Dorel Juvenile revenue increases on market share gains
Dorel Home accelerates restructuring program to realign its business
MONTRÉAL, March 11, 2025 (GLOBE NEWSWIRE) — Dorel Industries Inc. (TSX:DII, DII.A)) today announced results for the fourth quarter and the year ended December 30, 2024.
Fourth quarter revenue was US$326.8 million, down 6.8%, from US$350.7 million a year ago. Reported net loss for the quarter was US$73.0 million or US$2.24 per diluted share compared to US$3.8 million or US$0.12 per diluted share a year ago. The reported net loss for the quarter includes total restructuring costs of US$14.1 million, and write-downs of deferred tax assets of US$36.5 million. Adjusted net loss1 was US$59.2 million or US$1.82 per diluted share compared to an adjusted net income1 of US$0.2 million or US$0.01 per diluted share for the fourth quarter a year ago.
The adjusted operating loss1 for the fourth quarter of 2024 was US$8.9 million, an increase from US$2.9 million in the previous year. A significant component of the shortfall in earnings was a US$7.5 million variation in earnings in the Juvenile segment caused by the stronger U.S. dollar in the last quarter of 2024. The Home segment adjusted operating loss1 was slightly higher with both of these declines partially compensated by lower corporate costs.
Revenue for the full year was US$1.38 billion, down 0.6%, from US$1.39 billion the previous year. Reported net loss was US$172.0 million or US$5.28 per diluted share compared to US$62.4 million or US$1.92 per diluted share a year ago. The reported net loss for the full year includes total restructuring costs of US$17.4 million, an impairment loss on goodwill of US$45.3 million, and write-downs of deferred tax assets of US$36.5 million. Adjusted net loss1 for the year was US$109.8 million or US$3.37 per diluted share, compared to US$58.4 million or US$1.79 per diluted share in 2023.
The adjusted operating loss1 for 2024 was US$28.4 million, reflecting an improvement of US$19.3 million from the previous year. This enhancement is attributed to a stronger performance in the Juvenile segment and reduced corporate expenses, while the adjusted operating losses1 from the Home segment remained consistent with the prior year.
“Dorel Juvenile has maintained its trajectory of year-over-year revenue growth this quarter, achieving a 2.2% organic revenue1 increase. Notably, Europe achieved a revenue increase of approximately 18% in local currency. However, the strengthening U.S. dollar against almost all other major currencies negatively impacted revenue growth and earnings. Despite this challenge in the quarter, we continued to invest in marketing and sales initiatives to build momentum for 2025. Dorel Home revenues remain significantly lower than in previous years, and as previously announced on January 30, 2025, we are proactively adjusting our operational footprint to achieve profitability. Looking ahead, Dorel Home will focus on leveraging core competencies, strengthening retailer relationships, and driving growth with innovative, high-margin products,” stated Dorel President & CEO, Martin Schwartz.
______________________
1 This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by IFRS and therefore is unlikely to be comparable to similar measures presented by other issuers. Refer to the section “Definition and reconciliation of non-GAAP financial ratios and measures” in this press release.
Summary of Financial Information (unaudited)
Fourth Quarters Ended December 30,
All figures in thousands of US $, except per share amounts
2024
2023
Change
$
$
%
Revenue
326,846
350,679
(6.8)%
Net loss
(73,008
)
(3,757
)
n.m.
Per share – Basic
(2.24
)
(0.12
)
n.m.
Per share – Diluted
(2.24
)
(0.12
)
n.m.
Adjusted net (loss) income (1)
(59,171
)
189
n.m.
Per share – Diluted (1)
(1.82
)
0.01
n.m.
Number of shares outstanding –
Basic weighted average
32,590,581
32,552,430
Diluted weighted average
32,590,581
32,552,430
n.m. = not meaningful
(1) This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by
IFRS and therefore is unlikely to be comparable to similar measures presented by other
issuers. Refer to the section “Definition and reconciliation of non-GAAP financial ratios and
measures” in this press release.
Summary of Financial Information (unaudited)
Years Ended December 30,
All figures in thousands of US $, except per share amounts
2024
2023
Change
$
$
%
Revenue
1,380,215
1,388,748
(0.6)%
Net loss
(171,958
)
(62,350
)
175.8%
Per share – Basic
(5.28
)
(1.92
)
175.0%
Per share – Diluted
(5.28
)
(1.92
)
175.0%
Adjusted net loss (1)
(109,829
)
(58,404
)
88.1%
Per share – Diluted (1)
(3.37
)
(1.79
)
88.3%
Number of shares outstanding –
Basic weighted average
32,571,973
32,541,953
Diluted weighted average
32,571,973
32,541,953
(1) This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by
IFRS and therefore is unlikely to be comparable to similar measures presented by other
issuers. Refer to the section “Definition and reconciliation of non-GAAP financial ratios and
measures” in this press release.
