPT PER SHARE AMOUNTS
Third Quarters Ended Nine Months Ended
-------------------------- --------------------------
September 30, September 30, September 30, September 30,
2010 2009 2010 2009
------------ ------------ ------------ ------------
(unaudited) (unaudited) (unaudited) (unaudited)
------------ ------------ ------------ ------------
Sales $ 567,329 $ 514,654 $ 1,765,199 $ 1,583,322
Licensing and
commission
income 2,126 3,804 8,264 11,489
------------ ------------ ------------ ------------
TOTAL REVENUE 569,455 518,458 1,773,463 1,594,811
------------ ------------ ------------ ------------
EXPENSES
Cost of sales 447,384 389,718 1,361,903 1,221,746
Selling, general
and administra-
tive expenses 77,041 79,254 244,815 233,064
Depreciation and
amortization 8,066 7,332 22,789 19,322
Research and
development
costs 3,186 4,335 9,966 10,822
Interest 5,201 3,858 13,046 12,515
------------ ------------ ------------ ------------
540,878 484,497 1,652,519 1,497,469
------------ ------------ ------------ ------------
Income before
income taxes 28,577 33,961 120,944 97,342
Income taxes (1,542) 3,731 18,327 14,319
------------ ------------ ------------ ------------
NET INCOME $ 30,119 $ 30,230 $ 102,617 $ 83,023
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
EARNINGS PER SHARE
Basic $ 0.92 $ 0.91 $ 3.12 $ 2.49
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Diluted $ 0.91 $ 0.91 $ 3.09 $ 2.49
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
SHARES OUTSTANDING
Basic - weighted
average 32,833,643 33,179,322 32,906,296 33,297,385
Diluted -
weighted
average 33,159,981 33,338,597 33,260,965 33,389,225
DOREL INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
ALL FIGURES IN THOUSANDS OF US $
Third Quarters Ended Nine Months Ended
-------------------------- --------------------------
September 30, September 30, September 30, September 30,
2010 2009 2010 2009
------------ ------------ ------------ ------------
(unaudited) (unaudited) (unaudited) (unaudited)
------------ ------------ ------------ ------------
NET INCOME $ 30,119 $ 30,230 $ 102,617 $ 83,023
------------ ------------ ------------ ------------
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 43,784 20,220 (23,783) 20,878
------------ ------------ ------------ ------------
Net changes in
cash flow hedges:
Net change in
unrealized gains
(losses) on
derivatives
designated as
cash flow hedges (6,628) (961) (7,973) (120)
Reclassification
to income or to
the related non
financial asset (185) 240 (866) 461
Future income
taxes 2,102 464 3,429 (220)
------------ ------------ ------------ ------------
(4,711) (257) (5,410) 121
------------ ------------ ------------ ------------
TOTAL OTHER
COMPREHENSIVE
INCOME 39,073 19,963 (29,193) 20,999
------------ ------------ ------------ ------------
TOTAL
COMPREHENSIVE
INCOME $ 69,192 $ 50,193 $ 73,424 $ 104,022
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
DOREL INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
ALL FIGURES IN THOUSANDS OF US $
Nine Months Ended
--------------------------
September 30, September 30,
2010 2009
------------ ------------
(unaudited) (unaudited)
CAPITAL STOCK
Balance, beginning of period $ 174,816 $ 177,422
Issued under stock option plan 4,707 -
Reclassification from contributed surplus
due to exercise of stock options 1,147 -
Repurchase and cancellation of shares (2,406) (1,680)
------------ ------------
Balance, end of period 178,264 175,742
------------ ------------
CONTRIBUTED SURPLUS
Balance, beginning of period 20,311 16,070
Exercice of stock options (1,147) -
Stock-based compensation 3,748 2,944
------------ ------------
Balance, end of period 22,912 19,014
