Dorel Industries Inc. (TSX: DII.B DII.A) today announced results for the fourth quarter and full year ended December 30, 2012. Revenue for the fourth quarter increased 10.9% to US$622.6 million from US$561.6 million a year ago. Net income was up 6.4% to US$29.1 million or US$0.91 per diluted share from US$27.4 million, or US$0.85 per diluted share in 2011.
Revenue for the full year reached US$2.5 billion, up 5.3% from last year’s US$2.4 billion. Net income was US$108.6 million or US$3.39 per diluted share, up from US$104.6 million or US$3.21 per diluted share a year ago, increases of 3.8% and 5.6% respectively.
Net income in both 2012 and 2011 benefitted from a reduction in corporate general and administrative expenses on non-cash gains related to contingent consideration and put option liabilities in connection with prior business acquisitions. In the fourth quarter of 2012 this gain was US$2.0 million while in 2011 it amounted to US$11.1 million. For the full year, these amounts were US$3.5 million in 2012 and US$12.2 million in 2011. Excluding these non-cash, non-taxable gains, net income in the fourth quarter of 2012 was US$27.1 million versus US$16.3 million in 2011, an increase of 66%. For the full year, excluding the gain amount, net income was US$105.1 million in 2012 versus US$92.4 million in 2011, a 13.7% improvement.
“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 (DJG) 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.
“Driven by double digit growth in sales of Dorel’s premium Cannondale brand, the Recreational/Leisure segment’s full-year revenue surpassed US$900 million. Fourth quarter revenue increased markedly due to the ability to ship more product and strong sales of electric ride-on toys. 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,” concluded Mr. Schwartz.
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