MONTREAL, QUEBEC--(Marketwired - March 10, 2016) - Dorel Industries Inc. (TSX:DII.B)(TSX:DII.A) today announced results for the fourth quarter and full year ended December 30, 2015. Revenue for the fourth quarter was US$668.9 million down 4.6% from US$701.0 million a year ago. Organic revenue, adjusted for foreign exchange variation rates and business acquisitions, increased by approximately 4% in the quarter. Adjusted net income for the fourth quarter was US$14.1 million or US$0.43 per diluted share compared to adjusted net income of US$11.0 million or US$0.34 per diluted share in the fourth quarter of 2014. Adjusted net income increased despite a net negative after-tax impact of approximately US$9.0 million, or US$0.28 per diluted share, due to the effect of the appreciation of the US dollar versus the prior year. Reported net income for the quarter was US$6.6 million or US$0.20 per diluted share compared to a reported net loss of US$80.7 million or a net loss of US$2.50 per diluted share in 2014.
Revenue for the full year remained flat compared to the previous year at US$2.68 billion, with an organic revenue increase of approximately 4%. Adjusted net income for the year was US$58.0 million or US$1.78 per diluted share compared to adjusted net income of US$84.0 million or US$2.59 per diluted share in 2014. The net negative after-tax impact year-over-year of the appreciation of the US dollar versus the prior year was approximately US$35 million or US$1.08 per diluted share. Reported net income was US$25.7 million or US$0.79 per diluted share, compared to a reported net loss of US$21.3 million or a net loss of US$0.66 per diluted share a year ago.
As detailed below, the reported net income (loss) includes impairment losses on goodwill and intangible assets, restructuring and other costs and remeasurement of forward purchase agreement liabilities totalling US$32.3 million or US$0.99 per diluted share in 2015 and US$105.2 million or US$3.25 per diluted share in 2014. As such, the Company is presenting adjusted financial information as it believes that excluding these items is a more meaningful comparison of its core business performance between the periods presented. Contained within this press release are reconciliations of non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP.
"2015 was characterized by good performances in many of our markets overshadowed by challenging currency rates. Overall for the year, these adverse exchange rates impacted our earnings by approximately US$43 million pre-tax. Excluding this impact we would have exceeded prior year earnings for the year. Each of our foreign-based divisions responded to these currency challenges over the course of the year, as reflected in our fourth quarter results which exceeded last year. Our investments and success in becoming a true omni-channel supplier were evidenced by recent recognition from Wal-Mart in the U.S. where Dorel won the Wal-Mart Supplier of the year award specifically for Omni Channel excellence," commented Martin Schwartz, Dorel President and CEO.
| Summary of Financial Information (unaudited) | ||||||
| Fourth Quarters Ended December 30 | ||||||
| All figures in thousands of US $, except per share amounts | ||||||
| 2015 | 2014 | Change % | ||||
| Total revenue | 668,938 | 701,002 | (4.6 | %) | ||
| Adjusted net income | 14,116 | 10,993 | 28.4 | % | ||
| Per share - Basic | 0.44 | 0.34 | 29.4 | % | ||
| Per share - Diluted | 0.43 | 0.34 | 26.5 | % | ||
| Net income (loss) | 6,614 | (80,749 | ) | 108.2 | % | |
| Per share - Basic | 0.20 | (2.50 | ) | 108.0 | % | |
| Per share - Diluted | 0.20 | (2.50 | ) | 108.0 | % | |
| Number of shares outstanding - | ||||||
| Basic weighted average | 32,332,643 | 32,313,250 | ||||
| Diluted weighted average | 32,545,163 | 32,313,250 | ||||
| Summary of Financial Information (unaudited) | ||||||
| Twelve Months Ended December 30 | ||||||
| All figures in thousands of US $, except per share amounts | ||||||
| 2015 | 2014 | Change % | ||||
| Total revenue | 2,683,357 | 2,677,554 | 0.2 | % | ||
| Adjusted net income | 58,005 | 83,979 | (30.9 | %) | ||
| Per share - Basic | 1.79 | 2.61 | (31.4 | %) | ||
| Per share - Diluted | 1.78 | 2.59 | (31.3 | %) | ||
| Net income (loss) | 25,704 | (21,269 | ) | 220.9 | % | |
| Per share - Basic | 0.80 | (0.66 | ) | 221.2 | % | |
| Per share - Diluted | 0.79 | (0.66 | ) | 219.7 | % | |
| Number of shares outstanding - | ||||||
| Basic weighted average | 32,324,569 | 32,213,733 | ||||
| Diluted weighted average | 32,527,632 | 32,213,733 | ||||
Dorel Juvenile
| All figures in thousands of US $ | |||||||||
| Fourth Quarters Ended December 30 (unaudited) | |||||||||
| 2015 | 2014 | ||||||||
| $ | % of rev. | $ | % of rev. | Change % | |||||
| Total revenue | 253,037 | 289,236 | (12.5 | %) | |||||
| Adjusted gross profit | 74,699 | 29.5 | % | 75,840 | 26.2 | % | (1.5 | %) | |
| Adjusted operating profit | 10,180 | 4.0 | % | 8,816 | 3.0 | % | 15.5 | % | |
| Gross profit | 74,336 | 29.4 | % | 69,022 | 23.9 | % | 7.7 | % | |
| Operating profit (loss) | 3,015 | 1.2 | % | (130,893 | ) | (45.3 | %) | 102.3 | % |
| All figures in thousands of US $ | |||||||||
| Twelve Months Ended December 30 (unaudited) | |||||||||
| 2015 | 2014 | ||||||||
| $ | % of rev. | $ | % of rev. | Change % | |||||
| Total revenue | 1,039,947 | 1,070,513 | (2.9 | %) | |||||
| Adjusted gross profit | 284,196 | 27.3 | % | 298,196 | 27.9 | % | (4.7 | %) | |
| Adjusted operating profit | 43,677 | 4.2 | % | 61,939 | 5.8 | % | (29.5 | %) | |
| Gross profit | 282,966 | 27.2 | % | 291,378 | 27.2 | % | (2.9 | %) | |
| Operating profit (loss) | 29,747 | 2.9 | % | (79,038 | ) | (7.4 | %) | 137.6 | % |
Dorel Juvenile's fourth quarter revenue decreased by 12.5% or US$36.2 million to US$253.0 million from the prior year. Excluding the impact of foreign exchange and the acquisition of Dorel Juvenile China in late 2014, organic revenue increased approximately 1%. For the year, Dorel Juvenile's revenue declined by 2.9%, or US$30.6 million to US$1.04 billion from US$1.07 billion in 2014, with organic revenue increasing by approximately 1%. For both the quarter and the year, organic revenue growth was derived mainly from Latin American sales in local currency and renewed success in the sale of wooden juvenile furniture products.
For the quarter, operating profit amounted to US$3.0 million compared to a loss of US$130.9 million a year ago. After removing impairment losses and restructuring and other costs, adjusted operating profit increased by 15.5% or US$1.4 million, to US$10.2 million, from US$8.8 million in 2014. This was despite an approximate net negative impact of US$5 million due to adverse exchange rates. For 2015, operating profit increased by US$108.8 million to US$29.7 million compared to a loss of US$79.0 million a year ago. Excluding impairment losses and restructuring and other costs, adjusted operating profit declined by 29.5%, or US$18.3 million to US$43.7 million, principally due to foreign exchange pressures which had a net negative impact on operating profit of approximately US$20 million with Dorel Juvenile China operating losses accounting for the balance of the decline. This was partly offset by stronger margins related to the implementation of strategic price increases and to the introduction of new products.
