Profits at Leatt Corp. rose 13 percent in the second quarter on a 25 percent revenue gain. Leatt is a maker of sports protective equipment and ancillary products, including high-velocity sports, and is known for its Leatt-Brace neck brace.
Second Quarter 2022 Highlights
- Global revenues of $17.9 million, up 25 percent, compared to second quarter 2021;
- Income from operations of $3.7 million, up 18 percent, compared to second quarter 2021;
- Net income of $2.7 million, up 13 percent, compared to second quarter 2021;
- Earnings per basic share of $0.47 up 7 percent, compared to second quarter 2021; and
- Solid investment in sales and distribution capacity globally to fuel growth.
CEO, Sean Macdonald commented: “The 2022 second quarter was our 17th consecutive quarter of year-over-year revenue growth with results that continue to demonstrate our ability to grow revenue, gain sales traction in important product categories and build Leatt as a global consumer brand recognized for innovation and exhilaration.
“Global revenues for the first six months of 2022 were $42.2 million, up 55 percent, compared to $27.2 million for the same period last year. Net income for the first six months was $6.9 million, up 55 percent, compared to $4.5 million for the comparative period and earnings per basic share increased to $1.20 as compared to $0.82 for the first six months of 2021.
“We continue to achieve double-digit revenue growth in all of our expanding product categories, with the exception of neck braces, our most established category, where sales decreased compared to a very strong second quarter of 2021. Apparel, helmet and off-road motorcycle boot sales have been particularly strong, energizing our entire team and our international distribution network. We continue to build out a global team of sales and brand managers who are focused on specific regional market dynamics and support for our distribution partners and dealer networks.
“Although port congestion created some restocking issues for our dealers that ultimately resulted in a contraction in domestic sales during the second quarter and first six months of 2022, international revenues for the second quarter of 2022 were $13.9 million, up 45 percent over the same period last year. We have experienced an easing in these delays as we continue to drive consumer demand to stores with coordinated marketing campaigns and remain committed to investing heavily in our U.S. sales and distribution capacity to reach a wider group of Moto and MTB dealers around the country.”
Founder and Chairman Dr. Christopher Leatt remarked: “We continue to develop an exciting pipeline of innovative and consumer-centric products that are well-differentiated and rigorously tested by our team of dedicated product developers, engineers and passionate family of professional riders and athletes.”
Total revenue for the second quarter of 2022 increased to $17.9 million, up 25 percent, compared to $14.3 million for the second quarter of 2021. The increase was driven by an 11 percent increase in body armor sales, a 132 percent increase in helmet sales and a 51 percent increase in other products, parts and accessories, which were partially offset by a 17 percent decrease in neck brace sales
Income from operations for the second quarter of 2022 increased to $3.7 million, up 18 percent, compared to $3.1 million for the second quarter of 2021. Net income for the second quarter of 2022 increased to $2.7 million, or $0.47 per basic and $0.44 per diluted share, up 13 percent, compared to $2.4 million, or $0.44 per basic and $0.39 per diluted share, for the second quarter of 2021.
Leatt continued to meet its working capital needs from cash on hand and internally generated cash flow from operations. At June 30, 2022, the company had cash and cash equivalents of $4.95 million and a current ratio of 3.8:1.
Macdonald added: “We are making strong progress and are very aware of the potential economic headwinds that the current environment may reveal, but we remain enthusiastic about our ability to gain traction. Many of our new categories that have launched extremely well are still in their infancy in terms of market share and their potential to meet the needs of all levels of riders worldwide.
“Our MTB and Moto customers around the world have remained enthusiastic about the Leatt brand and our ‘head-to-toe’ offerings of exceptional protective gear over the last several quarters, and we expect that the global trend of consumer participation in outdoor riding activities will continue.
“Our team remains focused on our strong ability to invest in areas that fuel growth, control costs and operate efficiently in the midst of a widespread, global inflationary environment. We continue to monitor customer stocking, consumer buying patterns and worldwide economic and geo-political risks closely and are committed to building Leatt on a sustainable basis that creates lasting ongoing shareholder value.”
Photo courtesy Leatt