Asics Corp. showed an operating loss of ¥1 billion ($8.98 mm) in the American region in the second quarter ended June 30 as sales tumbled 17.7 percent in period.
In the year-ago period, Asics reported a profit of ¥974 million in the year-ago period. Sales slid to ¥21.2 billion ($190 mm), down from ¥25.8 billion.
The figures were calculated by subtracting second-quarter results from six-month results.
In the half, sales decreased 22.4 percent ,or 19.9 percent on currency-neutral basis, to ¥43.2 billion ($388 mm), due to weak sales in the U.S. The segment’s loss amounted to ¥560 million ($5 mm) due to the effect of the decline in sales despite an improved cost of sales ratio.
Companywide, Asics showed a net loss in the quarter of ¥1.9 billion ($17 mm) in the second quarter against earnings of ¥2.4 billion a year ago. Sales were down 2.8 percent to ¥88.1 billion ($791 mm).
In the half, earnings fell 70.7 percent in the six months to ¥3.42 billion. Sales dropped to ¥192.8 billion from ¥203.7 billion.
In Japanese region, sales in the half decreased 3.6 percent to ¥61.6 billion due to reduction of the lines of sportswear products with low profit margins despite strong sales of Onitsuka Tiger shoes. Segment income decreased 47.1 percent to ¥2.36 billion due to the effect of the decline in sales.
European region sales in the half increased 4.2 percent to ¥52.4 billion, due to steady sales in certain emerging-market countries. Sales were down 3.0 percent on a currency-neutral basis. Segment income decreased 19.0 percent, or 24.5 percent on a currency-neutral basis, to ¥2.9 billion, mainly due to increased costs in line with the expansion of retail stores.
Oceanian/Southeast and South Asian regions sales decreased 6.2 percent (a decrease of 6.2 percent using the previous fiscal year’s foreign exchange rate) to ¥13.6 billion, due to weak sales in Australia despite strong sales in Southeast and South Asian regions. Segment income decreased 11.4 percent (a decrease of 11.4 percent using the previous fiscal year’s foreign exchange rate) to ¥2.1 billion due to the effect of the decline in sales despite an improved cost of sales ratio.
East Asian region sales increased 6.8 percent and grew 3.7 percent on a currency-neutral basis to ¥26.8 billion due to the strong sales of running shoes and Onitsuka Tiger shoes, particularly in China despite the weak sales in South Korea. Segment income decreased 24.0 percent, or 26.3 percent currency-neutral, to ¥3.2 billion due to vigorous advertising investment in China and the effect of lower profit in South Korea.
Other business sales increased 5.6 percent (an increase of 4.1 percent on a currency-neutral basis) to ¥4.0 billion, due to steady sales of outdoor wear and other items under the Haglöfs brand and the effect of the foreign exchange rate. Segment loss was ¥364 million.
Asics kept the company’s full-year guidance for the year. Sales are expected to reach ¥425 billion and net income ¥12 billion. The compares to sales of ¥400.2 billion and earnings of ¥13 billion in 2017.
Photo courtesy Asics