Dorel Juvenile confident of continued growth Dorel Home significantly reduces operating loss MONTREAL, May 10, 2024 (GLOBE NEWSWIRE) -- Dorel Industries Inc. (TSX:DII, DII.A)) today announced results for the first quarter ended March 31, 2024.     Revenue was US$351.1 million, up 5.4%, from US$333.2 million a year ago. Net loss for the first quarter was US$17.6 million or US$0.54 per diluted share compared with US$31.5 million or US$0.97 per diluted share last year. Adjusted net loss1 was US$16.9 million or US$0.52 per diluted shares versus US$31.5 million or US$0.97 per diluted share a year ago. "Dorel Juvenile posted significant gains year-over-year, with adjusted operating profit1 improving by US$10.1 million versus last year's first quarter. Internal optimism is high as the segment is capitalizing on its introduction of a diverse selection of exciting new products. Both our retail partners and consumers have reacted well to the new offerings, with in store sales rebounding nicely, driving growth through market share gains. Through a combination of higher sales and by further reducing Juvenile costs we are more comfortable than ever that this business will continue its year-over-year earnings improvement. Dorel Home also made substantial progress during the first quarter, narrowing its adjusted operating loss1 by US$10.5 million. This was despite on-going softness in the furniture market, where industry sales continue to lag all other consumer product categories. The previously announced plan to simplify and combine certain key areas of the Home segment has made the combined operations more effective and cost efficient. Savings are expected to be US$4.0 million annually. Home is making all the right moves with new customers and new product listings growing. The meaningful benefits will come once industry volumes increase to more traditional levels", stated Dorel President & CEO, Martin Schwartz. __________________1 This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by IFRS and therefore is unlikely to be comparable to similar measures presented by other issuers. Refer to the section "Definition and reconciliation of non-GAAP financial ratios and measures" in this press release.   Summary of Financial Information (unaudited) First Quarters Ended March 31, All figures in thousands of US $, except per share amounts   2024   2023   Change   $ $ % Revenue 351,072   333,197   5.4 %         Net loss (17,569 ) (31,509 ) (44.2 )% Per share - Basic (0.54 ) (0.97 ) (44.3 )% Per share - Diluted (0.54 ) (0.97 ) (44.3 )%         Adjusted net loss (1) (16,870 ) (31,509 ) (46.5 )% Per share - Diluted (1) (0.52 ) (0.97 ) (46.4 )% Number of shares outstanding –       Basic weighted average 32,555,897   32,537,617   Diluted weighted average 32,555,897   32,537,617           (1) This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by IFRS and therefore is unlikely to be comparable to similar measures presented by other issuers. Refer to the section "Definition and reconciliation of non-GAAP financial ratios and measures" in this press release.   Dorel Juvenile  All figures in thousands of US $           First Quarters Ended March 31 (unaudited)   2024   2023   Change   $ % of rev. $ % of rev. % Revenue 212,690   200,025     6.3 %             Gross profit 56,457 26.5 % 44,793   22.4 % 26.0 % Operating profit (loss) 549   (8,923 )   n.m.             Adjusted operating profit (loss) (1) 1,129   (8,923 )   n.m.                         n.m. = not meaningful           (1) This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by IFRS and therefore is unlikely to be comparable to similar measures presented by other issuers. Refer to the section "Definition and reconciliation of non-GAAP financial ratios and measures" in this press release.   First quarter revenue was US$212.7 million, up US$12.7 million or 6.3%, from US$200.0 million a year ago. Organic revenue1 increased 6.2% year-over-year, after removing the impact of varying foreign exchange rates. The growth was derived mainly from the U.S. and European markets where the brick-and-mortar distribution channel rebounded strongly. In addition, Brazil and certain export markets contributed to the year-over-year revenue gains. In the U.S., car seats led increases in that division's product categories. Safety 1st did particularly well, the result of new product placements and a recent rebranding of this iconic brand. First quarter operating profit was US$0.5 million compared to an operating loss of US$8.9 million last year. Adjusted operating profit1 was US$1.1 million versus an adjusted operating loss1 of US$8.9 million a year ago. The U.S. dollar strengthened against most major currencies since the start of the year and if it had remained at the levels at the end of 2023, this would have added an additional US$2.0 million to earnings in the quarter. Both Dorel Juvenile USA and Dorel Juvenile Europe significantly increased operating profit compared to the comparable period last year with gross margin for the segment being 410 basis points better than the prior year. While a significant portion of the improvement was due to lower cost inventories to start the year, improved pricing, a better product mix and better cost absorption at the U.S. manufacturing facility also contributed to the quarter's improvement. Dorel Home  All figures in thousands of US $           First Quarters Ended March 31 (unaudited)   2024   2023   Change   $ % of rev. $ % of rev. %   Revenue 138,382     133,172     3.9 %               Gross profit 11,780   8.5 % 1,920   1.4 % n.m.   