Dorel Juvenile
All figures in thousands of US $
Fourth Quarters Ended December 30 (unaudited)
2024
2023
Change
$
% of rev.
$
% of rev.
%
Revenue
212,843
212,035
0.4%
Gross profit
54,338
25.5%
64,356
30.4%
(15.6)%
Operating profit
1,616
11,299
(85.7)%
Adjusted gross profit (1)
54,803
64,356
(14.8)%
Adjusted operating profit (1)
2,360
12,850
(81.6)%
(1) This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by IFRS and therefore
is unlikely to be comparable to similar measures presented by other issuers. Refer to the section “Definition
and reconciliation of non-GAAP financial ratios and measures” in this press release.
All figures in thousands of US $
Years Ended December 30 (unaudited)
2024
2023
Change
$
% of rev.
$
% of rev.
%
Revenue
864,065
829,778
4.1%
Gross profit
235,223
27.2%
219,109
26.4%
7.4%
Operating profit
15,628
6,411
143.8%
Adjusted gross profit (1)
235,688
219,109
7.6%
Adjusted operating profit (1)
18,297
7,962
129.8%
(1) This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by IFRS and therefore
is unlikely to be comparable to similar measures presented by other issuers. Refer to the section “Definition
and reconciliation of non-GAAP financial ratios and measures” in this press release.
Dorel Juvenile’s fourth-quarter revenue rose 0.4% to US$212.8 million compared to last year. Adjusted for foreign exchange rate variations, organic revenue1 grew by 2.2%, led by strong sales in Europe, Brazil, Australia, and export markets. Europe saw double digit revenue growth stemming from car seats and strollers due to new product launches like the 360 Pro Family car seats and Oxford and Fame strollers. Full-year revenue increased by 4.1%, reaching US$864.1 million from US$829.8 million the previous year. The full-year organic revenue1 increase was better than reported results at 5.3%.
The appreciation of the U.S. dollar affected earnings, resulting in lower-than-expected quarterly results. Compared to the previous year, the total impact in the quarter was an increase of approximately US$7.5 million in cost of sales. This led to reduced gross margins, with the adjusted gross margin1 being 470 basis points lower than the fourth quarter of the previous year. Sales in North America were softer after a very strong third quarter which pulled earnings forward, resulting in lower earnings in the quarter compared to prior year. This and continued challenges in Chile accounted for most of the remaining decrease in earnings versus the prior year.
Fourth quarter operating profit was US$1.6 million, compared to US$11.3 million in the same period last year. Excluding restructuring costs, adjusted operating profit1 was US$2.4 million, compared to US$12.9 million in the fourth quarter of the previous year. The decline in adjusted operating profit1 is primarily due to the negative foreign exchange rate impact. Full-year operating profit was US$15.6 million compared to US$6.4 million in 2023. Adjusted operating profit1 for the year was US$18.3 million, compared to US$8.0 million last year.
Dorel Home
All figures in thousands of US $
Fourth Quarters Ended December 30 (unaudited)
2024
2023
Change
$
% of rev.
$
% of rev.
%
Revenue
114,003
138,644
(17.8)%
Gross profit
(8,286
)
(7.3)%
6,481
4.7%
(227.9)%
Operating loss
(24,950
)
(12,802
)
94.9%
Adjusted gross profit (1)
1,838
1.6%
6,481
4.7%
(71.6)%
Adjusted operating loss (1)
(11,658
)
(9,821
)
18.7%
(1) This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by IFRS and therefore
is unlikely to be comparable to similar measures presented by other issuers. Refer to the section “Definition
and reconciliation of non-GAAP financial ratios and measures” in this press release.
All figures in thousands of US $
Years Ended December 30 (unaudited)
2024
2023
Change
$
% of rev.
$
% of rev.
%
Revenue
516,150
558,970
(7.7)%
Gross profit
10,817
2.1%
24,671
4.4%
(56.2)%
Operating loss
(95,330
)
(40,233
)
136.9%
Adjusted gross profit (1)
21,679
4.2%
24,671
4.4%
(12.1)%
Adjusted operating loss (1)
(35,413
)
(37,252
)
(4.9)%
(1) This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by IFRS and therefore
is unlikely to be comparable to similar measures presented by other issuers. Refer to the section “Definition
and reconciliation of non-GAAP financial ratios and measures” in this press release.