Dorel Sports
| All figures in thousands of US $ | ||||||||
| Fourth Quarters Ended December 30 (unaudited) | ||||||||
| 2015 | 2014 | |||||||
| $ | % of rev. | $ | % of rev. | Change % | ||||
| Total revenue | 253,694 | 260,083 | (2.5 | %) | ||||
| Adjusted gross profit | 51,298 | 20.2 | % | 56,890 | 21.9 | % | (9.8 | %) |
| Adjusted operating profit | 9,165 | 3.6 | % | 12,030 | 4.6 | % | (23.8 | %) |
| Gross profit | 51,298 | 20.2 | % | 56,890 | 21.9 | % | (9.8 | %) |
| Operating profit | 8,423 | 3.3 | % | 9,597 | 3.7 | % | (12.2 | %) |
| All figures in thousands of US $ | ||||||||
| Twelve Months Ended December 30 (unaudited) | ||||||||
| 2015 | 2014 | |||||||
| $ | % of rev. | $ | % of rev. | Change % | ||||
| Total revenue | 1,000,209 | 1,053,183 | (5.0 | %) | ||||
| Adjusted gross profit | 214,851 | 21.5 | % | 247,907 | 23.5 | % | (13.3 | %) |
| Adjusted operating profit | 42,007 | 4.2 | % | 67,507 | 6.4 | % | (37.8 | %) |
| Gross profit | 212,339 | 21.2 | % | 246,732 | 23.4 | % | (13.9 | %) |
| Operating profit | 10,895 | 1.1 | % | 55,889 | 5.3 | % | (80.5 | %) |
For the fourth quarter, Dorel Sports revenue decreased by US$6.4 million or 2.5% to US$253.7 million compared to last year. Organic revenue increased approximately 3%, after removing the impact of varying foreign exchange rates year-over-year. For the year, Dorel Sports revenue decreased US$53.0 million or 5.0% to US$1.0 billion in 2015 compared to US$1.05 billion a year ago. Organic revenue increased by approximately 3%. For both the quarter and the year, organic revenue growth was primarily in the IBD channel due to increased demand of new model year 2016 bicycles and in the U.S. mass channel where sales of battery powered ride-ons also showed strong growth.
Operating profit for the quarter decreased US$1.2 million or 12.2% to US$8.4 million from US$9.6 million a year ago. Excluding restructuring and other costs, adjusted operating profit was US$9.2 million, down US$2.8 million or 23.8% from US$12.0 million. For the year, operating profit was US$10.9 million in 2015, down US$45 million from US$55.9 million the previous year. Excluding impairment losses and restructuring and other costs, adjusted operating profit was US$42.0 million, down US$25.5 million or 37.8% from US$67.5 million last year. All major divisions were negatively affected throughout the year by the strong US dollar and the net negative impact on the segment's operating profit was approximately US$5 million for the quarter and US$29 million for the year.
Expectations for the fourth quarter were for Dorel Sports to exceed prior year in both revenue and operating profit. A combination of unforeseen factors affected the quarter. Dorel's largest customer unexpectedly reduced purchases late in the year. In addition, while sales to IBD customers were up double digits in the second half, expectations were to do even better during the fourth quarter, but this did not materialize. As such, results for the quarter were below expectations.
Dorel Home Furnishings
| All figures in thousands of US $ | ||||||||
| Fourth Quarters Ended December 30 (unaudited) | ||||||||
| 2015 | 2014 | |||||||
| $ | % of rev. | $ | % of rev. | Change % | ||||
| Total revenue | 162,207 | 151,683 | 6.9 | % | ||||
| Gross profit | 23,497 | 14.5 | % | 17,033 | 11.2 | % | 37.9 | % |
| Operating profit | 9,514 | 5.9 | % | 5,237 | 3.5 | % | 81.7 | % |
| All figures in thousands of US $ | ||||||||
| Twelve Months Ended December 30 (unaudited) | ||||||||
| 2015 | 2014 | |||||||
| $ | % of rev. | $ | % of rev. | Change % | ||||
| Total revenue | 643,201 | 553,858 | 16.1 | % | ||||
| Gross profit | 86,193 | 13.4 | % | 67,214 | 12.1 | % | 28.2 | % |
| Operating profit | 37,871 | 5.9 | % | 24,034 | 4.3 | % | 57.6 | % |
Dorel Home Furnishings' fourth quarter revenue increased by US$10.5 million, or 6.9% to US$162.2 million compared to last year's US$151.7 million. For the year, revenue increased US$89.3 million or 16.1% to US$643.2 million compared to US$553.9 million in 2014. Revenue gains for both the quarter and the year were led by increases in e-commerce sales which accounted for 44% of total segment sales in the quarter and 37% of sales for the year.
Operating profit for the quarter was US$9.5 million, an increase of 81.7% from the US$5.2 million of the prior year and for the year, operating profit increased by US$13.8 million, or 57.6% which were both driven by the on-line sales. Investments in technology and infrastructure have allowed Dorel to become best in-class in servicing customers' and consumers' e-commerce needs. E-commerce is a crucial sales channel for furniture companies and Dorel's investment in enhanced technology, improvements in shipping and warehousing and superior customer service all support the e-commerce growth that the segment has delivered.
Details of the impairment losses, restructuring and other costs and remeasurement of forward purchase agreement liabilities:
| Twelve months ended December 30 |
Fourth quarters ended December 30 |
|||||||
| 2015 | 2014 | 2015 | 2014 | |||||
| $ | $ | $ | $ | |||||
| Customer programs and incentive offerings [in revenue] | - | 600 | - | 600 | ||||
| Restructuring costs [in cost of sales] (2) | 3,742 | 7,393 | 363 | 6,218 | ||||
| Recorded within gross profit | 3,742 | 7,993 | 363 | 6,818 | ||||
| Employee severance and termination benefits | 6,815 | 2,770 | 3,839 | 2,020 | ||||
| Accelerated depreciation | - | 916 | - | - | ||||
| Write-down of assets | 3,196 | 2,062 | 2,196 | 2,062 | ||||
| Curtailment gain on net pension defined benefit liabilities | (326 | ) | - | (326 | ) | - | ||
| Other associated costs | 1,451 | 1,958 | 1,016 | 1,737 | ||||
| Recorded within a separate line in the consolidated income statements | 11,136 | 7,706 | 6,725 | 5,819 | ||||
| Total restructuring costs | 14,878 | 15,699 | 7,088 | 12,637 | ||||
| Acquisition-related costs | 3,654 | 4,533 | 819 | 3,081 | ||||
| Brixia investment write-down and other costs related to team sponsorship | - | 6,542 | - | 603 | ||||
| Total other costs recorded within a separate line in the consolidated income statements | 3,654 | 11,075 | 819 | 3,684 | ||||
| Total restructuring and other costs | 18,532 | 26,774 | 7,907 | 16,321 | ||||
| Impairment losses on goodwill and intangible assets | 26,510 | 125,821 | - | 125,821 | ||||
| Finance expenses | ||||||||
| Loss (gain) on remeasurement of forward purchase agreement liabilities | (7,810 | ) | (25,702 | ) | 2,069 | (30,789 | ) | |
| Total impairment losses, restructuring and other costs and remeasurement of the forward purchase agreement liabilities before income taxes (1) | 37,232 | 126,893 | 9,976 | 111,353 | ||||
| Total impairment losses, restructuring and other costs and remeasurement of the forward purchase agreement liabilities after income taxes | 32,301 | 105,248 | 7,502 | 91,742 | ||||
| Total impact on diluted earnings (loss) per share | (0.99 | ) | (3.25 | ) | (0.23 | ) | (2.84 | ) |
| (1) Includes non-cash amounts of: | 25,312 | 110,421 | 4,302 | 99,847 | ||||
| (2) Includes write-downs of moulds, accelerated depreciation and inventory markdowns and relocation of inventory costs. | ||||||||
The results include restructuring charges of US$7.1 million for the quarter and US$14.9 million for the year related to Dorel Juvenile and Dorel Sports and acquisition-related costs of US$0.8 million for the quarter and US$3.7 million for the year for Dorel Juvenile.
