Leatt Corporation, the South African-based manufacturer of protective gear, reported that first-quarter global revenues increased 45 percent year-over-year (y/y) to $15.4 million.
Leatt Corporation reports in U.S. dollars ($) currency.
The company said revenue growth and momentum are fueled by encouraging international sell-through and re-stocking dynamics, as well as the work of its distribution partners and sales and brand managers.
All major product categories reportedly grew at a double-digit rate compared to Q1 last year, with Body Armor revenues by 37 percent (+$1.8 mm), Helmet revenues by 101 percent (+$1.7 mm), Neck Brace revenues by 21 percent (+$0.12 mm), and Other Product, Parts and Accessories revenues by 33 percent (+$1.1 mm) year-over-year.
“We continued to fill robust ADV helmet orders and sales of our innovative and consumer-focused line-up of MTB helmets were exceptionally strong during the quarter,” said company CEO Sean Macdonald. “We continue to invest in design and innovation and are building a promising pipeline of cutting-edge products that we expect will fuel future growth.”
According to the CEO’s comments, international distributor sales increased 79 percent y/y as industry-wide inventory is being digested and sell-through and constrained ordering patterns continue to improve.
“The uptick in ordering from international distributors is filtering through to our revenues, a trend that we believe will continue as our long-term distribution partners grow sales over the next several quarters,” Macdonald said. As re-ordering patterns continue to improve, the company expects growth to continue.
Direct-to-consumer sales increased 14 percent y/y. Domestic sales on the company’s consumer-facing channels in the U.S. reportedly “continued to gain momentum,” and Leatt.co.za, Leatt’s consumer direct platform in South Africa, continued to deliver strong sales.
“Dealer direct sales in the U.S. at the brick-and-mortar level contracted by 9 percent as U.S. Moto and MTB dealers continue to manage industry-wide stocking dynamics and some turbulence at the dealer level, McDonald continued. “Participation and demand for Leatt products remain strong, and we expect to see improvement as our reorganized U.S. sales force gains traction.”
Income Statement Summary
Gross profit for the quarter was up 68 percent y/y to $6.72 million. Gross margin improved to 44 percent of sales in Q1, compared to 38 percent in the prior-year Q1 period.
“The first quarter of 2025 was a very strong and encouraging start to the year,” commented Macdonald. “Overall, we believe that we are making important progress in working our way back to a position of sustainable growth after the contraction that we experienced post-COVID.”
Net income for the first quarter of 2025 was $1.12 million, or 18 cents per basic share and 17 cents per diluted share, compared to a net loss of $0.82 million, or a loss of 13 cents per basic and diluted share, for the first quarter of 2024.
Balance Sheet and Cash Management Summary
Leatt said it continued to meet its working capital needs from cash-on-hand and internally generated cash flow from operations. Liquidity reportedly continues to improve. At March 31, 2025, the company had cash and cash equivalents of $12.7 million.
“Cash increased by $331,000, to $12.7 million, with cash flows provided by operations of $768,000 despite strong investments in working capital, our digital platforms and the development of a global multichannel sales force,” McDonald shared. “Our current ratio at quarter’s end was 7.3:1, as we continue to manage working capital and invest for future growth.”
Outlook
Company Founder and Research and Development Lead Dr. Christopher Leatt remarked, “We look forward to delivering a pipeline of innovative products in the growing ADV market over the next several quarters. Recent launches and product reviews in this area have been strong, which we view as a testament to the excellent work of our design team and our professional riders.”
“The momentum that we have built in recent quarters has our entire team enthused and energized for the future,“ McDonald added. “We face some industry-wide geopolitical and economic headwinds, particularly in the U.S., where the trade war could impact consumer confidence and inflation, and potentially reduce demand for our products. To that end, we are working closely with suppliers and customers to mitigate tariff risks and costs wherever possible.”
McDonald said the company is continuously refining its global selling capabilities and is confident that the newest additions to the team will benefit ongoing performance.
“These investments can take time to make a significant impression on results, but we believe our success in building a great team is a cornerstone for our future growth,“ the CEO said.
“We expect working capital investment to grow in the coming periods as ordering patterns at the consumer, dealer, and distributor levels continue to show encouraging growth,“ McDonald continued. “We are confident that we have sufficient liquidity to fuel this expansion. Importantly, inventory continues to be digested, participation remains strong as ordering patterns improve and filter through to revenue.”
McDonald said the company expects these trends to continue.
“We are very enthusiastic about the future of Leatt and remain confident that we are well-positioned for future growth and sustained shareholder value,“ the CEO concluded.
Image courtesy Leatt Corporation
