Mizuno Corp. reported revenue in its first quarter ended June 30 reached ¥46.1 billion ($451 mm), up 1.9 percent compared with the same period in the previous fiscal year as running offset a poor golf performance. Operating profits were down 20.1 percent.

Highlights of the quarter include:

  • Revenue totaled ¥46.1 billion, up 1.9 percent compared with the same period in the previous fiscal
    year.
  • Operating profit stood at ¥1.98 billion, down 20.1 percent. Ordinary profit totaled 1.84 billion yen, down
    19.4 percent. The quarterly net income was 1.03 billion yen, down 27.7 percent.
  • Running-related products continued their solid showing in all areas, but the increase in revenue was marginal in part due to a reactionary decline following a rush in demand ahead of the consumption tax hike specific to Japan. Also, operating profit fell on an increase in marketing expenses.
  • Manufacturing costs at overseas production sites dropped, improving the gross margin
    by 0.4 point.

Europe

In Europe, running-related products and businesses remained healthy. The product lineup was expanded by mirroring the diversifying population of runners, with a boost seen from sales promotion initiatives at the Hamburg Marathon, where Mizuno became a sponsor for the first time. Indoor sports business revenue rose as brand recognition got a push, especially in the handball market. Results for golf were bleak, as orders for custom fitting did not stage any growth. Revenue ultimately increased 37.2 percent.

The Americas

In the Americas, the volleyball business performed well, but the running,  and especially the golf businesses, struggled to overcome the impacts from inclement weather. Revenue ended up 4.2 percent higher, thanks to a major weakening of the yen, but declined 7.6 percent in currency-neutral terms. 

Japan
In Mizuno's home market, running and walking shoes, performed well and apparel sales were strong. Results at the company sports facilities business grew from the previous year partly because of an increase in construction projects tied to Tokoyo's hosting of the 2020 Olympic Games. Several Japanese sporting goods companies have secured contracts to run athletic facilities leading up the the game in hopes the work will stimulate greater domestic sales.

Meanwhile, mid-priced products, especially in golf and baseball, were sluggish in part due to an April 1 increase in the the sale tax. Revenue fell 6.5 percent due in part to the impact of transferring the agency business in the Asian region, to two consolidated subsidiaries. 

Forecast for Fiscal 2014

Mizuno forecasts revenue of ¥195.0 billion; operating profit of ¥8.0 billion; ordinary profit of ¥8.0 billion; net
income of ¥5.0 billion for Fiscal 2014. No changes were made from its prior guidance.
 

Sales and Operating Profit per region (3 months accumulated)

(Units : million yen)


 

Japan

Europe

Americas

Asia/Oceania

Total

Sales for 1st Quarter

29,601

3,617

8,434

4,413

46,066

Component  percentages

64.3%

7.9%

18.3%

9.6%

100.0%

 

Sales for last 1st Quarter

31,665

2,636

8,094

2,808

45,204

Component  percentages
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