Dorel Juvenile is continuing its on-going transformation into a more fully integrated operation in its various markets. Cost savings opportunities will be pursued through 2016. In 2015, US$10.3 million was recorded during the year, the majority, US$7.2 million, in the fourth quarter. The remaining charges related to this restructuring plan will be mostly non-cash write-downs of assets to fair value less costs to sell of underutilized land, buildings and land use rights in China that will be made available for sale in 2016 and as well as severance costs. Annualized cost savings of at least US$9.0 million are expected once the restructuring is completed in late 2016.
Dorel Sports recorded US$0.7 million pre-tax in restructuring charges in the fourth quarter and US$4.6 million during the year, of which US$0.2 million and US$3.7 million, respectively is non-cash and is related to structural changes in both the Cycling Sports Group and SUGOI divisions. As announced during the third quarter, the SUGOI and Cannondale apparel product lines are now consolidated into a single global apparel portfolio with SUGOI as the primary brand. The SUGOI center of excellence has moved to a new location. The restructuring initiatives for Dorel Sports are completed and will deliver annual cost savings of an estimated US$4.0 million as of this year.
In Brazil, as a result of the challenging economy and local market conditions, the rising inflation and the devaluation of the Brazil Real, assumptions on projected earnings and cash flow growth were revised for Caloi resulting in US$26.5 million pre-tax non-cash impairment losses on goodwill and intangible assets recorded in Dorel Sports' third quarter results.
Other
For the quarter, Dorel delivered cash flow from operating activities of US$71 million with an inventory reduction of US$92 million from third quarter levels. With this reduction, inventory returned to 2014 third quarter levels at US$585 million. In 2015, the Company's effective tax rate was a recovery of 11.9% compared to an expense of 28.9% in 2014. Excluding the income taxes on impairment losses and restructuring and other costs in both 2015 and 2014, the Company's adjusted tax rate was 3.6% and 13.4% respectively. The main causes of the variations are changes in the jurisdictions in which the Company generated its income and the recognition of tax benefits as a result of a foreign reorganization.
Outlook
"Overall we finished 2015 with a quarter that exceeded prior year in both organic sales growth and pre-tax profit. We expect this to be the case for full year 2016 with all three segments showing earnings improvements assuming the global economy does not deteriorate any further.
"In Home Furnishings, we are seeing the momentum from 2015 carry over into 2016 and we expect to exceed our record 2015 results with strong earnings growth in 2016," stated Martin Schwartz, Dorel President & CEO.
"Dorel Juvenile as a segment exceeded prior year earnings in the fourth quarter as new products and selective price increases were implemented. As foreign currencies stabilize and with the benefits of our restructuring program and other operational improvements, we expect this to continue going forward.
"Dorel Sports' 2016 product line is exceptional. We expect to expand our market share in the IBD sales channel by leveraging the early sell-in success of the model year 2016 bikes and the expansive and exciting upgrade of our product line in model year 2017. This should help fuel sales in the second half. In an attempt to clear excessive inventory, some of Dorel's key IBD competitors have initiated early season discounting. We are taking the appropriate pricing measures within this environment. An early spring could also help mitigate the situation. Business is good in our mass and sporting goods channels and we anticipate surpassing last year's results in these channels. Despite significant economic and political challenges in Brazil, Caloi should see some year-over-year improvement," concluded Mr. Schwartz.
Conference Call
Dorel Industries Inc. will hold a conference call to discuss these results today, March 10, 2016 at 1:00 P.M. Eastern Time. Interested parties can join the call by dialling 1-877-223-4471. The conference call can also be accessed via live webcast at http://www.dorel.com/eng/events. If you are unable to call in at this time, you may access a recording of the meeting by calling 1-800-585-8367 and entering the passcode 30342037 on your phone. This recording will be available on Thursday, March 10, 2016 as of 4:00 P.M. until 11:59 P.M. on Thursday, March 17, 2016.
Complete consolidated financial statements will be available on the Company's website, www.dorel.com, and will be available through the SEDAR website.
Profile
Dorel Industries Inc. (TSX:DII.B)(TSX:DII.A) is a world class juvenile products and bicycle company. The Company's safety and lifestyle leadership is pronounced in both its Juvenile and Bicycle categories with an array of trend-setting, innovative products. Dorel Juvenile's powerfully branded products include global juvenile brands Safety 1st, Quinny, Maxi-Cosi, Bébé Confort and Tiny Love, complemented by regional brands such as Cosco and Infanti. In Dorel Sports, brands include Cannondale, Schwinn, GT, Mongoose, Caloi, IronHorse and SUGOI. Dorel Home Furnishings markets a wide assortment of both domestically produced and imported furniture products, principally within North America. Dorel Industries Inc. has annual sales of US$2.7 billion and employs approximately 10,450 people in facilities located in twenty-five countries worldwide.
Caution Regarding Forward Looking Statements
Certain statements included in this press release may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. Except as may be required by Canadian securities laws, Dorel does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements, by their very nature, are subject to numerous risks and uncertainties and are based on several assumptions which give rise to the possibility that actual results could differ materially from Dorel's expectations expressed in or implied by such forward-looking statements and that the objectives, plans, strategic priorities and business outlook may not be achieved. As a result, Dorel cannot guarantee that any forward-looking statement will materialize, or if any of them do, what benefits Dorel will derive from them. Forward-looking statements are provided in this press release for the purpose of giving information about Management's current expectations and plans and allowing investors and others to get a better understanding of Dorel's operating environment. However, readers are cautioned that it may not be appropriate to use such forward-looking statements for any other purpose.
Forward-looking statements made in this press release are based on a number of assumptions that Dorel believed were reasonable on the day it made the forward-looking statements. Factors that could cause actual results to differ materially from Dorel's expectations expressed in or implied by the forward-looking statements include: general economic conditions; changes in product costs and supply channels; foreign currency fluctuations; customer and credit risk, including the concentration of revenues with few customers; costs associated with product liability; changes in income tax legislation or the interpretation or application of those rules; the continued ability to develop products and support brand names; changes in the regulatory environment; continued access to capital resources and the related costs of borrowing; changes in assumptions in the valuation of goodwill and other intangible assets; and there being no certainty that Dorel's current dividend policy will be maintained. These and other risk factors that could cause actual results to differ materially from expectations expressed in or implied by the forward-looking statements are discussed in Dorel's annual Management Discussion and Analysis and Annual Information Form filed with the applicable Canadian securities regulatory authorities. The risk factors outlined in the previously-mentioned documents are specifically incorporated herein by reference.
Dorel cautions readers that the risks described above are not the only ones that could impact it. Additional risks and uncertainties not currently known to Dorel or that Dorel currently deems to be immaterial may also have a material adverse effect on Dorel's business, financial condition or results of operations. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.
Non-GAAP financial measures
As a result of impairment losses, restructuring and other costs and remeasurement of forward purchase agreement liabilities incurred in both 2015 and 2014, the Company is including in this press release the following non-GAAP financial measures: "adjusted total revenue", "adjusted cost of sales", "adjusted gross profit", "adjusted operating profit", "adjusted finance expenses", "adjusted income before income taxes", "adjusted income taxes", "adjusted net income", and "adjusted earnings per basic and diluted share". The Company believes that this results in a more meaningful comparison of its core business performance between the periods presented. These non-GAAP financial measures do not have a standardized meaning prescribed by GAAP and therefore are unlikely to be comparable to similar measures presented by other issuers. Contained within this press release are reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP.
