Dorel’s overall growth has been bolstered by a strong performance from Dorel Juvenile, the baby and nursery arm of the business, which has seen organic revenue grow by 5.6% year-on-year.
Overall results for the second quarter (ending June 30, 2019) saw revenue of US$670 million, compared to US$623.2 million in 2018, an increase of 7.5%.
Dorel Juvenile saw Q2 revenue grow by 1.9%, to US$221.5 million, with organic revenue improving by 5.6% with the most significant contribution from Europe. Organic sales growth in North America, Brazil and Chile also saw same store retail sales rebounding from a difficult 2018.
Research and development initiatives have resulted in the launch of several new products throughout the quarter in multiple categories. There are also important new product launches scheduled for the second half of the year, including some in the growing multi-age car seat category in Europe.
Operating profit was US$2.4 million compared to an operating loss of US$22.4 million last year. Excluding impairment loss on intangible assets, restructuring and other costs, adjusted operating profit was US$6.6 million compared to US$3.6 million in 2018.
The Dorel Juvenile restructuring programme, which began in early 2019, is continuing in line with previous estimates. Annual cost savings of between US$12.0 million and US$15.0 million are predicted once the programme has been completed.
“We are encouraged that, without exception, all our businesses have produced top-line growth. U.S. tariffs imposed on China-sourced goods and its impact on retail price points have created uncertainty on customers’ buying decisions as well as on supply chain and inventory planning processes,” commented Dorel president and ceo Martin Schwartz.
“Dorel Juvenile was ahead of last year and there has been progress in Europe, however work is continuing to drive down costs and return the segment to the proper level of profitability.”