------------ ------------
RETAINED EARNINGS
Balance, beginning of period 818,707 738,113
Net income 102,617 83,023
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 (10,829) (4,309)
Dividends on common shares (13,977) (12,485)
Dividends on deferred share units (39) (22)
------------ ------------
Balance, end of period 896,479 802,224
------------ ------------
ACCUMULATED OTHER COMPREHENSIVE INCOME
Balance, beginning of period 95,365 83,139
Total other comprehensive income (29,193) 20,999
------------ ------------
Balance, end of period 66,172 104,138
------------ ------------
TOTAL SHAREHOLDERS' EQUITY $ 1,163,827 $ 1,101,118
------------ ------------
------------ ------------
DOREL INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
ALL FIGURES IN THOUSANDS OF US $
Third Quarters Ended Nine Months Ended
-------------------------- --------------------------
September 30, September 30, September 30, September 30,
2010 2009 2010 2009
------------ ------------ ------------ ------------
(unaudited) (unaudited) (unaudited) (unaudited)
CASH PROVIDED BY
(USED IN):
OPERATING
ACTIVITIES
Net income $ 30,119 $ 30,230 $ 102,617 $ 83,023
Items not
involving cash:
Depreciation
and
amortization 13,027 12,996 38,162 34,835
Amortization
of deferred
financing
costs 112 69 191 175
Accretion
expense on
contingent
considerations 784 - 1,725 -
Future income
taxes (2,001) 2,364 (8,061) (4,227)
Stock based
compensation 1,239 1,085 3,411 2,543
Pension and
post-retirement
defined benefit
plans 205 (902) 1,115 694
Restructuring
activities - (156) - (269)
Loss on disposal
of property,
plant and
equipment 891 71 893 480
------------ ------------ ------------ ------------
44,376 45,757 140,053 117,254
Net changes in
non-cash
balances related
to operations:
Accounts
receivable 49,088 33,127 (10,313) (23,760)
Inventories (71,500) 12,351 (129,256) 98,931
Prepaid
expenses (157) 3,030 (2,588) (643)
Accounts
payable,
accruals and
other
long-term
liabilities (27,220) (18,329) 72,842 (47,232)
Income taxes (3,742) (2,747) 1,160 3,620
------------ ------------ ------------ ------------
(53,531) 27,432 (68,155) 30,916
------------ ------------ ------------ ------------
CASH (USED IN)
PROVIDED BY
OPERATING
ACTIVITIES (9,155) 73,189 71,898 148,170
------------ ------------ ------------ ------------
FINANCING
ACTIVITIES
Bank
indebtedness 7,581 (3,018) 8,236 2,200
Increase of
long-term debt 28,679 - 228,679 -
Repayments of
long-term debt (10,000) (34,979) (230,122) (53,242)
Share
repurchase (6,541) (2,514) (13,235) (5,989)
Issuance of
capital stock 1,053 - 4,707 -
Dividends on
common shares (4,912) (4,125) (13,977) (12,485)
------------ ------------ ------------ ------------
CASH PROVIDED BY
(USED IN)
FINANCING
ACTIVITIES 15,860 (44,636) (15,712) (69,516)
------------ ------------ ------------ ------------
INVESTING
ACTIVITIES
Acquisition of
businesses (220) (7,457) (220) (13,941)
Additions to
property,
plant and
equipment - net (6,811) (5,915) (22,906) (12,775)
Intangible
assets (5,002) (5,414) (14,299) (15,793)
------------ ------------ ------------ ------------
CASH USED IN
INVESTING
ACTIVITIES (12,033) (18,786) (37,425) (42,509)
------------ ------------ ------------ ------------
Effect of
exchange rate
changes on
cash and cash
equivalents 6,131 2,665 (3,818) 3,034
------------ ------------ ------------ ------------
NET INCREASE IN
CASH AND CASH
EQUIVALENTS 803 12,432 14,943 39,179
Cash and cash
equivalents,
beginning of
period 33,987 43,713 19,847 16,966
------------ ------------ ------------ ------------
CASH AND CASH
EQUIVALENTS, END
OF PERIOD $ 34,790 $ 56,145 $ 34,790 $ 56,145
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
DOREL INDUSTRIES INC.