(All figures are in thousands of US$, except per share amounts)
| Reconciliation of non-GAAP financial measures: | |||||||
| Results for the fourth quarter ended December 30, 2015 | |||||||
Reported |
Restructuring and other costs |
Adjusted |
|||||
| $ | $ | $ | |||||
| TOTAL REVENUE | 668,938 | - | 668,938 | ||||
| Cost of sales | 519,807 | (363 | ) | 519,444 | |||
| GROSS PROFIT | 149,131 | 363 | 149,494 | ||||
| Selling expenses | 60,578 | - | 60,578 | ||||
| General and administrative expenses | 54,650 | - | 54,650 | ||||
| Research and development expenses | 10,554 | - | 10,554 | ||||
| Restructuring and other costs | 7,544 | (7,544 | ) | - | |||
| OPERATING PROFIT | 15,805 | 7,907 | 23,712 | ||||
| Finance expenses | 14,814 | (2,069 | ) | 12,745 | |||
| INCOME BEFORE INCOME TAXES | 991 | 9,976 | 10,967 | ||||
| Income taxes (recovery) expense | (5,623 | ) | 2,474 | (3,149 | ) | ||
| Tax rate | (567.4 | %) | - | (28.7 | %) | ||
| NET INCOME | 6,614 | 7,502 | 14,116 | ||||
| EARNINGS PER SHARE | |||||||
| Basic | 0.20 | 0.24 | 0.44 | ||||
| Diluted | 0.20 | 0.23 | 0.43 | ||||
| SHARES OUTSTANDING | |||||||
| Basic - weighted average | 32,332,643 | 32,332,643 | |||||
| Diluted - weighted average | 32,545,163 | 32,545,163 | |||||
| Results for the fourth quarter ended December 30, 2014 | |||||||
Reported |
Impairment losses, restructuring and other costs |
Adjusted |
|||||
| $ | $ | $ | |||||
| TOTAL REVENUE | 701,002 | 600 | 701,602 | ||||
| Cost of sales | 558,057 | (6,218 | ) | 551,839 | |||
| GROSS PROFIT | 142,945 | 6,818 | 149,763 | ||||
| Selling expenses | 61,444 | - | 61,444 | ||||
| General and administrative expenses | 57,736 | - | 57,736 | ||||
| Research and development expenses | 11,858 | - | 11,858 | ||||
| Restructuring and other costs | 9,503 | (9,503 | ) | - | |||
| Impairment losses on goodwill and intangible assets | 125,821 | (125,821 | ) | - | |||
| OPERATING PROFIT (LOSS) | (123,417 | ) | 142,142 | 18,725 | |||
| Finance expenses | (20,466 | ) | 30,789 | 10,323 | |||
| INCOME (LOSS) BEFORE INCOME TAXES | (102,951 | ) | 111,353 | 8,402 | |||
| Income taxes (recovery) expense | (22,202 | ) | 19,611 | (2,591 | ) | ||
| Tax rate | 21.6 | % | - | (30.8 | %) | ||
| NET INCOME (LOSS) | (80,749 | ) | 91,742 | 10,993 | |||
| EARNINGS (LOSS) PER SHARE | |||||||
| Basic | (2.50 | ) | 2.84 | 0.34 | |||
| Diluted | (2.50 | ) | 2.84 | 0.34 | |||
| SHARES OUTSTANDING | |||||||
| Basic - weighted average | 32,313,250 | 32,313,250 | |||||
| Diluted - weighted average | 32,313,250 | 32,502,846 | |||||
| Reconciliation of non-GAAP financial measures: | |||||||
| Results for the year ended December 30, 2015 | |||||||
Reported |
Impairment losses, restructuring and other costs |
Adjusted |
|||||
| $ | $ | $ | |||||
| TOTAL REVENUE | 2,683,357 | - | 2,683,357 | ||||
| Cost of sales | 2,101,859 | (3,742 | ) | 2,098,117 | |||
| GROSS PROFIT | 581,498 | 3,742 | 585,240 | ||||
| Selling expenses | 235,030 | - | 235,030 | ||||
| General and administrative expenses | 209,330 | - | 209,330 | ||||
| Research and development expenses | 37,595 | - | 37,595 | ||||
| Restructuring and other costs | 14,790 | (14,790 | ) | - | |||
| Impairment losses on goodwill and intangible assets | 26,510 | (26,510 | ) | - | |||
| OPERATING PROFIT | 58,243 | 45,042 | 103,285 | ||||
| Finance expenses | 35,277 | 7,810 | 43,087 | ||||
| INCOME BEFORE INCOME TAXES | 22,966 | 37,232 | 60,198 | ||||
| Income taxes (recovery) expense | (2,738 | ) | 4,931 | 2,193 | |||
| Tax rate | (11.9 | %) | - | 3.6 | % | ||
| NET INCOME | 25,704 | 32,301 | 58,005 | ||||
| EARNINGS PER SHARE | |||||||
| Basic | 0.80 | 0.99 | 1.79 | ||||
| Diluted | 0.79 | 0.99 | 1.78 | ||||
| SHARES OUTSTANDING | |||||||
| Basic - weighted average | 32,324,569 | 32,324,569 | |||||
| Diluted - weighted average | 32,527,632 | 32,527,632 | |||||
| Results for the year ended December 30, 2014 | |||||||
Reported |
Impairment losses, restructuring and other costs |
Adjusted |
|||||
| $ | $ | $ | |||||
| TOTAL REVENUE | 2,677,554 | 600 | 2,678,154 | ||||
| Cost of sales | 2,072,230 | (7,393 | ) | 2,064,837 | |||
| GROSS PROFIT | 605,324 | 7,993 | 613,317 | ||||
| Selling expenses | 235,776 | - | 235,776 | ||||
| General and administrative expenses | 210,691 | - | 210,691 | ||||
| Research and development expenses | 36,111 | - | 36,111 | ||||
| Restructuring and other costs | 18,781 | (18,781 | ) | - | |||
| Impairment losses on goodwill and intangible assets | 125,821 | (125,821 | ) | - | |||
| OPERATING PROFIT (LOSS) | (21,856 | ) | 152,595 | 130,739 | |||
| Finance expenses | 8,073 | 25,702 | 33,775 | ||||
| INCOME (LOSS) BEFORE INCOME TAXES | (29,929 | ) | 126,893 | 96,964 | |||
| Income taxes (recovery) expense | (8,660 | ) | 21,645 | 12,985 | |||
| Tax rate | 28.9 | % | - | 13.4 | % | ||
| NET INCOME (LOSS) | (21,269 | ) | 105,248 | 83,979 | |||
| EARNINGS (LOSS) PER SHARE | |||||||
| Basic | (0.66 | ) | 3.27 | 2.61 | |||
| Diluted | (0.66 | ) | 3.25 | 2.59 | |||
| SHARES OUTSTANDING | |||||||
| Basic - weighted average | 32,213,733 | 32,213,733 | |||||
| Diluted - weighted average | 32,213,733 | 32,440,354 | |||||
| Reconciliation of non-GAAP financial measures | ||||||||||||||||
| Fourth Quarters Ended December 30, | ||||||||||||||||
| 2015 | 2014 | |||||||||||||||
| Reported | % of revenue |
Restruc- turing and other costs |
Adjusted | % of revenue |
Reported | % of revenue |
Impairment losses restruc- turing and other costs |
Adjusted | % of revenue |
Adjusted Change % |
||||||
| Dorel Juvenile | ||||||||||||||||
| TOTAL REVENUE | 253,037 | 100.0 | - | 253,037 | 100.0 | 289,236 | 100.0 | 600 | 289,836 | 100.0 | (12.7 | ) | ||||