Revenue for the fourth quarter was US$114.0 million, a decrease of US$24.6 million, or 17.8%, from US$138.6 million last year. Most product categories experienced declines, although sales of indoor seating, TV stands, and step stools increased. Brick-and-mortar sales continue to be a focus area and, while slightly down compared to the previous year, this channel is expected to drive growth moving forward. For the full year, revenue was US$516.2 million, a decrease of US$42.8 million, or 7.7%, with e-commerce sales accounting for the majority of the decline.
Adjusted gross margin1 for the fourth quarter decreased by 310 basis points compared to the previous year, primarily due to increased promotional pricing and lower volume efficiency and production levels at the Company’s ready-to-assemble (RTA) plant. The changes implemented to reduce the manufacturing RTA footprint in 2024 did not impact margins positively in the quarter but are anticipated to do so in the future. Inventories decreased by US$79.7 million from the end of 2023 as the Company reduced new purchases and drew down existing inventory in line with the realignment efforts of the business. Lower operating expenses, which decreased by US$2.8 million, or 17.2%, to US$13.5 million partially offset the reduction in gross profit dollars.
Fourth quarter operating loss was US$25.0 million compared to US$12.8 million last year. After excluding significant restructuring costs in the quarter, adjusted operating loss1 for the quarter was US$11.7 million versus US$9.8 million a year ago. For the full year, the operating loss was US$95.3 million, compared to US$40.2 million a year ago. Adjusted operating loss1 for the full year was US$35.4 million, compared to US$37.3 million in 2023.
As previously announced in January 2025, Dorel Home undertook significant restructuring efforts, including a workforce reduction primarily impacting selling and administrative functions and the announcement of the closure of the Montreal production facility. These actions resulted in combined restructuring charges of approximately US$13.3 million in the quarter. The Company also made considerable progress in consolidating operations into a single facility following the closure of the Tiffin, Ohio RTA manufacturing facility. Equipment transfers and facility upgrades at Cornwall, Ontario have been mostly completed, and management improvements have been implemented.
Financing Update
It was announced on February 21, 2025 that the Company had entered into a sale-leaseback transaction for its factory and warehousing facility in Columbus, Indiana. The gross proceeds from the sale were US$30.0 million, of which approximately US$8.0 million was allocated to reduce existing debt, with the balance designated for funding the Company’s ongoing operations. This transaction is part of the Company’s initiative to finance the growth of its Juvenile segment and the turnaround of its Home segment, as announced on January 30, 2025. The Company is actively working on additional opportunities to further enhance its financial position.
Outlook
“As we move into 2025, Dorel Juvenile is poised for continued growth and success. Despite the challenges posed by foreign exchange fluctuations, we remain committed to our business plan centred around innovative new products, brand building, digital excellence and outstanding customer relationships. This will continue to drive market share gains and expansion efforts and enhance our competitive position. With a focus on improving profitability in underperforming regions, we have made management changes in Chile and we expect better performance going forward. We are confident in the Juvenile segment’s ability to achieve sustainable growth and create lasting value for our stakeholders,” commented Dorel President & CEO, Martin Schwartz.
“Dorel Home is making progress in overcoming the challenges posed by the current market environment for furniture companies. The restructuring efforts taken are already delivering results. Our ability to move domestic production to one RTA factory has improved our efficiency and lowered production costs. We have reduced our workforce and our success on lowering inventories means we will be exiting one of our warehouse leases at the end of the first quarter, with the balance of our footprint reduction scheduled for near end of year. Additionally, we will continue to innovate and introduce new products, prioritizing higher margin items and successful licensed brands to grow with our omni channel retail customers and expand our market presence in Europe. With a leaner, talented and more agile organization, we are confident in our ability to capitalize on market opportunities and expect to return to profitability by end of year,” commented Mr. Schwartz.
“As a Company with a substantial footprint in the United States, we are not immune from the potential business impact of import tariffs within the various jurisdictions in which we operate. Due to the unknowns today, it is difficult to assess the potential impact on our supply chain, product costing, retail price points and ultimately on our consumer. Our overall exposure to this risk is less acute in the Juvenile segment than in the Home segment given our domestic manufacturing facility in Columbus, Indiana and our global footprint. We also have strong supplier relationships in both segments with our overseas suppliers and we believe we are well positioned relative to our competitors to successfully navigate the challenges tariffs could pose,” concluded Mr. Schwartz.
Conference Call
Dorel Industries Inc. will hold a conference call to discuss these results on Wednesday, March 12, 2025 at 11:00 AM Eastern Time. Interested parties can join the call by dialing 1-844-763-8274. The conference call can also be accessed via live webcast at http://www.dorel.com. If you are unable to call in at this time, you may access a recording of the meeting by calling 1-855-669-9658 and entering the passcode 9621162 on your phone. This recording will be available on Wednesday, March 12, 2025 as of 2:30 PM until 11:59 PM on Wednesday, March 19, 2025.
