Dorel Sports Records $230 million loss

Dorel Industries Inc. has announced financial results for the fourth quarter and year ended December 30, 2018. Revenue for entire group in 2018 was US$2.62 billion, compared to US$2.58 billion the previous year. Reported net loss was US$444.3 million or US$13.70 per diluted share, compared to a reported net income of US$27.4 million or US$0.84 per diluted share the previous year.

Dorel Sports, the division which includes brands such as Cannondale, GT, Pacific Cycle and Caloi, reported a revenue increase of US$17.6 million, or 2.0%, to US$883.0 million. However, the operating loss was US$229.1 million compared to an operating profit of US$21.8 million in 2017 which the company put down to a US$237 million impairment loss.

In a report the company stated, 'A sustained decline in Dorel’s stock price during 2018 has caused Dorel’s market capitalization to be significantly lower than the carrying value of its net assets and as such the Company has recorded total impairment losses on goodwill, intangible assets and property, plant and equipment of US$501.4 million during the fourth quarter of 2018, of which US$264.2 million was within Dorel Juvenile and US$237.2 million was within Dorel Sports.'

Dorel President & CEO, Martin Schwartz noted that the company was, “disappointed by fourth quarter earnings at Dorel Juvenile and Dorel Sports. Both segments were affected by lower than expected industry-wide consumer demand over the holiday season and the on-going changes in the consumer products industry.”