MONTREAL - Dorel Industries Inc. (TSX: DII.B, DII.A) announced results for the second quarter and six months ended June 30, 2015 on August 6. The company's Home Furnishings segment showed especially strongs sales and profit growth. The manufacturer said juvenile wooden furniture drove its U.S. sales increases.
Total revenue for the quarter was US$669.6 million, up 2.1% from US$655.8 million recorded in the same period last year. Adjusted net income was $16.6 million, compared to adjusted net income of $19.8 million a year ago. The company cited a net negative impact of foreign exchange on Dorel’s earnings as the U.S. dollar remained strong against the Canadian dollar.
Revenue for the six months increased 2.4% to $1.34 billion compared to $1.30 billion last year. First half adjusted net income reached $28.4 million, compared to adjusted net income of $49.2 million last year.
“In Home Furnishings we are having a breakout year with revenues increasing by 29.9% in the quarter and 23.1% year-to-date. Operating profit was up 65.3% and 36.9% in the quarter and six months respectively. Dorel’s Juvenile and Sports segments continue to operate in an environment of challenging foreign exchange rates as the US dollar remains strong against practically all currencies. This had a significant effect on our earnings, impacting operating profit in the two segments combined by a net negative amount of approximately US$12 million in the second quarter alone, bringing the net negative FX year-to-date impact to approximately US$25 million. We have done a good job mitigating this impact with selective price increases and other proactive measures and our results reflect that. There have been numerous improvements at our Dorel Juvenile China factories and we are pleased with the progress of the integration process,” said Dorel President & CEO Martin Schwartz.
Dorel said the Home Furnishing segment's sales to internet retailers continued to drive revenue, accounting for more than 34% of total segment sales in the quarter, while sales to brick and mortar stores also saw a rise. The company noted that its expanded product line is resonating with customers.
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