by Company also narrows its adjusted net loss to $10.4 million, from $34.7 million last year
MONTREAL — Dorel Industries reported a 3.9% decline in revenues for its third quarter ended Sept. 30, while also narrowing its adjusted net loss from continuing operations.
The company reported total revenues of $359.7 million for the quarter, compared to $374.1 million during the same period last year. Its adjusted net loss from continuing operations was $10.4 million, or 32 cents per share, compared to an adjusted net loss of $34.7 million, or $1.07 per share, last year.
For the first nine months, the company had net revenues of $1.04 billion, a 15.6% decline from the $1.23 billion reported the same period last year. Its adjusted net loss from continuing operations was $58.6 million, or $1.80 per share, compared to an adjusted net loss of $71.2 million, or $2.19 per share in 2022.
The Dorel Home segment, which includes its key furniture brands such as Ameriwood Home, Alphason, DHP Furniture, Cosco and the licensed Novogratz and Cosmo Living lines, reported $153.7 million in revenues for the quarter, down 18% from the $187.4 million reported last year. It also had an operating loss of $3.5 million, which was down from nearly $8 million the same period last year.
For the full nine months, the segment reported revenues of $420.3 million, down 31% from the $608.7 million reported the same period last year. Its operating loss was $27.4 million, compared to a loss of $236,000 the same period in 2022.
The company said that its revenues in the Home segment increased for a third consecutive quarter and despite an overall softness in the market, it said that there are positive trends in the brick-and-mortar channel.
“The fall High Point Market was a success with Dorel Home’s customers enthusiastic about the new product introductions,” the company said.
Despite its net losses in the segment, it said that gross margins increased over the prior year and are up over the first and second quarters. For example, gross profits during the quarter totaled $10.9 million in the quarter, or 7.1% of revenues, compared to $8.9 million, or 4.8% of revenues, in 2022.
This resulted from reductions in freight and materials costs as well as reductions in warehouse and distribution costs. It also noted that inventory management resulted in a year-over-year inventory reduction of $54.7 million from last year. It also was down $38.3 million from the fourth quarter of 2022.
Its juvenile segment had third-quarter revenues of $205.9 million, up 10.3% from $186.7 million last year. The juvenile segment also reported an adjusted operating profit of $3.2 million, compared to a loss of $16.2 million last year.
For the first nine months of the year, it reported $617.7 million in revenues, down .6% from the $621.3 million reported last year. It also had an adjusted operating loss of $4.9 million for the period, compared to $28.8 million the same period last year.
Meanwhile, its gross profit in the segment totaled $55 million during the third quarter, or 26.7% of revenues, compared to $30 million, or 16.1% of revenues, last year. For the first nine months, it reported a gross profit of $154.7 million, or 25.1% of revenues, compared to $125.4 million, or 20.2% of revenues, the same period in 2022.
“We are pleased with the progress of our Dorel Juvenile segment as they delivered double-digit revenue growth and an impressive turnaround in earnings,” said Dorel President and CEO Martin Schwartz. “We are clearly seeing our products winning and delivering market share gains in an industry that was down versus the prior year. Dorel Home revenues continued to grow, improving sequentially with positive indicators at brick-and-mortar. Given the challenges for consumer products companies overall, our two segments are navigating positively, though we recognize the need for further improvement. There is far less retailer inventory and our own inventory levels are at their lowest in two years. The vast majority of all the high-cost inventory from last year has been sold, contributing to improving margins throughout 2023.”
