Shimano Group 2013 Sales Rise on Growing Chinese Demand

Shimano Group reported net sales reached ¥271.0 billion ($2.89 bn) in the year ended Dec. 31, 2013, up 10.2 percent from 2012 as favorable exchange rates and China’s growing appetite for sport bikes more than offset the negative effects a cold, wet spring had on sales of bicycling and fishing gear in its primary markets of Europe, North America and Japan.

The Ja panese company reported its North American sales reached ¥33.2 billion ($342mm), up ¥3.78 billion or 12.8 percent.  Sales rose 6.7 percent in Japan, 10.3 percent in Europe and 11.5 percent in the rest of Asia. Shimano earns about 77 percent of its revenue by selling bicycle components internationally, primarily to bicycle manufacturers.

Gross profit reached 35.6 percent, down 70 basis points from 2012.

Operating income was essentially flat at ¥41.8 billion ($424mm), or 15.4 percent of revenues. 

Ordinary income, which reflects ¥5.0 billion ($62mm) in foreign currency gains, increased 20.3 percent to ¥47.5 billion ($584mm) and net income increased 27.7 percent to ¥35.1 billion ($361mm).

Shimano said sales at its Bicycle Components business increased 9.6 percent from the previous year to ¥217.3 billion ($2.2 bn). Operating income increased 1.3 percent to ¥39.5 million ($407mm), or 18.2 percent of net sales.

In the Fish Tackle segment, sales rose 13.1 percent to ¥53.4 billion ($550mm), while operating income increased 5.7 percent to ¥2.4 billion ($25mm), or 4.5 percent of revenues.

The company boosted spending on both salaries and wages and advertising by nearly 15 percent and on R&D by roughly 8 percent over 2012 levels. Shimano ended the quarter with ¥125.9 billion ($1.30 bn) in cash and cash equivalents and ¥28.3 billion in merchandise and finished goods, up 32.8 and 10.5 percent respectively from a year earlier.

Outlook

 Shimano forecasts net sales will grow 3.3 percent in 2014 to ¥280.0 billion while operating income will rise 7.7 percent to ¥45.0 billion. Ordinary and net income is expected to decline 5.4 and 10.2 percent respectively. The forecast includes projected sales of ¥224 billion at Bicycle Components and ¥55 billion at Fishing Tackle.

By press release

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