Dorel cites Cannondale as reason for success

Dorel Industries Inc. has released results for the third quarter and nine months ended September 30th.

Revenue for the period was $552.2 million, up 25.5 percent from $440.1 million for the third quarter last year. Organic revenue growth in the quarter was 9 percent.

Revenue for the nine months was $1.7 billion, up 25.6 percent from the US$1.35 billion a year ago. Year-to-date organic revenue growth was also 9 percent.

The majority of the revenue increase in both the third quarter and first nine months was due to the acquisitions of Cannondale and Sugoi, that occurred in February 2008, as well as PTI Sports, whose assets were purchased in June of this year. In addition, organic sales rose, driven by the segment’s strong mass merchant performance, with sales to mass exceeding expectations, said Dorel President and CEO, Martin Schwartz.

"Cannondale’s business model is impacted more by seasonality and new model introduction timing than Dorel’s recreational/leisure mass merchant business and the third quarter can be the weakest," said Schwartz.

"This was the case in 2008, but despite this, orders were up for Cannondale year-over-year. However supply issues for some of Cannondale’s carbon models created delays which are now in the process of being resolved. Higher margins on Cannondale bicycles and SUGOi apparel again contributed to increased gross margins in the quarter."