Easton-Bell Sports reported a 13.4% increase in net sales for 2007 to $724.6 million from $639.0 million in 2006 as the company benefited from a full year's worth of Easton sales this year compared to results from the date of acquisition on March 16, 2006 last year. During 2007, an additional $67.9 million and $0.4 million in net sales were attributable to the Easton and Cyclo/Shanghai Cyclo acquisitions, respectively, with $62.9 million attributable to Team Sports and $5.4 million attributable to Action Sports.
Team Sports net sales increased 19.8% to $416.5 million, as compared to 2006. In addition to the acquisition of Easton, other factors contributing to the increase in Team Sports net sales included increased football shoulder pad and apparel sales and reconditioning services.
Action Sports net sales increased 5.8% to $308.1 million, when compared to 2006. The increase resulted from the inclusion of a full fiscal year of Eastons cycling business and the acquisition of Cyclo/Shanghai Cyclo, growth in sales of cycling helmets and specialty channel accessories and the introduction of Giro branded eyewear, all of which were partially offset by a mild decrease in sales of snow helmets.
For 2007, gross profit was $248.9 million, or 34.4% of net sales, as compared to $212.9 million, or 33.3% of net sales for 2006. The increase in gross profit as a percentage of net sales is primarily attributable to the cost savings realized from transitioning the manufacturing of certain aluminum products to Asia from the United States, foreign currency gains in our international operations and the impact in 2006 of expensing the purchase accounting inventory write-up associated with the Easton acquisition, partially offset by sales mix changes and increased distribution costs, freight costs and inventory write-offs.
Team Sports gross profit percentage was 38.4% of net sales, an increase of 3.9 percentage points, as compared to 2006. The increase in Team Sports gross profit as a percentage of net sales is primarily attributable to the cost savings realized from transitioning the manufacturing of certain aluminum products to Asia from the United States, foreign currency gains in our international operations and the impact in 2006 of expensing the purchase accounting inventory write up associated with the Easton acquisition, partially offset by increased distribution costs, freight costs and inventory write-offs.
Action Sports gross profit percentage was 28.9% of net sales, a decrease of 3.1 percentage points, as compared to 2006, primarily due to a change in sales mix and increased distribution costs, product costs, freight costs and inventory write-offs.
During 2007, SG&A expenses increased $14.0 million or 9.0%, as compared to 2006. The increase is primarily attributable to the inclusion of a full fiscal year of Eastons business during 2007, as compared to 2006, which only included such business from the date of acquisition on March 16, 2006. Other factors contributing to the increase are expenses related to marketing, R&D, product liability settlement and litigation, information technology and Sarbanes-Oxley compliance, partially offset by lower compensation expenses.
During 2007, SG&A expenses increased $14.0 million or 9.0%, as compared to 2006. The increase is primarily attributable to the inclusion of a full fiscal year of Eastons business during 2007, as compared to 2006, which only included such business from the date of acquisition on March 16, 2006. Other factors contributing to the increase are expenses related to marketing, R&D, product liability settlement and litigation, information technology and Sarbanes-Oxley compliance, partially offset by lower compensation expenses.
The company switched to a net profit for 2007 of $20.0 million from a net loss of $6.0 million for 2006.