| GROSS PROFIT | 74,336 | 29.4 | 363 | 74,699 | 29.5 | 69,022 | 23.9 | 6,818 | 75,840 | 26.2 | (1.5 | ) | ||||
| Selling expenses | 31,234 | 12.3 | - | 31,234 | 12.3 | 32,020 | 11.1 | - | 32,020 | 11.2 | (2.5 | ) | ||||
| General and administrative expenses | 25,430 | 10.1 | - | 25,430 | 10.1 | 25,927 | 9.0 | - | 25,927 | 8.9 | (1.9 | ) | ||||
| Research and development expenses | 7,855 | 3.1 | - | 7,855 | 3.1 | 9,077 | 3.1 | - | 9,077 | 3.1 | (13.5 | ) | ||||
| Restructuring and other costs | 6,802 | 2.7 | (6,802 | ) | - | - | 7,070 | 2.5 | (7,070 | ) | - | - | - | |||
| Impairment losses on goodwill, and intangible assets | - | - | - | - | - | 125,821 | 43.5 | (125,821 | ) | - | - | - | ||||
| OPERATING PROFIT (LOSS) | 3,015 | 1.2 | 7,165 | 10,180 | 4.0 | (130,893 | ) | (45.3 | ) | 139,709 | 8,816 | 3.0 | 15.5 | |||
| Dorel Sports | ||||||||||||||||
| TOTAL REVENUE | 253,694 | 100.0 | - | 253,694 | 100.0 | 260,083 | 100.0 | - | 260,083 | 100.0 | (2.5 | ) | ||||
| GROSS PROFIT | 51,298 | 20.2 | - | 51,298 | 20.2 | 56,890 | 21.9 | - | 56,890 | 21.9 | (9.8 | ) | ||||
| Selling expenses | 24,226 | 9.5 | - | 24,226 | 9.5 | 24,490 | 9.4 | - | 24,490 | 9.4 | (1.1 | ) | ||||
| General and administrative expenses | 16,145 | 6.4 | - | 16,145 | 6.4 | 18,498 | 7.2 | - | 18,498 | 7.2 | (12.7 | ) | ||||
| Research and development expenses | 1,762 | 0.7 | - | 1,762 | 0.7 | 1,872 | 0.7 | - | 1,872 | 0.7 | (5.9 | ) | ||||
| Restructuring and other costs | 742 | 0.3 | (742 | ) | - | - | 2,433 | 0.9 | (2,433 | ) | - | - | - | |||
| OPERATING PROFIT | 8,423 | 3.3 | 742 | 9,165 | 3.6 | 9,597 | 3.7 | 2,433 | 12,030 | 4.6 | (23.8 | ) | ||||
| Dorel Juvenile | ||||||||
| Reconciliation of non-GAAP financial measures | ||||||||
| Year Ended December 30 | ||||||||
| 2015 | 2014 | |||||||
| Reported | Restruc- turing and other costs |
Adjusted | Reported | Impairment losses, restruc- turing and other costs |
Adjusted | |||
| $ | $ | $ | $ | $ | $ | |||
| TOTAL REVENUE | 1,039,947 | - | 1,039,947 | 1,070,513 | 600 | 1,071,113 | ||
| Cost of sales | 756,981 | (1,230 | ) | 755,751 | 779,135 | (6,218 | ) | 772,917 |
| GROSS PROFIT | 282,966 | 1,230 | 284,196 | 291,378 | 6,818 | 298,196 | ||
| Selling expenses | 115,953 | - | 115,953 | 117,959 | - | 117,959 | ||
| General and administrative expenses | 97,128 | - | 97,128 | 93,069 | - | 93,069 | ||
| Research and development expenses | 27,438 | - | 27,438 | 25,229 | - | 25,229 | ||
| Restructuring and other costs | 12,700 | (12,700 | ) | - | 8,338 | (8,338 | ) | - |
| Impairment losses on goodwill and intangible assets | - | - | - | 125,821 | (125,821 | ) | - | |
| OPERATING PROFIT (LOSS) | 29,747 | 13,930 | 43,677 | (79,038) | 140,977 | 61,939 | ||
| Dorel Sports | ||||||||
| Reconciliation of non-GAAP financial measures | ||||||||
| Year Ended December 30 | ||||||||
| 2015 | 2014 | |||||||
| Reported | Impairment losses, restruc- turing and other costs |
Adjusted | Reported | Restruc- turing and other costs |
Adjusted | |||
| $ | $ | $ | $ | $ | $ | |||
| TOTAL REVENUE | 1,000,209 | - | 1,000,209 | 1,053,183 | - | 1,053,183 | ||
| Cost of sales | 787,870 | (2,512 | ) | 785,358 | 806,451 | (1,175 | ) | 805,276 |
| GROSS PROFIT | 212,339 | 2,512 | 214,851 | 246,732 | 1,175 | 247,907 | ||
| Selling expenses | 98,819 | - | 98,819 | 98,631 | - | 98,631 | ||
| General and administrative expenses | 67,611 | - | 67,611 | 74,720 | - | 74,720 | ||
| Research and development expenses | 6,414 | - | 6,414 | 7,049 | - | 7,049 | ||
| Restructuring and other costs | 2,090 | (2,090 | ) | - | 10,443 | (10,443 | ) | - |
| Impairment losses on goodwill and intangible assets | 26,510 | (26,510 | ) | - | - | - | - | |
| OPERATING PROFIT | 10,895 | 31,112 | 42,007 | 55,889 | 11,618 | 67,507 | ||
| DOREL INDUSTRIES INC. |
| CONSOLIDATED STATEMENTS OF FINANCIAL POSITION |
| ALL FIGURES IN THOUSANDS OF US $ |
| (unaudited) |
| as at December 30, 2015 |
as at December 30, 2014 |
||||||
| ASSETS | |||||||
| CURRENT ASSETS | |||||||
| Cash and cash equivalents | $ | 33,182 | $ | 47,101 | |||
| Trade and other receivables | 447,345 | 474,704 | |||||
| Inventories | 584,986 | 633,022 | |||||
| Other financial assets | 4,467 | 4,299 | |||||
| Income taxes receivable | 12,985 | 15,731 | |||||
| Prepaid expenses | 20,234 | 25,343 | |||||
| 1,103,199 | 1,200,200 | ||||||
| Assets held for sale | 11,265 | 1,308 | |||||
| 1,114,464 | 1,201,508 | ||||||
| NON-CURRENT ASSETS | |||||||
| Property, plant and equipment | 206,542 | 226,893 | |||||
| Intangible assets | 465,447 | 519,798 | |||||
| Goodwill | 476,330 | 544,782 | |||||
| Other financial assets | - | 571 | |||||
| Deferred tax assets | 37,258 | 31,009 | |||||
| Other assets | 4,904 | 5,398 | |||||
| 1,190,481 | 1,328,451 | ||||||
| $ | 2,304,945 | $ | 2,529,959 | ||||
| LIABILITIES | |||||||
| CURRENT LIABILITIES | |||||||
| Bank indebtedness | $ | 54,471 | $ | 27,053 | |||
| Trade and other payables | 434,178 | 490,527 | |||||
| Written put option and forward purchase agreement liabilities | 4,104 | - | |||||
| Other financial liabilities | 895 | 1,655 | |||||
| Income taxes payable | 15,590 | 19,046 | |||||
| Long-term debt | 32,857 | 62,556 | |||||
| Provisions | 34,267 | 37,727 | |||||
| 576,362 | 638,564 | ||||||
| NON-CURRENT LIABILITIES | |||||||
| Long-term debt | 465,732 | 490,188 | |||||
| Net pension and post-retirement defined benefit liabilities | 43,058 | 46,128 | |||||
| Deferred tax liabilities | 72,447 | 89,199 | |||||
| Provisions | 1,702 | 1,765 | |||||
| Written put option and forward purchase agreement liabilities | 30,788 | 44,640 | |||||
| Other financial liabilities | 1,890 | 2,063 | |||||
| Other long-term liabilities | 10,569 | 10,428 | |||||
| 626,186 | 684,411 | ||||||
