- Dorel Industries’ (TSX:DII.B) results for the quarter ending March 31 have taken a hit as a result of COVID-19
- Total revenue fell 7.2 per cent from C$871 million last year to $809 million this year
- Most significantly, net loss increased almost 600 per cent, from $11.5 million to $80.5 million
- The Dorel Juvenile segment was hit hardest, due to widespread retail closures
- Dorel Industries (DII.B) is currently down 1.34 per cent to $2.95 per share, with a market cap of $97.85 million
Dorel Industries’ (TSX:DII.B) results for the quarter ending March 31 have taken a significant hit as a result of COVID-19.
The Westmount-based company designs and manufactures a range of products across its home, sports and juvenile operating segments.
Total revenue for the period fell 7.2 per cent, from C$871 million in the first quarter fo 2019 to $809 million this year.
However, the most significant figure was Dorel’s net loss, which increased a substantial 598.9 per cent from $11.5 million last year to a loss of $80.5 million this year.
By far the hardest-hit segment was the company’s Juvenile business, which reported a drop in revenue of 15.2 per cent to a total of approximately $272 million.
This was largely attributed to the widespread closures of retail stores around the world, as well as a decline in demand and China-based supply complications.
Much of Dorel’s manufacturing centres are located in China and were subject to extended periods of operational suspension. While these activities resumed in mid-March, the impact was compounded by similar shutdowns across global retail outlets.
Martin Schwartz, President and CEO of Dorel Industries, said that while its Juvenile products declined, these purchases have not necessarily been cancelled, but rather deferred.
“While like most companies, Dorel’s revenues have been affected, manyof our products have remained popular with consumers purchasing them in stores where open, and increasingly online.
“We feel we are in a good position in the short- term and going forward as the economy recovers,” he added.
As a retail-focused company, Dorel said that even with stores now beginning to re-open, the gradual process will likely result in second quarter weakness.
That said, the company is anticipating significant financial improvement towards the latter half of the quarter, with new product launches and a catch-up of deferred purchases.
Dorel Industries (DII.B) is currently down 1.34 per cent to $2.95 per share at 12:08pm EDT.