Shimano Inc. reported sales rose 22.7 percent in its first quarter ended March 31, to ¥62.5 billion ($756.3 mm) from ¥50.9 billion a year ago. Operating income jumped 47.1 percent to ¥10.77 billion ($130.0 mm) from ¥73 billion while net income vaulted 217.2 percent to ¥7.0 billion ($84.7 mm) from ¥2.2 billion a year ago.

In its statement, Shimano said European economies “remained lackluster despite a slight recovery of the euro against other major currencies owing to a lull in the sovereign debt crisis. On the other hand, the U.S. economy, which is already preparing for this fall's presidential election, and the emerging economies bottomed out and showed signs of recovery, including moderate increases in stock prices. In Japan, both supply and demand lacked vigor. Although business confidence regained the pre-quake level, the real economy stalled because of concerns about the adequacy of the electricity supply and the persisting strength of the yen.”

In its Bicycle Components segment, sales increased 22.1 percent to ¥49.8 billion ($602.6 mm) with operating earnings jumping 40.9 percent to ¥10.1 billion ($122.2 million). Shimano said, “Buoyant sales in Europe benefited from a generally mild winter except for a cold snap from late January to early February. In the U.S., a general lack of extreme winter weather helped keep retail sales brisk. In contrast, Japan experienced a harsher winter than usual, resulting in sluggish sales. Distributor inventories in Europe and U.S. remained at appropriate levels. In these markets, demand for Shimano products rose. Positive factors include the anticipation of further growth in demand for sports bicycles in China and robust retail sales in Europe and the U.S. Sales for the first quarter fulfilled the forecasted.”

In its Fishing Tackle segment, sales increased 26.4 percent to ¥12.6 billion ($152.5 mm) and operating earnings grew 242.2 percent to ¥650 million ($7.9 mm).

 

“The Japanese market got off to a slow start due to unusually heavy snowfall and spells of particularly cold weather,” the company said in its earnings release. However, the market has shown signs of recovery since March.

 

Regarding Shimano products, the Force Master electric reel introduced in late 2011 continued to sell well. The Vanquish high-end spinning reel, which is a new product, and the ANTARES bait casting reel, featuring a new brake system for super long casts, were well received in the market. As a result, sales in Japan exceeded the level for the same period of the previous year.

 

Overseas, a challenging business environment persisted in Europe particularly attributable to the sovereign debt crisis, whereas the U.S. market was on a recovery track thanks to good weather. Meanwhile, the Oceanic market, having experienced flooding in Australia during the same period of the previous year, recovered.”

Sales for its Other Business segment decreased 33 percent to ¥110 million ($1.3 million) with an operating loss of ¥3 million ($36,000), although that was less than the operating loss of ¥49 million incurred a year ago.

For the first half of 2012, sales are expected to rise 10.1 percent to ¥118 billion from ¥107.1 million in the  2011 first half; operating income is projected to climb 25 percent to ¥19 billion from ¥15.2 billion. Net income is expected to reach ¥13 million, up from ¥6.9 million.

For the full year, Shimano expects sales to rise 5.0 percent to ¥233 billion from ¥221.8 billion, and operating income to climb 15.1 percent to ¥36.5 billion from ¥31.7 million. Net earnings are projected to reach ¥25.0 million, up from net income of ¥19.9 million the prior year.