| EQUITY | |||||||
| Share capital | 200,277 | 199,927 | |||||
| Contributed surplus | 26,480 | 25,691 | |||||
| Accumulated other comprehensive income (loss) | (113,956 | ) | (20,579 | ) | |||
| Other equity | 1,527 | 579 | |||||
| Retained earnings | 988,069 | 1,001,366 | |||||
| 1,102,397 | 1,206,984 | ||||||
| $ | 2,304,945 | $ | 2,529,959 | ||||
| DOREL INDUSTRIES INC. |
| CONSOLIDATED INCOME STATEMENTS |
| ALL FIGURES IN THOUSANDS OF US $, EXCEPT PER SHARE AMOUNTS |
| (unaudited) |
| Fourth Quarters Ended | Twelve Months Ended | ||||||||||||
| December 30, 2015 |
December 30, 2014 |
December 30, 2015 |
December 30, 2014 |
||||||||||
| Sales (1) | $ | 664,399 | $ | 695,063 | $ | 2,668,918 | $ | 2,661,559 | |||||
| Licensing and commission income | 4,539 | 5,939 | 14,439 | 15,995 | |||||||||
| TOTAL REVENUE | 668,938 | 701,002 | 2,683,357 | 2,677,554 | |||||||||
| Cost of sales (1) | 519,807 | 558,057 | 2,101,859 | 2,072,230 | |||||||||
| GROSS PROFIT | 149,131 | 142,945 | 581,498 | 605,324 | |||||||||
| Selling expenses | 60,578 | 61,444 | 235,030 | 235,776 | |||||||||
| General and administrative expenses | 54,650 | 57,736 | 209,330 | 210,691 | |||||||||
| Research and development expenses | 10,554 | 11,858 | 37,595 | 36,111 | |||||||||
| Restructuring and other costs (1) | 7,544 | 9,503 | 14,790 | 18,781 | |||||||||
| Impairment losses on goodwill and intangible assets | - | 125,821 | 26,510 | 125,821 | |||||||||
| OPERATING PROFIT (LOSS) | 15,805 | (123,417 | ) | 58,243 | (21,856 | ) | |||||||
| Finance expenses | 14,814 | (20,466 | ) | 35,277 | 8,073 | ||||||||
| INCOME (LOSS) BEFORE INCOME TAXES | 991 | (102,951 | ) | 22,966 | (29,929 | ) | |||||||
| Income taxes recovery | (5,623 | ) | (22,202 | ) | (2,738 | ) | (8,660 | ) | |||||
| NET INCOME (LOSS) | $ | 6,614 | $ | (80,749 | ) | $ | 25,704 | $ | (21,269 | ) | |||
| EARNINGS (LOSS) PER SHARE | |||||||||||||
| Basic | $ | 0.20 | $ | (2.50 | ) | $ | 0.80 | $ | (0.66 | ) | |||
| Diluted | $ | 0.20 | $ | (2.50 | ) | $ | 0.79 | $ | (0.66 | ) | |||
| SHARES OUTSTANDING | |||||||||||||
| Basic - weighted average | 32,332,643 | 32,313,250 | 32,324,569 | 32,213,733 | |||||||||
| Diluted - weighted average | 32,545,163 | 32,313,250 | 32,527,632 | 32,213,733 | |||||||||
| (1)Restructuring and other costs charged to: | |||||||||||||
| Sales | $ | - | $ | 600 | $ | - | $ | 600 | |||||
| Cost of sales | 363 | 6,218 | 3,742 | 7,393 | |||||||||
| Expenses | 7,544 | 9,503 | 14,790 | 18,781 | |||||||||
| $ | 7,907 | $ | 16,321 | $ | 18,532 | $ | 26,774 | ||||||
| DOREL INDUSTRIES INC. |
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) |
| ALL FIGURES IN THOUSANDS OF US $ |
| (unaudited) |
| Fourth Quarters Ended | Twelve Months Ended | |||||||||||
| December 30, 2015 |
December 30, 2014 |
December 30, 2015 |
December 30, 2014 |
|||||||||
| NET INCOME (LOSS) | $ | 6,614 | $ | (80,749 | ) | $ | 25,704 | $ | (21,269 | ) | ||
| OTHER COMPREHENSIVE LOSS: | ||||||||||||
| Items that are or may be reclassified subsequently to net income: | ||||||||||||
| Cumulative translation account: | ||||||||||||
| Net change in unrealized foreign currency gains (losses) on translation of net investments in foreign operations, net of tax of nil | (8,711 |
) | (24,821 |
) | (80,464 |
) | (73,385 |
) | ||||
| Net gains (losses) on hedge of net investments in foreign operations, net of tax of nil | (3,414 | ) | (7,617 | ) | (15,215 | ) | (10,835 | ) | ||||
| (12,125 | ) | (32,438 | ) | (95,679 | ) | (84,220 | ) | |||||
| Net changes in cash flow hedges: | ||||||||||||
| Net change in unrealized gains (losses) on derivatives designated as cash flow hedges | 3,774 |
279 |
5,264 |
6,425 |
||||||||
| Reclassification to income | 170 | 268 | 978 | 956 | ||||||||
| Reclassification to the related non-financial asset | (510 | ) | (2,471 | ) | (5,894 | ) | (1,488 | ) | ||||
| Deferred income taxes | (1,108 | ) | 676 | 152 | (1,559 | ) | ||||||
| 2,326 | (1,248 | ) | 500 | 4,334 | ||||||||
| Items that will not be reclassified to net income: | ||||||||||||
| Defined benefit plans: | ||||||||||||
| Remeasurements of the net pension and post-retirement defined benefit liabilities | 2,700 |
(14,137 |
) | 2,791 |
(14,021 |
) | ||||||
| Deferred income taxes | (959 | ) | 5,537 | (989 | ) | 5,504 | ||||||
| 1,741 | (8,600 | ) | 1,802 | (8,517 | ) | |||||||
| TOTAL OTHER COMPREHENSIVE LOSS | (8,058 | ) | (42,286 | ) | (93,377 | ) | (88,403 | ) | ||||
| TOTAL COMPREHENSIVE LOSS | $ | (1,444 | ) | $ | (123,035 | ) | $ | (67,673 | ) | $ | (109,672 | ) |
| DOREL INDUSTRIES INC. |
| CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY |
| ALL FIGURES IN THOUSANDS OF US $ |
| (unaudited) |
| Attributable to equity holders of the Company | ||||||||||||||||||||||||
| Accumulated other | ||||||||||||||||||||||||
| comprehensive income (loss) | ||||||||||||||||||||||||
| Share Capital |
Contributed Surplus | Cumulative Translation Account |
Cash Flow Hedges |
Defined Benefit Plans |
Other Equity |
Retained Earnings | Total Equity |
|||||||||||||||||
| Balance as at December 30, 2013 | $ | 190,458 | $ | 26,994 | $ | 75,378 | $ | (2,154 | ) | $ | (5,400 | ) | $ | - | $ | 1,061,484 | $ | 1,346,760 | ||||||
| Total comprehensive loss: | ||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | (21,269 | ) | (21,269 | ) | ||||||||||||||
| Other comprehensive income (loss) | - | - | (84,220 | ) | 4,334 | (8,517 | ) | - | - | (88,403 | ) | |||||||||||||
| $ | - | $ | - | $ | (84,220 | ) | $ | 4,334 | $ | (8,517 | ) | $ | - | $ | (21,269 | ) | $ | (109,672 | ) | |||||
| Issued under stock option plan | 7,281 | - | - | - | - | - | - | 7,281 | ||||||||||||||||