Operating loss (3,556 )   (13,881 )   (74.4 )%               Adjusted operating loss (1) (3,371 )   (13,881 )   (75.7 )%                           n.m. = not meaningful           (1) This is a non-GAAP financial ratio or measure with no standardized meaning prescribed by IFRS and therefore is unlikely to be comparable to similar measures presented by other issuers. Refer to the section "Definition and reconciliation of non-GAAP financial ratios and measures" in this press release.   Revenue for the first quarter was US$138.4 million, up US$5.2 million, or 3.9% from US$133.2 million a year ago. Total brick and mortar gross sales grew 23.3% from a year ago driven by strong sales of hand trucks, step stools and folding furniture. There was also an increase in replenishment orders as in stock store levels continued to come down. E-commerce gross sales decreased by 6.1%. The current high inflationary environment as well as an increase in U.S. mortgage rates continue to constrain consumer spending on home furnishings. Attendance was excellent at Dorel Home's booth at the recent High Point Furniture Market with customers enthused about the segment's new product line up. First quarter operating loss was US$3.6 million compared to US$13.9 million last year, a US$10.3 million improvement. Adjusted operating loss1 was US$3.4 million versus US$13.9 million a year ago. Gross margin increased by 710 basis points from prior year due largely to lower freight and raw material costs as well as a slight increase in factory volumes which helped overhead absorption. Efficiencies have improved and operating costs have been reduced through the segment's restructuring plan initiated in the fourth quarter of 2023. Inventories were down US$27.8 million from a year ago. Outlook "Dorel Juvenile came in as expected, despite some challenges on currency rates, and we are poised to continue our quarter-over-quarter earnings improvement. We have several significant customer events in the second quarter and expect an increase in sales versus the first quarter as we begin shipping these new items which should further enhance our current improving revenue line. As in prior years, we expect the second half to be better than the first, driven by continued year-over-year revenue gains," commented Dorel President & CEO, Martin Schwartz. "At Dorel Home, the traction at brick-and-mortar experienced in first quarter is expected to continue. As we gain new listings and our product begins to sell through, we expect the segment's on-going quarter-over-quarter earnings to continue to improve. However, given the sales cycle process is naturally longer at brick-and-mortar versus e-commerce, we will only see the benefits of our successes in that channel during the second half of the year. In the meanwhile, we continue to focus on cost reduction and on re-igniting our e-commerce business," concluded Mr. Schwartz. Conference Call Dorel Industries Inc. will hold a conference call to discuss these results on Friday, May 10, 2024 at 1:00 PM Eastern Time. Interested parties can join the call by dialing 1-800-319-4610. The conference call can also be accessed via live webcast at http://www.dorel.com. If you are unable to call in at this time, you may access a recording of the meeting by calling 1-800-319-6413 and entering the passcode 0766 on your phone. This recording will be available on Friday, May 10, 2024 as of 4:30 PM until 11:59 PM on Friday, May 17, 2024. Condensed consolidated interim financial statements as at March 31, 2024 will be available on the Company's website, www.dorel.com, and will be available through the SEDAR website. Profile Dorel Industries Inc. (TSX:DII, DII.A)) is a global organization, operating two distinct businesses in juvenile products and home products. Dorel's strength lies in the diversity, innovation and quality of its products as well as the superiority of its brands. Dorel Juvenile's powerfully branded products include global brands Maxi-Cosi, Safety 1st and Tiny Love, complemented by regional brands such as BebeConfort, Cosco, Mother's Choice and Infanti. Dorel Home, with its comprehensive e-commerce platform, markets a wide assortment of domestically produced and imported furniture. Dorel has annual sales of US$1.4 billion and employs approximately 3,900 people in facilities located in twenty-two countries worldwide. Caution Regarding Forward-Looking Statements Certain statements included in this press release may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. Except