Consolidated financial statements as at December 30, 2024 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, DII.A)) is a global organization, operating two distinct businesses in juvenile products and home products. Dorel’s strength lies in the diversity, innovation and quality of its products as well as the superiority of its brands. Dorel Juvenile’s powerfully branded products include global brands Maxi-Cosi, Safety 1st and Tiny Love, complemented by regional brands such as BebeConfort, Cosco, Mother’s Choice and Infanti. Dorel Home, with its comprehensive e-commerce platform, markets a wide assortment of domestically produced and imported furniture. Dorel has annual sales of US$1.4 billion and employs approximately 3,600 people in facilities located in twenty-two 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, the Company 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, including statements regarding the impact of the macro-economic environment, including inflationary pressures, changes in consumer spending, exchange rate fluctuations, the possible imposition of tariffs, and increases in interest rates on the Company’s business, financial position and operations, and are based on several assumptions which give rise to the possibility that actual results could differ materially from the Company’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, the Company cannot guarantee that any forward-looking statement will materialize, or if any of them do, what benefits the Company 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 the Company’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 the Company believed were reasonable on the day it made the forward-looking statements. Factors that could cause actual results to differ materially from the Company’s expectations expressed in or implied by the forward-looking statements include:
general economic and financial conditions, including those resulting from the current high inflationary environment;
changes in applicable laws or regulations;
changes in product costs and supply channels, including disruption of the Company’s supply chain resulting from the macro-economic environment;
foreign currency fluctuations, including high levels of volatility in foreign currencies with respect to the US dollar reflecting uncertainties related to the macro-economic environment;
possible imposition of tariffs on goods imported into the United States;
customer and credit risk, including the concentration of revenues with a small number of 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;
outbreak of public health crises, such as the COVID-19 pandemic, that could adversely affect global economies and financial markets, resulting in an economic downturn which could be for a prolonged period of time and have a material adverse effect on the demand for the Company’s products and on its business, financial condition and results of operations;
the effect of international conflicts on the Company’s sales, including the ongoing Russia-Ukraine war and a possible resumption of the Israeli-Hamas war;
continued access to capital resources, including compliance by the Company with all of the covenants under its ABL facility and term loan facility, and the related costs of borrowing, all of which may be adversely impacted by the macro-economic environment;
failures related to information technology systems;
changes in assumptions in the valuation of goodwill and other intangible assets and any future decline in market capitalization;
there being no certainty that the Company will declare any dividend in the future;
increased exposure to cybersecurity risks as a result of remote work by the Company’s employees;
the Company’s ability to protect its current and future technologies and products and to defend its intellectual property rights;
potential damage to the Company’s reputation; and
the effect of climate change on the Company.
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 the Company’s annual MD&A and Annual Information Form filed with the applicable Canadian securities regulatory authorities. The risk factors set out in the previously mentioned documents are expressly incorporated by reference herein in their entirety.
The Company cautions readers that the risks described above are not the only ones that could impact it. Additional risks and uncertainties not currently known to the Company or that the Company currently deems to be immaterial may also have a material adverse effect on the Company’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.
All figures in the tables below are in thousands of US $, except per share amounts.
Consolidated Results
Fourth Quarters Ended
Years Ended
Dec 30,
Dec 30,
Variation
Dec 30,
Dec 30,
Variation
2024
2023
$
%
2024
2023
$
%
Revenue
326,846
350,679
(23,833
)
(6.8)%
1,380,215
1,388,748
(8,533
)
(0.6)%
Cost of sales
280,794
279,842
952
0.3%
1,134,175
1,144,968
(10,793
)
(0.9)%
Gross profit
46,052
70,837
(24,785
)
(35.0)%
246,040
243,780
2,260
0.9%
Adjusted gross profit (1)
56,641
70,837
(14,196
)
(20.0)%
257,367
243,780
13,587
5.6%
Selling expenses
30,259
30,258
1
n.m.
126,162
126,096
66
0.1%
General and administrative expenses
29,244
36,645
(7,401
)
(20.2)%
133,478
139,696
(6,218
)
(4.5)%
Research and development expenses
5,727
5,979
(252
)
(4.2)%
23,579
24,536
(957
)
(3.9)%
Impairment loss on trade accounts receivable
285
837
(552
)
(65.9)%
2,507
1,117
1,390
124.4%
Restructuring costs
3,533
4,532
(999
)
(22.0)%
6,043
4,532
1,511
33.3%
Impairment loss on goodwill
–
–
–
n/a
45,302
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