| Reclassification from contributed surplus due to exercise of stock options | 1,924 | (1,924 | ) | - | - | - | - | - | - | |||||||||||||||
| Reclassification from contributed surplus due to settlement of deferred share units | 264 | (484 | ) | - | - | - | - | - | (220 | ) | ||||||||||||||
| Share-based payments | - | 907 | - | - | - | - | - | 907 | ||||||||||||||||
| Equity component of convertible debentures, net of tax of $727 | - | - | - | - | - | 2,037 | - | 2,037 | ||||||||||||||||
| Remeasurement of written put option liabilities | - | - | - | - | - | (1,458 | ) | - | (1,458 | ) | ||||||||||||||
| Dividends on common shares | - | - | - | - | - | - | (38,651 | ) | (38,651 | ) | ||||||||||||||
| Dividends on deferred share units | - | 198 | - | - | - | - | (198 | ) | - | |||||||||||||||
| Balance as at December 30, 2014 | $ | 199,927 | $ | 25,691 | $ | (8,842 | ) | $ | 2,180 | $ | (13,917 | ) | $ | 579 | $ | 1,001,366 | $ | 1,206,984 | ||||||
| Total comprehensive loss: | ||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | 25,704 | 25,704 | ||||||||||||||||
| Other comprehensive income (loss) | - | - | (95,679 | ) | 500 | 1,802 | - | - | (93,377 | ) | ||||||||||||||
| $ | - | $ | - | $ | (95,679 | ) | $ | 500 | $ | 1,802 | $ | - | $ | 25,704 | $ | (67,673 | ) | |||||||
| Issued under stock option plan | 219 | - | - | - | - | - | - | 219 | ||||||||||||||||
| Reclassification from contributed surplus due to exercise of stock options | 70 | (70 | ) | - | - | - | - | - | - | |||||||||||||||
| Reclassification from contributed surplus due to settlement of deferred share units | 61 | (101 | ) | - | - | - | - | - | (40 | ) | ||||||||||||||
| Share-based payments | - | 730 | - | - | - | - | - | 730 | ||||||||||||||||
| Remeasurement of written put option liabilities | - | - | - | - | - | 948 | - | 948 | ||||||||||||||||
| Dividends on common shares | - | - | - | - | - | - | (38,771 | ) | (38,771 | ) | ||||||||||||||
| Dividends on deferred share units | - | 230 | - | - | - | - | (230 | ) | - | |||||||||||||||
| Balance as at December 30, 2015 | $ | 200,277 | $ | 26,480 | $ | (104,521 | ) | $ | 2,680 | $ | (12,115 | ) | $ | 1,527 | $ | 988,069 | $ | 1,102,397 | ||||||
| DOREL INDUSTRIES INC. |
| CONSOLIDATED STATEMENTS OF CASH FLOWS |
| ALL FIGURES IN THOUSANDS OF US $ |
| (unaudited) |
| Fourth Quarters Ended | Twelve Months Ended | ||||||||||||
| December 30, 2015 |
December 30, 2014 |
December 30, 2015 |
December 30, 2014 |
||||||||||
| CASH PROVIDED BY (USED IN): | |||||||||||||
| OPERATING ACTIVITIES | |||||||||||||
| Net income (loss) | $ | 6,614 | $ | (80,749 | ) | $ | 25,704 | $ | (21,269 | ) | |||
| Items not involving cash: | |||||||||||||
| Depreciation and amortization | 15,109 | 16,377 | 58,801 | 60,886 | |||||||||
| Impairment losses on goodwill and intangible assets | - | 125,821 | 26,510 | 125,821 | |||||||||
| Unrealized losses (gains) arising on financial assets and financial liabilities classified as held for trading | 143 | 167 | (214 | ) | 92 | ||||||||
| Finance expenses | 14,814 | (20,466 | ) | 35,277 | 8,073 | ||||||||
| Restructuring and other costs | 7,907 | 16,321 | 18,532 | 26,774 | |||||||||
| Income taxes recovery | (5,623 | ) | (22,202 | ) | (2,738 | ) | (8,660 | ) | |||||
| Share-based payments | 95 | 188 | 389 | 763 | |||||||||
| Defined benefit pension and post-retirement costs | 1,671 | 19 | 4,119 | 2,544 | |||||||||
| Loss on disposal of property, plant and equipment | 747 | 608 | 1,474 | 617 | |||||||||
| 41,477 | 36,084 | 167,854 | 195,641 | ||||||||||
| Net changes in balances related to operations: | |||||||||||||
| Trade and other receivables | 271 | (5,985 | ) | 2,194 | (15,340 | ) | |||||||
| Inventories | 92,127 | (37,794 | ) | 6,491 | (78,035 | ) | |||||||
| Other financial assets | (482 | ) | 1,315 | (333 | ) | 886 | |||||||
| Prepaid expenses | 14,247 | 3,875 | 3,777 | 506 | |||||||||
| Other assets | 175 | (4,614 | ) | (391 | ) | (2,481 | ) | ||||||
| Trade and other payables | (46,753 | ) | 47,508 | (42,454 | ) | 59,946 | |||||||
| Net pension and post-retirement defined benefit liabilities | (1,285 | ) | (867 | ) | (3,941 | ) | (3,622 | ) | |||||
| Provisions, other financial liabilities and other long-term liabilities | (4,302 | ) | (3,749 | ) | (11,670 | ) | (12,351 | ) | |||||
| 53,998 | (311 | ) | (46,327 | ) | (50,491 | ) | |||||||
| Income taxes paid | (1,753 | ) | (3,203 | ) | (15,678 | ) | (25,057 | ) | |||||
| Income taxes received | 104 | 174 | 7,204 | 7,014 | |||||||||
| Interest paid | (23,089 | ) | (7,210 | ) | (34,683 | ) | (26,148 | ) | |||||
| Interest received | 88 | 114 | 346 | 689 | |||||||||
| CASH PROVIDED BY OPERATING ACTIVITIES | 70,825 | 25,648 | 78,716 | 101,648 | |||||||||
| FINANCING ACTIVITIES | |||||||||||||
| Bank indebtedness | (4,998 | ) | (8,952 | ) | 40,312 | (41,483 | ) | ||||||
| Increase of long-term debt | - | 142,950 | 32,107 | 249,033 | |||||||||
| Repayments of long-term debt | (41,623 | ) | (689 | ) | (64,134 | ) | (26,926 | ) | |||||
| Repayments of written put option and forward purchase agreement liabilities | - | (1,600 | ) | - | (1,600 | ) | |||||||
| Increase of written put option and forward purchase agreement liabilities | - | - | 525 | - | |||||||||
| Financing costs | (342 | ) | (5,356 | ) | (2,205 | ) | (6,740 | ) | |||||
| Issuance of share capital | 219 | 191 | 219 | 7,241 | |||||||||
| Dividends on common shares | (9,681 | ) | (9,694 | ) | (38,771 | ) | (38,651 | ) | |||||
| CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES | (56,425 | ) | 116,850 | (31,947 | ) | 140,874 | |||||||
| INVESTING ACTIVITIES | |||||||||||||
| Acquisition of businesses | (590 | ) | (115,808 | ) | (2,326 | ) | (170,551 | ) | |||||
