Shimano finished off fiscal 2004 with a very strong fourth quarter, posting a 16.9% increase in sales to ¥46.6 billion ($441.0 million). In spite of the strong improvements over 2003, the company did not quite reach its full year projections of ¥170 billion ($1.57 billion), falling short by roughly ¥800 million, or $7 million. This also caused Shimano’s net income to fall short of the ¥19.5 billion ($180.4 million) projected last quarter by roughly ¥90 million ($800,000).

Even though the company fell short of its internal projections, the fact that they were able keep sales within 4% of their stated targets is quite impressive given the production difficulties reported earlier in the year (see BOSS_0421). On the bottom line, it is also impressive that Shimano was able to actually improve net income as a percentage of sales by 300 basis points for the full-year given the last minute production expansion needed to meet demand.

Shimano’s operating income as a percentage of sales during the fourth quarter improved by 460 basis points, from 13.6% last year to 18.2% this year. This represents a 14.0% increase on a reporting currency basis, from ¥5.4 billion ($49.7 million) last year to ¥8.5 billion ($80.1 million) for the final quarter of 2004.

Europe remains the dominant country for Shimano sales, accounting for 38.9%, or ¥65.8 billion ($608.9 million) of the revenue generated throughout the 2004 fiscal year. Asia followed with 28.3%, or ¥47.9 billion ($442.9 million). The Americas were the third largest slice of the pie with 16.4%, or ¥27.8 billion ($256.7 million), and finally Japan accounted for 15.3% of total sales with ¥25.9 billion ($239.5 million).

Fiscal 2005 guidance calls for a 1.6% increase in total company sales to ¥172 billion and a 13.3% improvement to net income with ¥22 billion.