Asics America Group, which includes the U.S., Brazil and Canada, reported net income increased 16.1 percent in its fiscal year ended Dec. 31. Net sales for the year were up 13.2 percent and operating income rose 41.4 percent.
In a statement, Asics America said the fiscal year increase was largely driven by strong sales in the footwear category, including the newest addition, Asics Natural 33 Collection. Additional growth in emerging categories such as tennis and penetration in apparel and accessories also played a significant role in Asics America’s financial progress for 2012. Its volleyball and wrestling categories in the region also found success.
Asics America said it’s on pace to show continued growth in 2013 and is on track to reach its billion dollars sales goal by 2015.
As Asics continuously pushes the limits and expands its product offering beyond running we see the growth and potential to further penetrate new categories, said Asics America’s President and CEO Kevin Wulff, in a statement. We are thrilled to see the early traction we are already receiving in rising markets and it is a testament to the award winning, athletic performance products we offer.
Overall, Asics Corp reported revenues rose 5.0 percent to ¥260.2 billion ($2.6 bn). Domestic net sales increased 1.7 percent to ¥94.1 billion ($951.8 mm), mainly due to the strong sales of running shoes in spite of the weak sales of baseball wear and equipment affected by the unity of the Asics brand. Overseas sales increased 7.0 percent to ¥166.1 billion ($1.68 bn), because of the strong sales of running shoes in the Americas, Europe and the other regions.
Gross profit rose 5.8 percent to ¥113.8 billion ($1.15 bn), mainly due to an increase in net sales. Selling, general and administrative expenses increased 8.3 percent to ¥95.2 billion ($963.1 mm) because of the recording of commission paid to distributors as commission fee in line with the recording of net sales at the sales price to end consumers at the Korean subsidiary, in addition to an increase in personnel expenses. As a result, operating income fell 4.9 percent to ¥18.7 billion ($188.8 mm).
Ordinary income increased 4.2 percent to ¥20.5 billion ($207.7 mm), mainly due to the recording of exchange gain despite exchange loss was recorded in fiscal 2012. Net income for fiscal 2013 increased 9.2 percent to ¥13.8 billion ($139.4 mm), due to the recording of tax refund and interest on refund arisen from transfer pricing taxation.
By region, sales in the America region reached ¥67.1 billion ($678.8 mm), up 13.7 percent in Yen and 13.2 percent on a currency-neutral (C-N) basis. Operating income reached ¥4.8 billion ($48.0 mm) against ¥3.7 billion on a recorded basis.
In its home market of Japan, revenues rose 4.8 percent to ¥114.4 billion ($1.16 bn). Operating profits were down 23.9 percent to ¥4.3 billion ($43.5 mm).
In Europe, sales inched up 1.3 percent to ¥61.8 billion ($625.7 mm) but advanced 8.9 percent on a C-N basis, thanks to the strong sales of running shoes. Operating profits were down 5.7 percent to ¥6.6 billion ($67.1 mm) mainly due to a rise in purchasing costs, in spite of a decrease in advertising expenses.
In the Oceanic area, revenues rose 14.5 percent to ¥11.8 billion ($119 mm) and increased 14.5 percent C-N due to the strong sales of running shoes in Australia and a shift in sales to South East Asia from Japan Area to this area. Operating earnings improved 3.0 percent to ¥2.6 billion ($26.0 mm), mainly due to a rise in purchasing costs.
In its East Asia region, revenues grew 31.3 percent to ¥17.4 billion ($176.6 mm) and 31.1 percent C-N. The gain was due to the recording of net sales at the sales price to end consumers at the Korean subsidiary. Operating income dipped 12.1 percent to ¥916 million (9.3 mm) due to the recording of commission paid to distributors as commission fee.
In its Other Business segment, sales increased 6.4 percent to ¥8.2 billion ($83.0 mm) and grew 10.2 percent C-N due to the steady sales of outdoor wear under the Haglöfs brand and other products. The segment showed an operating loss of ¥56 million ($570,000) versus a loss of ¥204 million (2.1 mm) a year ago.
For the current fiscal year ended March 31, 2014, Asics Corp. forecasts consolidated net sales of ¥305 billion, operating income of ¥22 billion, and net income of ¥13.5 billion in the fiscal year ended March 31, 2014. That represents gains of 17.2 percent in sales, 18.3 percent in operating income and 2.0 percent in net income.