| Additions to property, plant and equipment | (9,692 | ) | (9,697 | ) | (34,309 | ) | (35,745 | ) | |||||
| Disposals of property, plant and equipment | 417 | 41 | 974 | 903 | |||||||||
| Additions to intangible assets | (4,253 | ) | (5,840 | ) | (17,744 | ) | (22,109 | ) | |||||
| CASH USED IN INVESTING ACTIVITIES | (14,118 | ) | (131,304 | ) | (53,405 | ) | (227,502 | ) | |||||
| Effect of foreign currency exchange rate changes on cash and cash equivalents | (1,801 |
) | 297 |
(7,283 |
) | (7,993 |
) | ||||||
| NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (1,519 | ) | 11,491 | (13,919 | ) | 7,027 | |||||||
| Cash and cash equivalents, beginning of period | 34,701 | 35,610 | 47,101 | 40,074 | |||||||||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 33,182 | $ | 47,101 | $ | 33,182 | $ | 47,101 | |||||
| DOREL INDUSTRIES INC. |
| SEGMENTED INFORMATION |
| FOURTH QUARTERS ENDED DECEMBER 30 |
| ALL FIGURES IN THOUSANDS OF US $, EXCEPT PER SHARE AMOUNTS |
| (unaudited) |
| Total | Dorel Juvenile | Dorel Sports | Dorel Home Furnishings | |||||||||||||||||
| 2015 | 2014 | 2015 | 2014 | 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Total revenue (1) | $ | 668,938 | $ | 701,002 | $ | 253,037 | $ | 289,236 | $ | 253,694 | $ | 260,083 | $ | 162,207 | $ | 151,683 | ||||
| Cost of sales (1) | 519,807 | 558,057 | 178,701 | 220,214 | 202,396 | 203,193 | 138,710 | 134,650 | ||||||||||||
| Gross profit | 149,131 | 142,945 | 74,336 | 69,022 | 51,298 | 56,890 | 23,497 | 17,033 | ||||||||||||
| Selling expenses | 60,196 | 60,678 | 31,234 | 32,020 | 24,226 | 24,490 | 4,736 | 4,168 | ||||||||||||
| General and administrative expenses | 49,885 | 51,144 | 25,430 | 25,927 | 16,145 | 18,498 | 8,310 | 6,719 | ||||||||||||
| Research and development expenses | 10,554 | 11,858 | 7,855 | 9,077 | 1,762 | 1,872 | 937 | 909 | ||||||||||||
| Restructuring and other costs (1) | 7,544 | 9,503 | 6,802 | 7,070 | 742 | 2,433 | - | - | ||||||||||||
| Impairment losses on goodwill and intangible assets | - | 125,821 | - | 125,821 | - | - | - | - | ||||||||||||
| Operating profit (loss) | 20,952 | (116,059 | ) | $ | 3,015 | $ | (130,893 | ) | $ | 8,423 | $ | 9,597 | $ | 9,514 | $ | 5,237 | ||||
| Finance expenses | 14,814 | (20,466 | ) | |||||||||||||||||
| Corporate expenses | 5,147 | 7,358 | ||||||||||||||||||
| Income taxes recovery | (5,623 | ) | (22,202 | ) | ||||||||||||||||
| Net income (loss) | $ | 6,614 | $ | (80,749 | ) | |||||||||||||||
| Earnings (loss) per share | ||||||||||||||||||||
| Basic | $ | 0.20 | $ | (2.50 | ) | |||||||||||||||
| Diluted | $ | 0.20 | $ | (2.50 | ) | |||||||||||||||
| Depreciation and amortization included in operating profit (loss) | $ | 14,925 | $ | 16,333 | $ | 10,998 | $ | 11,500 | $ | 3,187 | $ | 3,891 | $ | 740 | $ | 942 | ||||
| (1)Restructuring and other costs charged to: | ||||||||||||||||||||
| Sales | $ | - | $ | 600 | $ | - | $ | 600 | $ | - | $ | - | $ | - | $ | - | ||||
| Cost of sales | 363 | 6,218 | 363 | 6,218 | - | - | - | - | ||||||||||||
| Expenses | 7,544 | 9,503 | 6,802 | 7,070 | 742 | 2,433 | - | - | ||||||||||||
| $ | 7,907 | $ | 16,321 | $ | 7,165 | $ | 13,888 | $ | 742 | $ | 2,433 | $ | - | $ | - | |||||
| DOREL INDUSTRIES INC. |
| SEGMENTED INFORMATION |
| FOR THE TWELVE MONTHS ENDED DECEMBER 30 |
| ALL FIGURES IN THOUSANDS OF US $, EXCEPT PER SHARE AMOUNTS |
| (unaudited) |
| Total | Dorel Juvenile | Dorel Sports | Dorel Home Furnishings | |||||||||||||||||
| 2015 | 2014 | 2015 | 2014 | 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Total revenue (1) | $ | 2,683,357 | $ | 2,677,554 | $ | 1,039,947 | $ | 1,070,513 | $ | 1,000,209 | $ | 1,053,183 | $ | 643,201 | $ | 553,858 | ||||
| Cost of sales (1) | 2,101,859 | 2,072,230 | 756,981 | 779,135 | 787,870 | 806,451 | 557,008 | 486,644 | ||||||||||||
| Gross profit | 581,498 | 605,324 | 282,966 | 291,378 | 212,339 | 246,732 | 86,193 | 67,214 | ||||||||||||
| Selling expenses | 232,413 | 232,843 | 115,953 | 117,959 | 98,819 | 98,631 | 17,641 | 16,253 | ||||||||||||
| General and administrative expenses | 191,677 | 190,883 | 97,128 | 93,069 | 67,611 | 74,720 | 26,938 | 23,094 | ||||||||||||
| Research and development expenses | 37,595 | 36,111 | 27,438 | 25,229 | 6,414 | 7,049 | 3,743 | 3,833 | ||||||||||||
| Restructuring and other costs (1) | 14,790 | 18,781 | 12,700 | 8,338 | 2,090 | 10,443 | - | - | ||||||||||||
| Impairment losses on goodwill and intangible assets | 26,510 | 125,821 | - | 125,821 | 26,510 | - | - | - | ||||||||||||
| Operating profit (loss) | 78,513 | 885 | $ | 29,747 | $ | (79,038 | ) | $ | 10,895 | $ | 55,889 | $ | 37,871 | $ | 24,034 | |||||
| Finance expenses | 35,277 | 8,073 | ||||||||||||||||||
| Corporate expenses | 20,270 | 22,741 | ||||||||||||||||||
| Income taxes recovery | (2,738 | ) | (8,660 | ) | ||||||||||||||||
| Net income (loss) | $ | 25,704 | $ | (21,269 | ) | |||||||||||||||
| Earnings (loss) per share | ||||||||||||||||||||
| Basic | $ | 0.80 | $ | (0.66 | ) | |||||||||||||||
| Diluted | $ | 0.79 | $ | (0.66 | ) | |||||||||||||||
| Depreciation and amortization included in operating profit (loss) | $ | 58,262 | $ | 60,711 | $ | 40,901 | $ | 41,857 | $ | 13,130 | $ | 14,596 | $ | 4,231 | $ | 4,258 | ||||
| (1)Restructuring and other costs charged to: | ||||||||||||||||||||
| Sales | $ | - | $ | 600 | $ | - | $ | 600 | $ | - | $ | - | $ | - | $ | - | ||||
| Cost of sales | 3,742 | 7,393 | 1,230 | 6,218 | 2,512 | 1,175 | - | - | ||||||||||||
| Expenses | 14,790 | 18,781 | 12,700 | 8,338 | 2,090 | 10,443 | - | - | ||||||||||||
| $ | 18,532 | $ | 26,774 | $ | 13,930 | $ | 15,156 | $ | 4,602 | $ | 11,618 | $ | - | $ | - | |||||
Contact Information:
Rick Leckner
(514) 731-0000
Dorel Industries Inc.
Jeffrey Schwartz
(514) 934-3034