Giant Group reported that 2022 consolidated revenues increased 12.5 percent to NT$92.04 billion. Due to the impact of rising material and labor costs as well as an increase in the OEM business, the overall group’s gross margin and operating profit performance were negatively affected.
Net income before tax was NT$8.74billion, or flat compared to 2021. Net income after tax was down 1.5 percent to NT$5.84 billion, or EPS at NT$15.51 a share. A cash dividend of NT$7.8 per share has been approved during the board of directors meeting and this dividend payout will be acknowledged in the annual general meeting on June 21.
“At present, the balance of the supply and demand of the bicycle market has yet to be normalized,” the company wrote in a release to the market. “The demand for low- to mid-end products has cooled down, but the demands for high-end and E-bike remain strong.”
The company acknowledged that due to the disruption caused to the supply chain, inventory is high for the low- to mid-end components in both distribution channels and also on the manufacturing side. High-end components reportedly continue facing supply shortages and are unable to meet market demand. Giant Group said it has initiated a corrective mechanism since the second half of 2022, but since this action was taken during the traditional off-season, inventory reduction is still slow, and it is expected the reduction would take some time to see the results.
Giant went on to say that short-term revenue and earnings performance will be affected due to inventory issues and the headwinds of the economic outlook. However, in the mid- to long-term, e-bike demand remains solid and cycling is said to be popular which will continue to support the demand for high-end bikes. The company said with ESG trends, the cycling industry still has room for growth.
Moving forward, Giant Group said it will continue to focus on products and service values, continuing to pursue brand value enhancements to bring stable growth for the group.
Photo courtesy Giant Bicycles