Shimano 2019 H1 Operating Income Drops

OSAKA, Japan – Shimano has announced the company's financial results for the first half of fiscal year 2019. Although net sales increased 4.1% from the same period of the previous year to 181,949 million yen (approx US$1.67 billion), operating income decreased 1.3% to 34,053 million yen (approx. US$314 million). Likewise, ordinary income decreased 9.7%, to 34,644 million yen, and net income attributable to owners of parent decreased 10.6% to 24,766 million yen.

In the companies bicycle segment, net sales from this segment increased 4.1% from the same period of the previous year to 143,599 million yen (approx. US$1.32 billion), and operating income decreased 3.0% to 28,613 million yen (approx. US$263 million).In a press release, Shimano revealed its analysis of market conditions throughout the world:

In Europe, good weather conditions from the beginning of spring supported favorable retail sales of completed bicycles, mainly sport E-BIKE, and distributor inventories of bicycles in Europe remained at an appropriate level.
In North America, although total retail unit sales of completed bicycles had been sluggish from the start of the year, the sales amount remained at the same level as the previous year due to improved weather
from the latter half of March and also owing to a favorable sales environment, mainly for high-end bicycles. Distributor inventories remained at an appropriate level.
In China, retail sales of completed bicycles showed no clear signs of recovery, and sales continued to lack vigor. Meanwhile, distributor inventories remained at an appropriate level.
With regard to the other emerging markets, in South America, the Brazilian market continued to recover, while the Argentine market remained stagnant due to the effects of currency depreciation. Distributor inventories remained at an appropriate level except for the Argentine market.
In the Japanese market, despite overall good weather conditions, sales of high-end sports bicycles were sluggish. Meanwhile, as the shift to sports-type cross bike and E-BIKE for commuting to work and school further progressed, unit sales decreased, but sales unit prices increased. Distributor inventories were slightly high.

Accordingly, Shimano has adjusted its forecast for net income and operating income for the full year, revising down by 0.8% and 8.2 % respectively.