as may be required by Canadian securities laws, the Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements, by their very nature, are subject to numerous risks and uncertainties, including statements regarding the impact of the macro-economic environment, including inflationary pressures, changes in consumer spending, exchange rate fluctuations and increases in interest rates on the Company's business, financial position and operations, and are based on several assumptions which give rise to the possibility that actual results could differ materially from the Company's expectations expressed in or implied by such forward-looking statements and that the objectives, plans, strategic priorities and business outlook may not be achieved. As a result, the Company cannot guarantee that any forward-looking statement will materialize, or if any of them do, what benefits the Company will derive from them. Forward-looking statements are provided in this press release for the purpose of giving information about management's current expectations and plans and allowing investors and others to get a better understanding of the Company's operating environment. However, readers are cautioned that it may not be appropriate to use such forward-looking statements for any other purpose. Forward-looking statements made in this press release are based on a number of assumptions that the Company believed were reasonable on the day it made the forward-looking statements. Factors that could cause actual results to differ materially from the Company's expectations expressed in or implied by the forward-looking statements include: general economic and financial conditions, including those resulting from the current high inflationary environment; changes in applicable laws or regulations; changes in product costs and supply channels, including disruption of the Company's supply chain resulting from the macro-economic environment; foreign currency fluctuations, including high levels of volatility in foreign currencies with respect to the US dollar reflecting uncertainties related to the macro-economic environment; customer and credit risk, including the concentration of revenues with a small number of customers; costs associated with product liability; changes in income tax legislation or the interpretation or application of those rules; the continued ability to develop products and support brand names; changes in the regulatory environment; outbreak of public health crises, such as the COVID-19 pandemic, that could adversely affect global economies and financial markets, resulting in an economic downturn which could be for a prolonged period of time and have a material adverse effect on the demand for the Company's products and on its business, financial condition and results of operations; the effect of international conflicts on the Company's sales, including the ongoing Russia-Ukraine war and the Israeli-Hamas war; continued access to capital resources, including compliance by the Company with all of the covenants under its ABL facility and term loan facility, and the related costs of borrowing, all of which may be adversely impacted by the macro-economic environment; failures related to information technology systems; changes in assumptions in the valuation of goodwill and other intangible assets and any future decline in market capitalization; there being no certainty that the Company will declare any dividend in the future; increased exposure to cybersecurity risks as a result of remote work by the Company's employees; the Company's ability to protect its current and future technologies and products and to defend its intellectual property rights; potential damage to the Company's reputation; and the effect of climate change on the Company. These and other risk factors that could cause actual results to differ materially from expectations expressed in or implied by the forward-looking statements are discussed in the Company's annual MD&A and Annual Information Form filed with the applicable Canadian securities regulatory authorities. The risk factors set out in the previously mentioned documents are expressly incorporated by reference herein in their entirety. The Company cautions readers that the risks described above are not the only ones that could impact it. Additional risks and uncertainties not currently known to the Company or that the Company currently deems to be immaterial may also have a material adverse effect on the Company's business, financial condition, or results of operations. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. All figures in the tables below are in thousands of US $, except per share amounts. Consolidated Results              First Quarters Ended   March 31,   March 31,   Variation   2024   2023   $   %                 Revenue 351,072   333,197   17,875   5.4 % Cost of sales 282,835   286,484   (3,649 ) (1.3 )% Gross profit 68,237   46,713   21,524   46.1 % Selling expenses 31,162   31,439   (277 ) (0.9 )% General and administrative expenses