Shimano has reported an increase in sales for the fiscal year 2020, with net sales increasing 4.1% from the previous year.
Net sales from the bicycle components segment increased 2.7% from the previous year to 297,777 million yen, and operating income increased by 18.4% to 68,494 million yen, the company said.
Demand for bicycles had declined sharply in early spring due to the spread of COVID-19, the company said, but, as cycling gained attention as an easy form of recreation and exercise, demand for bicycles increased on a global scale. “Under such circumstances, in overseas markets, including that of Europe and North America, while retail sales of bicycles and bicycle-related products remained robust, as the inability of supply to keep up with the strong demand continued, trends of shortages in both distributor inventories and retail inventories persisted in each country,” said a statement.
In the Japanese market, although there was no significant increase in demand for bicycles as seen in the US and Europe, as retail sales for cross bikes, used for recreation and as a mode of transportation, and for e-bike were solid, distributor inventories remained largely at ‘appropriate levels’, Shimano said. Under these market conditions, order-taking was ‘brisk’ for the new Deore MTB components and a wide range of existing products overall.
Overall, for fiscal year 2020, Shimano said net sales increased by 4.1% from the previous year to 378,040 million yen.
In its forecast for the future, the company said that although there are some promising signs of economic recovery such as the start of vaccinations to prevent the spread of COVID-19, uncertainties remain over the full-scale recovery of economic activities. “Meanwhile, with a view to preventing the spread of COVID-19, interest in outdoor leisure activities that can avoid closed, crowded and close-contact environment is expected to continue,” Shimano added.
“In Europe, economic turmoil caused by Brexit is expected to be avoided by agreement to conclude a free trade agreement. In China, the impact of COVID-19 will ease, and the economic recovery is expected to continue, driven by personal consumption.
“In the US, the Biden administration came to power, and additional financial support by the government is expected. However, social instability due to political division may discourage economic recovery. In Japan, as infection trends directly affect consumer sentiment and concerns prevail over the impact on the holding of the Tokyo Olympic and Paralympic Games, decline in consumption will not be fully recovered and the pace of economic recovery is estimated to be moderate.
“In these circumstances, the Company emphasises not only striving to develop and manufacture “captivating products” that bring sensations to many people as a “development-oriented digital manufacturing company” of Japan origin, while closely monitoring favourable trends in demand for bicycles and fishing tackle, but also moving forward step by step as a “value-creating company” that continues to create a shared value between corporations and society.
“We will endeavour to further enhance management efficiency and strive for sustainable corporate growth by pursuing the creation of new cycling and fishing culture.”
Read the February issue of BikeBiz below: