Shimano Sales Rise 11.4% in First Quarter

 
The Japanese company now expects sales for the first half of 2010 to rise 12.7% to ¥101 billion ($1.1b). Net income for the period for the six months will rise 37.1% to ¥9 billion yen ($99.3mm), or ¥95.3 yen ($1.05) per share, according to the companys latest guidance. The company said it had not changed its guidance for the full fiscal year.

The tempo of economic activity in the United States and other developed countries began to pick up, albeit at a moderate pace, footnotes released with the company’s quarterly financial report said. Leading economies in Asia showed renewed strength as the impact of the global recession receded, with accelerating growth of Chinas economy pointing the way forward. In Japan, despite a persisting weak labor market and lackluster personal consumption, a recovery of corporate earnings began to take hold.

Shimano said sales of its bicycle business rose 13.0% to ¥39.9 billion yen ($440.1mm). Operating income at the business rose 35.0% to ¥7.0 billion yen ($77.2mm). Inventory levels in its distribution channels approached normal levels by the end of the quarter despite sluggish sales in January and February due to the long winter in the Northern Hemisphere. Bike sales and accelerated in March, however, leading to brisk shipments of bikes using Shimanos drive trains, cranks, pedals, brakes and other components.

In its fishing tackle business, sales rose 5.6% to ¥10.0 billion yen ($110.3mm) with the debut in Japan of 2010 models of the STELLA flagship spinning reel series equipped with X-SHIP gear system. In North America demand was recovering in the specialty channel, while demand continued to lag in Europe. Operating income for the business rose 220.7% to ¥325 million ($3.6mm).

 
Shimano said the pace of the recovery remained unpredictable in developed countries, so it would continue to focus on growing profits through better operational efficiency.