Business news : Mizuno Lowers FY Guidance on Weak Q3

Mizuno CEO, Masato  Mizuno

Mizuno reported revenues totaled ¥88.3 billion ($889.3 mm) in the six months ended Sept. 30, up 8.5 percent compared with the same period in the previous fiscal year. Operating profit stood at ¥2.6 billion ($26.2 mm), down 13.8 percent. The Japanese-based sporting goods giant reduced its profit outlook for the year.

Ordinary profit was ¥2.2 billion yen, down 14.2 percent, and net income was ¥1.3 billion ($13.1 mm), down 22.1 percent.

Mizuno said in its statement:

• The market contraction in China showed no sign of ending, and price competition on the back of excess distribution inventory accelerated. These factors had a significant impact on revenue.
• Rising import prices due to the weaker yen, in addition to higher costs such as raw materials and personnel expenses put pressure on profits.
• Business remained strong in the Americas as in the previous fiscal year. The performance also remained firm in Europe amid the difficult economic conditions. Footwear, especially running shoes, and apparel products continued to show a strong performance in each region.

Main regions

Europe

• The company sought to capitalize on an increase in demand for running- and indoor sports-related footwear products amid the sluggish European economy. Despite the difficult economic conditions, revenue was up 23.5 percent. Even excluding the effect of foreign exchanges, revenue remained solid, increasing 3.5 percent.
• Acquiring an agent in Italy, Mizuno Italia opened in January. In July, the company also acquired an agent in Spain and established Mizuno Espana. The company is working to strengthen its marketing by promoting direct inroads into the market in European countries.

The Americas

• Footwear, especially running shoes, and apparel businesses remained strong in the Americas. Revenue was up 28.7 percent. Even excluding the effect of foreign exchange, revenue also remained strong, up 8.3 percent.
• Particularly in the running shoes business, WAVE SAYONARA, a new product in the running shoes line, the mainstay for growth, performed well. Revenue enjoyed a double-digit increase as market share expanded in specialty stores.In golf, the Custom Fitting business continued to be the engine behind growth, and its products including JPX825 received a high reputation from the market.

Japan

• Revenue increased 1.7 percent partly backed by revenue at Senoh Corporation, which joined the Mizuno Group in July 2012.
• Sales of shoes for personal use, such as running and walking shoes, continued to be strong, as in the previous fiscal year.

Forecast for Fiscal 2013
On the same day, the company revised its consolidatedresults forecast for the fiscal year ending March 2014.

• Revenue remained unchanged at ¥183.0 billion  (up 11.8 percent year on year).
• Operating profit was revised downward from the initial forecast of ¥7.0 billion to ¥5.5 billion (up 52.6 percent year on year).
• Ordinary profit was revised downward from the initial forecast of ¥7.0 billion yen to ¥5.5 billion yen (up 34.3 percent year on year).
• Net income was revised downward from the initial forecast of ¥4.2 billion yen to ¥2.1 billion yen (up 7.9 percent year on year).

By press release


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