INDUSTRY SEGMENTED INFORMATION
FOR THE THIRD QUARTERS ENDED SEPTEMBER 30
ALL FIGURES IN THOUSANDS OF US $
-------------------------------------------------------
Total Juvenile
-------------------------------------------------------
2010 2009 2010 2009
(unaudited) (unaudited) (unaudited) (unaudited)
Total revenue $ 569,455 $ 518,458 $ 248,421 $ 247,860
Cost of sales 447,384 389,718 183,139 175,526
Selling, general
and
administrative
expenses 72,163 73,651 35,564 37,500
Depreciation and
amortization 8,021 7,258 5,762 5,570
Research and
development
costs 3,186 4,335 1,863 3,138
-------------------------------------------------------
Earnings from
operations 38,701 43,496 $ 22,093 $ 26,126
---------------------------
---------------------------
Interest 5,201 3,858
Corporate
expenses 4,923 5,677
Income taxes (1,542) 3,731
---------------------------
Net income $ 30,119 $ 30,230
---------------------------
---------------------------
Earnings per Share
------------------
Basic $0.92 $0.91
----- -----
----- -----
Diluted $0.91 $0.91
----- -----
----- -----
-------------------------------------------------------
Depreciation
related to
manufacturing
activities
included in Cost
of sales $ 4,961 $ 5,664 $ 3,142 $ 3,874
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
Recreational / Leisure Home Furnishings
-------------------------------------------------------
2010 2009 2010 2009
(unaudited) (unaudited) (unaudited) (unaudited)
Total revenue $ 172,530 $ 145,175 $ 148,504 $ 125,423
Cost of sales 133,110 111,404 131,135 102,788
Selling, general
and
administrative
expenses 27,196 27,049 9,403 9,102
Depreciation and
amortization 2,004 1,324 255 364
Research and
development
costs 688 536 635 661
-------------------------------------------------------
Earnings from
operations $ 9,532 $ 4,862 $ 7,076 $ 12,508
-------------------------------------------------------
-------------------------------------------------------
Interest
Corporate
expenses
Income taxes
Net income
Earnings per Share
------------------
Basic
Diluted
-------------------------------------------------------
Depreciation
related to
manufacturing
activities
included in Cost
of sales $ 745 $ 725 $ 1,074 $ 1,065
-------------------------------------------------------
-------------------------------------------------------
DOREL INDUSTRIES INC.
INDUSTRY SEGMENTED INFORMATION
FOR THE NINE MONTHS ENDED SEPTEMBER 30
ALL FIGURES IN THOUSANDS OF US $
-------------------------------------------------------
Total Juvenile
-------------------------------------------------------
2010 2009 2010 2009
(unaudited) (unaudited) (unaudited) (unaudited)
Total revenue $ 1,773,463 $ 1,594,811 $ 794,005 $ 746,493
Cost of sales 1,361,903 1,221,746 576,816 541,856
Selling, general
and
administrative
expenses 227,617 215,998 113,862 111,847
Depreciation and
amortization 22,672 19,220 16,947 14,303
Research and
development
costs 9,966 10,822 5,887 6,916
-------------------------------------------------------
Earnings from
operations 151,305 127,025 $ 80,493 $ 71,571
---------------------------
---------------------------
Interest 13,046 12,515
Corporate expenses 17,315 17,168
Income taxes 18,327 14,319
---------------------------
Net income $ 102,617 $ 83,023
---------------------------
---------------------------
Earnings per Share
------------------
Basic $3.12 $2.49
----- -----
----- -----
Diluted $3.09 $2.49
----- -----
----- -----
-------------------------------------------------------
Depreciation
related to
manufacturing
activities
included in
Cost of sales $ 15,373 $ 15,513 $ 9,952 $ 10,209
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
Recreational / Leisure Home Furnishings
-------------------------------------------------------
2010 2009 2010 2009
(unaudited) (unaudited) (unaudited) (unaudited)
Total revenue $ 569,095 $ 505,696 $ 410,363 $ 342,622
Cost of sales 432,033 390,645 353,054 289,245
Selling, general
and
administrative
expenses 88,254 78,393 25,501 25,758
Depreciation and
amortization 4,966 3,835 759 1,082
Research and
development
costs 2,125 1,975 1,954 1,931
-------------------------------------------------------
Earnings from
operations $ 41,717 $ 30,848 $ 29,095 $ 24,606
-------------------------------------------------------
-------------------------------------------------------
Interest
Corporate expenses
Income taxes
Net income
Earnings per Share
------------------
Basic
Diluted
-------------------------------------------------------
Depreciation
related to
manufacturing
activities
included in
Cost of sales $ 2,177 $ 1,984 $ 3,244 $ 3,320
-------------------------------------------------------
-------------------------------------------------------
For further information: MaisonBrison, Rick Leckner, (514) 731-0000; Dorel Industries Inc., Jeffrey Schwartz, (514) 934-3034
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